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Coordination of Supply Chains. Understanding Supply Chain Relationships. Agenda. North American Automotive Industry Automotive Industry Action Group Chrysler Corporation Supply Chain initiatives U of M Study Opportunities Areas for dialog Future research directions High impact areas .

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coordination of supply chains

Coordination of Supply Chains

Understanding Supply Chain Relationships

agenda
Agenda
  • North American Automotive Industry
  • Automotive Industry Action Group
  • Chrysler Corporation
    • Supply Chain initiatives
  • U of M Study
  • Opportunities
    • Areas for dialog
    • Future research directions
    • High impact areas
combined north american automotive market share
Combined North American Automotive Market Share

Chrysler, Ford, General Motors

Automotive Mergers

European Competition

  • Improved Quality
  • Lower Costs

Oil Shocks

Asian Competition

the auto industry
The Auto Industry
  • Worldwide market is 48 million vehicles
  • 5,500 vehicles built every hour of everyday
  • Potential for 60 million vehicles by 2001
  • 630 plants in 63 countries producing vehicles
  • 12 million units, over capacity
a typical seating supply chain

Excel/Atwood

Douglas &

Lomason

Collins & Aikman

Specialty Screw

Textileather

Canadian Fab

A Typical Seating Supply Chain

General

Motors

Chrysler

Ford

Johnson Controls

Hardware Suppliers

Soft Trim Suppliers

Lear Favesa

R. R. Spring

Rockford Spring

Dudek &

Bock Spring

Milliken &

Company

Technotrim

slide7

Automotive Industry

Action Group

  • Automotive trade association - nearly 1400 member companies
  • Association formed in 1982
  • Forum to address automotive industry issues
  • Focus on improving productivity
  • Educate and inform
slide8

Member Company Diversity

Software Vendors

Computer Hardware Vendors

Communication Vendors

Training Vendors

Registrar Suppliers

Construction Companies

Packaging Companies

Aftermarket Suppliers

GM, Ford, Chrysler

Heavy Truck Manufacturers

European Transplant OEMs

Japanese Transplant OEM’s

Financial Institutions

Transportation Suppliers

Production Part Suppliers

Non-Production Part Suppliers

slide9

AIAG Major Initiatives

  • QS-9000 SUB-TIER DEPLOYMENT
  • AUTOSTEP
  • EDI ROLLOUT
  • AUTOMOTIVE NETWORK EXCHANGE (ANX)
  • YEAR 2000
legacy proprietary one to one connectivity
Legacy: Proprietary, One-To-One Connectivity

Chrysler

Ford

GM

Chrysler

Telecom

Network

Ford

Telecom

Network

GM

Telecom

Network

Supplier

Supplier

Supplier

anx open any to any connectivity
ANX: “Open”, Any-To-Any Connectivity

Chrysler

Ford

GM

Chrysler

Telecom

Network

Ford

Telecom

Network

GM

Telecom

Network

ANX

Supplier

Supplier

Supplier

program history
Program History
  • Chrysler, Ford, and GM initiated this effort through the AIAG to provide:
    • common process to suppliers
    • independence / confidentially to manufacturers and suppliers
    • neutral facilities & support services
    • USA regulatory approval
2 0 develop tools

0.0

1.0

2.0

3.0

4.0

8.0

5.0

6.0

7.0

8.0

2.0 Develop Tools
  • Awareness Seminar
  • Self-Assessment
  • Web-based Tool Kit
    • Tips and Techniques
    • Plant-Floor-Equipment Knowledge Database
  • Evaluation Methodology
  • Assessor Training
  • Information Center
company background chrysler
Company Background: Chrysler
  • Manufacture of Cars and Trucks
  • 126,000 employees worldwide
  • 42 Assembly and Manufacturing locations
  • 3.1 million units sold in 1997
  • 1996 Forbes ‘Company of the Year’
  • Close the books forever, November 1998
cost in the average new vehicle
Cost in the Average New Vehicle?

70%

Supply Chain

30%

Chrysler

slide17

What it is

The Extended Enterprise™

A Chrysler-coordinated, goal-driven process that unifies and extends the business relationships of suppliers and supplier tiers to reduce cycle time, minimize systems cost and achieve perfect quality.

slide18
The Extended Enterprise Supply Chain

Subassembly

Supplier

Assembly

Plant

Delighted

Customer

Raw Material

Supplier

Component

Supplier

Dealer

Maximized value at minimized cost

enablers of the extended enterprise

Quality

Cost

Cycle-Time

Technology

Enablers of the Extended Enterprise

Supplier Relations

Supply Concept

Commodity Strategies

Supplier Development

Supplier Development

Cost Management

Technology Leverage

partner information network tools
Partner Information Network Tools
  • Computer Aided Design (CAD/CAM)
  • Electronic Data Interchange ( EDI )
  • Supplier Partner Information Network ( SPIN )
  • Electronic Funds Transfer ( EFT )
  • Electronic Mail ( E-MAIL )
slide22

ANX

ANX

ANX

Tier 2

Tier 3

Tier 1

Chrysler

EDI

830, 856, 862/866

EDI

Transactions

EDI

Transactions

TM

Empowering the Extended Enterprise

With Continuous Improvement

Supply Chain Order-entry Process Empowerment

$. C. O. P. E.

slide23

Extended Enterprise In Action:

Dealerships

Working together towards

process improvement

Communication Flow

(Supply Chain EDI)

Chrysler

Great Cars & Trucks

(Tier 1)

Dana

Corp.

Axles

(Tier 2)

Impact

Forge

Forgings

Material Flow

(On-Time Delivery)

(Tier 3)

Mac Steel

Northstar Steel

Steel

Best practice suppliers,

who are leading the

Supply-Chain EDI Initiative

Supply Chain Example

chrysler communications
Chrysler Communications
  • Verbal
    • meetings, townhalls, awards
  • Written
    • Supplier Newsletter, PASS report
  • Video
    • Chrysler Employee Network feed
  • Electronic
    • Electronic Commerce
understanding supply chain relationships
Understanding Supply Chain Relationships
  • Open business relationships
  • Communications builds trust
  • Establish partnerships
  • Empower
  • Reward
trust of the oem
Trust of the OEM

Very

Great

Extent

Very

Little

Extent

communication with oem
Communication with OEM

Very

Great

Extent

Very

Little

Extent

extent oem shares savings
Extent OEM Shares Savings

Very

Great

Extent

Very

Little

Extent

willingness to share new technology
Willingness to Share New Technology

Very

Great

Extent

Very

Little

Extent

good overall relationship
Good Overall Relationship

Very

Great

Extent

Very

Little

Extent

activity in supply chain management
Activity in Supply Chain Management

Very

Great

Extent

Very

Little

Extent

greatest long term benefits of extended enterprise
Greatest Long Term Benefits of Extended Enterprise™

Percent Selecting This Item Most Important

Improved

Communications/

Coordination

Lower Total

System Costs

Improved Margins

Improved

Quality

Reduced

Cycle

Time

Better Human

Resource

Utilization

areas for dialog
Areas for Dialog
  • Track and document ‘Role Model’
  • Methods for collaboration
  • How to measure success
  • Obtaining trust of user and accuracy of information
future research
Future Research
  • Where are the opportunities?
  • What are the cultural affects?
  • How can technology help?
  • Develop a ‘Step-by-Step’ Roadmap
  • What can the U.S. Government and Universities offer business?
high impact areas
High Impact Areas
  • Examples of
    • benefits
    • costs
    • opportunities
  • IT infrastructure as all levels of Supply-chain
  • Open communications up and down the chain
john kay
John Kay

Phone: +248-512-1438

E-mail: jvk@chrysler.com