Jaguar Land Rover’s (JLR’s) Production Process
JLR operates in the auto industry that has increasingly become dependent on innovation and creativity. This is mainly because the level of competition on the auto-sector has increased significantly. Additionally, the industry has negatively affected by the 2008 Great Recession as major players such as General Motors (GM) and Ford (the major players in the US auto sector) had to be bailed out. However, the industry has shown signs of recovery in recent years. Additionally, the industry faces massive pressure from environmentalists and other activists in the society to implement sustainable or “green” strategic approaches in their design and production. Many of the companies in the sector, including JLR, have bought into the sustainability aspect. This is illustrated by its implementation of a Lean system of production.
Lean Production
The concept of lean production was first conceptualized by the Japanese and popularized in the global market when Toyota employed it to massive successes in market share domination, innovation and creativity, as well as enhancing its profitability. The concept focuses on eliminating waste while maintaining o enhancing the quality of products. Lean Production can broadly be utilized in wide range of business activities such as design, production, and distribution.
At JLR’s Castel Bromwich production plant, the production line has been designed in line with the lean production principles. This is a reflection of the overall policy employed by JLR throughout its production plants. For example, in the past, JLR utilized massive space because it kept many of the supplies and stocks on the factory floor. However, after the implementation of Lean Production, it does not need as much space for operations. This is because these supplies and stocks are kept in spate storage areas. These storages are located strategically to enhance the just-in-time delivery to feed the production process.
In the JLR’s production line, the operatives utilize the minimum required stocks’ quantities. They only use more when required. In this case, they use the “Kanban signaling system” to inform the stores of the extra needed quantities to be supplied promptly. The efficient management of the company’s logistics has been crucial in its Lean Production approach. In this case, the kanban system is crucial in operating JLR’s assembly lines. In this case, the operator of each JLR station can order fresh supply of material or components when the stock levels at the station reach a pre-determined level. Therefore, JLR employs a supplier such as DHL is used to deliver such stocks to the stations. In fact, DHL is responsible for running all the JLR internal logistics. The kanban system is massively essential in JLR because it helps speed-up the production development flow.
Just-in-Time Production (JiT)
JiT is a philosophy that aims to eliminate waste completely. It focuses on the production or making the needed products, when they are needed, and the specific amounts in which they are needed. For example, for JLR to produce a massive number of automobiles that might utilize up to 30,000 parts there is a need to establish a detailed production plan. Crucially, such a plan must comprise of parts procurement. As a result, JiT is crucial in eliminating waste from JLR’s production cycle. At the same time, this approach can be crucial in eliminating unreasonable requirements and inconsistencies, which will likely rustle in improved productivity and efficiency.
The Kaizen Concept
The kaizen principle focuses on continuous improvement. JLR has adopted this principle because of the need to come up with innovative and creative technologies and ways carrying out business to remain competitive in the global market. This is because other companies are constantly innovating. At the same time, consumer behavior is constantly evolving as well. Therefore, the strategic approach at JLR has been to maintain a continuous state of change and improvement of its production system, efficiency, and the quality of products it put in the market. Additionally, efficiency will be helpful in ensuring that its pricing policy is competitive in the market.
Andon Boards
JLR also uses Andon Boards to enhance communication of information throughout the manufacturing plants. Ando refers to the displays, indicators, and controls that are crucial in the management of manufacturing because it enhances prompt responses to needs of the workers within the company’s system.
The Jaguar Land Rover Company Supply Chain
The industry supply chain is substantially decentralized. It has about 350 dealers in the United Kingdom and other 450 across the European region. About 50 worldwide suppliers are from North America, China, and Japan. The company team explains tasks to the new employees, and this makes it easier for the worker to adapt to the new environment. The employee gets to understand their role in the industry and thus making the workplace more conducive.
The company has the inbound logistics that organize the movement of goods and material handling equipment. It manages the transportation of arriving parts from the warehouse outside the company as illustrated in figure 1 below. The management controls the operations that provide services to the Jaguar Land Rover Company in the world. The finished product is transported to dealers and customers in the world by the outbound logistics (Pathak, 2016). Additionally, the outbound logistics ensures that the delivery of the vehicle produced takes place on time. Additionally, the outbound logistics make sure that the delivery is efficient without bargaining of the high-quality standards.
Figure 1: JLR’s Inbound and Outbound Logistics
The international manufacturing development ensures that the packing and shipping of the vehicle from the company is efficient. Moreover, it schedules the location where the products will assemble overseas. Packaging engineering program helps to reduce the waste and create the supply chain for the future products (Mukherjee, 2016). The program provides design container solutions and sets out the packaging plan for the company. Figure 2 below illustrates JLR’s supply chain management (SCM).
Figure 2: JLR’s SCM
Porter’s Five Forces Analysis
The threat of new entry – This force is significantly milt. This is because of the massive initial revenue needed to start an auto company. Additionally, new businesses fear to enter the car industry to compete with Jaguar Land Rover Company because there is a threat of new entry into the market. The new business may have an inadequate fund to make brands that can become more competitive than the JRL’s company. The business does not allow the entry of new business into the sector (Knoedle-Bunte, 2015). The company’s rules and regulations hold more standard that other firms will find it difficult to cope.
Buyer Bargaining Power – The power of the JLR Company’s buyers is more dominant than the other developing industries cannot withstand. In fact, the company manufactures products with high quality to enable the demand to be higher. The company has buyers from the major markets around the world and competing with them will not be easy. The company has many buyers globally, and the demand for their brands is higher (Pathak, 2016). Therefore, it will be harder for other car industry to convince customers that their products are better than that of JLR. The business also sells their brand at an affordable price to their clients. Unlike other car companies who sell their products at a higher price than the JRL industry. Thereby, making it harder to convince buyers to purchase brands from other vehicle industry.
The threat of substitution – This has made it difficult for other car industry to compete with JKL Company. It is not easy for other manufacturers to find an alternative product that can outdo the product from JKL firm. The company produces the best brand than any other company since they have enough capital and skills which enable them to provide more brands. The Jaguar Land Rover Company’s quality of products cannot be outsourced by other car industries. In fact, they produce high-quality products that attract the customers from major markets around the world. Therefore, making it more difficult for the competitors to compete against Jaguar Land Rover Company. The products made from other companies have less power to substitute the JLR’s product.
The supplier power – JLR’s suppliers display massive influence compared to their competitors. In fact, the company supplies are more than in other car companies. The company needs more supplies to enable them to produce more in their factory. The higher the quantity of its product the more it becomes difficult for their competitors to compete against them. At the same time, they have enough money to acquire better raw materials from their suppliers (Knoedle-Bunte, 2015). In this case, they have enough money to pay the vendors who provide them with the ideas and skills on how to make a new brand. The company can choose which suppliers are best for their industry because they have more choices and enough fund to pay for the services, unlike other car companies.
The competitive rivalry –The competitors in the market are not many, and the few who are there cannot outdo the produce from Jaguar Land Rover Company. In fact, the products from the other car industry cannot easily reduce the company’s power in the market. The level of competition between the companies is not higher because the products from JLR are of good quality compared other car industry (Wigley, 2013). The company’ competitor situation is not in the position to compete against the JLR’s industry. The products from the enterprise are much preferred than from other competing industries.
Product Life Cycle
The concept of a product’s life cycle refers to the life of a commodity in the market regarding financial costs. Additionally, it requires many skills, tools, and processes to manufacture a JLR brand. The products from this company have limited life thereby making them have a life cycle. The sales of these products pass through distinct stages, and each product poses different issues to the sellers. The brands in this company require different financing and purchasing power in each stage. However, before the company’s product is brought into the market, the industry conducts analysis for both external and internal factors (Pathak, 2016). The company can extend their product lifecycle by improving on their sales. The company advertises its products to make sure that they have new audience and customers. The JRL industry makes sure that the price of their products is affordable and they give discounts to their clients.
The company adds a feature that is not in other car made by other businesses to make sure that they catch the customers’ attention. It sells its products to a variety of markets to ensure that more customers acquire these products thereby making more profit for the company. The company has new packages in their brand to ensure that they reach their target customers. Moreover, the company appreciates its customers by changing their consumption thereby increasing their sales (Wigley, 2013). The range of vehicle that needs such kind of life cycle is Freelander Land Rover, Land Rover Defender, and Classic Range Rover. They have such kind of life cycle because they are fancy and are expensive.
JLR’s Main Competitors
The Jaguar Land Rover Limited has several competitors. For instance, there is the Bayerische Motoren Werk AG, Daimler AG, and the Porsche Automobile Holding SE. these competitors have greater sales almost like those of the JRL company. These companies have more employees with more skills which enable the industries to make high-quality products. The company has a large market in the world. The competitive companies have cars with more attractive designs that attract more customers thereby making more profit (Wigley, 2013). Additionally, the competitors have access to export markets. They have enough finance to employ engineers who are highly skilled and thus producing quality products that they can sell for lower prices to their customers. The companies have a variety of cars they can bring to the market. Therefore, the competitors can meet the demands of the customers thereby attracting customers to buy their brand.
Bibliography
Knoedle-Bunte, A., Henstridge, S. and Watkins, J., Land Rover, 2015. Pair of vehicle headlights. U.S. Patent D720,869.
Mukherjee, D., 2016. Case analysis: Tata Motors’ acquisition of Jaguar Land Rover. The Business & Management Review, 8(3), p.48.
Patel, P., Chan, A. and Smith, L., Jaguar Land Rover Limited, 2017. Front bumper. U.S. Patent D779,396.
Pathak, A.A. and Pathak, A.A., 2016. Tata Motors’ successful cross-border acquisition of Jaguar Land Rover: key take-aways. Strategic Direction, 32(9), pp.15-18.
Wigley, A., 2013. Considering mobile learning? A case study from Jaguar Land Rover. Development and Learning in Organizations: an international journal, 27(4), pp.12-14.
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