Analyzing Toyota's Operations, Logistics, and Supply Chain Strategies

This report provides an in-depth analysis of Toyota's operations, logistics, and supply chain management. It begins with an introduction to operations and logistics management, followed by a company overview of Toyota, highlighting its global presence and financial services. The report then explores two key operational areas: location and layout, and logistics mix, detailing the integration of supply chain management. It examines relevant theories and concepts such as Total Quality Management (TQM), Six Sigma, and location theory, illustrating how these are applied within Toyota. A comparison with Hyundai's inventory management practices is also included. The report further discusses the impact of regional and agglomerative factors on Toyota's location strategies and the importance of layout design. It concludes by emphasizing the significance of these elements in achieving competitive advantages and fostering effective business operations. The report aims to provide insights into how Toyota leverages these strategies to enhance its overall performance and meet customer demands.

Understanding Operations,
Logistics and Supply Chain
Management

Table of Contents
Introduction to Operations Management and logistics management...............................................1
Introduction to the company............................................................................................................1
Two selected areas of Operation and supply chain management....................................................2
Corresponding theories and concepts (First choice)........................................................................2
Corresponding theories and concepts (Second choice)...................................................................4
Triple bottom line............................................................................................................................6
Recommendation.............................................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCE...................................................................................................................................9

Introduction to Operations Management and logistics management
Operation management refers to the business administration practices in order to develop
possibilities of higher level efficiency within the company. Along with it is the process of
controlling, designing and formulating the business operation during the manufacturing of
product and services. It manage entire production system in companies like labour, raw material,
energy etc. on the basis of this companies can get appropriate output and results in an effective
manner. Wherein, Supply chain management is a process of maintaining flow of goods and
services that mainly includes raw material storage, work in progress inventories or
transportation. Therefore, operation management consist different types of process design,
quality management, facilities, planning and production planning. With the help of this
organisations can analyse their present situation and find better solutions in order to improve
their effectiveness. On the other hand Logistics briefly explain about organisations and executes
on complicated operations (Christopher, 2016). Logistics generally known as the management of
various things between the starting and ending point to meet consumers wants and needs. It is
one of the best resource for companies which generally involves in machine, equipments,
materials, supplies and so on. In other words, logistics refers to the process of managing like how
resources can be used and stored as well as transported to their specified destination. The
management of logistics involves to analysing prospective allocator and suppliers or identifying
their accessibility or effectiveness in a proper way.
Introduction to the company
For this respective assignment Toyota has been selected as an organisation which is very
famous company across the globe because it has higher quality of manufactured cars and have
their business operations globally and this company has lots of valuable customers around the
world. It was formed in the year of 1937 by KIICHIRO Toyoda and it is headquartered in Toyota
city, AICHI, Japan. Instead of this Toyota also offer financial services by its own division that
named as Toyota Financial Services (Heizer, Render and Munson, 2017). Along with its provide
this service all over the world in order to achieve their target and satisfying customer's aspects.
Therefore, products of Toyota are very high on demand globally. On the basis of this good will
this company can increase their selling and production process to achieve their goals properly. In
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the current scenario this brand expand their business in different countries so that they can fulfil
customers demand and able to focus on their improvements.
Two selected areas of Operation and supply chain management
Their are 2 operational area in reference with Toyota, those are given below:
 Location and layout
 Logistic mix: networks, channels and managing capacity and inventory
Supply chain management is the combination of various activities which can be used
during the transforming of raw material into end goods. This approach also deals with different
products of Toyota by which respective company can meet consumers requirements and able to
fulfil their demand. Additionally, it includes in different processes like transportation, production
or shipping of appropriate products. It is based on suppliers efforts that how they can design and
develop new goods and services. Supply chain always used unique technologies for vehicles of
Toyota in order to gain higher profits. As compare to this automotive supply chains can be
difficult because various ideas comes from other suppliers or people that can make issues in the
industry (Hugos, 2018). Therefore, supply chain management is the best way to design new
vehicles and fulfil customers needs.
Corresponding theories and concepts (First choice)
Theories and concepts: There are two elements which are location and layout as well as
logistics mix. These two elements are associated with supply chain management which consist of
range of components which affect the overall performance in positive manner. In this context for
maintaining the quality of products and services managers can use various theories and concepts
which are going to be explained below. In the present context of managing inventory and
capacity some of the techniques are as follows:
TQM (Total Quality Management): It is a technique or model developed by William
Deming in order to provide guidance which will assist them in order to reduce defects and errors.
TQM is a continuous process used by management team of an organization in order to detect,
eliminate and reduce the errors from manufacturing. With the help of this technique, company
will be able to improve their quality and set a standard which will assist them in order to
manufacture goods and services (Ishikawa and Lu, 1985). In the present context of Toyota, it
has been examined that management team of the company adopt TQM so that they will be able
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to maintain and set the quality. While using distribution and communication channel it is
required by the managers to use effective techniques which will help them in order to enhance
their effectiveness (Xu and et. al., 2015). In addition to this, they use advertisement technique,
online marketing and other digital platforms in order to create awareness among customers
towards the product. On the other hand, in case of transportation it has been said that company
use effective techniques in order to transport products and services from one place to another.
Six Sigma: It is a statistical-based, disciplined and data driven approach which is used
for continuous improvement within the company. Six sigma refers to a methodology which
mainly focuses on eliminating and reducing defects while doing business processes in order to
attain their organizational goals and objectives. By using this technique, managers will be able to
identify defect in advance which will assist them in order to maintain their quality. Primary
objective behind using this technique is to attain goals sets by the management team of the
company in an effective manner. In the present context of Toyota, managers of the company
decides to adopt this technique which will assist them in order to detect their mistakes and errors
in advance (Meindl, 2016).
In reference to Toyota, managers of the company adopt both the theories within their
organization in order to maintain the quality of products and services offered by them. As per the
given scenario, a comparison between two companies deal in similar industry are Toyota and
Hyundai. It has been analyzed that management team of Hyundai use Just in Time technique in
order to maintain their inventories. According to this technique managers of the company mainly
order goods and raw material as per their requirements. This is one of the most effective tool
which help them in order to avoid over stock. With the help of this strategy, management team of
Hyundai reduce the overall cost and also helps in minimizing the risk which is associated with
the stock available at the store.
Along with this, management team of Hyundai kept the recorder alert which will assist
them in order to make them aware when the stock reaches at the lower level so that managers get
notified and refill their stocks according to the requirements. This as result assist them to make
sure that they do not forget to refill their stocks within given time frame. All these methods help
the management team of Hyundai in order to manage their inventories in an effective manner
and attain their goals and objectives within given time frame.
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Corresponding theories and concepts (Second choice)
In order to better understanding of location and layout there are different kinds of theories
and concepts by which company can achieve target in an effective manner.
Location:
It refers to the geographical area like terminal, container freight and seaport etc. that
offers various facilities and goods movements such as support device, customs and storage as
well. Along with for knowing this topic in detain Weber gave location theory in 1909 which was
established in the form of essay (Meindl, 2016). According to location theory there are some
factors that influence industries and divided in to 2 categories, those are listed below:
Regional factors: According to this factor Weber evaluate the appropriate cost structure
for different companies in which he concluded that production cost can be varies from region to
region therefore, industries should be present in a general way to get effective profit. As per the
Weber there are 2 general regional factor, given below:
Transportation cost: It is very essential part in the location of an organisation that
influenced through the weight to transported and distance to be covered. Therefore, Weber said
that company should use effective transportation cost to increase sales value.
Labour cost: It influence the location of industries because it is unfavourable in nature
and become more difficult. Therefore, company should be choose their location according to
workers to become more attractive in marketplace.
Agglomerative factor: As per this companies centralize within the appropriate place that
includes in different external economies, facilities etc. centralization influence manufacturing
cost into the total production.
Degglomerative factor: Those factors decentralize in the location of companies and
includes in labour cost, local cost of land, transportation cost etc.
In context of Toyota, they can get impact from those factors in both positive and negative
way (Nemet and Brand, Varcode Ltd, 2015). But on the behalf of these term they can make some
improvements in their working operations appropriately.
Criticism of Weber’s Theory:
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Inadequate analysis of transportation cost: According to this there are some factors
like goods quality and topography etc. which affect transportation cost. Therefore, Weber has not
able to give any criticism on this.
Omission of important reason of location: Weber has involves in only transportation
and labour cost towards the location cause. But there are some factor which influence location
like weather condition, capital cost and facilities.
Layout:
It refers to the master plan as well as blue print on a established work like newspaper,
book, websites and so on. Along with it is also known as the arrangements of various graphic
elements like colours, headlines and body as well. By this companies can achieve their goals in a
smooth way (Noe and et. al., 2017). There are some objective of this term, those are mentioned
beneath:
 It facilitates the overall manufacturing process.
 Layout always maintain high turnover within the process of inventory.
 It helps companies to effective use of men, equipments and space.
 It always give different kind of arrangements to company and provide better business
operations in a perfect way.
 Layout mainly based on the organisational structure and offer employees safety or
convenience.
 Layout reduces the time of production.
 It helps to reduce investment within the equipments.
According to this Toyota can make effective plan of their business by using different
kinds of layout at appropriate location. With the help of this they can develop proper trust on
customers in a perfect scenario. Therefore, location and layout are the most appropriate term in
business to gain competitive advantages in a perfect way (Rumane, 2017). If Toyota will use
these sort of factors in their business operations so that they can get effective feedback from
customers and able to execute on their new ideas for expansion of business.
In context with Toyota, managers always ready to adopt new things for making their
business process effective. According to them those theories are most useful by which they can
create effective culture in working place. As per the current scenario the comparison between 2
companies dealing in a same organisation that named as Toyota and Hyundai, it has been
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observed that managers in Hyundai are using different locations theory in order to make their
place effective in front of customers. Along with they can store their inventories in a perfect time
frame. Therefore, this one of the best approach by which they can easily transport and able to
reduce extra cost from the products. Wherein Toyota applying these theories in a different way in
order to fulfil customers demand that's why they selected effective location in which customers
can easily contact.
Therefore, both companies having kind of same aspects by which they can fulfil
customers requirements at better way (Pugh, 2015). By having good locations of industry
managers can develop their objectives and able to expand business in an appropriate manner.
Triple bottom line
It refers to the accounting framework which is divided into 3 parts like social,
environmental and financial. In the current period time some of the companies are adopting this
TBL framework by which they can evaluate their overall performance and develop effective
value for business.
Economic Factor: In this factor there are various elements and approaches in order to
operate business in a perfect way. In context of Toyota, they are using different kind of
approaches as per this factor because it includes in interest rates, inflation rate to make business
effective and attractive. On the basis of these elements Toyota can achieve their goals within the
short period of time. So that economic factor is much beneficial for this respective company for
expansion of business. Some times if inflation rates are low then company can meet their target
in a proper manner.
Environmental Factor: In context with Toyota, environmental factor influence a lot in a
positive manner. This can be happen on the basis of climate changes, different laws and
regulation and recycling of waste material. Therefore, all elements useful for company by which
they can manage their business situation in order to grab potential customers in a perfect way.
For making better company manager of Toyota able to apply different theories and concepts to
make it well it attain competitive business environment.
Social Factor: According to this Toyota have different kind of elements by which they
can take more benefits in an effective manner (Reid and Sanders, 2015). All are much important
elements who always support organisation like increase their value, people interest and attitude
of society. For this they can make their goals and objectives within the short period of time. In
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order to follow social factor company needed to have proper adopting culture in order to make
their organisation effective and attractive (Ross, 2017).
From all of the above points Toyota can increase their sale and revenue at higher level in
order to achieve goals. Additionally they are also able to formulate on new strategies and
techniques by which they can easily accomplish customer's desire appropriately.
Recommendation
According to the above analysation it has been recommended to Toyota, that they should
bring different kind of techniques and strategies in order to develop proper goals and objectives.
Along with they should have proper training and development programmes for their employees
in organisation by which they can grow their effective skills and able to gain higher knowledge
appropriately. In order to make Toyota attractive manager should adopt high skilled people who
can face different challenges and able to overcome different conflicts in an organisation. Apart
from this operation management is one of the best thing to collection of appropriate data. So they
should use this tool to evaluate their overall business performance perfectly.
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CONCLUSION
According to the respective report it has been concluded that, Toyota is one of the best
auto mobile industry which deals in different products like luxury car and financial services. For
making better changes in this company managers are applying different theory and concept by
which they can attain goals properly. For making better quality of products in this company
manager applied good layout for attaining customers feedback in a positive way. With the help
of this company can get appropriate knowledge about location in which lots of customers can
interact with each other and able to communicate. Wherein total quality management is much
beneficial skills for managers and employees by which they can store inventories and used
different resources. Along with this they have been used Triple Bottom Line skills for knowing
better environment of the business culture.
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REFERENCE
Book and Journal
Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
Heizer, J., Render, B. and Munson, C., 2017. Operations management. Pearson Education
Limited.
Hugos, M.H., 2018. Essentials of supply chain management. John Wiley & Sons.
Ishikawa, K. and Lu, D.J., 1985. What is total quality control?: the Japanese way (Vol. 215).
Englewood Cliffs, NJ: Prentice-Hall.
Meindl, S.C.P., 2016. Supply Chain Management--Strategy, Planning and Operation. Tsinghua
University Press. wheat soybean others land for no use.
Nemet, Y. and Brand, E., Varcode Ltd, 2015. System and method for improved quality
management in a product logistic chain. U.S. Patent 8,967,467.
Noe and et. al., 2017. Human resource management: Gaining a competitive advantage. New
York, NY: McGraw-Hill Education.
Pugh, P., 2015. The Magic of a Name: The Rolls-Royce Story, Part 2: The Power Behind the
Jets. Icon Books Ltd.
Reid, R.D. and Sanders, N.R., 2015. Operations Management, Binder Ready Version: An
Integrated Approach. John Wiley & Sons.
Ross, J.E., 2017. Total quality management: Text, cases, and readings. Routledge.
Rumane, A.R., 2017. Quality management in construction projects. CRC Press.
Xu and et. al., 2015. Evolution of Rolls-Royce air-cooled turbine blades and feature analysis.
Procedia Engineering, 99, pp.1482-1491.
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