Automotive Industry and Production

Topics: Toyota Production System, Automotive industry, General Motors Pages: 28 (10247 words) Published: May 17, 2005
Toyota Financial Services (TFS) recently undertook a major business transition programme to in-source its back-office functions. This required that a large number of Toyota and Lexus retail finance contracts, together with all their associated transaction data, be converted from an external IBM mainframe-based system to an in-house system. The new system was based on the Lynx "Portfolio" software package using Unix and Oracle technology. ATD consultants worked closely with TFS throughout the data conversion project in the following roles: •contributing to a feasibility study into the risks and benefits of undertaking a data conversion from the outsourced external system, and presenting the findings of the study to the TFS management board, which approved the data conversion project •managing the data conversion project from the start, through to its successful conclusion 18 months later •acting as the principal contacts with both the existing external system supplier (Black Horse) and the suppliers of the new in-house system, for the resolution of technical and data-related issues •support for the transition of the business to an in-house operation, particularly through the provision of management information from the source data •data analysis, data mapping, design of the migration procedures and development of migration software •unit and system testing of the data migration procedures and software, as well as support for user acceptance testing •development of procedures for both the financial and non-financial reconciliation of the data conversion. The director of the transition programme was Blair Pollock, TFS' General Manager, Business Development, who commented:

"When the ATD consultants joined TFS, the administration of our finance portfolio was outsourced to Black Horse, a subsidiary of Lloyds TSB Bank. We had decided to bring this part of our business in-house and were looking for someone to lead the effort to convert our retail customer data from the Black Horse systems to our own.

The ATD consultants came to us highly recommended for their extensive knowledge and experience of similar conversions within the motor finance industry. We therefore expected a high quality outcome, but were nevertheless surprised by the excellent job that they did.

During the two years that the ATD consultants were with us, they delivered outstanding results. Their structured approach and attention to detail ensured that the specification, development and testing of the conversion was meticulous. The conversion event, a "big bang", took place according to schedule, and 100% of nearly 80,000 contracts were successfully loaded into the contract management system. We have subsequently had very few issues with the quality of the converted data and have been able to cope well with the tremendous increase in business volumes.

It is a great testament to the quality of the work performed by the ATD consultants that in a recent review of our insourcing project, the Board of Management of TFS recognised the retail conversion as a major success.", Copyright © 2004 ATD Data Solutions Limited. All Rights Reserved Columbia Project: Use of Software to Achieve Competitive Advantage AUTOMOBILES: TOYOTA MOTOR CORPORATION

Gaining and Sustaining Long-term Advantage Through Information Technology
Case Prepared By
William V. Rapp
Co-Principal Investigator
The College of International Relations
Ritsumeikan University
Kyoto, Japan
914-945-0630 (Fax: 914-923-1416; 011-81-75-466-1214)
April 2000
1 Introduction: Objectives of this Benchmarking Study……………………….…….3 2 Approach: Methodology and Questions…………………………………………....9 3 Introduction to Case…………………………………………………………….…10 4 The Industry Context: The Japanese and Global Automobile Industries………….10 5 Toyota's Multi-faceted...

References: semi-customized software (Rapp 1995) but is changing towards a more selective use of
package software managed via customized systems
analysts have hypothesized; a coherent business strategy is a necessary condition for a
successful IT strategy (Wold and Shriver 1993).3 These strategic links for Toyota and
environments. This is similar to Nelson and Winter 's (1982) rules and routines for other kinds of management decisions
and innovations, and illustrates these firms ' evolutionary approach to IT use and development
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