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GRP2_CASE8_TOYOTA SUPPLIER RELATIONS, FRANCISCO DYAN NICOLE.docx

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Toyota Supplier RelationsOperations ManagementMBA 703FEU-ManilaSubmitted by:Reporting GroupReacting GroupDe Guzman, Alino Elcir D.Francisco, Dyan Nicole M.1 |P a g eFAR EASTERNMASTER OF BUSINESS
I.Case BackgroundToyota faced a challenge related to the poor visibility and low quality of a supplier forthe Suprima model. The Japanese brand, being related to a top-quality product and aJust in Time manufacturing scheme could not afford to have stock-out problems nor notmeeting consumers' demand for quality.One of the main errors leading to this situation was the fact that ChassisCo didn't followthe Toyota principle of giving the bad news upfront. Toyota stated with every supplierthat they expected a swift alert in case any risks were to arise, to tackle root causes, anddiminish the problems right away.On the same line, Toyota knew that the manufacturing process for the suspensioncradles required substantial dedication in both effort and resources. Nevertheless, theymiscalculated the actual capacity of the supplier to meet Toyota's demand.When ChassisCo first manufactured the parts for the Suprima in 1997, a great part of therisk was decreased since Toyota made several simplifications, resulting in an overallquality increase, hence eliminating the need for quality inspections when the parts firstarrived at ChassisCo.This didn't happen in the latest model. Toyota actively collaborated with suppliers toattack potential quality risks before they happen. However, for the 2003 launch,ChassisCo didn't take the initiative of performing such a business practice.This time, Toyota let the supplier take full accountability for the sourcing part when inthe past it had been made all through Toyota, incorporating this highly preventingscheme. Besides, this new early was much more complex.Furthermore, another mistake was assuming that ChassisCo had the project managementskills necessary.Walt Bernstein, the director of production control for Toyota Motor Manufacturing'sMacon, Georgia operation, was notably frustrated with the plant manager for ChassisCo,a Toyota supplier. There were quality and conformance issues with the rear suspensioncradle that ChassisCo was manufacturing for Toyota's new Suprima crossover.ChassisCo had made several operational improvements since production started 14months earlier, but problems continued to surface. Bernstein, an expert in Toyota'sproduction principles, needed to figure out what to do.2 |P a g eFAR EASTERNMASTER OF BUSINESS
II.Statement of the Problem

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Term
Fall
Professor
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Tags
Management, Production line, Toyota Production System, The Toyota Way, Toyota principle

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