toyota company Practise school report

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Practice School Project Report
On
(Toyota Company)
Submitted to:
Institute Code: 832
Institute Name: Oakbrook Business School
In partial Fulfillment of the Requirement of the award of the degree
of
Master of Business Administration (MBA)
Offered By
Gujarat Technological University
Ahmedabad
Prepared by:
Students of
MBA (Semester – II)
April, 2017

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Oakbrook Business School
Institute Certificate
This is to Certify that this Practice School Project Report on “…Toyota company….”
is the bonafide work of (jaiminsinh parmar – 2046) and (dhwani trivedi – 2094 No),
who carried out the project work after consulting respective subject faculty. I also
certify further, that to the best of my knowledge the work reported herein does not
form part of any other project report or dissertation on the basis of which a degree or
award was conferred on an earlier occasion on this or any other candidate.
Ms. Riddhi Ambavale
Practice School coordinator
Dr. Sourabhi Chaturvedi
Director

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STUDENT’S DECLARATION
We, following students, hereby declare that Practise School Project Report on “Toyota
company” is a result of our own work and our indebtedness to other work publications,
references, if any, have been duly acknowledged.
Enrollment No. Name Signature
168320592046 Jaiminsinh parmar
168320592094 Dhwani Trivedi

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Table of Contents
Sr. No Particulars Pg. No
1. Quantitative Analysis – II 1.
2. Management Information System 7.
3. Marketing Management 11.
4. Human Resource Management 15.
5. Cost and Management Accounting 20.
6. Production and Operations Management 25.
7. Financial Management 34.

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Sequence of the subjects
Group A Group B
Sem 2 1. Quantitative Analysis – II
(QA-II)
2.ManagementInformationSystem
(MIS)
3. Marketing Management (MM)
4.Human Resource Management
(HRM)
1 Cost and Management
Accounting (CMA)
2.Production and Operations
Management (POM)
3. Financial Management (FM)

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Toyota Company history
The history of Toyota started in 1933 with the company being a division of Toyoda Automatic
Loom Works devoted to the production of automobiles under the direction of the founder's
son, Kiichiro Toyoda.[1]
Kiichiro Toyoda had traveled to Europe and the United States in 1929 to
investigate automobile production and had begun researching gasoline-powered engines in
1930. Toyoda Automatic Loom Works was encouraged to develop automobile production by the
Japanese government, which needed domestic vehicle production, due to the war with
China.[2]
In 1934, the division produced its first Type A Engine, which was used in the first
Model A1 passenger car in May 1935 and the G1 truck in August 1935. Production of the Model
AA passenger car started in 1936. Early vehicles bear a striking resemblance to
the Dodge Power Wagon and Chevrolet, with some parts actually interchanging with their
American originals.

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Toyota Company
Quantitative analysis
FacultyName:____________________________________
Sign:________________________
Date: _____________________

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W1 W2 W3 Capacity
A 80 60 90 100
B 60 30 80 300
C 50 70 90 700
requirement 600 300 200 1100
A manager has five persons for three separate jobs and the cost of assigning each job to each
person is given. His goal is to assign one and only job to each person in such a way that the
total cost of assignment is minimized
Step 1. Insert the following functions.
Explanation: The SUM functions calculate the total shipped from each Warehouse (Total
Out) to each customer (Total In). Total Cost equals the sumproduct of Unit Cost and
Shipments.

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Step 2. Find total cost:
Solve the Model
To find the optimal solution, execute the following steps.
1. On the Data tab, click Solver.

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2. Enter the solver parameters (read on). The result should be consistent with the picture
below
You have the choice of typing the range names or clicking on the cells in the spreadsheet.
2. Enter TotalCost for the Objective.
3. Click Min.
4. Enter Shipments for the Changing Variable Cells.
5. Click Add to enter the following constraint
Check 'Make Unconstrained Variables Non-Negative' and select 'Simplex LP'.
8. Finally, click Solve.
Check 'Make Unconstrained Variables Non-Negative' and select 'Simplex LP'.
8. Finally, click Solve.

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The optimal solution
W1 W2 W3 TOTAL Capacity
A 100 0 0 100 100
B 300 0 0 300 300
C 0 0 0 0 700
TOTAL 400 0 0 1100
requirement 600 300 200
Total Cost 26000

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Management Information Systems
FacultyName:____________________________________
Sign:________________________
Date: ________________________

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INTRODUCTION
Toyota has actively propelled growth and innovation in its information systems by
incorporating new information processing technologies while responding to various
changes in the external environment, including rapid globalization of development,
manufacturing, and sales operations; advancements in car electronics technologies;
compliance with global environmental standards; and changes in the Japanese and
global economy.
First half of the 1990s saw advances in office automation and in the globalization of
corporate systems in the commercial systems of business application systems.
Toyota applied in-house-developed CAD/CAM systems to broader areas of activity
and also extended them to supplier operations.
The second half of the 1990s to the early 2000s, advancements in administrative
systems made information systems more globally adaptable and also brought about
reform of Toyota's overall management structure. The early to late 2000s, Toyota
sought to globally standardize all business application systems and make better use
of information. Even such IT infrastructure as IC network systems were globally
standardized and shifted to TCP/IP-based systems in Japan and overseas. The
economic crisis that shook the world from 2008 to 2009 also had a major impact on
Toyota's information divisions.

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The company IT infrastructure consists of the following components:-
Hardware: Servers, computers, data centers, switches, hubs and routers,
ECM (electronic control module), etc.
ECM:-The purpose of the ECM is to control the engine; it acts as the ‘brain’ of
the engine.
Network: Network enablement, internet connectivity, firewall and security.The
company is using the SPIDIGO broadband internet with LAN connectivity.
Spidigo broadband speed is 8mbps for each department.They have 25
computers to controlled for machines and robots.
Lean IT
We help clients looking for internal efficiencies in order to maintain margins.
Our lean IT strategies provide the means for leadership to reduce IT costs
while improving IT processes and performance.
IT strategy
We work with automotive industry clients to make IT not simply a cost, but a
source of business advantage. By collaborating with clients, we are able to
drive strategy through reallocation of resources, standardization, and
horizontal integration across programs, increasing transparency with suppliers
and customers alike. We help the IT organization become a tool to enable
business growth.
Next-generation technology
We assess existing technology and investments against potential
opportunities. We also help to create business models for our clients that
leverage emerging and disruptive technologies such as open source, social
media, and cloud computing.

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Process transformation
We help clients enable business change and create capabilities that involve
significant technology elements. Topics covered include ERP and CRM
programs, ensuring fast and predictable results in large-scale renewal efforts,
and driving portfolio choices that are appropriate to serve business needs. We
have codified the key building blocks for program success in our Program
Value Realization service offering.
Main SAP Automotive Suit (ERP):-
• Main means of information flow between Toyota Australia and its counterparts
worldwide.
• Tighter collaboration links between TMCA and TMC
1. Logistic and shipping
2. Overall Value Chain
Electronic “Kanban”-Card System:-
• Identical in function to the physical “kanban” cards used by Toyota in Japan
• 4 main purpose:
1. requesting new parts
2. order shipment
3. specific supplier plant
4. Establishing the mix and volume criteria for assessing if an order was
correct
Electronic“ Kanban ”-Card System:-

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Marketing management
Toyota’s Marketing Mix (4Ps)
FacultyName:____________________________________
Sign:________________________
Date: ________________________

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Toyota’s Products (Product Mix)
Toyota has a diverse set of products. This element of the marketing mix identifies
organizational outputs for the target customers. The following are the product lines in
Toyota’s product mix:
1. Toyota automobiles
2. Lexus automobiles
3. Welcab series
4. Marine products
5. Spare parts and accessories
6. Engines
Toyota automobiles are the most popular in this product mix. Lexus automobiles are
luxury products from the company. On the other hand, the Welcab series are Toyota
automobiles modified for the elderly and people with disabilities. The company also
manufactures yachts, engines, and spare parts and accessories for automobiles and
marine products. This part of the marketing mix shows that Toyota reaches a wider
market and reduces market-based risks through a diverse product mix.
Place/Distribution in Toyota’s Marketing Mix
Dealerships are Toyota’s main places for distributing its products. This element of
the marketing mix determines the venues where customers can access the firm’s
products. The following are the main places in Toyota’s distribution strategy:
1. Dealerships
2. Retailers
Toyota dealerships are where most sales transactions occur. However, some
retailers like auto supply stores also sell the company’s products, such as spare
parts and accessories. This part of the marketing mix shows that Toyota relies
heavily on dealerships to sell its products to the target market.

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Toyota’s Promotion (Promotional Mix)
Toyota’s promotion strategy covers all the tactics of marketing communications. This
element of the marketing mix pertains to how the firm communicates with the target
market. Toyota uses the following promotion activities, arranged according to
significance:
1. Personal selling
2. Advertising
3. Public relations
4. Sales promotion
5. Direct selling
Toyota uses personal selling through dealerships’ sales personnel, who personally
promote products to potential buyers. The company also uses advertising on various
media, such as TV, newspapers, and websites. In addition, the firm promotes its
products through public relations, such as the Toyota Together Green program that
supports environmental initiatives, and the Meal Per Hour program that donates food
to Food Bank. These public relations activities create a positive brand image for
Toyota. On the other hand, infrequent sales promotion is used through special deals.
Also, the company sometimes uses direct selling for corporate clients. This part of
Toyota’s marketing mix indicates that the company has a comprehensive strategy for
promoting its business and products.

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Toyota’s Prices and Pricing Strategy
Toyota’s prices vary widely, depending on the product line and the product type or
model. This element of the marketing mix identifies how the firm sets the prices of its
products. Toyota uses a combination of the following pricing strategies:
1. Market-oriented pricing
2. Value-based pricing
Toyota uses the market-oriented pricing strategy to determine prices based on
market conditions and the prices of competitors. This pricing strategy is notable in
the vast majority of Toyota products, such as sedans and trucks. However, the firm
also uses the value-based pricing strategy, which sets prices based on the actual
and perceived value of the product. The company uses value-based pricing for high-
end or more expensive products, such as the Prius and Lexus cars. This part of
Toyota’s marketing mix shows that the company determines price levels based on
market conditions and customers’ perceptions.

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Human Resource Management
FacultyName:____________________________________
Sign:________________________
Date: ________________________

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GENERAL HUMAN RESOURCE MANAGEMENT
The term human resource management has been subject to considerable scrutiny
and its philosophy and character has been the focus of continuous debate, and a
widely accepted definition does not exists, however, below are some definitions of
HRM from its early years to date which can be useful in capturing a glimpse of its
philosophy and use.
Toyota Company ensure that the employees of an organization are used in such a
way that the employer obtains the greatest possible benefit from their abilities and
the employees obtain both material and psychological rewards from their work. They
even see to it that the employees get job satisfaction and also make sure that they
fulfil their individual goals with their organisational goals.
Human resource planning
1. Human resources planning is a process that identifies current and
future human resources needs for an organization to achieve its goals. Toyota
company believes that Human resources planning should serve as a link
between human resources management and the overall strategic plan of an
organization.
2. In Toyota company human resource planning is done only when there is
occurring an any requirement of employee for particular position.Toyota
company target is to continuous supply of right kind of people to fill various
position as per the requirement
Objectives of Human Resource planning
1.Toyota company follow the objective that to ensure optimum use of employees
which are working with firm.
2.Avoid imbalance in distribution and allocation of resources they follow the principle
that select right person at right job.
3. In Company they have already availability of resumes of candidates who want
job in Toyota Company.
4. They formulate the transfer and promotion policy as a human resource
planning.
5. Ensure adequate supply of manpower as and when required.

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6. Sure proper use of existing human resources in the organization.
7. Forecast future requirements of human resources with different levels of skills.
8. Assess surplus or shortage, if any, of human resources available over a specified
period of time.
9. Anticipate the impact of technology on jobs and requirements for human
resources.
Human resource recruitment in Toyota Company
First they takes Trainee level entry. After that 2 months review is done. They give
skill development programme, provide operational skills and design skills to the
employee’s .This all process will take 12 months. They put the employee into
individual assembly job. Rating to their work is given after 1st individual project
completion.
Steps of recruitment
Step 1: Evaluate Need and Identify Vacancy
In Toyota company first step of recruitment is to evaluate the need that for which
position they require employee, what they want that employee to work and in which
department, what qualification needed for that particular position. As Toyota
company Understand and take into consideration strategic goals for the department.
Are there any upcoming changes that may impact this role.

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Step 2: Develop Position Description
Toyota Company planned that for which position they require the employee. In
Toyota Company whenever vacancy occurs at that time they make one written
statement which describes the position, which is vacant, that what they want in
particular employee who is going to fill that position. They develop the criteria of
candidate who is going to fill that vacancy.
 Clearly articulates responsibilities and qualifications to attract the best
suited candidates.
 Assists in establishing performance objectives.
.
Step 3: Develop Recruitment Plan
As Toyota Company carefully makes structured recruitment plan maps out the
strategy for attracting and hiring the best qualified candidate. Recruitment plan of
Toyota company is to keep the resume bank with their which helps the HR
department to easily availability of manpower in an organization.
Step 4: Post Position and Implement Recruitment Plan
Once the position description has been completed, the position can then be posted
online. Every effort should be made to ensure the accuracy of the job description and
posting text. It may not be possible to change elements of a position once posted,
because it may impact the applicant pool.
Step5: Review Applicants and Develop Short List
In Toyota company, Applicants are those who apply during the initial application
period as described. All applicants must be reviewed and considered. Candidates
who apply after the initial application period will be considered “expressions of
interest” and not viewable by the search committee. It is recommended that all
members of the committee review all Applicants to ensure more than one person
assesses their qualifications and that individual opinion or biases are avoided. After
review applicants they short listed that candidates. Each member of the committee
may provide comments to each Applicant’s qualifications as they relate to the
minimum requirements of the position. A phone screening also conducted by Toyota
company to obtain information such as availability, salary requirements, special
position requirements (e.g. ability to perform shift work), ascertain minimum
requirements and other preliminary information to assist the search committee with
their review. It is possible to screen out an applicant due to information obtained
during this initial screening and therefore phone screens should be properly
documented and attended by at least two search committee members.

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Step 6: Conduct Interviews
The interview is the single most important step in the selection process. It is the
opportunity for the employer and prospective employee to learn more about each
other and validate information provided by both. In Toyota company the interview
conducted by the human resource manager first test of that interview is written test
than group discussion than personnel interview conduct.
Step 7: Select Hire
In Toyota company Once the interviews have been completed, the committee will
meet to discuss the interviewees. Committee members will need to assess the
extent to which each one met their selection criteria.
Your documentation should demonstrate your selection decision. Documentation is
required in order to comply with requirements. As one of the most critical steps in the
process, Toyota company keep the following in mind:
5. The best candidate for the position was chosen based on qualifications
6. The candidate will help to carry out the University and Department’s missions.
Step 8: Finalize Recruitment
 Upon completion of the recruitment process the offer to the selected finalist is
made.
 Prior to initiating the offer, it is recommended that one more check of the
selection process be completed as follows:
 Review the duties and responsibilities of the position and ensure they were
accurately described and reflected in the job description and interview
process
 Review selection criteria used to ensure they were based on the qualifications
listed for the position Confirm interview questions clearly matched the
selection criteria
 Confirm all applicants were treated uniformly in the recruitment, screening,
interviewing and final selection process.

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Cost and Management Accounting
FacultyName:____________________________________
Sign:________________________
Date: ________________________

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Cost Reduction Techniques
(Cost and Management Account)
Along with differentiation Toyota also uses low cost to try and gain a
competitive advantage in the automotive industry. “Toyota is (or was at the
time) the low cost producer in the industry. Toyota achieves its cost
leadership strategy by adopting lean production, careful choice and control of
suppliers, efficient distribution, and low servicing costs from a quality
product.”(Michael E. Porter) This quote from Michael Porter sums up how
Toyota achieves this low cost strategy. Through research, it is evident that
Toyota is still the low cost leader in the automotive industry.
1) Reduction in number of platforms
By using a common platform for the production of a greater number of
models, Toyota believes that it will be able to decrease the substantial
expenditures required to design and develop multiple platforms.
2) Commonality of parts
It includes reducing model variations and the number of parts used in each
model.
3) Effective Procurement
Toyota is seeking to increase the efficiency of procurement from outside
suppliers by making use of a common global database to enable plants in
different areas of the world to purchase parts and materials from the most
competitive sources

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4) Value Innovation
Toyota is engaged in the “Value Innovation” (VI) activity which is focused on
systems-based cost innovation, going one step beyond item-based
innovation. Adopting a new approach to designing, Toyota aims to achieve
comprehensive cost reductions by treating associated parts as integrated
systems.
5) Just in time
The key cost reduction strategy of Toyota is “just-in- time” philosophy.
This is the producing only precise quantities of already ordered items with the
absolute minimum of waste. This method is adopted by the automotive
industry across the world.
This is to reduce the inventory cost.
6) Eco factory and eco friendly concept
Toyota also use plant which is designed with eco factory concept to maximize
the output with the minimum input by creating a highly optimized
manufacturing process. To reduce process steps.
7) Reducing material cost
Toyota worked hard in product development with various initiatives to reduce
cost and unnecessary features from parts and systems in the vehicle.
Using light weight material.
Toyota cut the price of its car parts by 30%.
It improved the quality of their small car by keeping their cost low
To cut the price of individual parts.
Toyota saved $9billion for five years of using this strategy.

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Cost reduction of Toyota Company
The petrol EtiosLiva hatchback now starts at Rs 4.44 lakh as against Rs 4.53
lakh earlier and goes up to Rs 4.89 lakh for the top-end Xclusive model, which
was priced at Rs 5.03 lakh earlier. The diesel EtiosLiva price range starts at
Rs 5.74 lakh for the base J trim and the top Xclusive trim costs Rs 6.08 lakh.
The Toyota Etios petrol sedan now starts at Rs 5.39 lakh for the base car and
the top-end V SP petrol is priced at Rs 6.04 lakh. The Etios diesel sedan is
now priced from Rs 6.64-8.08 lakh. Overall the Etios sedan is now around Rs
14,000-21,000 cheaper across variants.
The Toyota Innova range now starts at Rs 9.47 lakh for the base E7 trim and
goes up to Rs 14.67 lakh for the top ZX7 trim. Before this price revision from
Toyota, the Innova was priced from Rs 9.89-14.92 lakh.
The Toyota Land Cruiser LC200 is now priced at Rs 1.13 crore against the Rs
1.16 crore `before the duty cut. The Land Cruiser Prado has also become
cheaper by around Rs 3 lakh and retails for Rs 84.57 lakh.
Cars Current price Past value Difference in price
1)EtiosLiva patrol
2)EtioslivaXclusive
3) EtiosLiva diesel
Rs 4.44 lakh
Rs 4.89 lakh
Rs 5.74 lakh
Rs 4.53 lakh
Rs 5.03 lakh
Rs 6.08 lakh
Rs 9000
Rs 14000
Rs 34000
1) Etios petrol
2) Etios diesel
Rs 5.39 lakh
Rs 6.64-8.08 lakh
Rs 6.04 lakh
Rs 6.70- 8.12 lakh
Rs 64000
14,000-21,000
1) Innova
2)InnovaE7 trim
Rs 9.47 lakh
Rs 14.67 lakh
Rs 9.89 lakh
Rs 14.92 lakh
42000
25000
1) Land Cruiser Rs 1.13 crore Rs 1.16 crore 300000 lakh
1) Camry petrol
2) Camry hybrid
Rs 25.09 lakh
Rs 29.13 lakh
Rs 25.2 lakh
Rs 29.70
11000
57000

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The Toyota Camry petrol now costs Rs 25.09 lakh against the Rs 25.2 lakh
earlier while the Camry hybrid is priced at Rs 29.13 lakh against the Rs 29.70
lakh earlier.
Toyota reduced its number of platforms , this reduced the maintenance cost of
these platforms and the human resource required also reduces which saved
the cost of wages and salary

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Production and Operations Management
FacultyName:____________________________________
Sign:________________________
Date: ________________________

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1. LOCATION OF THE PLANT:
 Availability of Raw Materials:
The raw material should be available within the economical distance.
Easy availability of supplies required for maintenance and operation of
the plant should also be considered.
 Transport Facilities:
Since freight charges of raw materials and finished goods enter into the
cost of production, therefore transportation facilities are becoming the
governing factor in economic location of the plant.
 Availability of Labour:
Potential supply of requisite type of labour governs plant location to
major extent. Some industries need highly skilled labour while other
need unskilled and intelligent labour. But the former type is difficult in
rural areas in comparison with industrially developed location.

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Layout of Toyota Plant:-
Toyota assembly lines consisted of three to four sub-lines, each about 300 meters in
length. The trim line is for the installation of electrical parts. In the chassis line, the
drive train, motor, exhaust, etc., are added. During the final line, bumpers, window
glass, wheels, etc., are attached.
Car Parts
Car test
Entry Room Cars storeroom
The exact number of people in the line depends also on the customer demand. One
of the methods to adjust the output of the line is by adding or removing workers.
When I observed the line, I measured a cycle time of 2:20 minutes per vehicle. The
highly automated welding line was much faster, being able to produce one chassis in
just over one minute. Interestingly, rather than cramming the line full with chassis
(the Western way), Toyota used a pull system. New chassis were released only at
the speed at which the assembly line could take them, hence there were always idle
stations without any chassis in the welding line.
Car
Polishing
Area
defected
partsEngine
assembly
Axle
assembly
Gearbox
AssemblyProduction
manager office
Chassis
Assembly 3
Body
Mounting
Chassis
Assembly 2
Final
assembly
Chassis
assembly 1
Weld
Shop
Paint
Shop
Trim
line

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Advantages of the Layout
There are different advantages for splitting the line. One major reason was worker
motivation. At Toyota, every worker not only has the ability to stop the line, but must
do so if there is a problem he cannot solve within one cycle time. However, in a long
line, this means inconveniencing many other workers, not all of whom the worker has
a social relation with. Hence, there is a feeling of guilt due to interrupting other
people’s work, and hence a hesitation to stop the line.
With a shorter line, only about fourteen workers are involved in a line stop. Only
problems longer than four or five cycle times affect other line segments; everything
else is decoupled through the buffer stock between the lines. Hence, most line stops
affect only a small social group of workers. Furthermore, the workers can temporarily
increase speed and build up a small buffer of cars, and then use the time gained for
a short five minute meeting to discuss current issues.
Toyota Production process:-

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Kaizen - Continuous Improvement:-
Kaizen is the heart of the Toyota Production System.
Like all mass-production systems, the Toyota process requires that all tasks,
both human and mechanical, be very precisely defined and standardized to
ensure maximum quality, eliminate waste and improve efficiency.
Toyota Members have a responsibility not only to follow closely these
standardized work guidelines but also to seek their continual improvement.
This is simply common sense - since it is clear that inherent inefficiencies or
problems in any procedure will always be most apparent to those closest to
the process.
The day-to-day improvements that Members and their Team Leaders make to
their working practices and equipment are known as kaizen. But the term also
has a wider meeting: it means a continual striving for improvement in every
sphere of the Company's activities - from the most basic manufacturing
process to serving the customer and the wider community beyond.
Just In Time:-
It is perhaps not widely known that the 'just in time' approach to production
that has now gained almost universal acceptance in world manufacturing was
actually pioneered by Toyota. In fact, a Toyota engineer coined the term itself.
This, too, is a simple but inspired application of common sense.
Essentially, 'just in time' manufacturing consists of allowing the entire
production process to be regulated by the natural laws of supply and demand.
Customer demand stimulates production of a vehicle. In turn the production of
the vehicle stimulates production and delivery of the necessary parts and so
on.
The result is that the right parts and materials are manufactured and provided
in the exact amount needed - and when and where they are needed.
Under 'just in time' the ultimate arbiter is always the customer. This is
because activity in the system only occurs in response to customer orders.
Production is 'pulled' by the customer rather than being 'pushed' by the needs
or capabilities of the production system itself.
The linkage between customer demand and production is made by analyzing
takt time, a device for measuring the pace of sales in the market in relation to

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the capacity of a manufacturing plant. For example, if a plant operates for 920
minutes per day and daily demand is for 400 vehicles, then takt time will be
2.3 minutes. If takt times are reduced more resources are allocated. Toyota
never tries to accommodate changes in demand by making substantial
changes in individuals' workloads.
Assigning more Members to a line means that each handles a narrower range
of work. Assigning fewer means that each handles a broader range. Hence
the paramount importance of having a well-trained, flexible and multi-skilled
workforce. Within the plant itself, the mechanism whereby production is
regulated in this way is known as the Kanban.
A kanban is simply a message. For example, in the assembly shop this
message takes the form of a card attached to every component that is
removed and returned when the component is used. The return of the kanban
to its source stimulates the automatic re-ordering of the component in
question.
Paperwork is minimised. Efficiency is maximised. And the Members
themselves are completely in charge.
Total Quality Management:-
 Total quality implies quality: in all activities by all people in the organization.
 TQM empowers an entire organization, from the most junior employee to the
CEO, with the responsibility of ensuring quality in their processes. In
particular, TQM provides management with the ability to ensure quality
through more streamlined and effective process-improvement channels.
1. for all stakeholders
2. for all customers
3. for all vendors
4. at all times

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Material Handling Equipment’s in Toyota Company
1. InternalCombustion Lift Trucks:-
A high level of safety. Equipped to be easy to use and
to reduce operator fatigue. New functions which make
it environmentally-friendly. Superior durability and
reliability. The “GENEO” is the internal combustion
counterbalanced lift truck that has all the essential
qualities that the lift truck should have.
2. Large Counterbalanced Lift Truck:-
Internal combustion large counterbalanced lift trucks meet the
needs of harbor, stone material and lumber loading and
unloading applications. Their sturdy, powerful lifting capability
make loading and unloading cargo from high places a safe and
easy operation.
3. Stationary Rack/FixedType:-
The stationary rack is a general-purpose rack with the ability
to respond flexibly to changes in the amount of product
being shipped. Offering superior durability and outstanding
construction, it is available in many variations such as
heavy-duty rack and cantilever rack styles.

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4. Mobile Rack:-
The mobile rack makes possible significant
reductions in stocking and shipping time as well
as facilitating efficient product storage. Because it
does not use rails, the floor can be completely flat
allowing reach trucks to pass freely.
5. Automatic Guided Vehicle System “Road Sorter S”:-
The Road Sorter S provides flexible solution for
many applications with its high operability and easy
maintenance. Options such as rapid charger are
available to meet diverse applications.
6. High Speed Rail Guided Vehicle System:-
In combination with the Rack Sorter, the Mobile
Sorter provides high-speed sorting and conveyance
for any line. It is available in a 1,000kg capacity type
as well as a 50kg capacity type. (Pictured is the
Mobile Sorter B.)

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Inventory control:-
Kanban System:-
In the TPS (Toyota Production System), a unique production control method called
the "kanban system" plays an integral role. The kanban system has also been called
the "Supermarket method" because the idea behind it was borrowed from
supermarkets. Such mass merchandizing stores use product control cards upon
which product-related information, such as a product's name, code and storage
location, are entered. Because Toyota employed kanban signs for use in their
production processes, the method came to be called the "kanban system." At
Toyota, when a process refers to a preceding process to retrieve parts, it uses a
kanban to communicate which parts have been used.
“ Kanban ”- Card System:-
Kanban process:-
The Kanban provide instructions for production the production line will process by
using materials fill the instructions indicated on the Kanban.

34
Financial Management
FacultyName:____________________________________
Sign:________________________
Date: ______________________

35
Toyata Pvt. Ltd.
Profit & loss A/c as per 31, march 2016
Parameter MAR'16
(₹ Cr.)
MAR'15
(₹ Cr.)
%
Gross Sales 65,262.80 55,133.60 18.37%
Less :Inter divisional transfers 0.00 0.00
Less: Sales Returns 0.00 0.00
Less: Excise 7,516.50 5,163.00 45.58%
Net Sales 57,746.30 49,970.60 15.56%
EXPENDITURE:
Increase/Decrease in Stock 6.90 -455.90 101.51%
Raw Materials Consumed 38,833.30 35,533.00 9.29%
Power & Fuel Cost 692.60 712.30 -2.77%
Employee Cost 1,988.70 1,606.60 23.78%
Other Manufacturing Expenses 3,731.40 3,030.60 23.12%
General and Administration Expenses 186.20 157.50 18.22%
Selling and Distribution Expenses 1,862.50 1,462.80 27.32%
Miscellaneous Expenses 1,526.40 1,279.90 19.26%
Expenses Capitalised 0.00 0.00
Total Expenditure 48,828.00 43,326.80 12.70%
PBIDT (Excl OI) 8,918.30 6,643.80 34.23%
Other Income 522.10 900.70 -42.03%
Operating Profit 9,440.40 7,544.50 25.13%
Interest 81.50 206.00 -60.44%
PBDT 9,358.90 7,338.50 27.53%
Depreciation 2,823.90 2,470.30 14.31%
Profit Before Taxation & Exceptional Items 6,535.00 4,868.20 34.24%

36
Exceptional Income / Expenses 0.00 0.00
Profit Before Tax 6,535.00 4,868.20 34.24%
Provision for Tax 1,963.60 1,157.00 69.71%
PAT 4,571.40 3,711.20 23.18%
Extraordinary Items 0.00 0.00
Adj to Profit After Tax 0.00 -79.20 100.00%
Profit Balance B/F 19,736.80 17,384.90 13.53%
Appropriations 24,308.20 21,016.90 15.66%
Equity Dividend (%) 700.00 500.00 40.00%
Earnings Per Share (in ₹) 151.37 122.89 23.18%
Book Value (in ₹) 894.28 784.91 13.93%

37
Toyata Pvt. Ltd.
Balance sheet as per 31, march 2016
Particulars Note
No.
As at 31,
march 2016
(rs. in cr.)
As at 31,
march 2015
(rs. in cr.)
(A) Equity and Liablities
1. share holder funds
Share capital 151.00 151.00
Reserves and Surplus 26,856.10 23,553.20
(B) Non-current liabilities
a) Long-term provision 302.00 292.60
b) Deferrend liabilities charges 474.10 481.00
c) Other liablities 122.40 105.40
Total Non-current liabilities 898.50 1,023.80
(C) Current liabilities
a) Short-term provision 12,762.30 10,378.30
b) Short Term Borrowings 77.40 35.40
c) Account payables 7,013.30 5,418.10
d) Other Current liablities 2,364.80 2,007.40
Total currunt liabilities 22,217.80 17,839.20
TOTAL 50,123.40 42,567.20

38
pParticulars Particulars Note
No.
As at 31,
march 2016
(rs. in cr.)
As at 31,
march 2015
(rs. in cr.)
B) Assets
Non-current Assets
Gross Block 29,409.20 26,461.70
Less: Accumulated Depreciation 16,641.40 14,202.40
Net Block 12,767.80 12,259.30
Capital Work in Progress 1,006.90 1,882.80
Non Current Investments 16,912.70 9,817.60
Long Term Loans & Advances 1,349.70 1,349.30
Other Non Current Assets 9.00 14.10
Total 32,046.10 25,353.10
2) Current asstes
Inventories 3,132.10 2,685.90
Sundry Debtors 1298.40 1069.70
Cash and cash equivalent 39.10 18.30
Short-term investment 873.00 2996.40
Other current asstes 250.20 253.00
Short Term Loans and Advances 12,484.30 10,190.70
TOTAL 50,123.40 42,567.20

39
Working capital statement
particular Amount
(rs. in cr.)
Current assets
a) Inventory 3,132.10
b) Sundry Debtors 1,298.60
c) Short-term loans and advances 12,484.30
d) Short term investment 873.00
e) Other current assets 250.20
f) Cash 39.10
TOTAL (A) 18,077.30
Current liabilities
a) Account payable 7,013.30
b) Short term debt 12,762.30
c) Other current liabilities 2,364.80
d) Short Term Borrowings 77.40
TOTAL (B) 22,217.80
Working capital (A-B) (4,140.5)
Interpretation:- current liabilities is more than current assets (4,140.5)which
means negative working capital shows business is able to pay off its short-
term liabilities.
Operating cycle:
A) Inventory period : Average inventory * 365
Annual cogs
: 3132.10 + 2685.90
2 *365
48,828.00
: 2909 *365
48,828.00

40
ANSWER : 21.74 days
B) Account receivable : average account receivable *365
Sales
1 : 1,298.60 + 1,069.80
2 *365
57,746.30
: 1184.2 *365
57,746.30
ANSWER : 7.48
C) Account payable period : average account payable *365
Cogs
: 7,013.30 + 5,418.10
2 *365
48,828.00
: 6215.7 *365
48,828.00
ANSWER : 46.46
Operating cycle: inventory period + Account receivable
: 21.74 + 7.48
: 29.22 days
Cash cycle : operating cycle - average payable period
: 29.22 – 46.46
: (17.24) days

41
 Leverage analysis:
Particular Amt ($)
Sales 20,00,000
(-) variable cost 5,00,000
Contribution 15,00,000
(-) fixed cost 3,50,000
EBIT 11,50,000
(-) Interest 50,000
EBT 11,00,000
Operating leverage : Contribution
EBT
: 15,00,000
11,00,000
: 1.36
Interpret:-
If the sales of the company increase or decrease by 1 time their EBIT will
increase by 1.36 times.
Finishing leverage : EBIT
EBT
: 11,50,000
11,00,000
: 1.04 times

42
Interpret:-
If numerator (EBIT) is increase or decrease by 1 time then denominator (EBT)
will increase by 1.04 times.
Combine leavrege : contribution
EBT
: 15,00,000
11,00,000
: 1.36
Interpret:-
If the sales increase by 1% then also contribution increased by 1% because
sales and contribution both are in same direction.
If contribution increase or decrease by time EBT will going to increase or
decrease by 1.36 times.

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