driving technology [automotive industry]

4
Driving tech no logy Access to information is essential in a successful organisation. Tom Kneen describes how IT can benefit the global company, with particular emphasis on the experiences of the automotive industry oday, business is global. Markets are international, manufacturing is dspersed, sales offices dot every conti- nent, and dstribution partners com- municate in many languages. Access to relevant information is essentialto being successful and competing on a world- wide scale. Yet many organisations cling to an outdated model of information tech- nology that builds barriers around corp- orate information and systems, limiting productive access to a select few. Businesses that fail to take full advantage of their networks are missing opportunities and allowing com- petitors to gain an economic edge. Companies must open up the flow of information, foster- ing interactive relation- ships with prospects, customers, partners, suppliers, and employees. To do so, they need a new information technology model-the global networked business. Becoming globally networked Becoming globally networked is no longer an option for most businesses. According to analysts International Data Corporation ‘To remain competitive, all corporations must have a strategy for sales and support over the Internet.’ But the process need not be disruptive or painful. Iniplementing a global network business model should be incremental and logical; companies should start small and grow as success builds on success. They can begin by selecting the one application with the greatest impact on their business. Companies embracing the global The Renault Technocentre networked business model should look for breakthrough ways of sharing information, tools, and systems in order to build stronger business relationships. Acknowledging the growing inter- national competition within the auto- motive indusg! French auto-maker Renault took drastic measures to shorten product cycles. The company relocated its disparate design, engineer- ing, and R&D functions to a single campus connected with a wide-ranging, hgh-speed network. This change allowed Renault to easily move people and equipment between workgroups, enabling more efficient cross-functional teamwork. The goal is to, within the next two years, reduce the time it takes to develop a new model by over 30% &om eight years to five years, and eventually, to just three years. Ultimately, the primary success factor in implementing a global networked business model is a reliable, secure, and manageable network that delivers the services necessary to create networked applications that support critical business functions. When a company selects an application, the implementation team must be multidisciplinary, with representatives fiom not only IT, but fiom all stakeholders. Input from users, for example, ensures that the application will be easy to use. Upon implementation, the application should be constantly monitored, modified and improved. Networked applications provide a wide range of benefits to the company and to its suppliers, partners, employees, prospects, and customers. Suppliers, partners and employees The purchasing function-ordering, delivery and billing-can be time and labour intensive as well as expensive. ED1 (electronic data interchange) is one networked application that can benefit MANUFACTURING ENGINEER FEBRUARY 2002 33

Upload: t

Post on 21-Sep-2016

215 views

Category:

Documents


2 download

TRANSCRIPT

Driving tech no logy

Access to information is essential in a successful organisation. Tom Kneen describes how IT can benefit the global company, with particular emphasis

on the experiences of the automotive industry

oday, business is global. Markets are international, manufacturing is dspersed, sales offices dot every conti-

nent, and dstribution partners com- municate in many languages. Access to relevant information is essential to being successful and competing on a world- wide scale. Yet many organisations cling to an outdated model of information tech- nology that builds barriers around corp- orate information and systems, limiting productive access to a select few.

Businesses that fail to take full advantage of their networks are missing opportunities and allowing com- petitors to gain an economic edge. Companies must open up the flow of information, foster- ing interactive relation- ships with prospects, customers, partners, suppliers, and employees. To do so, they need a new information technology model-the global networked business.

Becoming globally networked Becoming globally networked is no

longer an option for most businesses. According to analysts International Data Corporation ‘To remain competitive, all corporations must have a strategy for sales and support over the Internet.’ But the process need not be

disruptive or painful. Iniplementing a global network

business model should be incremental and logical; companies should start small and grow as success builds on success. They can begin by selecting the one application with the greatest impact on their business.

Companies embracing the global

The Renault Technocentre

networked business model should look for breakthrough ways of sharing information, tools, and systems in order to build stronger business relationships.

Acknowledging the growing inter- national competition within the auto- motive indusg! French auto-maker Renault took drastic measures to shorten product cycles. The company relocated its disparate design, engineer- ing, and R&D functions to a single campus connected with a wide-ranging, hgh-speed network. This change allowed Renault to easily move people

and equipment between workgroups, enabling more efficient cross-functional teamwork. The goal is to, within the next two years, reduce the time it takes to develop a new model by over 30% &om eight years to five years, and eventually, to just three years.

Ultimately, the primary success factor in implementing a global networked

business model is a reliable, secure, and manageable network that delivers the services necessary to create networked applications that support critical business functions. When a company selects an application, the implementation team must be multidisciplinary, with representatives fiom not only IT, but fiom all stakeholders. Input from users, for example, ensures that the application will be easy

to use. Upon implementation, the application should be constantly monitored, modified and improved.

Networked applications provide a wide range of benefits to the company and to its suppliers, partners, employees, prospects, and customers.

Suppliers, partners and employees The purchasing function-ordering,

delivery and billing-can be time and labour intensive as well as expensive. ED1 (electronic data interchange) is one networked application that can benefit

MANUFACTURING ENGINEER FEBRUARY 2002 33

relationships between all parties. The value of that dormation can be consider- able, helping everyone-employees, partners, and suppliers, as well as prospects and customers- to be more productive and successful.

both suppliers and customers. Net- worked suppliers have a competitive edge over other firms, potentially leading to increased sales. They are also able to better manage manufacturing schedules, improve cash management, and respond more quickly to their customers’ needs.

Successll partnerships leverage the resources of each partner. Through networked applications, partner service and support capabilities and sales assis- tance can be provided through immediate, round-the-clock, global access to a complete library of technical and product information.

A partner-initiated customer access program allows partners to offer these online services to their customers. Provid- ing basic self-help support solutions frees staff to address more difficult questions and problems. Customer issues, in turn, are resolved more quickly.

Information must be readily available to employees if companies are going to compete successfidly. Intranet applications provide the backbone for immediate access to current information and services. All employees, regardless of where they are located, can share the same information simultaneously through the power of networking. Employees can also participate in training courses onhne anytime from anywhere without ever speaking with a training depart- ment employee.

Prospects and customers When facing a buying decision,

organisations are often presented with many choices. A key competitive

differentiator is the ease with which prospects can access company infor- mation to simplify and facilitate their purchasing processes. Through an online connection, a suite of interactive, elec- tronic services that provide immediate open access to information, resources, and systems anytme, anywhere, allowing all constituents to streamline business processes and improve their product- ivity.

With expenses rising and qualified sales people in short supply in many industries, many companies are studying ways to reduce the cost of sales whde maintaining closer relationships with customers. One solution is to create a networking products marketplace that enables users to place and manage orders for products and services online.

The global networked business model presents companies with a tangible way to maximise the value of information by sharing it, cultivating ongoing

Covisint Covisint is striving to handle vehicle

manufacturer supplier transactions for the Big Three automotive manufac- turers, as well as Renault and Nissan Motor Corporation. This online forum will streamline the industry supply chain by removing many of the links in the chain. Moving processes online simplifies procurement, reduces costs, shorten and sharpens product-development cycles, allows for the exchange of internal dormation, and connects manufacturers and suppliers in a way never before imagined. Virtually any stage of the order-to-delivery process can be shortened while costs are reduced. Given these efficiencies, it’s fitting the name Covisint is derived from the words, collaboration, vision and integration.

At first strictly a Ford initiative called Auto-xchange, the marketplace smartly- and quickly-evolved into an industry solution. Ford Motor Company unveiled a supply-chain and procurement exchange, Auto-xchange, in November 1999. At the same time GM was working on a similar effort. The companies soon reahsed the potential benefits for the entire automotive industry and decided to join forces. This exchange has grown into an industry exchange with participation by Ford and its closest competitors in the automotive industry.

This was a pioneering effort to get the Big Three working together. It wasn’t long before Daimler Chrysler came on board and then Renault-Nissan. Everyone was interested in creating a common platform where buyers and sellers could come together and streamline the processes. Suppliers were asking ‘Do we really want to have four or five of these exchanges?’

The need for this type of electronic linkage in the automotive industry is tremendous. The automotive industry comprises more than 50 000 suppliers, and the average cost of processing a transaction is estimated at $100 to $150

14 MANUFACTURING ENGINEER FEBRUARY 2002

per invoice, according to Ford Vice President Brian Kelley. Bring Covisint and the Internet into the equation for transaction processing, and t h s figure could drop to an average of less than $5 per invoice.

But this isn’t the only cost-savings scenario in the supply chain. Imagine that Covisint notifies a parts maker that its customer, Ford, has just made an engineering change to an engine mount. Not only does this notification occur instantly but the supplier can also then pass on the technical data for the change to other engineers instantly via its own supply chain, saving time and money for all the companies involved. A process that previously took two weeks can take a day or two online in the future.

Supply chain management Thanks to networked supply chain

management (SCM), businesses within a supply chain can operate as a unified entity, sharing tasks once isolated within each company Integrated processes within the supply chain cut down on redundancy and improve efficiency. With this a company can share timely information about market demand, minimise inventories, enhance quality and improve profitability. In addition, a networked supply chain helps reduce the time to market through collabora- tion with suppliers and customers. Software solutions for SCM are usually separated into different components.

Product development, planning and logistics

Product development includes product requirements, product design and testing, and manufacturing design. Product development solutions enable a company to design better products and services faster, by enabling developers to work with direct, timely input about what customers want and what their suppliers are capable of helping to produce. These tools reduce time to market, product costs, and miscommuni- cation among engineering groups.

Planning solutions include sales and order forecasting, manufacturing and distribution planning, and matching future customer demand to avadable supply. These processes can streamline

A simple engineering change that previously took two weeks can be effected in a day or two online

production and delivery operations, allowing on time order fulfilment at a lower cost.

Distribution and logistics solutions include inventory and warehouse man- agement, inbound and outbound trans- portation, order management, physical distribution, and third-party partner management. A distribution and logistics solution helps ensure that a company has the proper number of products, at the right place in the supply chain, at the right time, and at the lowest possible cost. It improves the movement and storage ofgoods and ensures an adequate cash supply fiom the beginning to the end of the supply chain. Companies can track customers, supplies, and orders, as well as monitor and manage purchasing, transportation, and customer needs.

Purchasing, manufacturing and integration

Purchasing solutions includes the procurement of product components, standard raw materials, and customised supplies needed to manufacture the end product. Using Internet technology, a company can s t r e d n e its procurement process and reduce both the money and time spent on purchasing activities.

A manufacturing solution includes automated manufacturing, assembly, and subcontracting/outsourcing. It tracks, reports, and analyses manufacturing information in real time from the manufacturing shop floor to the field service depot. A company can easily pinpoint and eliminate areas of over- production, material movement, over processing, excess inventory, and bottlenecks.

Business partner integration solutions allow a company to focus on what it does best and to take advantage of the

MANUFACTURING ENGINEER FEBRUARY 2002 35

competencies of its partners. These solutions help to develop partner strategies by identi@ing the benefits of partner and supplier relationships, define the processes associated with these relationshps, and use networkmg technology to exchange information and expand the partner and supplier network.

Research firm IDC’s ‘Supply Chain Services: Worldwide Market Forecast and Analysis, 1999-2004’ report predicts that ‘e-commerce and e-business norms will push companies ofall sizes to deploy supply-chain management solutions and seek the services of specialised vendors’.

For businesses that establish a supply chain the benefits are ample resulting in two and threefold returns for pioneers in this area.

Manufacturing and distribution solutions

A manufacturing and distribution solution can help with forecasting and

production management by enhancing communication among manufacturing and distribution teams. The features of a manufacturing and distribution system include:

0 sharing ofproduction and distribution data among internal departments and external partners

0 inventory monitoring of finished goods and raw materials, components and parts

0 manufacturing planning 0 warehouse organisation 0 transportation route evaluation 0 order and delivery trackmg

Internet-connected manufacturing systems improve raw material control, inventory management, and infor- mation flow in production, assembly and subcontracting/outsourcing processes. These systems help manage the manu- facturing process from the time raw materials and sub-components enter the

manufacturing plant to when a finished product leaves the shop floor.

Distribution solutions allow a company to get its products to customers more efficiently. These solutions automate inventory and warehouse management, inbound and outbound transportation, and physical distribution. Additionally these solutions allow businesses to share inventory responsibility, help organise and select cost-effective transportation methods, and provide precise order tracking.

Can your manufacturing and distri- bution systems predict the future? Ifyou link them to supplier capabilities and customer needs over the Internet, they can certainly be prepared for whatever the hture brings.

Tom Kneen is U K Regional Munagev, Munllfcturing, with Cisco Systems Ltd. For more information, see www.cisco.com/uk

0 IEE 2002

Bmplementing IS0 9000t2000 Matt Seaver

Gower Publishing Ltd., 2001,262pp., A55, ISBN 0 566 08373 0

The author of this book is a quahty management consultant, who since 1992 has been an expert member of the I S 0 Technical Committee 176 (Quahty Management and Qu&ty Assurance) and has been deeply involved in the development of the I S 0 9000:2000 series of standards. Dr Seaver has attempted to give a practical guide to setting up a broad-based quality management system, which meets the requirements of IS0 9001:2000 (Quality Management Systems: Requirements). He also provides a detailed commentary on each of the clauses of the I S 0 9004:2000 standard (Quahty Management Systems: Guidance for Performance Improve- ment), which has been designed to facilitate best practice throughout the organisation, and guidance on how the clauses can be implemented in a simple and practical manner.

The book is very practical, can be

easily read by the busy Manager or Engineer and is divided into four main parts:

Part A An introduction to I S 0 9000 standards and guidance on managing the I S 0 9000 project; Part B: A commentary on all the clauses in IS0 9001 and I S 0 9004, carefully noting the differences between the two standards; Part C: A sample quality manual, which is very helpful to anyone starting to prepare one for either a manufacturing or a service company; and Part D: A large set of “help documents”, consisting of sample procedures, forms and guidance notes.

The guidance contained in t h s book is particularly helpful to small and medium companies, who are working towards upgrading their management system to comply with the new

requirements. Ths applies whether they are doing this work with their own resources or if they are using the services of a consultant.

The sample quality Manual is an excellent basis for an engineer or manager. The help documents include sample procedures for the six procedures, which every organisation must have in order to satis@ I S 0 9001:2000. These procedures are: Control of Documents; Control of Quallty Records; Internal Audits; Control of Non-Conformities; Corrective Action; and Preventive Action.

I would strongly recommend that managers and engineers, whose organisations are involved in I S 0 9000, read this book. It will be helpful to top management, whose responsibihties for quahty, have been increased by I S 0 9000:2000.

DR E L W N DAVIES

16 MANUFACTURING ENGINEER FEBRUARY 2002