Reference no: EM131006495

The Current event is Takata Airbag Recall.

Should have a 2-3 page paper executive summary, structured as an analysis.. The paper is all ready set up. Should include a lot of Supply chain management. I need a Power Point should be set up just like the paper.   The PowerPoint should be around 8 - 10 mins presentation which highlights the findings of your analysis You should at a minimum cite the text (repeatedly), cite your news source(s) and organization's website(s), and a minimum of 2 scholarly sources.  All citations should be in APA format.  

SCM 301

Current Event

3/22/16

Takata Airbag Recall

Elisha Smith, Rachel Brady, and Alex Delserone

Intro

            This paper will analyze Takata’s current event supply chain issues and findings. Their supply chain issue has affected the company financially and damaged the relationship with their buyers and consumers. Takata’s current event supply chain issue is an airbag recall with multiple car dealerships. This paper will discuss the company’s history, the supply chain issue, their actual state, their ideal state, and recommendations for the company.  These recommendations are developed from a strategic standpoint. 

Company’s History

            Takata is a automotive part company based in Japan by Takezo Takada in 1930s (TAKATA, n.d.).  Takata’s mission and vision statement is to provide quality and total customer satisfaction, be an active member of the community, and have highly motivated associates. Takata started out as a textile manufacturer that equipped cars with seat belts. After doing research for crash test with dummies, Takata created new products(TAKATA, n.d.). Takata products are airbags, steering wheels, electronics, interior parts, and safety systems. Takata served worldwide to different car dealerships such as; Toyota, Honda, Mazda, BMW, Nissan Mitsubishi, Mercedes Benz, Subaru, Chrysler, Ford, and General Motors.

Problems at Takata

            Takata was known for for their excellent customer service. They supplied many well known and respected car companies with air bags and other automobile accessories. Takata gained recognition and became one of the world’s leading suppliers of airbag systems, helping to protect people who ride in all types of vehicles. (Takata.com)

Problems began to arise in early 2004. During production, Takata learned that the airbags they were producing had a high chance of exploding and impaling the driver and passengers. Takata used ammonium nitrate, the chemical propellant used by Takata to inflate the airbags. It can destabilize over time and violently rupture the metal casing. (Bernard 2015)  Takata also had manufacturers in Mexico that were operating well below their production standards. The company learned that rust, bad welds, and even chewing gum dropped into inflators are also at fault. (Atiyeh and Blackwell 2016) Once Takata learned of these production errors and possible problems, they allegedly began doing secret tests to see how these production errors were affecting their air bags.

Takata continued to manufacture and sell their dangerous air bags for years. The problem came to light when car accidents would occur and people would die or be seriously injured by being impaled by shrapnel from the airbags. Investigators began to notice the correlation between these instances and connect it to the faulty Takata airbags. When faced with these accusations, Takata refused to release a complete list of automobile brands that they had sold to, and which models were possibly affected. As the National Highway Traffic Safety Administration and Federal government took over the investigation, Takata began releasing more information. As the investigation continues, more information comes to the surface about their secret testing and knowledge of these problems years prior to happening. Takata continues to release hundreds of more automobile brands that have these defected airbags. A statement taken from Industryweek.com states that, “Takata produced about 87.3 million inflators with two kinds of ammonium nitrate propellant and supplied them to auto manufacturers in North America as of the end of June 2015. The company might eventually have to recall all of them, U.S. Transportation Secretary Anthony Foxx said during a Nov. 3 press conference.” These staggering statistics have caused a decline in Takata’s sales.

Takata is no longer the trusted thriving company that it once was. The company has lost consumers’ trust. Modern consumers are extremely concerned with the quality of their products. Because Takata knew of their defects and still sold their air bags, many consumers no longer support the company. Takata has also suffered financial costs. They have been paying out sums of money due to their multiple lawsuits. Takata will struggle to regain its successful share in the market for years to come.   

Ideals 

Actuals

            Takata made several supply chain management mistakes. Supply chain management prides its ideals on being effective, efficient, and ease of communication. Supply chains begin at the manufacturer, and Takata’s mistakes show how crucial each part of the supply chain is. Takata was one of the leading manufacturers of air bags and other automobile accessories. In early 2004, Takata became aware that their air bags had the possibility of exploding and killing the passengers of the car. For fear of losing money, they continued to produce their defective air bags. Manufacturers produce products that will eventually touch consumers. Takata’s lack of communication to their buyers, the automobile industry, was their first mistake. Takata never communicated to the automobile industry that the air bags they were buying were potentially deadly. Takata feared losing money more than they feared the fate of unknowing consumers. This leads to their second mistake, a lack of ethics.

Supply chain management is so focused on logistics of products that they often overlook one of the most crucial aspects, the consumers. Companies have an ethical obligation to make sure that their products are safe and reliable for consumers. Consumers take risks every day when they drive their cars or purchase food. People expect that their car will keep them safe, just like the expectation that their food is safe. When Takata continued to sell their defective air bags it showed their buyers and consumers that they lack ethics. Takata was more focused on profits then the safety of people.

Takata’s testing information was 

Recommendation

 About Takata|TAKATA. (n.d.). Retrieved March 16, 2016, from https://www.takata.com/en/about/

Coyle, J. J., & Coyle, J. J. (2009). Supply chain management: A logistics perspective. Mason, OH: South-Western Cengage Learning.