December 2006

1
RENAULT Global Evalog MMOG/LE Presentation
Denis Mozzo Logistics Inbound Quality Manager

• December 2006

2
Presentation

• - Introduction
• - Why Renault chose MMOG LE to assess its
  suppliers ?
• - Key figures
• - How Renault uses the self assessment results
• - Some experiences
• - Renault objectives during MMOG LE audit
• - Evaluation of 5 main criteria
• - Conclusion

3
Introduction

• Logistics Quality was managed by Renault until
  2003 through Evalog, which was an internal tool
• Renault has been strongly involved in the
  development and the use of Global MMOG LE from
  the start
• Renault, as GALIA team member, participated to
  the definition of this tool.
• Referring to the 2009 Renault Commitments, all
  Renault suppliers must meet a range of
  commitments as part of the Renault supply chain
  program
• MMOG LE is one of the key tools in use to achieve
  logistics commitments connected with 2009 RC.

4
Why Renault chose MMOG LE to assess its
suppliers ?

• 100 of Renault suppliers have to remain or to
  reach the world class level, in terms of
  logistics results and organization
• Renault doesnt assess all suppliers
• ? It was decided to use self assessments in order
  to
• 1) get a diagnostic of suppliers logistics
  current level, compared to benchmarks detailed in
  MMOG LE
• 2) check suppliers progress planning

5
Key figures

• 2009 RC for logistics
• suppliers SR gt 98
• Number of self assessments required from 2005
  until end 2006
• For current suppliers 220
• For new project suppliers 120
• 40 audits at suppliers plants done in 2006

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How Renault uses self assessment results ?

• Renault needs to make sure that progress is
  managed
• For already-mass production suppliers
• If logistics performances are strongly improving
  and if they are consistent with self assessment
  gtgt success
• Otherwise, Renault sends logistics auditors to
  the supplier
• For futures suppliers
• If action plan of self assessment is serious,
  and if supplier development during the project
  phases is OK gtgt no audit
• If action plan is weak, or if self assessment
  results are not consistent with other weaknesses
  seen during the project phases gtgt Renault sends
  logistics auditors to the supplier

7
Some experiences

• Strength
• Opportunity to check the place of logistic in the
  supplier organization
• Progress tool
• Self-assessment is a great opportunity for
  logistics improvement and saving
• Measure and improve Costumer-supplier relation
  (internal and external)

• Difficulties
• Involvement of the top management often weak
• Suppliers often overestimated
• Some suppliers dont use MMOG as a progress tool
• Define progress on a scale / work organized with
  targets not natural !

8
Renault objectives during MMOG LE audit

• - To make sure that the supplier has an effective
  PDCA management of its supply chain
• - To evaluate 5 main criteria
• 1. Results of the self-assessment of the supplier
• 2. Consistency of the results
• 3. Involvement of the top management of the plant
• 4. Level of the logistics organization
• For mass production life
• 5. Capacity to reach Renault logistics
  objectives (service rate, Quality Aviexp)
• For projects
• 5. Capacity to start mass production
  successfully

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Evaluation of the 5 main criteria

• Each criteria is estimated on a scale from 1 to 5
• Results of the self-assessment made by the
  supplier A5, B3, C1
• Reliability of the results of the presented
  self-assessment
• 1 The evaluation doesnt reflect the reality -
  overestimated - no solid action plan
• 5 All the fulfilled criteria are really in
  place and managed very seriously - complete
  action plan
• 3. Involvement of the top management of the
  plant
• It is measured from 1 to 5 from the first 10
  questions 0,5 points by positive and
  satisfactory answer
• 4. Level of the logistics organization
• 1 No effective action plan, no dynamic of
  progress, weak logistic management
• 5 Excellent management, all the actions are
  strictly followed up and on time, no delay clear
  objectives and visible progress

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Evaluation of the 5 main criteria

• For mass production life
• 5. Capacity to reach the Renault objectives
• It is measured from 1 to 5 from 5 main questions
  1 point by satisfactory answer
• - The service rate for Renault and the quality of
  Aviexp are measured and managed with an animation
  tool?
• - The analysis of these 2 indicators is weekly
  updated and is reported to Renault monthly ?
• - There is a monthly capacity analysis with the
  CFO volumes?
• - The performance of the production is measured
  and managed with an animation tool?
• - The quality of communication with the Renault
  people is measured and animated?
• For the projects
• 5. Capacity to start mass production
  successfully
• It is measured from 1 to 5 from 5 following
  questions 1 point by satisfactory answer
• There is a project leader on the site?

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Conclusion

• With Global MMOG LE, you can plan and control
  logistics progress
• Check your position compared to the best
  practices
• Manage Progress
• Prioritize Preventive actions, instead of
  corrective actions
• Develop logistics Quality culture
• ? Performances and costs saving
• Renault requires commitments from suppliers top
  management about Logistics-Quality organization
  progress
• ? Capacity to reach 2009 Renault Commitments
  logistics target.