Causes
ChassisCo was Toyota’s suspension cradle supplier and they worked successfully in two projects until 2004. After successful launches of Suprima in 1997 and Responsa in 1999, Toyota decided to engage the company with another project, Suprima 2003. However, this project did not achieve expected success as it registered poor quality, increased costs, and low returns among other things. These failure problems were significantly caused by both Toyota and ChissisCo. Thus, while Toyota gave ChissisCo increased responsibilities, ChissisCo did not have the qualification to meet the company’s demands.
Toyota caused the Suprima 2003 failure when it added ChissisCo more responsibilities. ChissisCo was already producing a suspension cradle for Suprima 1997 and Responsa 1999 for continued Toyota production, when Suprima 2003 was added as a new launch project. Toyota assumed that following past success with the two projects, ChissisCo would deliver success for the new project. Toyota also entrusted ChissisCo with project 2003 management yet they had no adequate skills. Furthermore, Toyota introduced ChissisCo to Technical Instruction Sheet (TIS) on top of TPS yet the management had no skills to run the program.
ChissisCo was also the primary cause of the Suprima 2003 project failure. First, the company had decentralized its office operations meaning that the experts who had worked for the past two Toyota projects had been scattered to three different branches. Therefore, when the company was hired for Suprima 2003 launch, it had no adequate skills, yet the management did not disclose this fact.
Another mistake is that ChissisCo was already doing launch projects for other companies from all over the world. Hence, it did not have enough resources and time to meet Toyota’s demands. ChissisCo worsened the situation by assuming automatic success for the new project, however, it had changed the working settings and skills. The last major mistake that caused the project failure is that the project did not have a Supply Manager to control the use of resources, hence ChissisCo incurred extra costs off-budget.
Resolution 1
ChissisCo had a chance to rectify the low-quality production of the project 2003 suspension cradle. During the launching of the projects, the defects going to Toyota Motor Manufacturing’s Macon in Georgia (TMMGA) increased from 565 to 2845 in 2004. These defects were caused by increased robots, use of TIS without necessary skills, and poor management of the ChissisCo. The best solution would be for ChissisCo to hire qualified personnel to use the system and other competent staff for tuning as the current tuning caused gaps, hence increasing reshaping time. A defect flow-out control system would also be needed to detect and report a defective suspension cradle before it reaches TMMGA. Furthermore, on behalf of ChissisCo, I would ask for tuning help from the Japanese branch because the Japanese covered only 15% and left the rest of the work to ChissisCo, which is now a burden.
Resolution 2
Toyota would resolve the low-quality production of cradles by increasing the project budget. The ChissisCo Project Manager reports that Toyota was not willing to incur an extra cost when defects began to increase as it intended to stay on budget. Consequently, the project management could not rectify existing defects and quality problems. Being in charge on behalf of Toyota I would finance new skills to be acquired by personnel and also the purchase of defect flow-out control system. Furthermore, I would finance other extra expenses which would contribute to reduced production defects and improved quality.