COMPETITIVE ADVANTAGE

by poter

Porter's Generic Competitive Strategies (ways of competing) A firm's relative position within its industry determines whether a firm's profitability is above or below the industry average. The fundamental basis of above average profitability in the long run is sustainable competitive advantage. There are two basic types of competitive advantage a firm can possess: low cost or differentiation. The two basic types of competitive advantage combined with the scope of activities for which a firm seeks to achieve them, lead to three generic strategies for achieving above average performance in an industry: cost leadership, differentiation, and focus. The focus strategy has two variants, cost focus and differentiation focus.

1. Cost Leadership In cost leadership, a firm sets out to become the low cost producer in its industry. The sources of cost advantage are varied and depend on the structure of the industry. They may include the pursuit of economies of scale, proprietary technology, preferential access to raw materials and other factors. A low cost producer must find and exploit all sources of cost advantage. if a firm can achieve and sustain overall cost leadership, then it will be an above average performer in its industry, provided it can command prices at or near the industry average.

2. Differentiation In a differentiation strategy a firm seeks to be unique in its industry along some dimensions that are widely valued by buyers. It selects one or more attributes that many buyers in an industry perceive as important, and uniquely positions itself to meet those needs. It is rewarded for its uniqueness with a premium price.

3. Focus The generic strategy of focus rests on the choice of a narrow competitive scope within an industry. The focuser selects a segment or group of segments in the industry and tailors its strategy to serving them to the exclusion of others. The focus strategy has two variants. (a) In cost focus a firm seeks a cost advantage in its target segment, while in (b) differentiation focus a firm seeks differentiation in its target segment. Both variants of the focus strategy rest on differences between a focuser's target segment and other segments in the industry. The target segments must either have buyers with unusual needs or else the production and delivery system that best serves the target segment must differ from that of other industry segments. Cost focus exploits differences in cost behaviour in some segments, while differentiation focus exploits the special needs of buyers in certain segments.

IMPLEMENTATION

1. COST LEADERSHIP LEAN SUPPLY CHAIN MANAGEMENT [Toyota Indonesia Case]

GOAL of LEAN ACTIVITY COST REDUCTION PROFIT INCREASE

as Basic Philosophy (1) SALES PRICE = (2) PROFIT = COST + PROFIT SALES PRICE - COST

PROFIT

= SALES PRICE - COST

SO IN TOYOTA,, PRESSING THEIR PRODUCTION COSTS TO INCREASE PROFITS,, NOT WITH raise the price,, BECAUSE IF THE PRODUCT PRICE increased, WILL AFFECT CONSUMERS BY PEMBELILIAN volume

SIMPLE CONCEPT FROM TOYOTA

___________I_______I__________I______I_____________I______I_________I______I___ _______ LD LD LD LD LD LD LD LD

=============================TOTAL LEAD TIME==================================

(1) SHORTENING LEAD TIME Simplifying the Process Continuous Flow ( One Piece Flow Process )

(2) REDUCE INVENTORY LEVEL

SUPPLY CHAIN IN MANUFACTURING

VENDOR(1)

(2)MANUFACTURE (4)END USER

(3) DEALER

(1) AND (2) Linked between internal and vendoR STOCK REDUCTION USING KANBAN ( Kanban Cyclic ) & SEQUENTIAL PARTS DELIVERY KANBAN:- A small time that is the key control for JIT production.

Internal Logistics Simplify Process Re-arrangement of Process

Summary

TOYOTA Indonesia utilize Toyota Production System as the base of manufacturing process, and Lean was blend inside of TPS as the focus point in TPS Basic Philosophy : Cost Awareness with Customer First and Quality as priority.

Saurce: LEAN SUPPLY CHAIN MANAGEMENT [Toyota Indonesia Case] Sharing on 6th Indonesia Supply Chain and Logistics Conference and Expo 2011 (ISCL) New Era of Indonesia Supply Chain and Logistics : Center of South East Asia J.F. Ferry Yanto Jakarta, November 3rd, 2011

different strategies

Toyota has a difference with its competitors, here I see the scope of the two .. that is 1. human resources 2. product

1. Management of human resources Toyota is very concentrated in terms of human resources,, is demonstrated by the filosophy toyota way,, following his 14-point philosophy The 14 Principles of the Toyota Way is a management philosophy used by the Toyota Corporation That includes the Toyota Production System. The main ideas are to base management decisions on a "Philosophical sense of purpose", to think long term, to have a process for solving problems, to add value to the organization by developing its people, and to Recognize That continuously solving root problems drives organizational learning.

14 Principles of the Toyota Way. 1. Base your management decisions on a long-term philosophy, even at the expense of short-term financial goals 2. Create a continuous process flow to bring problems to the surface. 3. Use "pull" systems to avoid overproduction. 4. Level out the workload (heijunka). Work like the tortoise, not the hare. 5. Build a culture of stopping to fix problems, to get quality right the first time 6. Standardized tasks and processes are the foundation for continuous improvement and employee empowerment. 7. Use visual control so no problems are hidden. 8. Use only reliable, thoroughly tested technology That serves your people and processes. 9. Grow Leaders WHO Understand thoroughly the work, live the philosophy, and teach it to others. 10.Develop exceptional people and teams WHO follow your company's philosophy. 11.Respect your extended network of partners and Suppliers by Challenging Them and Helping Them Improve.

12.Go and see for yourself to thoroughly Understand the situation (Genchi Genbutsu). 13.Make decisions SLOWLY by consensus, thoroughly considering all options; implement decisions rapidly (nemawashi). 14.Become a learning organization through Relentless Reflection (hansei) and continuous improvement (kaizen).

1. Product Toyota continues to prove its commitment in providing the Best Total Ownership Experience to customers. Reflection of customer satisfaction to service Toyota this year can be seen from the results of the survey JD Power category CSI (Customer Satisfaction Index) and SSI (Sales Satisfaction Index), where Toyota was ranked first. In terms of products, superior quality products back Toyota proved by JD Power Asia Pacific 2007 Indonesia Initial Quality Study (IQS), where the Toyota Yaris, Vios, and Rush was ranked top in each segment. 3 products outperform Toyota 5 segments were taken into account in this survey. Vehicles that are in the first position is recorded at least get a report on problems per 100 vehicles in the survey in their respective segments. Toyota Yaris is ranked top in the segment of premium compact vehicles. Ranked second in this segment is followed by a Suzuki SX4 and Honda Jazz. Meanwhile, Toyota Vios in the top position in the entry midsize car segment / midsize, which won second place Honda Civic and Honda City in the third position. Both the Toyota Yaris and the Vios was also in the same position the previous year. While Toyota's new product, the new Toyota Rush marketed since early 2009, managed to outperform the Daihatsu and Isuzu Panther in the entry SUV segment. Responding to these achievements, Johnny Darmawan said, "This is testament to the quality of Toyota products are marketed in Indonesia. We are proud that these results obtained from the consumer voice, which indicates the quality of Toyota's product is above its competitors ", said President Director of PT ToyotaAstra Motor is. J. D. Power Asia Pacific 2009 Indonesia Initial Quality Study (IQS), which this year enters its fifth year, a survey conducted on the new car owners who make purchases in the month of October 2006 - June 2007, on matters of quality vehicles. Results J.D.

Power Asia Pacific 2009 Indonesia Initial Quality Study (IQS) is obtained from a survey conducted over 2796 new-vehicle owners, including 50 passenger and commercial vehicles from 14 brands. Field survey itself is conducted in April - August 2009 Competency Toyota products are also recognized by the media, as can be seen on the list of winners Autobild Award 2009 in which the Toyota Vios, Toyota Avanza Toyota Camry and was crowned as the best vehicle in the category Small Sedan, Big Sedan, and People Carry.

2. Segmentation
PT Toyota-Astra Motor, or commonly abbreviated by TAMs is a Brand sole agent (ATPM) Toyota Cars in Indonesia. TAM is a joint venture between PT. Astra International Tbk with the percentage shares of 51% and Toyota Motor Corporation, Japan with 49% the percentage of shares. Products sold by the TAM itself are: Sedan: Vios, Altis and Camry Mini MPV: Yaris and Avanza SUV: Fortuner and Rush Pick up: Hilux MPV: Innova and Corolla Truck: Dyna Market segmentation Toyota-Astra Motor is as follows: - Geographic Segmentation In supporting the sales and after sales service, TAM is assisted by 5 Primary Dealers who oversees dealers spread all over Indonesia

 Auto 2000 is the Toyota Main Dealer in the area of Jakarta, West Java, East Java, East Nusa Tenggara, Bali, Borneo and Sumatra in part PT New Ratna Primary Dealer of Toyota Motor is in Central Java and Yogyakarta Co NV Hadji Kalla TRD is Toyota Main Dealer in South Sulawesi and Southeast Sulawesi PT Hasjrat Abadi is a Toyota Main Dealer in the region of North Sulawesi, Central Sulawesi, Gorontalo, Maluku, Ternate and Papua PT Agung Automall is a Toyota Main Dealer in the area of Bali, Riau, Jambi, Bengkulu and Batam. TAM now also have to have a website that contains the product being sold, info-info about toyota, forums, and community toyota car so it can further strengthen the relationship between TAM with consumers and consumers with the formation of the community. - Demographic Segmentation 1. Gender: The car is offered can be purchased by men and women 2. Age: minimum 17 years due to the buying process must use the ID card 3. Price: Toyota offers car prices vary in accordance with the wishes of the buyer 4. Number of families: Toyota offers various types of car buyers as desired - Psychographic segmentation 1. Social class: Toyota to offer products with different kinds of circles 2. Design: Toyota always release an innovative car design 3. Type: Toyota offers the kinds of cars such as mini MPV, MPV, sedans, SUVs, pick ups and trucks so that buyers can choose according to their own needs - Segmentation Behavorial 1. Toyota Parts are easily available and cheap enough so the price is affordable 2. The legs of the car a more durable than competitors 3.Customer care 24 hours