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Nissan Motor Company Ltd.:
Building Operational Resiliency
Presented by:
Group - 4
Presented to:
Prof. Pradeep
History of the Japanese Automotive Industry
• Military sponsored initiativesPrior to1930’s
• Jidosha Seizo Company, Toyoda Automatic Loom1933
• Nissan and Toyota faced risk of Bankruptcy1945
• Toyota developed JIT and reduced buffer in stock,
Developed TPS1940’s to1960’s
• Toyota and Nissan increased their exports1960’s
• Exported 50% of total production1970’s
12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 2
About Nissan
• Jidosha Seizo Company1933
• Named Nissan1934
• Nissan resumed its manufacturing1945
• Entered into market with procut targeting niche market1970’s
• Concentrated on eco-friendly engines1997
• Won the North American Car of the Year Award2002
12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 3
Nissan’s Supply Chain Philosophy: A
Focus on Flexibility
Flexible organization and integrating a variety of perspectives
Embraced diversity, as corporate officers were from various countries
Simplified product line compared to its competitors
Build-to-stock strategy for few SKUs and Build-to-order for rest
Simplify its operations, product offerings and increase sales
12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 4
Risk Management at Nissan
12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 5
1999
• Severe financial
difficulties
• Resolved when it
formed an alliance
with Renault
Renault
• It bought 36.8%
stake in Nissan
• Forced Nissan to
confront
entrenched
practices and to
take proactive
action
Executive Level
Committee
• Corporate Risks
• Designated Risk
Owners
• Reported to BoD
Risk Readiness
• Seismic
Reinforcement of
Facilities
• Business Continuity
Planning
• Disaster simulation
training
Process of Risk Management
Identifying Analysing Planning
Implementing
Counter
measures
12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 6
Adhered to the
principles detailed in its
earthquake
emergency-response
plan
Recovery Committee
was established
Sharing
Information
Allocation
Supply
Managing
Production
Empowering
Action
12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 7
Nissan’s response to Disaster
Recovery by the Big Three Japanese Auto
Manufacturers from downfall of 24%
Toyota
• Significant
exposure
• High rate of
Japanese
production
Nissan
• Several plants in
close proximity to
the disaster area
Honda
• Attributed its
production problems
to supply chain
constraints
• A strategy Nissan has
successfully adopted
12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 8
Going Forward
12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 9
Nissan
- Increase its production of cars in US up to
90% by 2015
- Reduce reliance on Japanese parts
- Identify critical dependencies within supply
chain
Thank You
12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 10

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Nissan Creating Operational Resiliency

  • 1. Nissan Motor Company Ltd.: Building Operational Resiliency Presented by: Group - 4 Presented to: Prof. Pradeep
  • 2. History of the Japanese Automotive Industry • Military sponsored initiativesPrior to1930’s • Jidosha Seizo Company, Toyoda Automatic Loom1933 • Nissan and Toyota faced risk of Bankruptcy1945 • Toyota developed JIT and reduced buffer in stock, Developed TPS1940’s to1960’s • Toyota and Nissan increased their exports1960’s • Exported 50% of total production1970’s 12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 2
  • 3. About Nissan • Jidosha Seizo Company1933 • Named Nissan1934 • Nissan resumed its manufacturing1945 • Entered into market with procut targeting niche market1970’s • Concentrated on eco-friendly engines1997 • Won the North American Car of the Year Award2002 12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 3
  • 4. Nissan’s Supply Chain Philosophy: A Focus on Flexibility Flexible organization and integrating a variety of perspectives Embraced diversity, as corporate officers were from various countries Simplified product line compared to its competitors Build-to-stock strategy for few SKUs and Build-to-order for rest Simplify its operations, product offerings and increase sales 12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 4
  • 5. Risk Management at Nissan 12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 5 1999 • Severe financial difficulties • Resolved when it formed an alliance with Renault Renault • It bought 36.8% stake in Nissan • Forced Nissan to confront entrenched practices and to take proactive action Executive Level Committee • Corporate Risks • Designated Risk Owners • Reported to BoD Risk Readiness • Seismic Reinforcement of Facilities • Business Continuity Planning • Disaster simulation training
  • 6. Process of Risk Management Identifying Analysing Planning Implementing Counter measures 12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 6
  • 7. Adhered to the principles detailed in its earthquake emergency-response plan Recovery Committee was established Sharing Information Allocation Supply Managing Production Empowering Action 12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 7 Nissan’s response to Disaster
  • 8. Recovery by the Big Three Japanese Auto Manufacturers from downfall of 24% Toyota • Significant exposure • High rate of Japanese production Nissan • Several plants in close proximity to the disaster area Honda • Attributed its production problems to supply chain constraints • A strategy Nissan has successfully adopted 12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 8
  • 9. Going Forward 12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 9 Nissan - Increase its production of cars in US up to 90% by 2015 - Reduce reliance on Japanese parts - Identify critical dependencies within supply chain
  • 10. Thank You 12/20/2016PROPERTY OF INDUS BUSINESS ACADEMY. FOR ACADEMIC PURPOSE ONLY. 10