Toyota Global auto manufacturer

1. Toyota
A global Auto Manufacturer
ALOKCHAUDHARY
GROUP - A

2. Toyota motor corporation’s vehicle production system is a
way of “making things that is referred to as “learn
manufacturing system”.
The TPS(Toyota manufacturing system) was developed to
improve Quality and Productivity.
 Objective:”making the vehicles ordered by customers in
the quickest and most efficient way, in order to deliver the
vehicles as quickly as possible”.
INTRODUCTION

3. Sakichi Toyoda (1867-1930)
Toyoda Power Loom equipped with a new weft-breakage automatic
stopping device (developed in 1896)
World's first automatic loom with a non-stop shuttle-change motion,
the Type-G Toyoda Automatic Loom (developed in 1924)
Origin of Toyota Production System

4. Kiichiro Toyoda(1894-1952)
Drawing on his experience of introducing a flow production method
using a chain conveyor into the assembly line of a textile plant
(completed in 1927)
monthly production capacity of 300 units,
Also introduced this method into the body production line at Toyota
Motor Co., Ltd.'s Koromo Plant (present day Honsha Plant)
 completed in 1938.
Origin of Toyota Production System

5. Eiji Toyoda (1913-)
By ensuring thorough implementation of jidoka and the Just-in-Time
method,
 Eiji Toyoda increased workers' productivity by adding value
 realized the Toyota Production System, which enabled Toyota to
compete head-on with companies in Europe and the U.S.
Origin of Toyota Production System

6. Taiichi Ohno(1912-1990)
With strong backing from Eiji Toyoda, Taiichi Ohno helped
 establish the Toyota Production System
 built the foundation for the Toyota spirit of "making things“
 for example, creating the basic framework for the Just-in-Time
method
Origin of Toyota Production System

7. Basedon

8. TYPICAL DIVISIONSWITHINOPERATIONS :
 Engineering and manufacturing
 Research and Development
 Sales
 Financial services
CONSISTS OF:
 Designing
 Manufacturing
 Selling automobiles
 Calty Design Research
 Toyota Racing Development
BUSINESSMODEL

9. KEYFEATURESOF TOYOTABUSINESSModel
INTEGRATEDLOWCOST
Purchasing the world's best parts at the lowest cost with the
shortest lead times.
 Higher quality at lower costs by creating standardized,
multipurpose components .
 In 2000, Toyota launched a new cost effective strategy
called CCC21, for Low Cost operational expenses .
 Intensive coordination with its suppliers
 Finding the lowest operational cost
 Toyota steadily feeds cost improvements back into the
product to raise their value.

10.  Unique niche or strategy that separates them from the competition.
 Undertaken manufacturing revolution by integrating four areas:
design, production engineering, procurement, and component supply
KEYFEATURESOF TOYOTABUSINESSModel
DIFFERENTIATEDSTRATEGY

11. SUCCESSOF TOYOTA’SBUSINESSMODEL0
 Market share of 14% in the first four months of
this year
 2.3% jump from the previous year
 Toyota ranks fourth in United States sales

12. DIVERSEOF SUPPLYCHAIN
FACILITY:
• Vehicles coming out of assembly line moved into warehouse called
“Marshaling yard”
• Fitting accessories, price tag and final quality assurance takes place
here.
INVENTORY:
• Just-in – time based inventory method.
• Pull based system and kanban methods are followed
TRANSPORT:
• Majority of transport of raw material through truck , since suppliers stay close to plant.
• Finished products transported through truck or rail for transport within the country and
ships for export.
• Road transport is provided by third party logistic providers.
INFORMATION:
• Parts and master database is maintained for part name, supplier, lot size information.
• 13 week forecasting is given to suppliers to provide them with guidance.

13. TOYOTA SUPPLYCHAIN
Suppliers
parts
Outbound
logistics
Assembly
plant
Inspection
Dealers
Customers
Inbound
logistics
Production

15.  Suppliers provide thousands of parts and components
that go into the 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 has fewer but reliable
tier 1 suppliers. Eg : Denso, Bridgestone etc
SUPPLIERS:

16.  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
INBOUNDLOGISTICS:

17. Network design to analyze 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

18. Transforming inputs into the final product form, in assembly and
manufacturing (its production) Toyota use various systems to be efficient
and effective, we could also call it, TPS is the Toyota Production System,
The concept of the Toyota Production System can be described as a
complete building which consists of various components are integrated.
The building was also called a The House of Toyota.
JUST IN TIME : One of the two main pillars of TPS. It refers to the
manufacturing and conveyance of only ” what is needed, when is needed,
and in the amount needed in the system”.
1. The Pull System
2. Continuous Flow Processing
3. Take time
JIDOKA : One of the two main pillars of TPS. It refers to the ability to
stop production ,by man or machine.( equip malfunction)
Operations

19.  Vehicles are produced at the final assembly plant from
the parts provided by hundreds of suppliers.
 The plant is subdivided into 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.
PRODUCTION

20. OUTBOUNDLOGISTICS:
Dealers:
 Responsible for selling the vehicles produced by the manufacturer
to the retail customers.
 Toyota s sales model is designed so that a high percentage
of vehicles is sold from a relatively low level of dealer stock
Transport
to dealers
Final
quality
assurance
Accessories
installation
Vehicles at
marshaling
yard

21. Local production model
Overseas production model
European distribution model
DISTRIBUTIONMODEL
Toyota DISTRIBUTIONMODEL :

22.  Considering suppliers and dealers as partners, sharing
profits with them, has helped to manage supply chain efficiently.
 By leveling out production (heijunka) and synchronizing with
demand and supply has helped to maintain stability in supply chain.
 By effective demand forecasting , production and supply chain
activities are managed effectively .
 Suppliers are categorized as clusters based on geographic location
and single truck picks up part from the cluster increasing the efficiency
of supply chain.
 Toyota takes responsibility for procuring parts from
supplier which increases reliability on inbound logistics.
EFFECTOF THE SUPPLYCHAINON THE COMPANY

23. CONCERNS
 Toyota took its single source strategy to risky extremes
without proper risk management oversight, need closer
observation on tier-2 and tier-3 suppliers.
 Bigger expansion means working with unfamiliar suppliers
who may not have proper understanding of Toyota culture.

24. RECOMENDATIONS
 Benchmark Tier-2 and Tier-3 suppliers as
per Tier-1 suppliers.
 Scope for improvement in Outbound Logistics.

25. THANK YOU