Toyota 's Report On Inventory Management Essay

Toyota motor products include; Hybrid, Plug-in Hybrid, Cars, MPVS/Vans, SUVs, Fuel Cell and Commercials. The strategy Toyota uses for marketing is mostly to showcase its different range of vehicles to the market as they also get inspired through the same to manufacture better vehicles. With this method both the clientele and the company benefit from each other.

To be successful in today’s business environment, an organization must be able to perform certain fundamentals accurately and efficiently. One of these elements is having an effective and efficient Inventory System Management (ISM). ISM enables one to have the knowledge of where his or her inventory is at every step of the way. This allows one to better interact with consumer and make sales. Choosing the right ISM can lead and pave the ground work for future business success and profitability.

During the game, I realized that wide gaps in orders of every role in the supply chain such as factory, distributor and retailer create inventory management challenges. For example, distributor records 0units between week1-week 4 compared to retailer within the same period. The retailer records 3units, 5units, 2units and 2units between weeks 1- week 4. The same applies to factory with 0units from weeks 2-4. Addressing inventory management problems requires developing an average unit level to avoid disappointing customers when demand

Office Depot uses multiple inventory strategies to order products. 90% to 95% of goods are ordered through automatic replenishment, manual replenishment, pull replenishment, and global sourcing are also used depending on channel, volume, velocity and cost. (Office Depot, 2015). The accuracy of the inventory from both a DC and store perspective is critical to the organizations success. Heizer and Render (2014) state that record accuracy is a prerequisite to inventory management, production scheduling, and sales. Accuracy is maintained by either periodic or perpetual systems (p.479). In Office Depot, the stores are required to cycle-count technology items such as laptops, desktops computers, and tablets five days a week. Discrepancies are entered in the system and bounced off the local DC’s on-hand inventory discrepancies. Office Depot is a “blind receive” organization meaning the stores receive pallets of products and simply unwrap and put them away. The only way a store knows if a product is missing is through the cycle-count program. This system was put into place to speed up the receiving process and eliminate unnecessary steps once the product was received at the store level. Office Depot conducts a full physical inventory once a year through a third party and trues up the inventory shrink at this time.

The demand for cars is subject to strong fluctuations. During the year, sales tend to increase in spring and droop in winter. Most importantly,

Automobile industry of japan witnessed an awesome accomplishment with the growth of Toyota. It became the biggest maker in the worldwide business. Toyoda kiichiro was hesitant to invest in automobile sector. In the year 1933 the company started its production. In order to have cost efficiency they adopted the mass production technology.

Communication is the most important aspect of conducting business. Toyota must improve their means of communication and it must start at the beginning of the customer/supplier relationship. The Process Flow chart will identify the communication process between Toyota and supplier is further updated to show improved processes. Expectations should be established to ensure that suppliers are providing the quality products that represent the Toyota brand. Currently, Toyota has sacrificed quality and safety to meet the demands of the customers. Toyota must take into consideration the market they enter and the major players that exist to provide the support necessary. Toyota uses the Annual Purchasing Policy process to communicate their expectations to suppliers. “The purpose of supplier expectations is to highlight key priority activities and emphasize broader, more philosophical issues universal to all suppliers (ToyotaSupplier.com, 2012).” In addition, “individual expectations, on the other hand, are developed uniquely for each supplier and include specific targets in the key areas of quality, delivery, value improvement and minority sourcing (ToyotaSupplier.com,

Furthermore the U.S. market is now the target for most of the globe’s auto makers since the economy is steadily improving and consumers are much more inclined to replace or buy a new vehicle with the latest estimates for auto sales in 2014 expected to reach the 16 million vehicle range. However, finished goods inventories management is still a big problem and many automotive OEM’s such as GM are now considering even more investments in added capacity.

The problem faced by the company is they do not have any systematic system to record and keep their inventory data. It is difficult for the admin to record the inventory data quickly and safely because they only keep it in the logbook and not properly organized.

Inventory management has two very different, but effective methods: Vendor managed inventory, and consignment inventory. A company may choose to utilize either of these two methods to manage inventory. If a company is able to manage inventory, they will be better able to work the company's capital to the fullest extent. The following paper will identify the differences between the two as well as identify what type of company is best suited for each method.

Toyota Motor Manufacturing, U.S.A. (TMM) is deviating from the standard assembly line principle of jidoka in an attempt to avoid expenses incurred from stopping the production line for seat quality defects. This deviation has contributed to the inability to identify the root cause of the problem, which has led to decreased run ratios on the line and an excess of defective automobiles in the overflow lot for multiple days. If this problem isn’t fixed quickly, an increased amount of waste will continue to be incurred and customer value will be threatened.

Supply chain management (SCM) is a core part of organizational effectiveness in order to achieve goals characterizes efficiency. Globalization and international agreement led Toyota to develop it is SCM process to increase outsourcing supply raw materials from foreign market that are low cost and high quality.

In 2009 Toyota Motors (TM) posted a net loss of $4.6 billion ("Market watch," 2014). From 2009 to 2011 Toyota encountered a number of factors contributing to their economic downturn. It began with recalling millions of vehicles, for quality related problems, followed by natural disasters hitting northeastern Japan. These disasters wiped out Toyota’s production capabilities (Tabuchi & Vlasic, 2014). While these events were occurring, the cloud of the 2008 global financial crisis was still being felt. This crisis weakened demand in the automotive industry. This weakened demand increased the competitive landscape for all automotive manufactures. This drove down automotive prices and effectively contribution margins (i.e. sold less

One factor that adds to the success of Toyota’s supply chain is their relationship with their suppliers and how they do business with those suppliers. Toyota does not simply give their supply contracts to the highest bidder; instead they work incredibly closely with their suppliers so that they can get the highest quality products possible. Toyota uses long-term, just-in-time contracts with all of their suppliers (Winfield & Hay, 1997). Toyota does not engage in any kind of mutual contracts, such as buy-back or revenue-sharing; however, they do take multiple steps to ensure a mutual benefit when they pair up with a supplier. Toyota invests in their suppliers to help them develop products (Liker & Choi, 2004). They also ensure that they share information with their suppliers in a structured fashion. They believe that targeted information leads to results and they ensure that specific communication is relayed to their suppliers at set times and in set ways (Liker & Choi, 2004). Perhaps the most unique aspect of Toyota’s relationships with their suppliers is that they embark on joint improvement ventures together. They set up study groups with suppliers to help both parties learn how to improve operations and send executives and engineers to the supply plants to help them improve processes (Liker & Choi, 2004). These kinds of benefits are described in the contracts Toyota keeps with their suppliers (Toyota Supplier, 2011). The close relationships that

In March of 2011, northeastern Japan was struck by one of the largest earthquakes ever recorded. The magnitude 9 quake (Oskin, 2015) triggered a devastating tsunami, killing thousands, damaging the country’s infrastructure and paralyzing all private, public, and government entities. One of the businesses disrupted by the disaster was Nissan Motor Company LTD, a multinational auto manufacturer producing automobiles under the brand names of Nissan, Infiniti, and Datsun. This paper will discuss how Nissan’s quick-thinking Operations Management (OM) team responded to the crisis with rapid efficiency, helping it to capture a competitive advantage over other Japanese auto makers and succeed in its recovery from this monumental natural disaster.