Supply Chain Management Of Toyota

Presented By
Shruthi.Holla
Sneha.LS Soujanya.N

INTRODUCTION
Toyota Motor Corporation
Founded Founder Headquarters 1937 Kiichiro Toyoda Toyota City, Japan

Industry Products
Revenue Employees

Automotive, Robotics, Financial Services and Biotechnology Economy/mainstream/luxury vehicles

18.583 trillion (2012) 300747 (2012)

History of Toyota Auto Industry

Established in 1937 out of Sakichi Toyotas weaving machine company

Launched first car (SA Model) in 1947

Toyota Production System formed in 1950 based on just in time principal First global expansion in 1959 at Brazil In 1972, cumulative production >10M units

Founder & CEO

Founder: Kiichiro toyoda CEO : Akio toyoda MD: Hiroshi nakagawa Present CEO : Fujio Cho

Business segments
Automotive
Design, manufacture and sales of passenger cars, recreational vehicles, SUVs and related parts

Financial services
Provisions of loans to car buyers and car deals.

Others
Industrial vehicles (forklifts, etc.)

Product line

Electric technology- Toyota pirus, Auris. Highlander and Camry Plug- in hybrids All electric vehicles- RAV4 Cars- 70 different models

SUVS Luxury type vehicle

Non- Automotive Activities

AEROSPACE
Toyota is a minority shareholder in Mitsubishi Aircraft Corporation invested US$67.2 million

will produce the Mitsubishi Regional jet.

It has also produced aircraft TAA-1 in 2002

Philanthropy
Toyota Municipal Museum of Art in Aichi helping low-income community members for education

United Negro College Fund (40 annual scholarships)

National Underground Railroad Freedom Centre (US$1 million)

Higher education
Toyota established the Toyota Technological Institute in 1981, as Sakichi Toyoda

Robotics
In 2004, Toyota showcased its trumpet-playing robot.

It founded the Toyota Technological Institute at Chicago in 2003 Supporter of Toyota Youth for Understanding Summer Exchange Scholarship Program. Toyota Community Scholars. contributed to a number of local education. Developing multi task robots destined for elderly care, manufacturing, and entertainment. Example of Toyota's involvement in

robotics for the elderly is the Brain Machine

interface

SCM
Minimizing supply chain costs while keeping a reasonable service level customer satisfaction quality on time delivery, etc.

OBJECTIVE
Right product

Right price
Right store

Right quantity
Right customer Right time

Supply chain overview

Suppliers Parts

Inbound logistics
Assembly plant Production Inspection Outbound logistics Dealers

Customers

Supply chain Contd.

Suppliers
Suppliers provide thousands of

Production
Vehicles are produced at the final assembly plant from the

parts and components that go into he vehicle.

Parts and components are received from tier 1 suppliers through inbound logistics. Supplier chain contains several levels : tier 1, tier 2 .. And so on. Since Toyota relies on JIT it had

parts provided by hundreds of suppliers. The plant is sub divided in to shops. The vehicle is born in the body shop where the frame and body are formed. The body parts are stamped in the stamping shop by presses. The body shop is where numerous robots are used to weld the body parts together. After body being assembled, It moves to paint shop. After painting, It moves to final line where supplier parts are installed to make finished vehicle. Final Inspection is done and moved to yard

fewer but reliable tier 1 suppliers.

Ex: Denso, Bridgestone etc

Network design to analyse locations of suppliers

Determine which cross dock is located nearest to suppliers

Transport parts to cross docs and stage them for each assembly

Transport to plants and containers travel in reverse route.

Inbound Logistics:
Company establish partnership with third party logistic providers Company organizes many of its suppliers into clusters based on geographic location. Parts are picked up from those suppliers by trucks on a milk route and delivered to regional cross dock. At cross dock, parts are unloaded and staged for each assembly plant and then loaded to trucks which take parts directly to each plant. After the parts are unloaded, the truck is reloaded with the corresponding empty returnable containers. Returnable containers flow in reverse route.

Procurement Policy
Toyota procures the necessary parts, materials, and equipment for these many different business fields from suppliers
all over the world. Toyota also cooperates with their Suppliers to promote environmental preservation and meet the other demands of society. They take a long term view toward our relationships with suppliers with an aim to realize an amicable relationship of mutual prosperity based on fair business practices. Fair Competition Based on an Open Door Policy Amicable Relationship of Mutual Benefit Based on Mutual Trust Environmentally-Friendly Products Based on Green Procurement Localization of Business Based on Good Corporate Citizenship Obeying the Law

Outbound Logistics

Vehicles at marshalling yard

Accessories installation

Final quality assurance

Transport to dealers

Dealers:
Responsible For selling the vehicles produced by the manufacturer to there tail customers. Toyotas sales model is designed so that a high percent age of vehicles is sold from a relatively low level of dealer stock. Local Distribution Model

Toyota Distribution model:

Distribution Model Over seas Distribution Model

European Distribution Model

TOYOTA SUPPLY CHAIN

Parts/ Service Centers
Dealer Customer

Distributor Overseas Network Warehouse Assembly Plant Components Supplier Group Raw Material Suppliers

FEATURES OF TPS
JIT

Technical Related
Kanban TPS Workers People Related

Revolutionized manufacturing industry At its core is lean a relentless drive to improve efficiency and eliminate waste

Suppliers

Beginnings of TPS were born out of necessity due to lack of resources in post-war Japan.

Key Main Concepts Of TPS

SMED
Single Minute Exchange of Dies Promoted flexibility of production runs It refers to the ability to stop production, by man or machine.(equip malfunction).

Heijunka
Where ever possible evenly distributed workload

JIT
Just In Time manufacturing Small batches which reduced inventory costs, tightened relationship with suppliers and improved quality control

made at any time, Without this, just in time cannot

be applied, because it will happen stacking and queuing at peak level.

Total Productive Maintenance

A comprehensive equipment maintenance process so that the tools are always in good condition to wear to work.

JIDOKA
One of the two main pillars of TPS.

Toyotas Strategy
Increase competitive strength through advanced technology

Environmental technology
fuel consumption, emission, recoverability Increased emphasis on financial services and information communication system Hybrid vehicles and next generation fuel cells Cost-reduction efforts discontinuation, integration of older models

Financial Planning Process

Establish Goals and Objectives

Review your goals and current situation

Develop a Strategy to meet your needs

Implement Recommendation

Make Recommendation

Drivers of Supply chain

Facility:
Vehicles coming out of assembly line are moved into warehouse called Marshaling yard . transport within the country and ships for export. Road transport is provided by third party logistic providers.

Fitting accessories, price tag and final quality assurance

takes place here.

Information:
Parts and master database is maintained for part name, supplier, lot size information.

Inventory:
Just-in time based inventory method.
Pull based system and kanban methods are followed.

13 week forecasting is given to suppliers to provide them

with guidance.

Transport:
suppliers stay close to plant. Finished products transported through truck or rail for

Sourcing

Majority of transport of raw material through truck , since Pricing

Conclusions
Toyota is a great company with an integrated supply chain management as well. Toyota has an integrated system in its production, namely TPS (Toyota Production System). Toyota has a wide range of advantages ranging from human resources to its products, it is evidenced by the wide range of awards Toyota have 14 principles which refers to the quality of service, product quality and efficiency Toyota including Indonesia's largest company automotive in the world. Toyota lead because his concept of lean management.

Any Questions!!!