Developing automotive global competitive capabilities in an emerging market context: the case of TPS supplier development in Indonesia

Type de publication:

Conference Paper


Gerpisa colloquium, Bordeaux (2024)


Purpose—This study examines how Toyota undertakes supplier development in emerging markets with the particular purpose of understanding the mechanisms used by Toyota Tier 1 suppliers in the sustainable development of lower tier suppliers operating in the automotive industry in Indonesia. While Toyota has a world-leading reputation for supplier development, our research suggests that Toyota’s global tiering system is less effective in diffusing the dominant Toyota Production System (TPS) across auto parts supply chain of Tiers 2 (low), 3 (lower) and 4 (lowest) production, manufacturing and operation capabilities, in particular, in the context of late-industrialized country characterized with weak manufacturing and labor market institutions.

Design and methodology—The study involves inductive reasoning drawing on in-depth qualitative data that includes direct observations across automotive manufacturing plants (car, motorcycles, and auto parts) and training sites in Indonesia and Japan, and 147 semi-structured interviews undertaken with diverse participants across machine operator, engineer, management, directors, policy makers, TPS trainers and quasi-government representative directly involved in the supplier development scheme in 2014, 2022 and 2023.

The significance—our research contributes to operation, production and manufacturing management (OPM) and supply chain scholarship, and industrial development policy, by scrutinizing the mechanisms of supplier-to-supplier development in diffusing-adopting TPS across Tiers 2, 3 and 4 in the Indonesian automotive supply chain. We present novel data and an examination of development activity lower in the supplier pyramid than is generally the focus of research. Against this backdrop, our research contributes to the understanding of TPS supplier development theory and practice.

Findings—our study sheds new light on the effectiveness of supplier-to-supplier development in the emerging market manufacturing context: (i) the systematic roles of Tier 1 Toyota direct suppliers in materializing Toyota’s global manufacturing objective; (ii) on the developments through the supply chain, particularly in-direct Toyota Tiers 3 and 4 suppliers that are rarely studied.

  GIS Gerpisa /
  4 Avenue des Sciences, 91190 Gif-sur-Yvette

Copyright© Gerpisa
Concéption Tommaso Pardi
Administration Juan Sebastian Carbonell, Lorenza MonacoGéry Deffontaines

Créé avec l'aide de Drupal, un système de gestion de contenu "opensource"