Principles of Logistic Management: A Case Study of Toyota Motors

Principles of Logistic Management
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Executive Summary
Logistics is a cornerstone of the business performance and productivity of an organization.
Logistics is helping the modern day business establishments to carry out their business
operations in a smooth manner and thus business establishments are eventually able to
successfully accomplish their business goals and objectives in the market. This assignment
would provide a detailed understanding about the diverse aspects of logistics management
and how it is eventually contributing towards the overall organizational growth and
productivity. For ensuring a thorough and detailed analysis of the importance of logistics
management in the modern day business, Toyota Motors has been selected as the case study
organization. This assignment has tried to shed light on how the process of logistic
management at Toyota Motors is eventually influencing the other business functionalities of
the organization such as manufacturing, marketing and accounting. The assignment has
provided a detailed explanation about the order cycle process that is presently being utilised
at Toyota Motors and how it is eventually helping the organization to foster customer
satisfaction and brand loyalty among their clients. Furthermore, the assignment also tries to
provide a detailed insight regarding how the process of inventory management is being
facilitated by the logistics management process at Toyota Motors. The assignment concludes
by providing a recommendation to Toyota Motors regarding how they could further increase
the efficiency of their logistics management process.
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Contents
Executive Summary...................................................................................................................2
Introduction................................................................................................................................4
The Interfaces.............................................................................................................................5
Order Cycle................................................................................................................................6
Inventory Management..............................................................................................................9
Conclusion................................................................................................................................11
Reference List..........................................................................................................................12
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Introduction
Logistics management is a very vital component of modern day business which help
organizations to conduct their business operations in a smooth and efficient manner. The
aspect of logistics management mainly deals with the effective maintenance and control of
the supply chain management functionalities which eventually helps the business
establishments to effectively cater to the existing market demand for their products and
service offerings (Christopher, 2016). By ensuring an efficient logistics management process,
business establishments are able create a balance between the market demand and supply for
their products.
Toyota Motor Corporation (usually referred to as Toyota Motors) is a Japanese multinational
car manufacturer that has their headquarters in Aicha, Japan. Toyota has replaced
Volkswagen Group as the largest global automobile manufacturer generating revenues to the
tune of $264 billion. The organization was founded in the year 1937 by Kiichiro Toyoda at
Toyota-shi and this company was created as a diversion from Toyoda Loom Works which
was established by the owner’s father Sakichi Toyoda (Monden, 2011). In the year 2012, the
company achieved the distinction of becoming the only global car manufacturer that had a
yearly production volume of more than 10 million vehicles, a feat which the company has
been able to continue till now (Jha, 2018). Toyota was the first company to introduce the
concept of lean manufacturing and production process which comprised of five main
principles – value, value stream, flow, pull and perfection. Toyota is presently the largest
listed company in Japan in terms of market capitalisation and its valuation is almost twice
that of the second listed company (Softbank).
Toyota considers innovation to be an inherent aspect of their organization as the company
continuously strives to incorporate the highest product quality standards in order top foster
brand loyalty and customer satisfaction in the market. According to the vision statement of
Toyota, the company intends to undertake a comprehensive approach towards emphasises on
the twin aspects of innovation and customer needs (Greenspan, 2017). This has enabled the
organization to achieve global success.
Logistics is a crucial component of the everyday business functionalities of Toyota and the
organization provides a lot of importance and emphasis towards maintaining an efficient
logistics management which has contributed tremendously towards their present growth and
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