Materials Management Operations GuidelineLogistics Evaluation

1、1Materials Management Operations Guideline/Logistics Evaluation November 2007MMOG/LE2AgendaWhy MMOG/LE?What is MMOG/LE?Completing the Self-AssessmentWho is Requiring MMOG/LE?MMOG/LE Key CriteriaAIAG/Odette MMOG/LE Benefits SurveyCustomer Success StoriesSupporting Training and Documents Available3Why

2、 MMOG/LE?4Improving Supply Chain Delivery PerformanceGain control of processes Reduce inventory carryingcosts, premium freight, rework, line stoppages, lead timesGain control of supply chain Increase inventory visibility Reduce supply chain riskSupport continuous improvement Increase customer satisf

3、actionIncrease competitivenessActionline Magazine, Fall 20065Who is implementing MMOG/LE?Suppliers to comply with OEM requirementsSuppliers in emerging marketsCompanies looking to Reduce supply chain risks Improve supply chain compliance and Increase delivery and long distance performanceRegional in

4、dustry associations Brazil, Romania, China, etc.MMOG/LE Outside the Automotive IndustryUniversitiesHigh SchoolsOther non-automotive industries Hospitals Construction Aerospace Chemistry Electronics Industrial Retail7What is MMOG/LE?8Principles of Global MMOG/LERecommended standard for materials and

5、logisticsSelf-assessment tool for identifying gaps in processesBased on agreed business processes By OEMs and suppliers Ford, Chrysler, PSA, Renault, Volvo Car, Volvo Truck, etc.Based on extensive, best practices 6 chapters 206 criteriaDetermine current level of plant performance9Scoring Summary (AB

6、C Classification)A LevelSupplier is considered to be at or near “world class” standards (90% or higher).B LevelSupplier is deficient in two or more aspects of a given category or multiple categories (75% 90%). An action plan should be put in place and the corrective action should not require a signi

7、ficant amount of time to implement.C LevelSupplier is deficient in one or more critical or high impact aspects (75% or less). Action plans required to ensure deficiencies do not result in serious or prolonged issues to the customer.10MMOG/LE Self Evaluation CategoriesStrategy and ImprovementWork Org

8、anizationProduction and Capacity PlanningCustomer InterfaceProduction and Product ControlSupplier InterfaceMMOG/LE TranslationsAvailable in 10 languages including:English FrenchGermanSpanish PortugueseChineseRomanianCzechRussianOver 2000 trained users in 16 different countriesWhat Does this Mean to

9、Me?Attend AIAG/Odette MMOG/LE standard training Understanding and building a team to complete assessmentComplete self-assessment Attend self-assessment education and review Develop gap analysis and action plan customer, internal, and sub suppliers Implement Action Plan Internal processes and systems

10、Sub suppliers (, Tier 2)Customer certifies self-assessment score13Completing the Self-AssessmentDownload the Self Assessment or ENGLISHFRENCHCHINESE151.2 Objectives1.2.1Objectives relative to the Materials Planning and Logistics function are defined, communicated and understood within the organizati

11、on. Why?Objectives allow departments and employees to focus on areas of importance to achieve customer satisfaction and the organizations Materials Planning and Logistics strategy.CriteriaF2XAll objectives are measurable and consistent with the organizations Materials Planning and Logistics strategy

12、.EQOS - Inventory accuracy is measured by the cycle count program, supplier delivery performance, customer delivery performance. F2xObjectives are accepted by all relevant functions and are clearly cascaded throughout the organization. EQOS reviewed by operations and at staff meetings and posted mon

13、thly for all employees to review. F2Objectives are reviewed with senior management at planned intervals. Complete the FormEach Question is Yes (“X”) or No (Blank)Populates the gap analysis tab16Each Question is WeightedF1F2 Missing six results in “C” level F3 Missing one results in “C” level 17Submi

14、t Scoring SummarySubmit Gap Analysis List of All Unanswered Questions (Blank)19Who is requiring MMOG/LE?20OEMEMEANorth AmericaSouth AmericaAsia/PacificFrequency of SubmissionMMOG/ LE v2 UsageCommentsEuropeYesTBDYesAnnuallyNext submittalYesYesBy Jan. 2008YesAnnually. This is a requirement for Q1.Next

15、 submittalCurrently, all regions using MMOG/LE for Q1 require Level A except Europe and Asia Pacific, which currently accepts Level B. Western Europe and Central and Eastern Europe onlyYesNew vehicle projectNext submittalStrong involvement of the plant management is required in order to make sure th

16、at progress is in place.YesYesYesYesRequired all suppliers Next submittal Volvo CarYesYesYesYesAnnually. This is a requirement for Q1Next submittal Volvo GroupEurope, a few suppliers in the Middle EastYesYes, BrazilIndia, ChinaAnnually self-audit submission and follow-up to be implementedNext Submit

17、tal21OEMSupplier Audit PolicySupplier evaluations are completed by Chrysler personnel using the Supply Process Analysis (SPA) for new suppliers, new supplier locations, and problem suppliers. The SPA encompasses elements inclusive of the MMOG self-assessment. Additional audits will be conducted on s

18、uppliers that have a significant variance in the self-assessment ranking and their actual Chrysler Supply performance rating.North America and Europe only. Potential suppliers, new suppliers, and problem suppliers. All suppliers will eventually get an audit. Major and problem suppliers will be prior

19、itized. Suppliers are consulted on the Global MMOG/LE in the Project Phase. Annual audits are not required annually, only during the project phase. In the Trial phase, evaluations are carried out if there are problems with the supplier.New and problem suppliers Volvo CarAn attempt is made to visit a

20、ll new suppliers and big volume suppliers. For potential suppliers self-assessment is the first step. Volvo GroupPotential suppliers, new suppliers, and problem suppliers22OEM Focus During MMOG/LE AuditsStrategy and Improvement Management commitmentCapacity and Production PlanningSupplier Interface

21、(Tier 2) Performance measurement Sub-tier supplier communication Sub-tier suppliers in emerging marketsImprovement PlanSelf-Assessment Quality23Key MMOG/LE Criteria24MMOG/LE Processes26Key CriteriaMaterials Management ObjectivesAnalyzed, measured (action plans if necessary)Defined, documented, commu

22、nicated and understood Identify continuous improvement opportunitiesCorrective action for bottleneck processesJob descriptions, work instructions and training plans27Key CriteriaKey Performance Metrics Delivery Performance Supplier Performance Internal performance (plan versus actual)KPIs for MMOG/L

23、E*ASN MessageKPI4GMML 1ASN PerformanceKPI4GMML 5Production DisruptionSchedule ModificationsIncomplete unitsLine StopsKPI4GMML 4Material Handling & IdentificationorKPI4GMML 2Delivery Accuracy orKPI4GMML 6 Supplier Communication & Cooperation Criteria : Self-sufficiency, Reliability, Responsiv

24、eness Supplier problem notification, Availability, FlexibilityDelivery RequirementsSupplier Plant Customer Plant WarehouseAssembly Line DOCKDOCKKPI4GMML 3“VMI”*Key Performance Indicators for Global Materials Management and Logistics29Key CriteriaResource Planning Flexibility and availability are opt

25、imizedContingency plans and emergency procedures exist Employees are trained Capacity Planning Long, medium, short-term plans reviewed regularly Process in place to notify of shortages Support all requirements for all customersMinimize inventory Obsolescence Raw material WIP Finished goods30Key Crit

26、eriaCommunication Scheduling automatically integrated into system without manual intervention830/DELFOR/Planning Releases862/DELJIT/Shipping ReleasesSystem compares resources versus requirementsProcess in place to notify of resource limitationsMaterial IdentificationSegregate good/bad materialPackag

27、ing and bar code labeling31Key CriteriaProduction and Product ControlProcess to monitor inventory levelsSafety stock, minimum stock, etc.Count AccuracyProduct structure accuracyControl and handling of WIP, scrap, rejects, returnsTraceability32Key CriteriaEngineering Change Control Participate and fo

28、rmal sign off New parts/past models/inactive partsShipping Timing, contents and accuracy of shipping labels Labels match customer requirements Data content of ASN is 100% accurate Controls in place to prevent shipping discrepancies Customs clearing process (if applicable)33Key CriteriaSupplier Commu

29、nication Process to ensure sub-tier suppliers can support production on-time with the right quantities Electronic communication (EDI or Internet) Releases, schedules and ASNs Planning horizon is appropriate In-transit visibility from ASNs Customs clearing process (if applicable) Process for supplier

30、s to notify of shortages34Key CriteriaSupplier PackagingBar code labelsProcess in place to define packaging and pack sizeEnsure sufficient packaging material is available35Key CriteriaSupplier Assessment Methodology to select and evaluate suppliers Continuous improvement process for sub-suppliersSup

31、plier performance metrics36AIAG/Odette Benefits SurveyAIAG and Odette MMOG/LE SurveySurvey administered in March/April 2007Over 160+ survey respondents North America Europe ChinaRespondent demographics Tier 1, Tier 2, Tier 3 and Aftermarket Large, Midsize and Small Companies Implementation time was

32、from 1 to 3+ yearsManagement commitment was not measuredTop Five Performance Improvements: Tier 1 and Tier 2-3Ability to meet ISO TS-16949Ability to keep existing businessData accuracyAbility to support lean (Tier 1)Overall supplier rating (Tier 2-3)Inventory ControlRegardless of Tier:Top Five Perfo

33、rmance Improvements: Large, Midsize and Small CompaniesData accuracyAbility to meet ISO TS-16949Ability to keep existing businessLarge suppliers also indicated Delivery accuracy and inventory controlMidsize suppliers also indicated Supports lean implementation and new businessSmall suppliers also in

34、dicated Overall supplier rating and new businessRegardless of Size:Top Five Performance Improvements: by Time ImplementedData accuracyAbility to meet ISO TS-16949Ability to keep existing businessAlso indicated: 1year: Ability to support lean and inventory control1-2 years: Inventory control2-3 years

35、: Delivery accuracy and line shortages3+ years: Reduced manual entry and inventory controlRegardless of Time Implemented:Data Accuracy Positive Performance Improvement Mean Score Over Time5860626466687080 15% improvement in past 10 years 85% of suppliers are at MMOG/LE Level “A”Benefits of Using MMO

36、G/LE China Tier 1 Suppliers Opinions Reduction in raw material, work-in-process and finished inventoryMore efficient process from receiving raw material to shipping inventoryVisible signs on shop floor identifying manufacturing operationsUse of metrics to capture failure in processImportance of appr

37、opriate packagingMore organized warehouse: FIFO process used more effectivelyMore control and accountability in the material ordering processMore warehouse spaceEase of production planning and scheduling processLess errorsAbility to compare material received versus material shipped Ability to see AS

38、Ns from tier 1s and pay tier 1s electronicallyImproved communications within the supply chain47Delivery Score Improvements602 suppliers completed MMOG/LE 2006-2007 54% improved in Chrysler delivery rating Average improvement to Chrysler rating = 30% 36% improved MMOG/LE score 85% are at “A” level48M

39、MOG/LE, Volvo Group, update Sept 07All new suppliers are requested to submit the documentA Requirement for existing major and poor performing suppliers A Criteria of Volvo Group Key Elements Procedures, Logistics 850 assessments received, 230 verified with Volvo internal personnel (most often on loc

40、ation)Linked to supplier relationship development processExample N-America: Self-assessed 44% of suppliers on A-levelAfter verification 37% of suppliers on A-levelExample S-America: Adherence to supply instructions (Mar to Aug) Total local suppliers average 89.0% correct day/quantity Total self-asse

41、ssed suppliers 86.7% All verified level A-suppliers 96.7% All verified level C-suppliers 85.8% not included: Volvo Car CorporationMMOG/LE Benefits and Success Stories from SuppliersJCC Company BackgroundCompany size $50 million USD Supplier in Fuzhou, ChinaParts produced Aluminum alloy pistons Motor

42、 air compressors Diesel engines Outboard enginesOEM and aftermarket supplierResultsReduced raw material and finished goods inventory by 50%Ability to achieve 100 points for monthly delivery ratingDecreased premium freightImproved overall rating by 20%Obtained a competitive advantage Obtained new cus

43、tomersEnterprise visibility into customer requirements drives businessGained efficiencies in productivity, quality and deliveryProducts include pulleys, dampers and idlersApproximately $55 million in salesSupplies to OEMs and major Tier 1sMajor customers include: Ford General Motors Nissan Automotiv

44、e Component Holdings (Visteon)London, Ontario Operations BackgroundPhysical Inventory Reduced frequency from monthly to annuallyInventory Value Reduced 50% in past yearsDelivery Performance On time shipping performance to customers in 2006 was 99.7% Delivery ratings to customers providing feedback w

45、as 100Supplier Performance On time delivery from suppliers is 100% on date required 97% of material requirements are communicated electronically to suppliers 95% of incoming material shipments are transmitted via ASNsLondon, Ontario Operations Results54Global MMOG/LE ProjectsNorth America TRW Freude

46、nberg Akebono Plastech Gates - Schefnacker Georg Fischer General Bearing Wagon Automotive Lear SchefenackerEurope ArvinMeritor - Tower Automotive - SNOP - recia - Mecaplast - MGI Coutier - Magneti Marelli - Treves Robert Bosch - Rieter Automotive - Hutchinson SIEMENS VDO Automotive Behr France Metaldyne International France TRW France - Edscha France Beru Eyquem SAS Amis (Sifcor) APM Autoliv France Continental Cooper Standard Dunlop roues Electrofil Fabri Freudenberg GKN Driveline Gris Dcoupage - Mahle Mann Hummel A