TIARA SHINTA R (NPM.

2106663723)

MANAJEMEN OPERASI
SALEMBA 2021

Solutions of case study on

Nissan Motor Company Ltd. :

Building Operational Resiliency
JOURNAL REFERENCES :
01 Risk assessment and risk management: Review of recent
advances on their foundation

02 Effective case research in operations management: a

process perspective

03 What could Nissan have done to assess the risk of

disruption in their supply chain?
On March 2011, 2011 a 9.0 magnitude earthquake, among the five most powerful on record, stuck off the
coast of Japan..
In the 1970s and early 1980s, the strategic challenge for a company was viewed primarily as one of protecting its
potential profits from erosion through either competition or bargaining. This view of strategy changed radically in the
late 1980s. The need to pursue multiple sources of competitive advantage simultaneously led not only to the need for
building an interdependent and integrated network organization within the company, but also to the need for building
collaborative relationships externally with governments, competitors, customers, suppliers, and a variety of other
institutions.
The latest and also perhaps the
most visible manifestation of the
growing role of collaborative
strategies lies in the
phenomenon often described as
strategic alliance :
The increasing propensity of
multinational companies to form
cooperative relationships with
their global competitors. In the
1990s, there is a fast-growing
and widespread perception that
global competitive battles will
increasingly be fought out
between teams of players
aligned in strategic partnerships
(Bartlett & Ghoshal, 1999).
4 Risks Related to Business
Strategies and Maintenance
of Competitiveness
1. PRODUCT STRATEGY
To secure profitability and sustainable growth based on our future product lineup plan, as part of our
product strategy developing process we monitor the impact of various risk scenarios—such as global
market changes and deterioration of demand—on our future profitability as projected by the plan.
2. Quality of Products
and Services
In order to achieve quality targets, milestone meetings are held for
processes from design, production preparation and production. At
these meetings, key check points are confirmed, such as
achievement of quality targets, prevention of recurring problems,
and adoption of measures for potential risks related to new
technology, mechanisms and design changes. Commercial
production starts after confirmation at the Start of Production
(SOP) Judgment Meeting, which confirms all issues are solved
and quality targets can be achieved. The final decision that the
model can be sold is made at the Delivery Judgment Meeting after
confirmation of the quality of commercial production and
preparedness for service/maintenance.
3. Environment and
Climate Change
The automotive industry is affected globally and
throughout its value chain by various regulations
and social requirements related to the
environment and safety, such as exhaust
emissions, CO2/fuel efficiency, fossil fuel
restrictions, noise, chemical substances,
recycling, and effects on water resources,
ecosystems and other natural capital. These
regulations are growing more stringent by the
year. To meet these requirements, we formulate
environmental strategies based on materiality
assessments of management risk factors,
analyzing potential risks and opportunities and
identifying issues that are crucial for both us and
our stakeholders.
4) Compliance and Reputation
We have produced a Nissan Global Code of Conduct for all employees of the Nissan Group
worldwide. To ensure thorough understanding of the code, training and education programs such as
e-learning are provided and our compliance with laws and ethical standards is monitored by
regional and local compliance committees that report to the Global Compliance Committee. We
have also implemented a globally integrated whistleblowing system allowing employees to report
suspected compliance issues to management.
OUTLINE
01 Potential costs and benefits of these actions identification
02 What else could Nissan has alone to prepare for and
respond to the disaster?

03 What could Nissan have done to assess the risk of

disruption in their supply chain?

04 How did Nissan’s product line strategy help or hurt its

ability to respond to and recover from the disaster?

05 How will the operational changes announced in 2012

affect Nissan exposure to future disruptions?
01 Potential costs and benefits of these actions identification
Nissan reborn from crisis in 1999. The principles of Nissan’s
emergency response plan included a priority on human life,
prevention of follow-on disasters, rapid disaster recovery and
business continuity, and support for the neighboring
community, companies, and government. Their Global Disaster
Headquarters responsible for gathering and distributing
information concerning employee safety, facility damage, and
business continuity plan. Some practices of Nissan:

1) Sharing information
2) Allocating Supply
3) Managing Production
4) Empowering Actions

Carlos Goshn.
Sharing information:
Their information sharing had the amazing depth to constantly update their regional production forecast
but it would be a distraction. So they brought send two staff members to Japan to gather their own
information and to solve problems holistically.
Allocating supply:
Their operational network, allocation was on the sales, marketing, and the regional Supply chain
management. They identified which car models required integrated GPS To meet customer demands, and
allocated resources accordingly, low end models Did not receive the allocation. Customers were willing to
purchase those models Without an integrated GPS. This method was completed within two weeks of the
earthquake and continually updated as the supply situation became clearer.
Managing
Production :
Nissan slowed their
production lines in a targeted
way. Management also pulled
vacation time into April and
May in order to free up
capacity later in the summer
when upstream bottlenecks
were projected to have
cleared. They used this
vacation as bought by having
in-transit inventory to identify
and implement supply
alternatives. They secure air
freight out of Japan so they
could get critical parts out of
the Country faster and
Empowering Action :
Their rapid and flexible action of empowered decision making without lengthy analysis helped them to recover
the critical situation. Actually they were successfully enabled themselves to take prompt actions when the time
came. Their speedy decisions at the situation by employee safety & damage caused and to take appropriate
actions based on this. They were able to gathered team immediately for damage restoration just after 15 minutes
of earthquake.
02 What else could Nissan has
alone to prepare for and
respond to the disaster?
Nissan thought little of the harms caused by the
tsunami, which was a result of the earthquake. Now
considering that tsunamis are results of submerged
earthquake, for what reason didn't Nissan ascertain
tsunami harms to a degree level with those of quakes?
Nissan could have made new tsunami clearing courses
and focuses that considered tsunami dangers. Likewise,
Nissan could have enormously expanded its
nourishment storage to be adequately sufficient for its
workers, their families and nearby inhabitants inside a
basic range.
As indicated by the Exhibit 2
for the situation examine,
fires broke out in the Tochigi
factory. This distinguishes a
weakness for fire
arrangement in the planning
and recognizing phases of
hazard administration. The
costs to keep these fires may
likewise be ostensible since
one could reveal the present
intend to cover the neglected
regions where the fires
occurred.
03 What could Nissan have done to assess the
risk of disruption in their supply chain?
Nissan had an association committed to the risk management beginning in 2008.
The Global Disaster Control could have arranged and distinguished the dangers more
deliberately, particularly when it came to topographical interdependencies and risk
possibilities. Japan is situated in a zone where tremors are visit. Nissan's risk
management centered around distinguishing and dissecting dangers as right on time as
could be expected under the circumstances, and arranging and quickly actualizing
countermeasures.
The organization built up a committed risk management work which was in charge of these exercises.
There was additionally an official level board of trustees that settled on choices on corporate dangers,
assigned "risk proprietors" to deal with the particular dangers. Be that as it may, as per the contextual
investigation, the effect of tsunamis was thought little of and this was a noteworthy defect in the
likelihood/affect network. At that point Nissan would lead a quantitative and subjective examination to
design the sorts of reactions important.
 Be that as it may, the belittling in the ID stage kept an appropriate risk
examination to react to the tidal wave dangers. Utilizing specialists acquainted
with Japanese calamity dangers ought to have been a need and put tidal wave
risks in the high risk zone. To evade these bottle necks in the inventory
network, Nissan could have streamlined, to a significantly higher degree, every
single basic part to be tradable with parts in various areas.
This would for all intents and purposes dispose of the requirement for
possibility stores of basic and various coming required from Japan and different
regions.
04 How did Nissan’s product line
strategy help or hurt its ability to
respond to and recover from the
disaster?
Nissan’s took a good product line strategy that help its
ability to respond to and recover from the disaster. Nissan
displayed their production lines in a targeted way. Nissans
management department considered in-stock and in-transit
inventory within their network and slowed their production
line for avoiding bottlenecks. The company successfully ramp
down their production so that they were able to decrease
overtime costs for operations that were expected to be
bottlenecked. The company’s management brought their
vacation time between April and May so that they could free
up their capacity later in the summer when upstream
bottlenecks were projected to have cleared.
 The company used the time
bought by having in-transit
inventory to identify and implement
supply alternatives. Their lead time
was 20 days for ocean transport
from Japan to United States. This
meant management have 20 days to
identify how to excess another
suppliers on critical situation. They
also secure air freight out of Japan
to get critical parts faster and quiet
the reduction of in-transit stocks.
05 How will the operational changes announced in 2012
affect Nissan’s exposure to future disruptions? How will it
affect its steady-state operations? What trade-of is
management making and why?

Nissan made several changes in its operations in its business as a preventive

measure to face any kind of challenges in future. The company made several
efforts to reduce the dependency of its foreign factories on Japanese
manufactured components. The localized manufacturing of cars was increased
from 70% to 90% by 2015.
A remarkable efforts were made by the company to better understand the
importance of secondary suppliers other than the primary suppliers in its supply
chain. The company took many lessons from the calamity which encouraged
them to modify its approach for a better future of the company. The buying
processes mainly of critical components were modified to reduce the supply risk
concentration to tier 1 which is a less severe level and to maintain the flow of
business. Every firm ought to strike better net time.
Thus, Nissan was required to be fully prepared and even better than before the net disaster strikes. To develop a
better sustainable business strategy the company must have an organized list of suppliers of all level as a
response to any type of threat or disaster developing better risk management techniques and an efficient supply
chain are also good for any business. & proper brought up and implementation of these changes can surely help
in developing an improved future disaster recovery plan that will help in flourishing the business and more
tolerant to severe.
THANKYOU.