Toyota’s Digital Strategy: Navigating the Future of Automotive Innovation

Toyota’s Digital Strategy: A Journey of Innovation and Collaboration

The automotive industry has seen significant changes in its supply chain since the onset of the Covid-19 pandemic. This has led to a demand for a more integrated and technologically advanced approach from car manufacturers. At Toyota Motor Europe (TME), the focus is on empowering its 2,000-strong supply chain team to become ambassadors for the company’s digital strategy.

Jean-Christoph Deville, vice-president of supply chain at TME, recently shared insights into the company’s approach at the Automotive Logistics and Supply Chain Digital Strategies conference in Germany. He emphasised the need for radical breakthroughs in addition to Toyota’s traditional strategy of incremental improvement.

Deville highlighted the evolving priorities of Toyota’s supply chain experts, who have shifted their focus from safety, quality, delivery, and cost to resilience, agility, and sustainability. The complexity of supply chain and logistics has increased by 400% in recent years, presenting new challenges that require innovative solutions.

The Toyota Production System (TPS) forms the strong foundation for the company’s logistics operations, built on the problem-solving skills and collaborative efforts of its team. However, TME is also committed to reducing carbon emissions from its operations. A notable initiative in this direction is the collaboration with VDL Groep on a hydrogen fuel cell truck, with plans for further production and usage within Toyota’s logistics network.

In addition to environmental considerations, there is a growing emphasis on data analytics, technological fluency, and strategic leadership within the supply chain. Deville stressed that digitalisation and AI are seen as complements to human intelligence, rather than replacements for human workers.

To drive this transformation, TME is engaging its supply chain team members in workshops and hackathons aimed at automation and problem-solving. These initiatives have resulted in significant time savings and efficiency improvements, demonstrating the value of collaborative innovation.

Furthermore, TME is fostering better strategic thinking through direct observation and interaction, known as “genchi gembutsu,” and collective problem-solving using the Corporate Obeya principle. This approach not only addresses operational challenges but also contributes to the development of effective leadership within the organization.

The company’s focus on leadership development extends to promoting cross-functional dialogue, sharing business strategies, and nurturing a culture of continuous learning and adaptation. Deville emphasised the importance of developing “T-shaped people” who possess a broad understanding of internal and external processes, including customer perspectives.

Overall, Toyota’s digital strategy is a testament to its commitment to innovation, collaboration, and leadership development. By empowering its supply chain team as ambassadors of the digital journey, the company is poised to navigate the evolving landscape of the automotive industry with confidence and success.