Stable Supply of Products
Casio's primary mission is to deliver the products desired by customers at the right time. The company is working to strengthen its global supply chain, and to continue providing cutting-edge products without interruption.
Approach to stable product supply
Delivering a stable supply of products to consumers is one of the most important responsibilities of a manufacturer, and is required to ensure customer satisfaction and loyalty.
As part of Casio's mission to provide delight, happiness, and pleasure to customers through its innovative products, the company is promoting the following policies.
Policies on Stable Product Supply
- We strive to shorten production lead-time and improve planning and execution accuracy by using IT to streamline the supply chain (procurement-production-logistics-sales-service).
- We build good relationships with component suppliers to ensure stable procurement.
- We maintain the flexibility needed to address various risks involved in manufacturing by:
▪ building a production system with at least two production sites for each product;
▪ producing multiple products at each Casio Group production site
▪ maintaining in-house production and inlining of key devices and components.
Supply network is highly responsive to changes in demand
Since sales for products such as electronic dictionaries for education (for schools, teachers and students) are concentrated in the early spring when the Japanese school year starts, this makes accurate sales planning more difficult. On the other hand, the components at the core of these products, such as semiconductors and display devices, have a procurement lead time that is determined by the market. This means long-term planning is required.
Accordingly, Casio has taken various measures to minimize the loss of sales opportunities, and has worked to expand its market share.
One such measure is the operation of parallel supply chain management systems (SCM) at the headquarters procurement division and a production site, in order to enhance capacity simulation speed.
Production sites carry out simulations based on sales plans provided by the sales department, and calculate the personnel and equipment levels needed for production, before making the necessary arrangements. The materials procurement department adjusts the procurement quantities every week by looking at information on materials to be received and the models prioritized by the sales department. These efforts help ensure timely production delivery.
In the case of electronic dictionaries, by using common platforms as base models, and performing primary assembly production, it is possible to add individual model specifications, such as dictionary content, display panels, and keyboards, during secondary assembly just prior to delivery. This enables Casio to rapidly meet changes in customer demand.
In the past, all parts procurement was carried out three months in advance. However, through the use of model platforms, the lead time for final product specifications determination has been shortened to just two weeks in advance, which also helps minimize surplus production.
Casio responds to the competitive and rapidly changing market for digital cameras by using weekly supply chain management in all divisions for sales, procurement and production.
Diversifying production risk and producing core components in-house
Casio maintains a stable supply of products by having each production site manufacture multiple product items, and by ensuring that two different sites can produce any given Casio product.
he company is also increasing the internal production of components in order to protect newly created technologies and to reduce parts procurement risk.
Production sites for individual products
Casio’s plant in Nava Nakorn Industrial Park of Pathum Thani Province in Thailand was damaged by the October 2011 flooding. Moving quickly, the Casio Group was able to meet its supply obligations by switching production to manufacturing sites in Japan and China. At the same time, Casio brought forward the opening date of its new plant in Nakhonratchasima Province, a different part of Thailand, where preparations for operation had been underway. This new Thai plant is located on high ground not vulnerable to flooding. Looking ahead, Casio plans to increase the manufacturing functions at the plant, making it one of the main production sites in the Casio Group, by expanding the number of products manufactured as well as producing components on site.
Although Casio was able to adapt in 2011, the recent flooding in Thailand has brought a range of issues into sharp focus. The Casio Group is currently addressing these issues in a review of its business continuity plans at the company’s production sites outside Japan.