The main issue that is being faced by the Bridgestone Industries is the increasing costs associated with manufacturing and operations specifically in the automotive component and fabrication plant which has been depicting highly inefficient operations with high level of wastage. The management at the company has invested significantly in reducing the costs of operation by revaluating the processes and streamlining the operations of the company through the reengineering process. However the company has not been able to sustain the benefits of the investment.
Instead the passage of time has showed that the costs of the Bridgestone Industries are incrementally increasing and the company is facing excessive pressure ton reduce costs to increase the profitability as the volume of sales has been decreasing with the low level of demand for the products presented by the three big US automobile manufacturers. In order to resolve this issue, it has been presented that the company should seek to outsource its manifold production line. This is mainly because the outsourcing of this production line can provide significant cost savings and increased profitability for the company while reducing the overhead burden that exists on the current production lines. Additionally the outsourcing of the production line would also enable the company to get the manifold component manufactured from a specialized third party that can dedicate resources and skilled human resource for the operations while providing savings from stream lined lean manufacturing.
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