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Matthew Brower Man4504 Case Study: Toyota/Chassisco

Toyota delegated too much responsibility to ChassisCo for production of rear crossmembers without proper oversight. ChassisCo spread its experts too thinly across projects and chose poor suppliers. ChassisCo's options include redirecting experts and labor to problem areas, phasing in new suppliers, and consulting experts to identify weaknesses. Toyota can send experts to improve ChassisCo's suppliers, adjust designs, or switch suppliers as a last resort. Both companies must collaborate to resolve quality issues through education and process improvements.

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115 views2 pages

Matthew Brower Man4504 Case Study: Toyota/Chassisco

Toyota delegated too much responsibility to ChassisCo for production of rear crossmembers without proper oversight. ChassisCo spread its experts too thinly across projects and chose poor suppliers. ChassisCo's options include redirecting experts and labor to problem areas, phasing in new suppliers, and consulting experts to identify weaknesses. Toyota can send experts to improve ChassisCo's suppliers, adjust designs, or switch suppliers as a last resort. Both companies must collaborate to resolve quality issues through education and process improvements.

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Matthew Brower

MAN4504
Case Study: Toyota/ChassisCo

1. Toyota’s responsibility involves delegating too much responsibility and not enough
inspection regarding ChassisCo. production and operations. To begin with, Toyota
allowed ChassisCo to takeover complete management of the project from the first tier
upward. Toyota incorrectly assumed that ChassisCo operated by adhering completely to
Toyota’s JIT and TPS methods. This was not possible as ChassisCo demonstrated an
incompetent level of understanding that was not compatible with the direction Toyota
advised ChassisCo to use. As such, ChassisCo was given too much responsibility by
overseeing complete project management. This could have been rectified by using a
management collaboration much like the processes for the 1997 Suprima and other
successful products. Additionally, Toyota was responsible for inspecting and maintaining
ChassisCo processes to ensure they adhered to the “Toyota Way”. There was an overall
lack of inspection on Toyota’s behalf. ChassisCo errors were not discovered until late in
the process during supplier inspection when Bernstein finally visited the supplier and
discovered how out-of-line the project was.

ChassisCo’s responsibility includes spreading their experts too thin across the company
and poor supplier choice compared to Toyota standards. In the case study, ChassisCo
mentions their experts were tasked with managing multiple projects because of
decentralization and increased business popularity due to previous successes. This
allowed focus, energy, and resources to be spent elsewhere and in other areas which
ultimately let the Toyota project decompose. In addition, ChassisCo did not fully
understand the “Toyota Way” and as such, made supplier choices that both misaligned
with Toyota standards as well as questionable reputations given the nature of the project.
ChassisCo worked with suppliers that were inexperienced with both the Automotive part
industry as well as the heavy-line suspension production required for the rear
crossmember manufacturing.

2. ChassisCo’s options are dependent on multiple factors but can be boiled down to a few
key concepts to correct the issue. Manpower and expertise could be redirected from
projects that have not yet begun or involve less direct management. By bringing experts
back in to diagnose root issues and make decisions, corrective actions can be taken. On
the ground level, ChassisCo could also redirect their labor force to manually weld at
points of production as opposed to the new, automated machines. This would ensure that
the parts being welded were properly inspected, variances compensated, and welded
correctly. Another option would be to phase in new suppliers with more experience with
automotive parts, suppliers that can produce smaller tolerances between individual
pieces. This would help throughout the assembly process as lower tolerances yield better
quality production.

If I oversaw ChassisCo, I would employ a blend of all these options to maintain


production quantity while improving production quality significantly. First I would
consult company experts and use their experience to identify the weakest suppliers and
most troublesome welding areas as well as specific methods and adjustments that could
be made with automation and processes to improve our product. Suppliers that are
responsible for the highest number of ill-fitting, low quality pieces should be phased out
and replaced with suppliers who can produce better quality parts. In order to give the
experts time to work and make these changes, I would redirect our human capital to
cover the assembly process manually weld in the problem sections to ensure they are
welded properly the first time to prevent as much re-working or scrapping of the
materials as possible. While this would slow down production, it would keep a flow of
correctly made crossmembers moving and increasing quality statistics until more
permanent solutions can be made and get the project back on track.

Toyota has a few options they can use to correct the issues in Athens. They can choose to
move production of the rear crossmembers to another supplier. This would likely involve
an impedance or shutdown in Suprima production while this happens as there will be a
gap in supply while the shift takes place. Another option Toyota has is to send its own
experts in to “tune” ChassisCo’s suppliers so that ChassisCo receives better parts that
generate fewer production errors. This would be a significant undertaking, as
ChassisCo’s suppliers may not be physically or financially equipped to make such tuning
changes. Also, Toyota can be more lenient in working with ChassisCo to adjust design to
better accommodate the current process in order to regain quality control. ChassisCo
asked for this previously but were turned down. As mentioned in the case study, Toyota
engineers have tacit knowledge of how these pieces can be tuned, and if that info cannot
be written down, it should be taught to production staff in order to ensure better quality.

If I were making decisions for Toyota, I would send any and all resources I could to
ChassisCo and its suppliers in order to educate, adjust, and take charge in addressing the
quality issues from the ground up. This involves engineers, management staff, and
production managers to make every effort to improve the project and regain the “Toyota
Way”. Additionally, I would have my team working behind the scenes to source, quote,
and prepare to shift suppliers to another source separate from ChassisCo. As switching
suppliers is the riskiest in regard to maintaining vehicle production and preventing a
brand-wide crisis, it must be kept as a “last resort” in order to be instituted if the
ChassisCo operation cannot continue.

Ultimately, just as Toyota and ChassisCo are jointly at fault, they must also jointly
collaborate to employ a solution and resolve the production issues for ChassisCo, Toyota,
and most of all the safety of the consumer.

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