1、Automotive Best Practices ForumSupply Chain Management0WELCOME!Todays meeting will focus on the results of the Supply Chain Management Assessment, completed by 22 automotive supplier executives and 3 vehicle manufacturer executives.Introduction1Table of ContentsIntroduction4 - 13Supply Chain Managem

2、ent14 - 21Definitions and Strategy22 - 32Understanding Expectations33 - 38Supply Chain Management39 - 47Performance Measurement48 - 55Technology Solutions56 - 60SCM Opportunities61 - 72Page Number2Industry Forces and IssuesIntroductionThe automotive supply chain is going through a period of unpreced

3、ented change in order to meet increasing consumer expectations with regard to price, delivery, and product customization. The managing of the supply chain pipeline is therefore faced with a number of key issues including;Elevating supply chain management as a critical success factor to achieving com

4、petitive advantageAligning the organizational structure to support global supply chain managementEstablishing a process oriented, functionally integrated supply chainForecasting the impact of changing global markets on supply chain costs and capabilitiesDefining key performance indicators and measur

5、ing supply chain performanceUnderstanding, selecting and integrating supply chain management enabling technologyAnticipating and responding to the impact of supplier consolidationsAnticipating and responding to the impact of OEM consolidationsDefining and tracking total supply chain costs 3Introduct

6、ionDefine supply chain management and its componentsUnderstand the elements of a supply chain strategyPosition the role of a supply chain executiveIdentify the elements of supply chain managementUnderstand the role of information technology applicationsIdentify how to utilize performance measures in

7、 the supply chain processUnderstand how to use best practices and benchmarking in support of supply chain managementUnderstand role of customers, suppliers, and third parties for collaborative support.Todays Objectives4The integrated supply chain concept has gone through three distinct phases.“Push”

8、 era focused on distribution of finished goodsManaged WIP, raw materials, and finished goods as separate functionsMgmt required production to be balanced with customer requirementsPhase I1960-1975Importance realized in integrating operations within the enterpriseComputer horsepower applied to manage

9、 material flowCompanies began to migrate from “inventory push” to a “customer pull” channelPhase II1975-1990Significant productivity increases could only be realized through managing relationships, information and material flow across enterprise bordersRecognized the “delivery of enhanced customers

10、and economic value through the synchronized management of the flow of physical goods and associated information from sourcing to consumption”Phase IIIlate 80s - presentSource: Bernard LaLonde, professor emeritus of logistics at Ohio State UniversityHistory of SCMSCM Overview5The following represent

11、some of the other initiatives which have either helped develop or have been spawned from the SCM movementAgileManufacturingEfficient ConsumerResponseTotal Quality ManagementDirectivesChannel ManagementShared ServicesConstraintBased SchedulingChannelIntegrationValue Chain(extended)FlowReplenishment/F

12、luidDistributionDistributionResourcePlanningVendorManagedInventoryTheory ofConstraintsChangeBasedStrategyVendorManagedInventory (VMI)FlexibleManufacturingTime based mfg./logisticsContinuous ReplenishmentPlanning (CRP)QuickResponse (QR)Reverse Flow LogisticsTheory ofConstraintsSynchronousManufacturin

13、gJust-in-time (JIT)Third PartyLogistics (3PL)FlexibleDistributionCategory Management ContinuousReplenishmentPlanningSCM Related ConceptsSCM OverviewJust-in-time (JIT)Total Quality ManagementSynchronousManufacturingTheory ofConstraints6ValueComplexityFunctional “Silos” Virtual Extended ChainsIntegrat

14、ed Internal Supply ChainIntegrated External Supply ChainSelect Vendor/Customer CollaborationSelected Cross-functional TeamingInternally Focused Optimization COLLABORATIONPULLPUSHSCM ContinuumSupply Chain ContinuumSCM Overview7A survey conducted on supply chain essentials resulted in a management res

15、ponse from 451 companies in 25 countriesAlmost one-third (29%) of the companies surveyed do not involve their suppliers in inventory managementNearly one-quarter of the companies (22%) do not involve their customers in planning manufacturing requirementsOnly 13% rated their ability to communicate wi

16、th customers on forecasting as strong1. Planning and deploying inventory effectively2. Providing predictable delivery performance3. Creating new products and services4. Reducing order fulfillment cycle time5. Having products in stock6. Decreasing manufacturing cycle time7. Reducing transportation co

17、sts8. Reducing customer returns9. Communicating electronically with customers and suppliersTop Supply Chain EssentialsSource: 1997 KPMG / Northwestern Supply Chain StudyCurrent State of SCM MovementSCM Overview8Degree of CompletionThe majority of companies are implementing supply chain initiatives.

18、This figure has increased dramatically from 10% reported in 1996.Question 35%35%60%0%0%0%0%10%20%30%40%50%60%70%80%90%100%Improvement initiatives are completePlan to begin addressing initiatives beyond 2000No initiatives or opportunities plannedPlan to begin addressing initiatives during 1999Current

19、ly evaluating improvement opportunitiesCurrently implementing an improvement initiative(s)% of RespondentsSCM Overview9There are many approaches, concepts, models, and ideologies developed to describe SCMPlanSourceMakeDeliverBuys from Manufacturer/WholesalerStores in warehousesMoves it to RetailersS

20、tores it on shelvesSells it toCustomersSupplierWhouseWhouseRetailRetailCustomerTrucksSCM ApproachesSCM Overview10SourceThis portion of the model pertains to procurement of goods (raw materials, semi-finished, or finished) and services. Partnership building, strategic sourcing, organization compatibi

21、lity, technological capabilities, and commitments to continuous improvement are all important elements.ProduceThis section of the model addresses the physical manufacturing process and any corresponding constraints, if applicable. Production scheduling, labor scheduling, and minimizing downtime and

22、setup costs are all key factors in the production process and supply chain management. More importantly, the coordination of these efforts with other functional areas of a company must be evaluated to ensure the greatest supply chain efficiency.StoreThe Store segment of the model refers to receiving

23、 and shipping practices, inventory management, warehouse management, and selection of products for distribution. Internal vs. outsourcing alternatives, process flows, layouts, and storage-density practices must be evaluated in terms of cost, quality, and speed. The economic and competitive consequen

24、ces of various warehousing strategies must be analyzed to ensure a better return on assets and long-term, bottom-line impact.Supply Chain ModelSCM Overview11PlanDisciplined planning is needed to maximize the coordination of supply chain functions. In addition, it is important that an overall strateg

25、ic plan and goals exist in order to provide a common and uniform direction to the different operating functions. This information must be accurate, timely, and freely shared. Forecasting is part of the planning process, in addition to the integration and collaboration of processes and practices. Tra

26、nsportThis section covers the movement of goods from the supplier to the production facility and/or distribution center and from the distribution center to the customer. Regulations, litigation, technology, relationships, customer expectations, and delivery alternatives are all important components.

27、 The right strategy, including partnering relationships, can differ dramatically from one market to the next.SellAttracting, managing, and retaining customers is the main focus of the Selling section of the model. A better understanding of customers needs, goals and behavior can improve product deve

28、lopment and delivery. Policies, procedures, processes, and systems are significant factors which must be examined in order to improve service and increase customer satisfaction.Supply Chain ModelSCM Overview12Foster A Leadership Driven Supply Chain StrategyDevelop IT Strategy and InfrastructureAsses

29、sCustomerNeeds &SegmentsDevelopSupply ChainStructureAlign &MonitorKeyPerformanceIndicatorsThe following model has been developed as a guide for discussing an effective supply chain management solutionGuiding Principles of SCMDefinition and Strategies13Develop IT Strategy and InfrastructureAssessCust

30、omerNeeds &SegmentsDevelopSupply ChainStructureAlign &MonitorKeyPerformanceIndicatorsFoster A Leadership Driven Supply Chain StrategyDevelop a strategic vision aligned with customersFocus on optimizing the entire supply chainIdentify goals and develop prioritization proceduresMaintain focus on “big-

31、bang” goals but implement in stagesLead from the topFoster A LeadershipDriven SC StrategyDefinition and Strategies14SUPPLIERDISTRIBUTIONCONSUMERMANUFACTURINGCUSTOMERWhat is the Supply Chain?The supply chain is a compilation of activities, functions, and procedures which enable raw materials to be co

32、nverted into products, delivered and consumed by end users. . .Supply Chain DefinitionDefinition and Strategies . . .including functional activitiesInformation TechnologySourcingOrderProcessingProductionSchedulingProcurementCustomerServiceInventoryManagementTransportationWarehousing15What is Supply

33、Chain Management (SCM)?It is the coordination and integration of all these activities. 1. The Supply Chain Council2. Supply Chain Management“From your suppliers supplier to your customers customer”1“The art of managing the flow of materials and products from source to user”2SUPPLIERDISTRIBUTIONCONSU

34、MERMANUFACTURINGCUSTOMER. . .into a seamless processSupply Chain Management DefinedDefinition and Strategies16Supply Chain Management refers toManaging the entire supply chain flow from raw material procurement, distribution to manufacturing facilities, processing finished goods, distribution to war

35、ehouses worldwide and to end customer.Successful performance by all organizations and resources in the production and delivery of products and services to customers.Extending company boundaries to supplier network through information sharing from concept to life of product-making suppliers an integr

36、al part of the company.Use of pro-active material, acquisition planning supported by a tailored and benchmarked supply base.Logistics includes the processes and activities of Materials management such as forecasting, sourcing and purchasing, warehousing distribution and transportation.Moving goods f

37、rom supply points through the manufacturing process and to the customer.Planning, obtaining, producing, and distributing material and products in the correct quantities.The entire procurement distribution, inventory and warehouse system.Getting products or services from the supplier to your door.Sup

38、ply Chain Management DefinedDefinition and StrategiesSuppliers have many definitions of supply chain management. The key is to define it in terms of the activities that are crucial to the success of the supply chain process.Questions 117My Company has a well documented supply chain strategy 3.1The s

39、upply chain strategy is directly linked to the corporate strategy 3.3Supply Chain StrategyIn general most companies have high level goals and measures but lack implementation content such as budget and systems integration plans.Questions 4 & 514%18%27%36%36%36%36%36%41%41%45%59%64%68%68%0%10%20%30%4

40、0%50%60%70%80%90%100 %Facility Network Evaluation and DesignThird Party Relationship Management PlansWarehousing Management PlanMission StatementManufacturing RequirementsInformation Systems IntegrationBudget and Investment RequirementsCompetitive EnvironmentTransportation Management RequirementsOrg

41、anizational ResponsibilitiesInventory Management RequirementsCustomer Requirements and RelationshipsSourcing/Procurement RequirementsPerformance MeasuresPerformance Goals and Objectives*Level of Agreement*Where 1=Disagree, 2 = Somewhat Disagree, 3= Neutral,4 = Somewhat Agree, 5 =Agree% of Respondent

42、sDefinition and Strategies18Title: Director or Vice PresidentDepartment: Purchasing or Supply Chain ManagementResponsibilities:Supply Chain Executive ProfileOrganizational ResponsibilitiesIn general, Supply Chain executives are not responsible for customer facing sales activities or manufacturing, b

43、ut rather traditional purchasing and logistical operations.Most Common:1. Sourcing and Purchasing (68%)2. Supply Chain Planning and Network Design (64%)3. Inventory Management (50%)4. Warehouse Operations Planning & Management (50%) Transportation (50%)Least Common1. Manufacturing (14%)2. Linkages w

44、ith Sales, Promotions and Marketing (14%)3. Packaging Design (18%)4. Sales Order Management (18%)Questions 11 & 1219Management of the Supply Chain*Where 1=Disagree, 2 = Somewhat Disagree, 3= Neutral, 4 = Somewhat Agree, 5 =AgreeSenior executives are aware of the importance of Supply Chain Management

45、 but lack financial resources for implementationQuestion 13Senior executives are forward thinking and keep up with the latest management techniques for optimizing the supply chain and enhancing shareholder value.12345Senior executives understand the complexities of optimizing supply chain performanc

46、e and are willing to make the required investments.Senior executives are dedicated to taking supply chain management from theory to practice.Supply chain management is a top priority with senior executives.Senior executives are keenly aware of the competitive advantage that can be gained through eff

47、ective management of the supply chain process. Supply chain management has elevated in importance and visibility due to increasing growth and profitability pressures.Organizational ResponsibilitiesLevel of agreement with regards to supply chain management:20Develop business unit st

48、rategies to support achievement of company objectives.Appoint a supply chain executive to serve as a natural facilitator and integrator between the divergent needs of sales and manufacturing, quality and price, cost and service, and financial and qualitative measures.Clearly define supply chain func

49、tions, processes, and activities and articulate throughout the organization.Translate business unit strategies into supply chain strategies with quantifiable goals and objectives. Identify critical processes essential to the achievement of the business strategy and goals. Establish action plans deta

50、iling the steps required to achieve the goals and objectives.Best Practices Definitions and Strategies21Automotive suppliers define supply chain management differently. The activities comprising automotive suppliers supply chains also differ dramatically.The majority of respondents were unsure wheth

51、er supply chain strategies are aligned with business unit and corporate strategies.Companies with supply chain strategies place emphasis on performance measurement and supplier and customer facing issues, but little emphasis on defining action plans, budgets, investment requirements, and resources r

52、equired to implement those plans.Companies assessed that they were best prepared to respond to global supply chain issues, but less capable of capturing supply chain costs, measuring performance, and selecting and integrating software solutions.Key Findings Definitions and Strategies22Suppliers supp

53、ly chain executives roles and responsibilities vary, as does the level and department within the organization.Suppliers feel that senior executives may only partially understand the complexities of optimizing supply chain performance and are willing to make the required investments necessary to achi

54、eve optimal performance.Key Findings Organizational Responsibilities23Understand customers and segment based upon needs and preferencesAnalyze cost of service by customer Develop a channel strategy to target and serve different segmentsFoster A Leadership Driven Supply Chain StrategyDevelop IT Strat

55、egy and InfrastructureDevelopSupply ChainStructureAlign &MonitorKeyPerformanceIndicatorsAssessCustomerNeeds &SegmentsAssess CustomerNeeds & SegmentsUnderstanding Expectations24Companys Expectations of Self Understanding ExpectationsQuestion 7SuppliersOEMs100% on-time deliveryCost improvements Define

56、, Track, and Reduce Supply Chain costsReduce purchased product/supplier costsReduce parts cost every model yearReduce Inventory and obsolescenceReduce premium freight and distribution costsQuality ImprovementsIntegrate / leverage supplier capabilities and technologies for competitive advantageImprov

57、e PPM performanceTechnologyImplement / upgrade EDI/ERP/WMS capabilitiesExpectationsXXXXXXXXX XXX25Understanding ExpectationsQuestions 8 & 9 Tier One SupplierOEM Customer SupplierExpectations of CustomersExpectations of SuppliersExpectations of SuppliersUnderstanding ExpectationsExpectations of OEM26

58、Expectations of Customers Questions 8 & 9To be rewarded for superior performance, to be dealt with as a partner, to be paid on timeStable orders (subjective), communication of key issues affecting suppliersReduced number of design alterations during design development, improved forecast stability an

59、d accuracy, risk sharing of raw materials cost exposureUnderstanding Expectations Tier One SupplierOEM Customer Supplier SupplierExpectations of CustomersExpectations of CustomersSchedule stability, recognize our full value, share technology expectationsSharing program or cycle plans information, fa

60、irness in customer supplier relations, providing business opportunities to supportLarger orders, limited customization, quality forecasts, EDI orderingExpectations of OEM (Supplier)To meet or improve all quality targets, to meet or improve all cost targets, to meet or improve all delivery targets.St