Toyota's Supply Chain

4094 words 17 pages
1.0 Executive Summary

The report details the findings on Toyota Motor Corporation's supply chain management in great description. Areas that will be covered in the report include the supply chain processes of Toyota, supply chain strategies that it adopts and the practical use of drivers that determine the performance of the entire supply chain in terms of responsiveness and efficiency.

The supply chain processes and strategies of Toyota are the fundamentals in its daily operations. By adhering Just-In-Time (JIT) manufacturing and Toyota Production System (TPS), Toyota emerges to be one of the world's largest automaker.

In addition, the above-mentioned drivers refer to transportation, facilities, information technology and
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New stock is also ordered when stock drops to the re-order level.

• Results of Just-in-Time

The Just-in-Time system delivers clear results.

 Quality is confirmed at every step, through first-in, first-out flow. This is to ensure that if parts or material defects are found in one process, the Just-in-Time systems force the problem to be quickly identified and corrected.
 Cost and space needed is reduced by eliminating the need for warehousing, as well as the expense of scrapping warehoused parts that are found to be defective. The need for extra labor costs is also eliminated.
 Due to "built to order", the risk of vehicles that are produced but not sold are eliminated, thus improving the company's return on equity.
 Maximum productivity is a result when the right parts and materials are supplied at the right time and in the right amount.
 The factory responded faster to an order. This improved customer satisfaction by providing vehicles usually within a day or two of the minimum economic shipping delay.
4.2 Pull Processing
Pull Processing is a method use in Just-in-Time where a process signals its predecessor that more material is needed. Products are pulled from the consumer end (demand) just-in-time to be used, not pushed from the production end (Supply). The pull system produces only the required material after the subsequent operation


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