丰田需求供应链管理案例分析

丰田需求供应链管理案例分析GLOBALSUPPLYCHAINMANAGEMENTFORUMCASE:GS-42DATE:3/18/2005ThiscasewaspreparedbyHauLee,BarchiPelegandSeungjinWhangasthebasisforclassdiscussionratherthantoillustrateeithereffectiveorineffectivehandlingofanadministrativesituation.TheauthorsgratefullyacknowledgethesupportofToyotaincarryingoutthisstudy.Copyright©2005bytheBoardofTrusteesoftheLelandStanfordJuniorUniversity.Allrightsreserved.Toordercopiesorrequestpermissiontoreproducematerials,e-mailtheCaseWritingOfficeat:gsbcwo@gsb.stanford.eduorwrite:CaseWritingOffice,StanfordGraduateSchoolofBusiness,518MemorialWay,StanfordUniversity,Stanford,CA94305-5015.Nopartofthispublicationmaybereproduced,storedinaretrievalsystem,usedinaspreadsheet,ortransmittedinanyformorbyanymeans––electronic,mechanical,photocopying,recording,orotherwise––withoutthepermissionoftheStanfordGraduateSchoolofBusiness.TOYOTA:DEMANDCHAINMANAGEMENTINTRODUCTIONTheToyotaMotorCo.Ltd(Toyota)wasfirstestablishedin1937byKiichiroToyodaasaspin-offfromToyodaAutomaticLoomWorks,oneoftheworld’sleadingmanufacturersofweavingmachinery.TheToyodaAutomaticLoomWorkswasestablishedbyJapan’s“KingofInventors,”SakichiToyoda,whowasKiichiro’sfather.Theseed-moneyforthedevelopmentandtestbuildingofToyota'sfirstautomobileswasobtainedbysellingtoPlattBrothers(U.K.)thepatentrightstooneofSakichiToyoda’smachines.In1950thecompanyexperienceditsoneandonlystrike,fromwhichbothlaborandmanagementemergedfirmlycommittedtotheprinciplesofmutualtrustanddependence.Thiscorporatephilosophycontinuestoguidethecompany’sgrowth,sowhileToyotaemployeesareunionized,thetwopartiesmaintainagoodrelationship.Infact,ToyotaMotorSales(TMS)U.S.usestheterm“associates”inplaceof“employees,”toemphasizetherespectforindividualsthatthecompanychampions.Inthelate1950sToyota’sproductionsystemswereimproved,culminatingintheestablishmentofthe‘ToyotaProductionSystem’(TPS)byTaichiOhno,asystemthathasbecomethebasisforhighlyefficient“lean”manufacturinginindustriesworldwide.BasedontheprinciplesofJidoka(automationwithastopsystemwhenthemachinefindsdefects),Just-in-Time(throughthetoolofKanban)andKaizen(continuousimprovement),thesystemisamajorfactorinthereductionofinventoriesanddefectsintheplantsofToyotaanditssuppliers,anditunderpinsallthecompany’soperationsacrosstheworld.Toyotalauncheditsfirstsmallcar(ModelSA)in1947.ProductionofvehiclesoutsideJapanbeganin1959atasmallplantinBrazil,andcontinuedwithagrowingnetworkofoverseasplants.Toyotabelievesinlocalizingitsoperationstoprovidecustomerswiththeproductstheyneed,wherevertheyneedthem.Thisphilosophybuildsmutuallybeneficiallong-termrelationshipswithlocalsuppliersandhelpsthecompanyfulfillitscommitmentstolocallabor.AsofMarch2002,besidesitsown12plantsand11manufacturingsubsidiariesandaffiliatesinJapan,Toyotahas45manufacturingcompaniesin26countriesandregions,whichproduceLexus-andToyota-brandvehiclesandcomponents(Exhibit1),employs264,100peopleworldwide(onaconsolidatedbasis),andmarketsvehiclesinmorethan160countriesandregions.Besidesmanufacturing,Toyotaalsohasaglobalnetworkofdesign,researchanddevelopmentfacilities,embracingthethreemajorcarmarketsofJapan,NorthAmericaandEurope.By2004,Toyotawastheworld'ssecondlargestmanufacturerofautomobiles,withcombinedsalesof6.78millionunitsinthe2003calendaryear(Exhibit2),andbyfarthelargestJapaneseautomotivemanufacturer(Exhibit3).Theirtargetistoreach15percentmarketshareworldwidebythe2010s,withanannualsaleslevelof9millionvehicles.Togetherwithitssubsidiaries,Toyotaproducesafullrangeofmodelofferings!frommini-vehiclestolargetrucks.Automotivebusiness,includingsalesfinancing,accountsformorethan90percentofthecompany’stotalsales,whichcametoaconsolidated¥15.5trillioninthefiscalyeartoMarch2003(Exhibit4).Toyotaalsohasagrowingportfolioofdiversifiedoperations,withventuresintelecommunications,prefabricatedhousingandleisureboats.Overseas,ToyotasoldmorevehiclesthaneverinNorthAmerica,reaching2.07millionunitsin2003.Europeansalesreached834,700units,alsoarecord(seeExhibit5).DOMESTICDISTRIBUTIONToyotaisJapan’smarketleaderwith42.6percentmarketshare(excludingmini-vehicles)in2003.Itfacestwoarchrivals!Nissan(marketshare19.4percent)andHonda(11.9percent)(seeExhibit6-7).Toyotaisanindependentcompany,notpartofabusinessgroup(orkeiretsu).Thishasledtoadifferentcompanymission,aswellasadifferentapproachtochannelstrategy,comparedwiththeothercarmanufacturers.Forexample,ToyotainJapanlistenscloselytotheopinionsofitsdealersandoffersawiderlineofproductsinJapan,mostlybuildingonordersfromdealers.DistributionChannelsInJapan,(asofMay2004)Toyota’ssalesandmarketingworkisdividedintofourdistributionchannels1:Toyota(mostlyhigh-end,largecars),Toyopet(mediumsize),ToyotaCorolla(compact),andNetzToyota(compact).Overall,Toyotaoffersabout60carmodels,witheachchannelofferingonly15-25models.Thisway,eachdealercandevelopdeepknowledgeofallmodelshehasforsale,andcanmakeanefforttosellallcarmodelsassignedtohim,ratherthanonlythefewmostprofitableones.About50percentofcarmodelsaresoldasexclusivemodelsforasinglechannel.Thechannelsandcarmodelswereintroducedovertime,asToyotaexpandedthemarketbymoregranularsegmentation.TheToyotadealersasawholehaveapproximately5,000outletsand120,000employees.Altogether,Toyotahas295dealerships,eachwithanaverageof16to17outlets.1AchannelatToyotameansadealernetworkthatsellsacertainsetofcarmodels.Inthatsense,itissimilartothebrand(likeCadillac,Oldsmobile,etc)atGeneralMotors,butthedifferencesarethatallchannelssharethesamebrandToyota,andthatsomemodelofferingsareoverlappedatmultiplechannels.ToyotaplanstoselltheLexusBrandinJapaninthesummerof2005.Inadditiontothefourmajordistributionchannels,Toyotahastwosmallchannels:VolkswagenandRental.TheVolkswagenchannelwassetupbyToyotaaspartoftheeffortsbytheJapanesegovernmenttoshowthattheJapanesedistributionmarketisnotclosedtoforeigncars.ToyotahandlesthephysicaldistributionandordermanagementofVolkswagentotheirdealers,actinglikeadistributor.Toyotaappliesthe“ToyotaWay”tomanagedealers,basedonthreebasicprinciples:1.Independenceofdealersasoutsideinvestors:Dealersarefreetomakeindependentdecisions,andToyotacanonlyhelpthemtoinvestintherightthingstoimprove.Suchastrategymotivatesdealerstobemoreproactive.2.Winningjointly:BoththedealersandToyotamustprosperjointly.3.Encouragingcompetitionamongthechannels:Competitionisameanstoimprove.Toyotameasurestheperformanceofdealersperiodically,usingbotharankingsystemandarecognitionsystem.Thedimensionsofevaluationinclude:1.Salesofnewandusedcars(unitsandmarketshare)2.Salesfromafter-salesservice(unitsandmarketshare)3.Customersatisfaction4.Numberofshowrooms,serviceshopsandstaff5.ProfitabilityCriteria1and2aboveconstitutearound50percentoftheweightintheevaluation.Thenormalcontracttermswithdealersisthreeyears.Dealerswhoperformedpoorlyintheaboveevaluationaregivenaone-yearcontractterm.Afterthisoneyear,ifthedealercontinuestoperformpoorly,thenthedealermaybeaskedtoreducetheprimarymarketingareaitisresponsiblefor;oranotherdealercouldbeaddedontothissameprimarymarketingarea.ThesedealershavetosubmitplansforimprovementstobeevaluatedbyToyota.Sofar,nodealershavebeenterminatedduetocontinualpoorperformance.TheToyotaNationalDealersAdvisoryCouncil,madeupofToyotadealersnationwide,existsasanadvisorygrouptointerfacewithTMCandtofosterdealerfriendship.Dealersareencouragedtoinvestinimprovingtheirshowroomsandfacilities.Dealershaveinvestedatotalof¥80billionannuallyforsuchimprovements,excludingadvertisingbudgets.AdvertisingisplannedbythedealersandToyota.Toyotaisprimarilyresponsibleforproduct-leveladvertisingtocreateandpromotebrandimage,whiledealersareresponsibleforlocalsalescampaigns.Themaincompetitionamongdealersinvolvesafter-salesserviceandcustomerhandling.DomesticVehicleOrderingandInventoryManagementSystemInJapan,thecustomerorderprocessrunslikeapullprocess,withcustomersplacingorderswiththedealers,whothentransfertheordersontoToyota.Itisnotapurepullprocess,asdealers!thelargeronesinparticular!alsogetstocksbasedonforecast,sothattheycouldservetheircustomersbetterwithshorterresponsetime.Inthelattercasethedeliveredcarsarestockedatastockingpointwherethedealerscaninspectandinstalloptionswhentheactualcustomerordersarrive.Overall,Toyotadealershaveaboutonemonth’sworthofinventoryattheirlots,which,duetohighrealestatecost,areusuallylocatedseparatelyfromtheshowroomsatremotesuburbanareas.Attheendoftheyear,theleftoverinventoryatthedealersisusuallysoldthroughtheusedcarchannel,orthroughspecialsalespromotions.ThemagnitudeofsuchsalesismuchsmallerthanintheU.S.,duetotheprimarilypull-basedcustomerordermodel.Similarly,whileToyotaaimstobasealldomesticproductionondealerorcustomerorders(thatis,abuild-to-orderprocess),inrealitysomecarsarebuilttostock(BTS).TheToyotaSalesandMarketingorganizationpreparesorderplansbasedonforecastsandtransmitsthemtoToyotaproduction.Toyotamanagesthisprocessverytightly,andeverymonthadjuststheplantoensurethatattheendoftheyearthereisminimalfinishedgoodsinventory(FGI).Indeed,therecordshowsthattheyhavedonethisverywell.Attheendofamonth,theyusuallyhaveabout5,000carsofinventory,whichamountsto3percentoftheirmonthlysalesvolume.Thisisequivalenttojustbelowonedayofsupply,whichisquiteremarkable.ToyotawouldoftenasktheirdealerstotakeextrainventorytoreduceToyota’sinventoryposition.Thereisnoexplicitincentivegiventothedealersforthatfavor,butitisunderstoodaspartofthecultureandpartnershipbetweenthetwoparties.Intimesofshortages,aswasthecasewiththenewPriusmodel,Toyotawoulddosomeallocationofcarstothedealers,basedontheordersizesbythedealers.This,ofcourse,couldpotentiallyleadtogamingbehaviors,wheredealerswouldexaggeratetheirordersinordertogetbetterallocation.Inpractice,however,thisrarelyhappens,asToyotamakesitclearthatiftheyfindoutthatadealerhadexaggerated,thatdealerwouldgetzeroallocation.ThetrustingrelationshipbetweenToyotaanddealersalsoseemtomitigateoreliminatethebullwhipphenomenon2.Theorderingprocessoperatesinthreeplanningcycles!monthly,weeklyanddaily.(a)MonthlyPlanningThemonthlyplanningstartsonemonthinadvanceofproduction,whentheSalesdivisionconductsmarketanalysisandorder/salesplanningtodeterminetotalproductionvolumeforthenextmonth.Basedonthisinformation,theSalesandProductiondivisionsproduceapreliminaryproductionplanforthenextthreemonthsbyseries,engine,bodytype,andmajorfunctions.Theplancoversglobalmarketsandglobalcapacity,andservesasanestimateofproductionrequirementstosecurecapacity.Thispreliminaryplanislaterupdatedbasedonmonthlyproductionorderplanssubmittedbythedealers,andaCapacityStudyconductedateachoftheassemblyplants.Oneweeklater,theSalesandProductiondivisionsdeterminetheallocationbetweendomesticandoverseassales,andconductaProductionMeetingtosetmoredetailedproductionplansforthenextthreemonths.TheseplansareusedbytheSalesdivisiontofixmonthlyvolumeandspecforecast,andtodeterminethequotaperdealer.Attheendofthatweek,theSalesdivisionprovidesdealerswithorder“guides”fortheirweeklyorders.2Thebullwhipphenomenonisoneinwhichdealersexaggeratestheirordersanddistortsthedemandpatternthattheyactuallyexperiencedintheirsales.Therearemanycausestothisphenomenon,anddealergamingtogetbetterallocationisoneofthem.Atthebeginningofthefollowingweek,dealersstartplacingbulkordersforproducttype.Inparallel,ProductionDivisionateachsitedeterminesthemonthlyproductionplanandworkswithitssupplierstopreparetherequiredpartsforthenextthreemonths(actualordersarebasedonaKanbansystem).(b)WeeklyCycleEveryTuesday,dealersplacetheirweeklyorderswithToyotainfullcarspecs,withtheorderforthefirstweekofthemonthbeingplacedsevenworkingdaysbeforethebeginningofthemonth.Onceordersarereceived,theSalesdivisionmakesadjustmentsbetweenthemonthlyplanandactualweeklyorders.Basedoncapacityavailability,theyprepareanestimateddeliveryschedule,andnotifydealersaccordingly.ProductionDivisionreceivesaweeklytemporaryproductionschedule.(c)DailyCycleUptothreedayspriortoactualproduction,dealerscanchangetheorderspecaspartoftheonlinesystem.Nochangescanbemadeinthenumberofcarsorderedforeachenginetype,butwithinenginetype,colorsandoptionscanbechangedforupto20percent.However,Toyotadoesnotguaranteethatallchangeswillbemet.Ittakesonaverage20daysforanend-customertogetthecarfromthetimetheorderisplaced.Theorderlead-timefromToyotatothedealersis15days.Only10daysoutofthislead-timeareduetoproductionanddelivery.Theother10daysareattributedtolegalpaperwork(registration).Additionaltime(about10additionaldays)isrequiredatthebeginningoftheprocess,beforetheorderisplaced,forloananalysis.Monthlyforecastiscommunicatedtothesuppliersbeforehand,tomakeiteasierforthemtopreparetheirorders.Iftherearelargedeviationsfromtheoriginalplan,theywillbeadjustedaspartofthemonthlyplanningcycle.Suchfluctuationsaremostlikelytohappen,forexample,immediatelyfollowingthelaunchofanewmodel.Orderlevelsaredistributedmoreorlessevenlythroughoutthemonth,andthereisnospikeindemandtowardstheendofthemonth.OVERSEASDISTRIBUTIONOverseasDistributionOrganizationandMarketsToyotaworkswithonedistributorineachcountry.IntheUnitedStatesexceptHawaii,TMSservesasthedistributor.TheU.S.markethasabout1,200dealersandisdividedinto12regions,witheachregionsubdividedintomultiple“districts”sothateachdistricthas10to15dealers.Forhistoricreasons,twoU.S.ToyotaregionsareprivatelyandindependentlyownedbySoutheastToyotaDistributors,LLC(coveringFlorida,CarolinaandAlabama,etc.)andGulfStatesToyota(coveringTexas,Louisiana,etc.).BetweentheToyotaowned/privateregionsandToyotaMotorSales,transferpricesaresetaswellasmarketingfees,partscosts,anddeliveryfees,etc.Oneregioncovers70to130dealersinmultiplestatesexceptCalifornia,whichiscoveredbytworegionaloffices.Inparticular,theSoutheastToyotaregionisthelargest,selling20,000vehiclespermonththrough166dealers.Eachregionalofficeisresponsibleforcoordinatingwithandmonitoringthedealers.Toyotadecideswhichmodelstosellandtheirrespectivepricesineachcountry,basedonmarketresearchfromdistributorsandresearchcompanies,taxesandtheexchangerate.Carsofferedindifferentcountrieshavedifferentspecifications,e.g.,whetherABSisastandardornot).InKoreatheydidnotintroduceanyToyotacarsbecauseofstiffcompetitionwithKoreanbrandsofferingcheaperproductsandservices.However,LexusissuccessfullymarketedinKoreatofillthegapinthehighendofthecarmarket.Toyotamarketscarsinabout170countriesthroughitsoverseasnetworkconsistingofmorethan160importers/distributorsandnumerousdealers.Overall,Chinaisthehighest-growthmarket.Thisyearthetotalsizeofthesalesisaboutevenlydividedamongthreeregions!Japan,NorthAmerica,andtheremainingregions.LocalProductionToyota’sbasicstrategyistoproducethevehicleswheredemandis.Forexample,ToyotaproducesCorolla/MatrixfortheNorth-AmericamarketataplantinCanada.ButsomeunitsmaystillcomefromJapan,dependingontherequiredvolume.LocalproductionprovidesseveralbenefitstoToyota.Forexample,itofferssomestabilityagainstfluctuationsofcurrencyexchangerates,andahigherdegreeofspeedandflexibilityindistribution.Asvolumeincreases,Toyotaalsopreferstohaveitsproductsmorecloselyharmonizedwiththecustomers.Toyotaseesbenefitsinbeingrecognizedasalocalorganizationineachregion.However,suchstrategyisnotalwaysfeasible.Toyotamustfirstverifytheavailabilityofsuppliersthatcanprovidetherequiredquality,volume,lead-time,andcost.Politicalissuesalsohavetobetakenintoconsideration.Ingeneral,whilesomepartsaredeliveredtothetransplantsfromlocalsuppliers,otherparts!especiallythemoreimportantonessuchasengines,areimportedfromJapan..Attheendof2002,Toyotahadatotalof45overseasmanufacturingcompaniesin26countries/regions.NorthAmericanplantsinclude:"Indiana,whichassemblesSienna,Tundrapickups,Sequoia(SUV)"OntarioCanada,whichnowassemblesRX330,Corolla,andMatrix"NewUnitedMotorManufacturingInc.(NUMMI),inCalifornia,whichassemblesCorollaandTacoma(smallpickups)"WestVirginia,whichproducesenginesandtransmissions"GeorgetownKentucky,whichassemblesCamry,AvalonandSolara.EuropeanplantsarelocatedintheU.K.(Avensis,Corolla),France(Yaris),andTurkey(Corolla).LargercarsareshippedfromJapan,sincetheirrelativelysmallvolumedoesnotjustifylocalmanufacturing.InChina,Toyotahasajointventurewithalocalcompanyforoneassemblyplant,foronemodel.AjointventurewasrequiredduetoChinesegovernmentrestrictions..OtherAsianassemblyplantsarelocatedinThailand,Indonesia,Philippines,Malaysia,Taiwan,Vietnam,India,aswellasPakistan.ForU.S.distribution,eachmodelisusuallyproducedinonlyonelocation(eitherJapanorlocalproduction),exceptforCamry,Corolla,RX,andYaristhataremadeinJapanandtheU.S.and/orEurope.Forthesemodels,themonthlydecisiononthequantitiestobuildineachlocationismadeduringtheProductionMeeting,whichtakesplace12workingdaysbeforethebeginningofeachmonth.Thesedecisionsareflexiblymadewhiletakingintoconsiderationtheannualplan,whichdeterminesoverallthenumberofunitstobeproducedineachlocation.JapaneseplantsaremoreflexiblethanU.S.plants,sincemostassemblyplantsarelocatedinToyotaCity,whichmeansthatemployeescanbemovedfromoneplanttoanotherifdemandshiftsfromonemodeltoanother.IntheU.S.sucharrangementisnotfeasible,andbuildingaflexiblelinethatcanassembledifferentcarmodelsismoreexpensive.Exhibit8showsthemarketshareandproductionlevelsacrossthemajordifferentregions.OverseasPlanningCyclesToyotaoperatestwoplanningcycles–annuallyandmonthly.Thisisinadditiontoitsstrategicplanningthatspans3to10yearsintothefuture,whichinvolvesinvestmentincapacity,partsandtooling.AnnualPlanTheannualplanningprocessstartsinOctober,wheneachcountrypresentsthree-yearsalesplansandproductionrequeststoTMC.Theplangivesthequantitiesofeachseriesathigh-levelspecs(enginesandbodytypes),aswellascomplexcars.InDecember,aproductionplaniscreatedbasedonproductionrequests,togetherwithsupportingsub-plans(suchasmaterialsandlogisticsrequirements).ThisplanisrevisitedinJuneofthefollowingyeartoseeifadjustmentsarenecessary.MonthlyCycleActualsalesareoftensubjecttointernalandexternalevents,suchastheintroductionofanewcarbyacompetitor,orthegreater-than-expectedsuccessofaproductinthemarketplace,e.g.,theIndiana-builtSiennamodel.Consequently,theyearlyplanisrevisedonamonthlybasis.BasedontheProductionMeeting,domestic(Japan)ordersaredeterminedintwosteps!DomesticSalesDivisiononlyfixesmonthlyvolume(permodel)andspecforecast,anddealersdeterminetheexactspeclaterintheweeklyorder.Fortheoverseasmarket,thetotalvolumeandfull-specplanforthefollowingmonthisfrozenattheProductionMeeting.Oncedistributorsgivethree-monthforecastsbasedontheirownestimatesanddealerinput,theyhavelimitedflexibilitytochangetheirorders.Intheweeklyupdates,distributorsareonlyallowedtomakebetween10-20percentchangesinthespecs.Theycannotmakeanychangestothequantity.Nodailychangesareallowed.Althoughtheycanchangethequantityonamonthlybasis,Toyotamaysometimesaskthemtotakemorethantheyhaverequested.ThedetailsofthemonthlyplanningprocessatTMSareasfollows.Consideramonthinwhichproductionistotakeplace.Onemonthpriortothismonth,DistributionOperationDepartment(DOD)aggregatesregionalinputstodevelopfinalorderrequests.DODthensendsthethree-month-aheadproductionrequests,calledPPR(pre-productionrequest)toOPD(OverseasPlanningDepartment)#PPR1,PPR2,andPPR3.PPR1isdefinedinfullspec#series,modelsandcolor.Then,OPDbuildsaproductionplan(volumeperline)andsendsittotheU.S.DODalsorunsareaallocation,basedonhistoricalsales,currentandfuturepipelinebalance,anddealerorders.Theallocationrule,especiallyincasesofshortage,aimsatmaximizingfairnessamongregions.Inparticular,verifiedperformancebecomesamainbasisoftherule.Giventheallocation,eachregiongainsdealerinputthroughmonthlymeetings.FinishedvehiclesareshippedfromJapantotheU.S.viafourportsintwolines.TheWestlinegoestoPortland(coveringtheMidwestuptoOhiobyrail)andLongBeach(coveringCalifornia,Oklahoma,Nevada,andwestofMississippi).TheEastlinepassesthePanamaCanalandstopsatJacksonville,Florida(forSETandLexusSouth)andNewYork(coveringtheNE).Theshippinglead-timeis11to14daysforWest,andonemonthforEast.Heijunka(smoothingorbalancing)iscontinuouslyappliedtoshipping,sothatshippingequipmentremainsutilizedatanefficientlevelthroughouttheyear.Giventheirconfirmedbuildscheduleandvesselloadinginformation,regionsrunthedealerallocation,basedonperformanceanddealerinput(viamonthlymeetings).Dealerscanexpressitem-levelpreferences,butthereisnoguaranteethattheywouldgetthemastheywant.DealerscantracktheirallocatedordersthroughtheonlinesystemcalledDealerDaily.TheycanseetheVIN(VehicleI