The paper “ Toyota Production System - Logistics & Supply, Mass Customisation, Manufacturing Simulation Software, and Lean Manufacturing” is a breathtaking option case study on management. Company ‘ X’ is an Australian-based company involved in the production and distribution of cars as well as automobile parts. Besides that, the company engages in the production of machine tools, distribution of special purpose vehicles, in addition to bodywork business and delivery inspection of automobiles. Given that the company is new, it does not have associated companies or subsidiaries. At the global level, the company faces competition from giant automakers such as Toyota, General Motors, and Volkswagen.
At the domestic level, the company faces competition from Australian automobile companies such as Holden, Ford Australia, Toyota Australia, Iveco, and many others. Currently, the company is specializing in smaller cars as well as trucks. Besides that, the company is relying on its product line-up in order to grow and has made a huge investment in styling and technology to meet the domestic and international requirements and needs of its customers. Imperatively, the company has tailored most of its models with the objective of fitting the domestic and global audience, with the expectation that it will gain some market share.
Using manufacturing simulation software, the company is planning to introduce two fuel-efficient engine options and sports compact automobile to its customers. To succeed and survive in the competitive automotive industry, the company seeks to achieve as well as sustain competitive differentiation, which relies on differentiating timeliness, cost/value, and quality attributes. The competitiveness foundation for the company is investing in consumer‐driven products that are attractive, affordable and fresh. Logistics & Supply In the automotive sector, managing logistics and supply efficiently has turned out to be a survival factor.
Owing to the increasing competition in both the domestic and international markets, the flexibility in managing information flow and materials in the assembly plants of the company is the main requirement for future growth. Presently, the supply chain practice in the automotive industry is in the transition period, and all supply chains have been tied to projections. Therefore, the automotive industry depends heavily on build-to-delivery as well as build-to-forecast (see appendix one).
As suggested by Suthikarnnarunai (2008, p. 1), automobile companies should ensure that the supplies have been matched with the demands from the first chain to the last chain. For this reason, the company needs a global insight into the demand so as to efficiently make decisions with regard to sourcing and capacity management. The insight should be structured according to the company’ s financial plan so as to find the existing gaps and ways of addressing them. More importantly, the company should optimize its outbound logistics operations by means of collaboration and consolidation amongst original equipment manufacturers (OEMs), which as a result could lower the transportation cost, transportation time, -house inventory as well as facility costs.
As mentioned by Hassan (2012, p. 2), collaborating the inter- and intra-OEM outbound logistics operations is very crucial because it can lead to cost reduction. Toyota Production SystemToyota production system (TPS) has been used successfully in the Toyota Company for many years and has been improving Toyota in distribution patterns, supplier management production processes, as well as research innovation. Thanks to TPS, Toyota has successfully cut costs. The manufacturing industry according to La et al.
(2015, p. 2) was built by Taiichi Ohn and Henry Ford, wherein the former improved the method of mass production by introducing the Toyota production system while the latter reformed the method of mass production using the flow lines. Importantly, the underlying principles of the Toyota production system are valuable to emulate. The company can learn numerous lessons from the TPS today as compared to three decades ago. The first lesson is that there are no substitutes for direct observation: Specifically, the company cannot improve its business processes without directly observing how business processes are performed today.
Therefore, the company should learn how business processes are performed in order to discover the possibilities of process improvement. Another lesson learned is that suggested changes should all the time be structured as experiments. For the company to improve its business process, it must invest in employee training, manufacturing systems and accelerate value-adding steps. The third lesson that can be learned from TPS is that workers and managers should always experiment: that is to say, the company’ s focus should be on process improvement.
The last notable lesson is that managers should act as coaches: therefore, the activities of process improvement should be conducted and organized by both employees and management, and not just the managers.