Value Chain Analysis : Toyota Motor Corporation Essay

TOYOTA PRODUCTION SYSTEM (TPS) The TPS model depends on its Human Infrastructure. The entire model is base on its PEOPLE & TEAMWORK being successful in doing their job and there buy in to the Key Elements of the TPS culture, which are as follows;  Selection  Ringi decision making  Common Goals  Cross-Trained TPS emphasize the point of its human infrastructure as a “COMMON GOAL” for all personnel in the corporation, which again is emphasize that its employees are its greatest assets as shown by the

Overview: The Toyota Production System has long been hailed and admired as the source of Toyota’s outstanding performance as a manufacturer. TPS aims to eliminate waste, reduce defects and maximize flow. TPS aims to increase efficiency and productivity by employing a unique production system that cuts costs through continuous improvement. Long term goal is to yield sharp reductions in product development and manufacturing lead times. Toyota want to be the industry best and they stand behind their culture to share the wealth of how they do it.

BYD Auto creates value through a mix of various activities. In terms of technology, BYD Auto has been constantly focusing on technological innovation. First of all, 40% of the employees in BYD Co. Ltd engage in R&D activities, generating over 500 national patents annually. As its affiliate company, BYD Auto employs about 5,000 employees in its Automobile Research Center, 500 of which are specializing in car-use-battery development, and

In order for the strategy to be successful it should realistically assess the company’s internal resources. An internal analysis is used to identify the strengths of the company and identifies the weakness to overcome in the strategy. The internal analysis will help with understanding the internal issues that exist at StilSim by evaluating a value chain analysis, a resource analysis, core competencies and a stakeholder analysis.

Today, Toyota is the world's third largest manufacturer of automobiles in terms of both unit sales and net sales. It is also the largest Japanese automotive manufacturer, producing more than 5.5 million vehicles per year, equivalent to one every six seconds. See Appendix 1 for a list of its guiding principles. Appendix 2 depicts excerpts from the company’s 2000 annual report showing their main goals for that year. The company has 12 manufacturing plants in Japan and approximately 54 manufacturing companies in 27 countries throughout the world. These plants produce vehicles and components under the Lexus and Toyota brand names and employ about one quarter of a million people worldwide. In total Toyota vehicles are marketed and sold in more than 160 countries and regions with the automotive business, including sales and finance of the vehicles, accounting for more than 90% of the company's total sales. Appendix 3 shows worldwide sales and appendix 4 shows the models produced in North American Toyota plants. North Americanization of Toyota Since the late 1980’s Toyota had made several moves that showed their commitment to what management called the North Americanization of the company. The idea was to increase car sales in the lucrative North American market by also introducing manufacturing plants that produced parts and assembled whole vehicles for

Costco is among the leading global retailers which provide customers a wide range of merchandise, ranging from small to well-known brands. The company began operations in 1983. Over the years, Costco has been a retailer in low cost membership-only leader, in warehouse club of merchandise. Moreover, Costco does not offer frills warehouse business models as its competitors do.  Costco’s major competitors are BJ’s Wholesale Club and Sam Club (Costco, 2010).

Toyota Production System (TPS) on the other hand shifts their focus primarily towards employee empowerment engaging team members to optimize quality by constantly improving processes and eliminating unnecessary waste in all resources. Its main focus is to provide best quality, lowest cost, and shortest lead time through the elimination of waste. A drawback to this system is the high cost and the level of complexity to implement the method.

Value chain analysis looks at every step a business goes through, from raw materials to the eventual end-user. The goal is to deliver maximum value for the least possible total cost. It is a systematic approach to examining the development of competitive advantage. The most basic breakdown of primary functions includes inbound logistics, operations, outbound logistics, sales and marketing and service. People should use the other models and frameworks within this software to further differentiate between, and add to, these domains. Product Innovation is one area that is not normally included in the de jure model but is often included in the de facto model. Value Chain Analysis describes the activities that take place in

For more than 50 years, Toyota Motor Corporation has been one of the world’s leading manufacturers of motor vehicles in the United States. It was born a Japanese company in 1935 and came to America in 1957. Now headquartered in Toyota City, Japan, it employs more than 300 thousand employees globally (Toyota Motor Corporation Company Profile, 2012). In addition Toyota is a global marketing organization. It strategically operates primarily through Japan, Asia, Europe, and North America; but its vehicles are sold in more than 170 countries and regions across the globe (Toyota Motor Corporation Company Profile, 2012). The Toyota brand is traditionally defined by brand attributes such as global leadership, innovation,

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.

The main aspect of Toyota Company’s value chain analysis is the inbound logistics. Inbound logistics use JIT (Just-in-Time) system of production as it decreases the inventory cost. JIT helps Toyota to optimize their assembling and production process as well as to minimize parts going to waste or getting unused as inventory. Inbound logistics are the goods that the company receives from its suppliers and store for some period of time until the moment when they will be used in the production process. Toyota company does not have and is not able to create own raw materials that are needed for assembling of cars, thus it has to collaborate with a third party.

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

We will start the external analysis with the PESTEL analysis of the automotive sector followed by the Porter’s five forces analysis and we will end by having a look at the key competitors and competitor pricing.

main strategy for the North American market is to aim for higher sales, while raising the proportion of locally produced automobiles. Toyota Motor Corp have reached a stage where investments made over the last several years to expand production capacity are beginning to show returns and improved profitability can be expected. Toyota’s goal is to bolster local production through additional investment, and contribute to the regional economy by expanding its operations. At present, our production capacity in North America is approximately 1.25 million units (including our joint venture with GM). However, Toyota Motor Corp plan to boost this to 1.45 million units during 2003.

Within technology and the value system, this called for an emphasis on media relations to disseminate information to the local community and its leaders. Solid communication practices, i.e. strategic communications, was of the utmost importance to gain the respect and acceptance of the population.