NISSAN

MOTOR COMPANY LTD. IILM

UNDERGRADUATE
:BUILDING OPERATIONAL BUSINESS SCHOOL

RESILIENCY

- CHARCHIT PAHWA | MOHAMMAD FARZAN | SRISHTI

S NO. CONTENT
1. Introduction

2. History

3. Nissan’s supply chain Philosophy

4. Risk Management at Nissan

5. Nissan’s response to Disaster

6. Recovery and Way Forward

TABLE OF CONTENTS
On March 11, 2011 – Japan was hit by three calamities – An
Earthquake , A Tsunami , A Nuclear Emergency.

Huge blow to entire Japanese Economy and Automotive

Industry

Toyota , Honda and Nissan were all impacted which halted

their production levels to a major extent and thus impacted
the economy and its global footprint.

INTRODUCTION BRIEF INTRO ABOUT JAPAN

 HISTORY
• Domestic automobile manufacturing was limited to Military Sponsored Initiatives , Hand-Built
PRIOR TO 1930’S Models and Imported Automotive Kits

• Aikawa Yoshisuke established Jidosha Seizo Company , Predecessor of Nissan Motor Company
1933 • Toyoda Automatic loom = Toyota Motor Company

Post World war II

• Both experienced lower productivity and were at a risk of slipping into bankruptcy
( After 1945)
• Toyota developed Just In Time Manufacturing and eventually Toyota production system which was
1940’s to 1960’s adopted by all other manufacturers

Late 1960’s • Both the firms had started to experience rapid rise in production and exports

• Three Largest Japanese Automotive firms globalized their operations and expanded their foreign
Late 1970’s to 1980’s manufacturing footprint and overtook US as the world’s top automobile producing country.
NISSAN’S SUPPLY CHAIN PHILOSOPHY : A FOCUS ON FLEXIBILITY

• Regional and Decentralized Supply chain

structure
• Maintains Flexible organisation and integrating
a variety of perspectives
• Embraced Diversity as corporate officers were
from various countries and was considered as a
source of strength
• Simplified Product line
• Build To Stock and Build To Order Strategy
• As a result : Simplified Operations and Product
offerings and increase in sales
• Their Supply chain philosophy is one of
vigilance and extreme responsiveness allied
with single point responsibility.
RISK MANAGEMENT AT NISSAN
1999

Company faced
severe financial
difficulties and was Renault bought 36.8%
rescued from of Nissan’s outstanding All this made
impending stock as a result of them focus on
bankruptcy by their alliance. Dedicated risk
identifying and
Renault. analysing risks as management Nissan’s Continuous
early as possible function and readiness process
and rapidly executive level included:
implementing committee was 1.Seismic reinforcement of
countermeasures.
established to facilities
deal with risks. 2.Business Continuity
Planning
3.Disaster simulation
training
NISSAN’S RESPONSE TO THE DISASTER
Sharing
Information
• Its response adhered to principles detailed in its
earthquake emergency-response plan .
• Nissan’s Global Disaster Control Headquarters was
convened to evaluate the impact and to oversee the
restoration of activities.
Empowering Action Allocating Supply
• Recovery Committee was established.
• It emphasized on simple meaningful practices to
coordinate better responses to the disaster which are :

Managing
Production
Following the earthquake , all three companies experienced different issues associated with the disaster. Toyota had
exposure due to its large size , Honda attributed its problems to constraints in its supply chain and Nissan had several
plants close to the disaster area. However, Nissan had successfully insulated itself in different ways:

1. Continuation of strategies , priorities and plans that were already in place

2. Different strategies that were adopted to better balance their operations during and post the disaster.
3. Focus on localization strategy.
4. Understanding critical dependencies that exist within the supply chain beyond the first tier of suppliers.

All of the above ways has helped them to deal with the disaster in a better way. However, they still have a long way to go
and a lot to do such as rehabilitation of supply chain, necessity of actionable BCP , modifying the purchasing process etc.
considering the challenges that lie ahead to build a more robust and sustainable business across the globe.

RECOVERY AND WAY FORWARD By William Schmidt , David

Simchi-Levi