Toyota Supplier Relations: Fixing the Suprima Chassis

Sample Solution

   

ChassisCo’s responsibility:

• Lack of project management experience
• Silo mentality
• Decentralized company structure
• Insufficient manpower
• Lack of knowledge of Toyota’s Technical Instruction Sheets (TIS)
• Failure to communicate with Toyota about unrealistic prices
• Failure to audit suppliers
• Failure to implement standardized work

Full Answer Section

      Toyota’s responsibility:

• Unrealistic pricing expectations
• Lack of communication with ChassisCo about production plans
• Failure to provide adequate support to ChassisCo

2. ChassisCo’s options for resolving the crisis

ChassisCo has a number of options for resolving the crisis, including:

• Fix the quality problems: ChassisCo needs to identify and fix the root causes of the quality problems at the Athens plant. This may require investing in new equipment, training employees, and implementing new quality control procedures.
• Improve communication with Toyota: ChassisCo needs to improve its communication with Toyota about production plans, pricing, and quality issues. This will help to avoid misunderstandings and ensure that both companies are working towards the same goals.
• Seek financial assistance from Toyota: ChassisCo may need to seek financial assistance from Toyota to help cover the costs of fixing the quality problems and improving the Athens plant.

What I would do if I were in charge: If I were in charge of ChassisCo, I would take the following steps to resolve the crisis:

1. Identify and fix the root causes of the quality problems at the Athens plant. This would involve working with employees, suppliers, and Toyota to identify the specific problems and develop solutions. I would also invest in new equipment and training to help prevent the problems from happening again.
2. Improve communication with Toyota. I would establish regular communication channels with Toyota to discuss production plans, pricing, and quality issues. I would also keep Toyota updated on our progress in fixing the quality problems at the Athens plant.
3. Seek financial assistance from Toyota. If necessary, I would seek financial assistance from Toyota to help cover the costs of fixing the quality problems and improving the Athens plant.
4. Toyota’s options for resolving the crisis

Toyota also has a number of options for resolving the crisis, including:

• Provide technical and financial assistance to ChassisCo: Toyota can provide technical and financial assistance to ChassisCo to help them fix the quality problems at the Athens plant. This could include sending engineers to the plant, providing training to employees, and investing in new equipment.
• Work with ChassisCo to develop a new production plan: Toyota can work with ChassisCo to develop a new production plan that is more realistic and sustainable. This may involve reducing the number of units that ChassisCo is producing or providing them with more time to produce each unit.
• Terminate its contract with ChassisCo: If Toyota is not satisfied with ChassisCo’s progress in fixing the quality problems, it can terminate its contract with them. This would be a last resort, but it is an option that Toyota has.

What I would do if I were in charge: If I were in charge of Toyota, I would take the following steps to resolve the crisis:

1. Provide technical and financial assistance to ChassisCo. I would send a team of engineers to the Athens plant to help ChassisCo identify and fix the root causes of the quality problems. I would also provide ChassisCo with the financial resources they need to implement the necessary changes.
2. Work with ChassisCo to develop a new production plan: I would work with ChassisCo to develop a new production plan that is more realistic and sustainable. This may involve reducing the number of units that ChassisCo is producing or providing them with more time to produce each unit.
3. Set clear expectations for ChassisCo: I would set clear expectations for ChassisCo in terms of quality, delivery, and cost. I would also communicate these expectations to all levels of the ChassisCo organization.
4. Monitor ChassisCo’s progress: I would closely monitor ChassisCo’s progress in implementing the necessary changes. I would also provide them with feedback and support on an ongoing basis.

By taking these steps, Toyota can help ChassisCo to resolve the crisis and become a more reliable supplier.