Essay on Toyota Supply Chain

2804 Words 12 Pages
The business environment is increasingly becoming competitive and challenging. In the recent past, manufacturers have found themselves facing the threat of dwindling profit margins due to unfortunate global events such as the 2007 global financial crisis and the on going Europe economic crisis. The need to improve operation efficiency so as to ensure current and future investment yield the highest rate of return has therefore become extremely important. Manufacturers are now actively engaged in, managing their costs, Research and Development, adopting best procurement strategies, among other Actions. While such actions might eventually lead to positive results, additional business value can be achieved through proper
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It is therefore important to analyze and evaluate this organization’s supply chain and thus provide recommendation for the way forward (Krivda 2004; Aqua Management Consulting Group 2009).
Toyota Supply Chain Management
For years Toyota has been considered to be having a lean supply chain. In fact in 1990 after the successful completion of Massachusetts Institute of Technology study that painted a deemed picture of the effectiveness of mass production in enabling manufacturers achieve competitive advantage, lean production system, which what the study advocated for, was also referred to as Toyota production system(Sezen & Erdoragan 2009; Teresko 2001). Companies that have rushed to replicate Toyota’s lean production system have quickly realized that lean thinking cannot be sufficiently effective if it is only incorporate in the production stage. It has to be extended to be incorporated in the whole supply chain network, as it has been the case in Toyota. By doing so not only will the product meet consumers specification and desires, but also the manufacturer will attain his/her goal of identifying and eliminating waste (in terms of time, effort and materials) in each step of the production (Sezen & Erdoragan 2009 ; Jung, Chen & Jeong 2007).
This can only be achieved when the whole supply chain is treated as uniform entity, encouraging the sharing of

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