Essay about Toyota Supply Chain Management

1569 Words 7 Pages

To begin I should define a core competency as this is related with the Supply Chain in my review, so first, what is a core competency? According to Fitzsimmons (2012), core competency is something that the company does so well that it provides the company a competitive advantage. Core competency gives the company hard-to-imitate advantage. One of the Toyota's core competencies is their production system which is known as Toyota Production System (TPS). This is consists of Lean manufacturing and Just-In-Time (JIT) Production. Lean Manufacturing is the production practice in which it is focusing on the elimination of waste and continuous improvement over long-term. Lean Manufacturing has been proven to be
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Therefore, it is obvious that Toyota is actually selling their “brand” name on their cars.
Nowadays, customers are expecting highest possible quality products with lowest possible costs. This gives pressure to the company to continuously improve and innovate. Failure to innovate will lead to the loss of market share to their competitors. Innovation manufacturing has been introduced by Toyota through its Toyota Production System (TPS). This is helpful for the improvement of the company system-wide process by linking the focal company, suppliers and customers in order to improve the quality and at the same time reducing costs. However, in order to survive in the future competition, Toyota should be able to exploit its core competencies. Network orientation which is part of the Lean Manufacturing principles can be exploited in the future through Early Supplier Involvement (ESI). For the company like Toyota in which they rely on few suppliers, getting the suppliers involved early is critical. Recent Toyota recall case occurred because of the poor communication between the Toyota and its suppliers. The gas pedal provided by CTS Corporation has been proven to be the primary factor leading to the recall issue. This is because CTS Corporation are only given a specification regarding the design of pedal by Toyota without getting CTS Corporation to be involved early in the development process. In the future, Toyota

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