Case Operations Management in Daikin

Grup 5

M Deo Saputra (29115390)

Ardin Nurbi Narendra H (29115038)

Wahyu Rizki Andenaz (29115396)

Farah Dina Rachman (29115368)

Question:

1. What is your assessment of the problems conforting the shiga factory of daikin industries ?
2. What are the strengths and weaknesses of shiga factory relative to the competitor ?
3. As mr.oka, what short-term and long-term actions would you recommend to your board of directors  how would you justified them?
4. Which step in the supply chain, if any, would you like to tighten up or eliminate ? If so, how would you proceed ?
5. Would you move to a low cost country such as China be in your plan ?

Answer:

1.  The asessment of the problem

1. sales company are afraid of stock out, they often withhold the actual level of dealer orders from the factory, and do not provide precise forecast, also the factory create system pre order because the demand is high, inside the pre order system the sales company can canceled the order one month before the factory delivery the item.
2. The supply chain is long, sometimes causing daikin lost its customer because the retailer offer another product to the customer
3. Uncertain demand caused by uncertain market seasonably
4. The stagnant behavior of the market was facing hard times with increasing its market share on the basis of product diferentiation.

1. Strenght

1. huge variety for product line. Daikin have 600 variant for ac product.
2. Skilled employee (well manage, highly train resource)
3. Good relation with the supplier and the customer.

Weaknesess

1. Daikin have big competitor like matsushita, mitsubishi tosiba,hitachi and sanyo. So daikin din not have atenttion , also daikin doesn’t havr considerable pressance in other country outside japan
2. High cost sales structure and high sale ratio
3. Daikin inventory turn over is low

1. Short term :

1. make a new system for pre order system to prevent unprecise demand. Because it can make the inventory cost getting high.
2. Make a supply chain more shorter because it can make the cost

Long term:

1. create a new factory outside of japan to compete globally.
2. Create a new regional warehouse for daikin units only so that the shipment time to the retail store will be decreased.

1.  The supply chain we want to eliminate are,

1. Tightened the preorder system so that the forecast demand will be more precise.
2. tightened the shipment system so that daikin can prevent the customer loss by decreasing by the shipment time.

5) As Toshinari Oka, we will recommend getting a new factory outside of Japan to the board director. However, this recommendation has a flaw which is the quality of the product might not be the same as in Japan. To avoid that, we recommend to only produce a non vital part only in the outside of Japan. By creating a factory outside of Japan too, Daikin will be able to grow and expand to the global market easier.  This could lead Daikin to a greater success in the future.