Executive Summary When thinking of Toyota, the first thing that comes to mind is a good quality vehicle and the recent recall that affected a large amount of people. With just one set of recalls Toyota went from being a highly trusted brand to a brand that was questionable in terms of quality and regard for customers. Now that there are threats presented through the company itself, preparing best practices to be reinstated and revamped in addition to the new recommendations to help with the negative aspects, will be beneficial in the strategic plan for a fresh start. Lean initiatives have proven to be a success in Toyota thus far; benchmarking these initiatives against the optimal standards set forth by Taiichi Ohno in the early days of Toyota will keep their kaizen philosophy alive. Continuous improvement is what Toyota lives by and by constantly improving their lean initiatives through manufacturing and operations, such as the standardization of work and a continuous one-piece flow, Toyota will grow as a company. These lean strategies they have been implementing since the beginning will continually help in the increase in productivity, decrease in administrative costs, and in turn help the company be more profitable.
While Toyota is somewhat opposed to Six Sigma and does not fully utilize the methodologies that are presented. They are currently using a lean sigma approach that helps fit in with the culture. However, with the recent events, a recommendation of fully implementing six sigma to reduce defects and increase customer satisfaction has been suggested. Using the DMAIC cycle as well as the standard equation for defects per million opportunities, Toyota can save money on defects that will no longer happen to the magnitude that happened over the past year. There are ways to balance the use of six sigma and lean management to help Toyota implement both of these successfully. The following will illustrate which strategic supply chain goals are supported by the best practices in addition to the recommended improvements.
Introduction
In order to make a strategic supply chain plan successful, it is important that the goals and strategies set forth by the supply chain to be aligned with the corporate goals and strategies, no mater which company is being represented. The alignment of the supply chain’s goals and strategies with the overall business’ will allow the company to grow and improve as a whole, and make decisions that will not only impact the functional area, but will be beneficial to the whole company. By focusing on the best practices and keeping those up to date with the industry standards or a vision of a perfected practice, as well as changing certain areas to make improvements will give Toyota an advantage in accomplishing the alignment.
Best Practices
One of the reasons why Toyota has been successful as a company over the years is through the Toyota Production System, which was the starting point of lean management initiatives. Because the practices that Toyota perfected are the fundamental ideas used in lean, Toyota can use their vision of a lean supply chain as a way to benchmark their supply chain. Lean initiatives align perfectly with Toyota’s goals simply because they have been actively implementing these ideas since the very beginning stages of the company.
The Toyota Production System is all about one-piece flow and elimination of wastes. Lean management covers all of the principles outlined by Toyota and the way they do their business. The principles the company lives by are continuous improvement, respect for people, long-term philosophies, implementing the right processes to produce the desired results, adding value through people and partners, and continuously solving root problems to drive learning.
Toyota Motor Corporation was first established in 1935 when the A1 prototype passenger car was successfully created. Kiichiro Toyoda had an extremely entrepreneurial