When one considers the proposed eight year anticipate the behalf of Nissan to bring the development of the "Leaf" model to the flower there is the consideration of the issue of why its might take so long to bring about the actualisation of this effort. However, when the books (Slack et al 2009) is consulted the response in short would seem to be to be that the whole process of concept era and design is a complicated and elongated one which begins with the customer and marketing departments a long time before the process ever before reaches the procedures stage.
Initial periods see concept era taking place, this is the initial brainstorming stage when a new "concept" product will be thought up by those within the business. Slack et al (2010) however, highlights the value that the concept generation level is one in which a whole new encompassing idea must be taken to the consumer somewhat than merely a specific plan and specification. For the Nissan Leaf, the concept is not the look of a power car, but the presentation of environmentally friendly form of move as a thought (Paukert 2010).
After concept technology, the next stage is that of the beginning of the marketing process. Here comprehensive market research needs to be conducted that will ascertain whether or not any one would want to purchase the Nissan Leaf (Jobber 2007). There may be little point in carrying on with an initiative from an functions perspective, when there is no market for the original concept.
Having considered the original phases of the marketing process Nissan will then be able to consider two other important elements of the initiative, the fund of the job and the physical design of the process. In a few ways these two elements may be observed as going together, given that it is unrealistic to ascertain the expenses of an activity without knowing just what that process is. Yet an activity could not be designed without constant reference to the costs involved.
In designing the procedure detailed attention needs to be giving to the insight factors, these are raw materials and labour on the whole as well as any specialised capital equipment necessary for the new Lead model. Once the insight factors have been determined process designers can provide a detailed specification of the processing process which encompasses all components of the transformation including quality, rate, dependability, overall flexibility and costs (Slack et al 2010) and ends up with the development of the final model of the car.
Again the look stage may be seen as adding significant levels of time for you to the imitative overall. Take for instance the factor of procurement of recycleables, this may appear just like a simple buying operations. However, in the automotive sector the buying of recycleables may involve calendar months of complex discussions in itself. Such negotiations can include items which range from the detailed technical specs of products and services to be obtained through to the management of intricate supply chain contracts aimed at facilitating just in time delivery and creation (Christopher 2005).
After many of these elements have been considered, only then can Nissan move onto the physical phases of operations management. Having founded a concept, simple fact that there is market and suggested process. Nissan may then produce a prototype product, the utilization of prototyping is an essential part of the design process. Prototyping really helps to identify previously unforeseen problems in the complete value chain and as such brings about increased efficiencies and lower wastage and defect rates at the later functional stage. As such, you can consider that the prototype and trials stage can be an essential one in guarding the trustworthiness of Nissan with its customers when the model goes into production.
In conclusion one can see that the great number of processes which take place in the full total bringing of a new product to the market necessitates a greater deal of your time than one may consider, only if the physical components of operations management where to be considered.
Academic theory is definately not fixed over the issue of how suppliers should best work together. On the main one hands, some (Christopher 2005, Waters 2009) generally advocate an optimistic view of increasing degrees of co-operation between suppliers which is also known as supply chain or value chain management. However, others such as (Lambert and Knemeyer 2004) suggest that whilst you can find value in the idea it is not a universally suitable one and that lots of times all that is required is a good contract which all celebrations to the arrangement stick to.
In the situation of the creation of the Nissan Leaf, Nissan has chosen the first option which is to get significantly in its source chain and supplier relations. This is not an uncommon practise within the motor vehicle sector were other producers such as Toyota have significantly moved towards distributor co-operation types of production, somewhat than working in isolation (Spear and Bowen 2004, Spear 2004).
One of the key initiatives which Nissan has embraced is that of just in time production, just with time production is a concept which sees that inventories are minimised and lean production is achieved by enhancing communications flows and minimising traditional procedures issues such as container necks and quality issues which start to see the need for buffer stock to be used (Slack et al 2010). However, low fat production is not just a concept that can be used internally in just a business. To be able to facilitate true low fat production, a company must work with its suppliers and marketers.
Here Nissan spent some time working strongly with those who source input good in to the factory to reduce lead times which has the effect of lowering the levels of inventory required at the Nissan factory. It has multiple results for Nissan, chief amongst there is a keeping in financial conditions, in effect the company has less of its capital tangled up in inventory. The idea also has a direct effect on the concept of quality, buffer stocks and options and other inventories often present the opportunity for such materials to be defective or destroyed merely by being held in storage area (Fitzsimmons and Fitzsimmons 2008). By eliminating such buffer shares, Nissan in addition has increased its overall level of quality by detatching a chance for a contributory factor specifically that of manufacturer harm to be eliminated. The process however, is not a one way avenue, the benefits of such a policy also needs to be sent to the distributor as the management of the complete supply chain considers the same great things about reduced inventory throughout the supply chain. In effect lean production shouldn't simply mean that inventories are simply moved back again to a previous stage in the resource chain, they should in effect be eliminated over a permanent basis (Christopher 2005) saving money and increasing quality for dealer and customer.
Nissan in its Sunderland operation has also caused its suppliers to improve quality significantly. In the case of the Sunderland operation the key consideration from a quality perspective is that all components that can come into the factory accomplish that in an operating condition and meet the original features and tolerances of the components bought.
From a theoretical perspective the concept of quality asks the question do the features of something or service meet up with the needs of the client? The response to this question may be express not as a yes or no but as a from what extent or degree the qualities of a product or service meet the needs of the customer. Where, there's a divergence between customer prospects and the provision this is known as a "gap" (Slack et al 2010).
At Nissan's Sunderland seed this concept has been employed to a significant degree. Whilst the customer us usually considered to be the end end user of something or service, Nissan uses the concept internally within the business enterprise. So, not only will there be an idea that those offering into the business at the front end end have a customer supplier romantic relationship with Nissan. Furthermore those working within the factory also have a person supplier romance, each process in the creation process being considered as the supplier to another customer. The application of such a formalised and visible concept of process management has allowed Nissan to make significant advancements in the entire quality levels achieved within the seed.
Finally, there is the consideration of the idea of quality and cost. There exists often the account that higher degrees of quality lead to raised costs of your business (Fitzsimmons and Ftizsimmons 2008). Nissan however, along with many other companies within the creation sector uses its provider relationships and the concept of quality to attempt to reduce costs. By working with suppliers to remove problems throughout the resource chain the effect is a reduction in flaws and wastage rate. Therefore this brings about real cost savings for Nissan by reducing the amount of rework required and getting rid of expensive vehicle repairs and rectifications once a product reaches the customer.
Here Nissan has chosen to produce the new "Leaf" model at the Sunderland plant in the UK. The Nissan Leaf is a new idea car which considers the incorporation of new solutions to make a fully electrically powered car. The Nissan Leaf is reported to truly have a selection of 100 miles and you will be operable at a cost of 3p per mile, this comes even close to a cost of around 14p per mile for a typical petrol run hatchback of the same size (Vaughan 2010).
Nissans decision to choose the Sunderland seed as the site for production of the new Leaf model is a substantial investment for the business which will impact upon the companies operations and strategy for a long time. In addition the choice is a proper one which links back to you to the company's overall policy of harmonising its Western operations in the project imitative known as "Next 21".
This section will now consider the key reason for why Nissan has chosen the Sunderland herb for the creation of the new Leaf model. In the beginning Nissan's decision to produce the Leaf model in Sunderland may be seen as a function of inner considerations. The Sunderland flower lately has experienced significant degrees of improvement in relation to provider management, quality levels and output. As such the seed has demonstrated that it is a practical site worth further capital investment from the business centrally.
Secondly Nissan's Sunderland plant also has a good link to the company's Next 21 imitative, an imitative made to bring most of Nissan's plant life and operations into lines with performance levels experienced in Japan. In the beginning, the Sunderland flower has already proven the ability to achieve the same levels of performance as those experienced in Japan. Second of all the Sunderland site is also a strategic location from a geographic point of view for furthering the company's ambitions in European countries. The Sunderland location is near to key ports like the Interface of Tyne and ABP Grimsby, both of which have significant car distribution operations with links to European marketplaces (ABP 2010).
Not only will such concern allow Nissan better access to its European market segments from a syndication perspective, there is also the account that in finding a niche site inbound logistics are just as important. Sunderland's location, close to dock facilitates and connected to the key road and rail sites will also imply that the company is able to effectively receive goods into the plant. This is a key awareness for the just in time production theory, there are concerns that if Nissan got have located its procedure in an alternative area like the Southeast. Issues such as congestion on the highway system could have had a direct effect on the company's capacity to operate a just with time processing process effectively.
Other factors that have influenced the business to use the Sunderland place for the creation of the new Leaf model are those that are related to wider environmental concerns. In the first instance, the Sunderland region is recognised as having a lesser wage rate than that of the national average (One Northeast 2010), for Nissan which means that the company is able to benefit from lower costs credited to a standard lower wage rate at the website. Where in fact the company will choose to operate a policy of paying its works at the countrywide rate, this will lead to increased value understanding on the behalf of local staff and therefore increased levels of employer commitment and output.
Finally you have the consideration of federal government policy and taxes incentives. As a location which is defined as a regeneration area, those investing in the area are apt to receive both subsidies and taxes breaks. Nissan has an extended history of good relationships with various UK government authorities and is wearing numerous occasions received subsidies and state aim. Such as was the circumstance when in 2001 the united kingdom government honored Nissan 40m to purchase the production facilities required to produce the Nissan Micra at the flower (Castle 2001). Such incentives can help offset the significant costs of capital investment required in that project.
In conclusion you can note that Nissan's decision to choose the Sunderland flower is a blend of several factors however, selecting plant may be seen as a key tactical decision which aligns the company's key internal functional strengths with the opportunities of the external business environment.