Survey of Japanese, Japanese-Transplant, and U.S. Auto Plants

Analyze and evaluate various aspects of the management of relation with the suppliers.

The main aim of this report is to analyze and evaluate various aspects of the management of relation with the suppliers. In the current business era, the success of the business of manufacturing organizations largely depends on the aspects of supplier relation and management. The main purpose of this article named “SUPPLIER RELATIONS AND MANAGEMENT: A SURVEY OF JAPANESE, JAPANESE-TRANSPLANT, AND U.S. AUTO PLANTS” is to make analysis and evaluate of the process of supplier relation and management between the U.S. Automobile manufacturers and the Japanese automobile manufacturers (Cusumano & Takeishi, 1991). According to this article, the author has tried to achieve the research purpose by answering three major questions. The author of the article has tried to answer the question whether the automobile companies of U.S. and Japan have identical set of differences in the process of supplier relation and management or not. After that, the author has also tried to answer the quatrains that whether there are significant differences between the U.S. and Japanese plants regarding suppliers relation and management or not. Lastly, another major purpose of this research article is to analyze the role and importance of suppliers’ relation and management in the aspects of globalization, production process, procurement process and design operations (Cusumano & Takeishi, 1991).

According to the selected article, the main argument of the author related with the topic is whether the automobile companies of U.S. and Japan has identical set of differences in the process of supplier’s relation and management (Cusumano & Takeishi, 1991). It can be seen that the author has conducted a survey and interview in order to find the results of the research. It can be seen that the findings of the research has provided the author with an unique opportunity for the assessment of the practice of Japanese transplants in U.S. in comparison with the Japanese and U.S. parent companies (Schuh et al., 2014). There are some major findings of the research program. The first finding is related with Japanese transplants. According to the finding, in Japan, the Japanese automobile companies use to set low cost with high quality for the transplants. However, the situation is different in U.S. as the Japanese transplants have limited products that are a hinder in the reduction of cost and increase in quality (Cusumano & Takeishi, 1991). According to the research findings, the U.S. suppliers of the American and Japanese companies have limited engineering capabilities and responsibilities for the development of products and process and thus, they are not much helpful in the reduction of price and increase of quality. The analysis has also found that the Japanese automakers and transplants use to maintain higher quality standards as compared to the U.S. automakers (Lambert & Schwieterman 2012). Another major finding of the research is that different companies use to have different philosophies related with the product prices and quality. Japanese companies use to have the tendency to accept low price and low margin so that they can increase the margin later. These are the major findings (Cusumano & Takeishi, 1991).

Findings of the research program

The analysis of the report shows that the author has carried on the research process in a well-structured manner. The article shows that the researcher has adopted a specific methodology in order to complete this research. First, the researcher has carried out a questionnaire survey among the U.S. and Japanese automobile manufacturers in order to answer the research questions (Al-Abdallah, Abdallah & Hamdan, 2014). It seems that this is the best way to get the answers of the research questions, as only the members of these companies would be able to provide specific information. However, inefficiency can be seen in getting the appropriate information from the companies as the members of the companies do not always want to disclose confidential information (Leppelt et al., 2013). After that, the researcher has also conducted interviews with 49 engineers, managers and other employees of 4 Japanese transplants and 23 Japanese suppliers in U.S. It needs to be mentioned that it would be better if the researcher would select some U.S. automobile manufacturers in the interview process, as it would be helpful in fetching more appropriate information of the research questions. These small changes would be helpful in deriving more appropriate conclusion of the research process (Miocevic & Crnjak-Karanovic, 2012).            

Type of Company

The analysis of this report states that the researcher has worked on the auto manufacturing industry. For the completion of this research, the author has selected the U.S. and Japanese automobile companies. For the filling of the survey questionnaire, the researcher has approached to three U.S. based automobile companies; they are Ford, General Motors and Chrysler. The researcher has also approached to five large Japanese automobile companies; they are Nissan, Toyota, Honda, Mazda and Mitsubishi. Apart from this, the researcher has also approached to some of the major Japanese transplants. For this reason, a car manufacturing is selected to apply various aspects of this research paper and the company is U.S. based.

Implications

The data from the surveys and the interviews fetch different kinds of implications regarding the three major questions of the research. For this reason, these implications can be divided into three major categories based on the research questions (Meng, 2012). According to the first implication, it can be observed that the automobile firms of U.S. and Japan has clear differences in the practice of supplier’s relation and management. Some of these differences are related with the performance that provides advantage to the Japanese companies over the U.S. firms. It can be seen that the main advantageous area for the Japanese companies is their operations. There is another major implication of the research process for second question (Cusumano & Takeishi, 1991). It states that the inability of the suppliers of transplant to meet the target price creates the major difference between the operations of U.S. companies and Japanese companies. The U.S. pants tend to have lower quality of the components than the Japanese companies do. The main reason of the target pricing discrepancy is the low prices that the Japanese companies use to set in compared to the U.S. companies. The implication related with the third question states that that some specific manufacturing practices of the Japanese companies have positive effects on the performance of the companies. In addition, the major factors of high quality and low cost components are longer contracts, suggestions to the suppliers, accurate target-pricing process, the capabilities for cost reduction and others (Cusumano & Takeishi, 1991). These are the major three implications related to the management accounting practices within the organization.         

Research methodology

Risks and Benefits

In this context, it needs to be mentioned that non-implementation of the recommended actions can pose certain threat to the selected car manufacturing company. First, there is a severe threat for degradation of quality of products in the selected company. In this process, the company will not be able to insert the above-discussed factors of quality improvement (Imanipour, Rahimi & Akhondi, 2012). The implementation of the same will be beneficial for the company in the improvement of the products. After that, non-compliance with the recommendations will create a threat to lose major business to the Japanese competitors of the selected company (Hollensen, 2015). The implementation of recommended actions will helps the company in effective management of supplier’s relation and management that will be helpful for the company in getting the necessary competitive edge. Lastly, the non-implementation of the recommended actions will create a threat for inability of transplant suppliers. The company will be beneficial in establishing good relation with transplant suppliers (Cusumano & Takeishi, 1991). 

Based on the above discussion, some recommendations are provided below:

• The above discussions show that quality is the main area where the U.S. automakers are lagging behind the Japanese companies. For this reason, it is recommended to the selected organization to improve the quality of their products. One of the major ways to do so is to improve the aspect of supplier relation and management. In addition, it is also recommended to the organization to increase the profit margin of the company by improving the quality of their products (Nguyen & Mutum, 2012).
• As per the above discussion, another major concern for U.S. organizations is the inability of the suppliers of transplant to meet the target price. For this reason, it is recommended to the selected company to make effective strategy for the suppliers so that they can meet the price target. In order to take this, the company is required to take certain initiatives; they are to use the company suppliers in the process of detailed designs, to provide the suppliers of the company with more amount of information, to provide the suppliers with more history about the business operation and others (Schiele, 2012).
• Lastly, it is recommended to the selected company to establish effective supplier management system within the organization. For this reason, it is required for the company to implement certain strategies in the origination. The company is required to go into longer contract with the suppliers in order to gain their trusts. After that, the company is required to welcome suggestions from the suppliers in various aspects of business. Most importantly, the company is required to put more emphasis on accurate target-pricing and cost reduction capabilities and all these are effective for maintaining the high quality of components (Kato & Schoenberg, 2014).

References

Al-Abdallah, G. M., Abdallah, A. B., & Hamdan, K. B. (2014). The impact of supplier relationship management on competitive performance of manufacturing firms. International Journal of Business and Management, 9(2), 192.

Cusumano, M. A., & Takeishi, A. (1991). Supplier relations and management: A survey of Japanese, Japanese?transplant, and US auto plants. Strategic Management Journal, 12(8), 563-588.

Hollensen, S. (2015). Marketing management: A relationship approach. Pearson Education.

Imanipour, N., Rahimi, M., & Akhondi, N. (2012). An empirical research on supplier relationship management in automotive industry. International Journal of Business and Management, 7(9), 85.

Kato, J., & Schoenberg, R. (2014). The impact of post-merger integration on the customer–supplier relationship. Industrial Marketing Management, 43(2), 335-345.

Lambert, D. M., & Schwieterman, M. A. (2012). Supplier relationship management as a macro business process. Supply Chain Management: An International Journal, 17(3), 337-352.

Leppelt, T., Foerstl, K., Reuter, C., & Hartmann, E. (2013). Sustainability management beyond organizational boundaries–sustainable supplier relationship management in the chemical industry. Journal of Cleaner Production, 56, 94-102.

Meng, X. (2012). The effect of relationship management on project performance in construction. International journal of project management, 30(2), 188-198.

Miocevic, D., & Crnjak-Karanovic, B. (2012). The mediating role of key supplier relationship management practices on supply chain orientation—The organizational buying effectiveness link. Industrial Marketing Management, 41(1), 115-124.

Nguyen, B., & Mutum, D. S. (2012). A review of customer relationship management: successes, advances, pitfalls and futures. Business Process Management Journal, 18(3), 400-419.

Schiele, H. (2012). Accessing supplier innovation by being their preferred customer. Research-Technology Management, 55(1), 44-50.

Schuh, C., Strohmer, M. F., Easton, S., Hales, M., & Triplat, A. (2014). Supplier relationship management. In Supplier relationship management (pp. 7-12). Apress