Title: MP
1 Volvo Car Corporation
2e-business challenges !
Shareholder value
What drives the business?
Business
People
Technology
Product, Manufacturing, Logistics, Information!
Change Management!
3Customer Ordered Production- Short lead-time,
high precision
DISTRIBUTION
DELIVERY
PRODUCTION
1
SUPPLIER
ORDER
4Total Supply Chain
2nd tier
Vehicle distribution
Dealer/ Customer
Plant
1st tier
Transport
Physical flow
Capital flow
Information flow
5Making the Transition
Purchase priorities
Supplier positioning focus
- Whole of life cost
- Partnership
- Shared default/risk
Strategic Purchasing
- Total cost of acquisition
- Process capability
- Cycle time
- Flexibility/innovation
Strategic buying
Q U A N T U M L E A P
- Price
- Product quality
- Delivery
Commercial buying
- Budget
- Headcount
- System costs
- Savings
Transactional buying
Internal focus of activities
6Material Planning and LogisticsImportant factors
for Volvo
- Customer Ordered Production
- Early involvment in vehicle project
- Reliable Lead Logistics Provider
- Supplier communication - EDI
7Supplier to Consumer Logistics
Parts
M A R K E T A R E A S
Design for Logistics
Industrial Structure
Torslanda
Supplier choice
Gent
Capacity Flexibility
CCT ECT ECG
Uddevalla
Logistics Assurance
KDO
Test Pre-series Materials management
Inbound Logistics
Outbound Logistics
8Benefits supplier parks
- Improving order to delivery process and enables
customer ordered production (COP)
- Reduces logistic costs and inventory
- Closer and quicker communication between the
plant and park suppliers
- Freeing up space in car manufacturing plant
9Change to Modules Systems
From
To
Many direct suppliers
Many direct contacts
Substantial own design
- More second tier suppliers
10Fitting of modules systems in assembly
Cockpit
Front-end
Seats
Safety
SILS
SILS
SILS
SILS
SILS
SILS
SILS
SILS
Harnesses
Headliner
Door Trim
Wheel Tire
11Supplier Choice criteria's
12(No Transcript)
13Delivery precision
- Number of parts delivered inside time frame
- --------------------------------
- total number of parts required
- Time frames
- minutes for sequence suppliers
- hour(s) for suppliers with transport time table
- 1 day for the rest
- Measuring point
- Where Volvo takes over responsibility!
- Mistakes punished at the earliest point of
discovery, i.e. when required for arrears, when
delivered for over-deliveries - Common for all Volvo units
98
14LEAD LOGISTICS PROVIDER
Transport leverage and optimisation
Packaging leverage and standardisation
Transport precision
Track and trace along the supply chain
Protect materials and vehicles
15EDI (4 B 2 B)Electronic Data Interchange
Before
After
16Volvo Cars EDI Demands
- 100 usage of EDI without a manual interference,
the business must include the following
functionality's according to Volvos profile of
the Odette subset of EDIFACT. - DELFOR, Delivery schedules message.
- Calloff, based on DELFOR
- DELJIT only sequence suppliers.
- DESADV, Advanced shipping note.
- OTL, Odette transport label.
- INVOIC, Self-billed message
- ENGDAT, Engineering model exchange, Odette
message.
17Logistic EDI flow
Purchasing
Orders
Agreements
Supplier
SAL
Orders
Data file
MFG
DELFOR / Call-off
Manual SHP-routine
SHP
DESADV
Goods / Labels
VCC-Unit
SAL Sales Office MFG Manufacturing unit SHP
Ship from location
EDI Self Billed INVOIC
18EDI Vs WEBTwo Scenarios
EDI Web Service Provider
EDI file
Browser
EDI file
Volvo
Supplier
EDI file
EDI file
19EDI Vs WEB
- EDI
- A need for Volvo to reach customer Order
Production - A need for many suppliers
- Application to application without a manual
interference. - WEB
- Reachable everywhere
- Cheap
- A possibility for small suppliers to provide us
with EDI - Higher risk for errors due to manual handling
20Future supply chain demands need e-business
development!
Exchange of demand and capacity information
along the supply chain for critical items !
Exchange of problems and inventory
informationfor pro-active decisions !
Transparency and visability is a must !
21Thanks for your attention!