Materials Management
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Materials Management






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  • Connie Harde, American Axle Cara Besh, DaimlerChrysler Eric Minehart, Ford Motor Company Roger Bergsten, Volvo Cars Henry Rosten, Volvo Trucks Morris Brown, AIAG Aidan Hughes, Gates Corporation Rob Brown, SMMT Industry Forum Jacky Cousin, Renault Joerg Vollmer, Bosch Corporation
  • “supplier box” all resources required at supplier location
  • Companies that are currently implementing the MMOG/LE Same tool – different ways to implement
  • DCX Required of all launch suppliers to North American DCX Plants Required by product launch One time submission Ratings bonus What are we doing with the scores? Compare MMOG w/past delivery performance Potential on-site assessment MMOG is used as a tool
  • Ford North America Q1 Award - requires Level “A” compliance to the Global MMOG/LE. Self assessments required annually High impact requirements of the MMOG are still represented in the Global MMOG/LE. Potential MP&L audit Timing of rollout - either document will be accepted for self assessment in 2004 Ford objective: to have one global standard for MP&L that suppliers are held to globally. Encourage training at AIAG for all suppliers looking for additional resources.
  • JCI: Governing requirement, with QS9000, for JCI’s Business Operating System (BOS) One requirement for all customers Incorporated as part of JCI supplier performance metrics Requirement for yearly supplier awards Yearly submission GATES: Supplier partnership manual addresses ‘high impact’ questions. Suppliers are encouraged to use MMOG as basis for developing a robust materials management process. Supplier Quality System Assessments measure effectiveness of materials management processes. AAM: Currently implementing MMOG internally Rolling MMOG out to major AAM suppliers
  • Ericcson cell phone company High Schools & Universities -Germany and Sweden Boeing has requested information ABB Robotics Company in Europe Schemker -Logistics Service Provider
  • Wanted to improve Baseline audit – score: 17% Revenue Projected to double over the next 2 years

Materials Management Materials Management Presentation Transcript

  • Global MMOG/LE Materials Management Operations Guideline & Logistics Evaluation Cara Besh Morris Brown DaimlerChrysler AIAG Co-Chair Program Manager MMOG Work Group Materials Management
  • Chrysler Group Launches in 2004
    • 9 New Product Launches
    • 2-3 Per Year is the Average
    • Let’s take a look!
  • We Need Help! Goal is NO supplier disruptions to production Utilize all tools available MMOG/LE is one of those tools!
  • What is the Global MMOG/LE?
  • Who is the Work Group?
    • Ford
    • DaimlerChrysler
    • American Axle
    • Gates Corp.
    • JCI
    • GM
    • Robert Bosch
    • PSA
    • Renault
    • Volvo Cars
    • Volvo Trucks
    • SMMT Industry
    • Forum
  • Who is the
    • Automotive Industry Action Group
    • Industry Trade Association
    • 1,400 Member Companies
    • Automotive, Truck, Heavy Equipment Manufacturers
    • Suppliers – Production & Non Production
    • Founded in 1982
    • Mission is to develop standards and implementation strategies that improve the global automotive supply chain
    • Only place in North America where all OEMs, suppliers and service providers can assemble to address issues and resolve problems that affect the global automotive supply chain.
    • AIAG Objective
      • Reduce cost and complexity
      • Improve product quality, employee health and safety and the environment
      • Optimize speed-to-market
  • Who is Odette?
    • Odette is a non-profit organization run by automotive people for automotive people.
    • The principal areas of activity are: -E-Business Communications -Logistics Management -Engineering Data exchange
    • Member countries: Benelux, Czechia, France, Germany, Spain, Sweden, UK
  • Global Team
  • MMOG History
    • OEMs and Automotive Suppliers
    • MAP Study - Identified the Problem
      • Surveys and self-assessments from different customers
      • Too busy filling out forms
      • No consensus on what was important
    • Purpose of the Project
      • Industry accepted benchmark in Materials Management
      • Create common terminology
      • Gain consensus on what is important
      • Save money
  • What is the MMOG/LE “Process?”
  • Professional Development Overview of the MMOG/LE Process A Continuous Improvement Cycle + Delivery Rating MMOG Self Assessment MMOG Self Assessment Supplier Development/ Audit Team Training Needs Customer Interface 1 Executive Sponsor 2 Assemble Team Self-Assess 3 Identify Gaps 4 Set Goals 5 Develop Action Plan 6 Measure Progress 7 Evaluate effectiveness 8 + Delivery Rating
  • MMOG/LE Self Evaluation Categories
    • Strategy and Improvement
    • Work Organization
    • Production and Capacity Planning
    • Customer Interface
    • Production and Product Control
    • Supplier Relationship
  • Structure of Global MMOG/LE Question Why-Statement Criteria to be evaluated with specific weighting 4.1 COMMUNICATION 4.1.1 The organization maintains a process to ensure a co- operative communication based on actual and adequate information for both parties. Why? To maintain customer relations, prevent misunderstandings and ensure continued business based on co-operative communication. Criteria:  (F2) There are agreed contingency plans established between both parties to maintain permanent communication during bottleneck situation(s). (1.4.2)  (F2) The customers’ goals regarding Material Planning and Logistics performance are clearly defined (e.g. Customer delivery instructions/schedules), visualised and followed-up by the organization (3.1.4)  (F1) A contact list exists conta ining name, function, method of communication (e.g. phone number, fax number, e-mail address, language spoken, etc.), hours of availability and deputies/back-ups for each Material Planning and Logistics function from its customers (1.4.2/16)  (F1) The contact listing must support the entire scheduled operating hours of all customers (18)  (F1) There is a documented process (incl. process owner) for maintaining contact information internally and updating the contact information on the customer's system (17) Change to ODETTE Logistics Evaluation : Evaluation no more on question level but on criteria level
  • Scoring : Scoring Summary
  • Scoring : ABC-Classification
  • Gap Analysis Tool Global MMOG/LE
  • Where Do We See the Most Nonconformances?
    • Bar code labels are inaccurate
    • Inability to communicate requirements electronically throughout the supply chain
    • Lack of control of Work-In-Process
    • Lack of control of First In/First Out (FIFO)
  • Where Do We See the Most Nonconformances?
    • Identify customer shipping discrepancies
    • ASN data is not generated automatically
    • Responding to unexpected changes in demand
    • Inadequate storage location labeling
    • Behind schedule checks are not automatic
  • How will the Global MMOG/LE be Implemented?
  • MMOG/LE Implementations OEMs Suppliers
  • MMOG/LE @
    • Required of all launch suppliers to North American DCX Plants
    • Required by product launch
      • One time submission
      • Ratings bonus
    • What are we doing with the scores?
      • Compare MMOG w/past delivery performance
      • Potential on-site assessment
        • MMOG is used as a tool
  • Global MMOG/LE @
    • North America Q1 Award - requires Level “A”
    • Self assessments required annually
    • Timing of rollout - either document will be accepted for self assessment in 2004
  • Global MMOG/LE @ Supplier Locations
    • Johnson Controls
    • American Axle
    Gates Corporation
  • Non-Automotive Companies
    • Ericcson
    • High Schools/Universities
    • Boeing
    • ABB Robotics
    • Schemker
  • MMOG MMOG MMOG OUR GOAL: Supplier Development through the Supply Chain MMOG MMOG MMOG Ratings Ratings Ratings MMOG (Milliken) OEM (Ford, DCX) Tier 1 (JCI) Tier 2 Tier n
  • How Can I Gain Management Support? Why SHOULD Management Support this Effort? What’s in it For Me?
    • Cost Savings
    • Improved Delivery Ratings/Scores
    • Meeting Customer Requirements
      • Increase Customer Satisfaction
      • Better understanding of customer requirements
    • Reduced Stress
      • Fewer expedites/emergencies
      • Consistent Processes
    What’s in it for Me?
  • What Happens When I Implement MMOG/LE?
  • Using the MMOG internally Case Studies
    • Simco Automotive used MMOG to develop action plans
      • Reduced:
        • Premium freight by 85%
        • Obsolescence costs by 80%
        • Inventory Carrying Costs by 43%
        • Data Entry Time by 20%
        • Stress!!!
      • Additional Improvements:
        • Increased Revenue
        • Improved scheduling and visibility
        • Improved customer relations
      • Savings $135,000 - Cost $60,000 = $75,000 ROI Percentage = 125%
  • Using the MMOG internally Case Studies
    • Gates Rubber Company
      • MS-9000 Mandate by Ford
  • Benefits Realized at Ford Total Suppliers 1994 – 1171 1995 – 1184 1996 – 1158 1997 – 1250 1998 – 1389 1999 – 1424 2000 – 1459 2001 – 1528 Calendar Year (thru June 2001) Percent of N.A. Assembly Plant Suppliers with a Delivery Rating Over 81
  • Morris Brown Program Manager Materials Management AIAG
  • What Resources are Available to Me if I Don’t Understand Something?
  • What Is Available if I am a Member of AIAG?
    • FAQ Website
      • Here’s what it looks like
      • accessible through “members only” website
    MMOG Tools
    • Email Point of Contact
      • For members & nonmembers
      • Find it on AIAG website
      • [email_address]
    • Materials Management
    • Work Group
      • Contact Us!
      • Ford, DCX, JCI, Am. Axle, Gates Rubber, others
    MMOG Tools
    • Free downloads to AIAG members
      • M-7 Global MMOG/LE
      • M-8 Supplier Delivery Performance Guideline
      • M-9 Performance Improvement Guideline
    MMOG Tools
  • What Is Available if I am NOT a Member of AIAG?
  • What is the Future of the Global MMOG/LE?
  • Training Development Process AIAG Work Group Instructor Manual Participant Manual Training Slides OLY MANGEMENT CONSULTANTS INTENTIA TRILOGIS Training Provider Group
  • Course Objectives
    • Use Global MMOG/LE information in this course as a tool for continuous improvement and as a result be able to:
      • Describe all sections of MMOG/LE
      • Self-assess your operations and perform a gap analysis
      • Generate, based on gap analysis and sample project plan, your own Global MMOG/LE improvement implementation plan
  • Course Objectives
    • Through sample presentations and action plans, you will also be capable of communicating Global MMOG/LE issues to:
      • Management
      • Specific Members
      • Overall organization
      • In order to gain:
        • Sponsorship
        • Management acceptance
        • Support for assessment
        • Resources to accomplish action plans
  • Training Dates
    • One-day Course in Southfield, Michigan
            • April 2
            • May 3
            • May 25
            • June 14
            • June 16
    • How to Sign up for Class
      • Call AIAG at 248-358-3003
  • MMOG/LE Training @ Explore!
    • “ Using the MMOG/LE as a Continuous Improvement Tool”
    • Will be offered in conjunction with QAD Explore Annual Conference on
    • May 27, 2004
    • Charlotte, NC
    • Call Customer Service to register
    • 248-358-3003
    • Or register online at
  • Related MMOG/LE Sessions
    • Detail MMOG/LE for Automotive Suppliers-C. Besh & M. Brown 10:00-11:00
    • How QAD Supports Your Industry Benchmark with Global MMOG/LE- D. Doyle & T. Onica 11:30-12:30
    • Achieving Best Practices in Materials Management Session at Annual Explore Conference
  • Contact Us!
    • Cara Besh, DaimlerChrysler
    • [email_address]
    • Eric Minehart, Ford
    • [email_address]
    • Aidan Hughes, Gates Corp.
    • [email_address]
    • Connie Harde, American Axle
    • [email_address]
    • Morris Brown, AIAG
    • [email_address]
  • You have questions… We have information!