Toyota tackles the millennium bug
By Staff -- Purchasing, 2/11/1999
According to Y2K task-force coordinators at Toyota, relying on outsourced fixes and new software is not enough to guarantee the turn of the millennium will go off smoothly. So they are examining the company's internal systems as well as those of its supply chain for potential millennium crashes, striving to avoid such disasters as order processing going haywire, computerized equipment crashing, and entire accounts being deleted.The backbone of the effort is internal assessment. According to Karthik Chandramouli, director of corporate planning at Toyota Motor Manufacturing North America (tmmna), this will result in a more centralized operation. To beat the clock, Toyota's three main U.S. divisions are pooling their task forces' procedures and information. The three divisions cover sales and distribution (Toyota Motor Sales), forklift and materials handling manufacture (Toyota Industrial Equipment), and tmmna's consumer cars and trucks.
Says Chandramouli: "The task forces are cross-functional, and representatives designate what each department should evaluate." For example, the purchasing department oversees supply chain evaluations, while accounting is responsible for spreadsheets. IT supports each group and provides checklists.
With three subsidiaries sharing suppliers, Toyota's purchasing departments had to find an efficient way for the organizations to evaluate those suppliers for Y2K compliance without wasting precious time on duplicated effort. To avoid overlapping with other divisions and even other automakers, tmmna joined DaimlerChrysler, GM, and Ford in using the Automotive Industrial Action Group (aiag) to gather information about suppliers.
AIAG helps streamline the effort
aiag centralizes information about suppliers for the automakers. Each automaker, Toyota included, provides a list of the suppliers and parts it uses, and aiag gathers the information the automakers need, then makes it available electronically. The information is tailored to each carmaker's needs, including a level of detail that can go as far as showing which supplier location provides which parts.
The organization also provides information about new equipment that is Y2K compliant. (Surprisingly, not all recent-model equipment is.) This information enables Toyota and other customers to evaluate products right at the time that they are deciding between converting to new equipment or updating what they already have. "It is imperative that purchasing have access to this information," says Rebecca Vest, manager of production at tmmna.
One challenge for Toyota is that it still imports many of its production materials from Japan, and there is no Japanese counterpart to aiag. tmmna is working through its parent organization to measure Japanese supplier compliance.
Some products the company uses are made in the U.S., but by companies not assessed by aiag. In that case, Toyota measures compliance on its own. For example, Toyota Motor Sales tailors its information-gathering based on the relationship the company has with the suppliers of such things as MRO and computers. If Toyota wants an ongoing relationship with a supplier, with a need for supplier business information and frequent billing, it uses one type of survey; otherwise, when the technology itself is paramount, the surveys are based on the role the equipment will play in TMS operations or the aftermarket business segment.
The role of IT
Toyota's information-technology department has broad responsibility for supporting every business function that uses embedded electronic systems. tmmna's IT group checks everything that is purchased at its eight locations for compliance. TMS and TIE have separate IT departments that provide the same function.
"What becomes tricky," says Randall Bauer, Y2K project director at TMS, "is that the parent company purchased some of the computer and manufacturing equipment for the U.S. subsidiaries. That adds the complication of communicating with counterparts in IT in Japan in order to ensure the equipment measures up."
For all the subsidiaries, no matter what the provenance of their equipment, some seemingly time-consuming work really pays off. "Tracking the [original equipment's] paperwork is an effort, but contacting manufacturers really saves time," says Bauer. "The manufacturer may have a faster, more economical way to convert the equipment." Also, the OEM can often furnish information about compliance that makes opening up the machine unnecessary.
"To assess computers and other electronic technologies, IT has set up a mainframe to replicate the production department," says tmmna's Chandramouli. This enables the department to test electronic data interchange (EDI), software, security systems, and anything else that has been reengineered or converted. It also tests interfaces with business partners, such as other tmmna plants, TMS, and the parent company. By setting up a separate mainframe, IT guarantees there is no risk of a company-wide crash, even if a system proves to have a bug.
Manufacturing also conducts tests, says Chandramouli. For example, the company has experimented with rolling dates forward to check what happens to PLCs (programmable logic controllers) and other numeric controllers. Testing took place during year-end shutdown.
Toyota plans to have all its locations tested and bug-free by this summer.
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