04/08/2023Vender selection , University of Management and Technology , Lahore

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HOW DID TOYATA CREATE A NETWORK 'IDENTITY'? Toyota's network is known (labeled) as the

`Toyota group'.

Toyota creates a shared network identity by developing multiple groupsThe supplier associationToyota's operations management consulting

divisionVoluntary small group learning teams

(jishuken) (Interfirm employee transfers)

04/08/2023Vender selection , University of Management and Technology , Lahore

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SUPPLIER ASSOCIATION Kyohokai: Toyota's supplier association

was established in 1943

Suppliers must be close to each otherTokai (150 members)Kanto (65 members)Kansai (29 members)

04/08/2023Vender selection , University of Management and Technology , Lahore

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SUPPLIER ASSOCIATION Suppliers association has general (high

level) meetings every other month Quality committees. Excellent plant tours allow network members

to visit `best practice' plants Quality management conference held once a

year lectures from directors, senior managers + six

success ful supplier cases of quality improvement

04/08/2023Vender selection , University of Management and Technology , Lahore

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CONSULTING TEAMS Toyota's Operations Management

Consulting Division (OMCD) 6 senior executives, 50 consultants

Direct free `on-site' assistance for suppliersperiods ranging from one day to many

months on average suppliers are visited about 4

times a year with an average visit lasting 3 days

emergent problem solving: cross divisional problems solving teams helping a supplier

04/08/2023Vender selection , University of Management and Technology , Lahore

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VOLUNTARY LEARNING TEAMS Jishuken: 60 of the key suppliers `voluntary

study groups' Each group consists of roughly 5-8 suppliers

geographic proximity no direct competitors in the same group level of experience with Toyota

Groups are reorganized every 3 years (Why?)

After determining theme, the group visits each member to develop suggestions

Member of OMCD monitors (to assist and to learn)

04/08/2023Vender selection , University of Management and Technology , Lahore

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VOLUNTARY LEARNING TEAMS (II) Jishuken are reported to be very

valuable (especially in transmitting tacit knowledge)

04/08/2023Vender selection , University of Management and Technology , Lahore

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NETWORK RULES FOR KNOWLEDGE PROTECTION Creating an identity isn't enough to solve sharing

and free riding problems

Toyota sets a norm/rule by sharing its own knowledge eliminating the notion that there is `propriety knowledge'

Suppliers must be willing to open their plants to other network members to other network members reciprocal obligations: We will help you, but in return, you

must agree to help the network. reciprocity norm is enforced by implicit threat of

withdrawal of business

04/08/2023Vender selection , University of Management and Technology , Lahore

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NETWORK RULES FOR KNOWLEDGE PROTECTION Tacit rule about value appropriation

The recipient of knowledge may appropriate 100 percent of the savings in the short run, but over time will be expected to share a proportion of those savings with the network

Compare Toyata practice with the GM consultancy teams (PICOS)

04/08/2023Vender selection , University of Management and Technology , Lahore

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CREATING MULTIPLE KNOWLEDGE SHARING PROCESSES

How to maximize efficiency?

Toyota established variety of bilateral and multilateral processes, each designed to facilitate different types of knowledge

04/08/2023Vender selection , University of Management and Technology , Lahore

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THE CREATION AND EVOLUTION OF TOYATA'S US KNOWLEDGE SHARING NETWORK

1988: Toyota begins producing cars in Georgetown, Kentucky

Suppliers had virtually now contact with each other, how did Toyota implement its knowledge management ?Phase 1: Developing weak ties among suppliersPhase 2: Developing strong ties with ToyotaPhase 3: Developing strong ties among suppliers

04/08/2023Vender selection , University of Management and Technology , Lahore

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1. DEVELOPING WEAK TIES

1989 Toyota initiates supplier association (BAMA)

04/08/2023Vender selection , University of Management and Technology , Lahore

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2: STRONG TIES WITH TOYOTA

Free of charge well trained consultants made available to BAMA members

04/08/2023Vender selection , University of Management and Technology , Lahore

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3: STRONG TIES AMONG SUPPLIERS

Toyota divided suppliers in small learning teams-no competitors-rotation-equal capabilities

04/08/2023Vender selection , University of Management and Technology , Lahore

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One large network with core firm as hub

Bilateral relationships Weak ties/arm's lenght

relations Structural holes Explicit knowledge Members motivated to

demonstrate commitment Power game

self-interest independence closed formal contracts

Large network plus multiple nested networks

Multi-lateral relationships Strong/embedded ties in

nested networks with core firm Dense network Both explicit and tacit

knowledge reciprocity; benefits of

participation outweigh isolation

Trust game fairness interdepence open informal contracts