Development of Japanese-style supply chain management in the auto-electronics industry

We consider how Japanese suppliers cope with the supply chain existing in the USA, concentrating on the case of an electronics parts supplier, Denso, and two auto makers, Toyota and Mitsubishi. The auto makers place firm orders with the supplier on the basis of sales information provided by dealers and/or auto sales companies using EDI (electronic data interchange). In 1998, this order cycle was shortened to half a day for Toyota and one day for the other maker. Denso decided to change to a more upstream approach, meeting orders for parts rather than finished products, thus strengthening its ability to react to reduced order cycles and uncertainties in forecasted car sales fluctuations.