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Integrated Business Planning for Automotive Manufacturing

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Automotive manufacturers are faced with complicated supply and demand planning …

Automotive manufacturers are faced with complicated supply and demand planning
challenges—from customizable order options to expanding sales lines to high levels of
competition. In just the past 3 years, manufacturers have been forced to balance between these pressures in a variety of ways:

- Emerging countries—especially China, Brazil and India had rampant double digit growth
- North America rebounded from the extremely difficult conditions from 2008-2010 but
showed continued exposure to market volatility
- The tsunami and earthquake in Japan and the floods in Taiwan posed major challenges to the supply chain
- Changing demographics in Europe and North America driving preference for sustainable
products and increased demand for battery powered vehicles

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  • 1. INTEGRATED BUSINESS PLANNING FOR AUTOMOTIVE MANUFACTURING DATA SHEETSteelwedge Integrated Business Planningfor Automotive ManufacturingYour company must be able to better connect with suppliers and respond to changingregional and global customer demand to remain successful.Leading Information Technology research and consultancy, Gartner, summarized in its2011 Top Supply Chain 25 report:To respond, automotive companies need a deep understanding of customer demand tomaximize assets and finished goods inventory. By rethinking existing, siloed processesand developing new ones that anticipate demand, companies are able to react morequickly to the unexpected. This results in high inventory turns and lowered lead-timesfrom order to delivery.Role of Integrated Business Planning in AutomotiveAutomotive Demand, Supply and Product CharacteristicsDEMAND SUPPLY PRODUCTLong lead-time operationsAssembly line manufacturingBuilt-to-Order & Built- to-StockHighly configured products with amix of large multi-level BOM andSKU-level, simple productsStatistical forecasting at SKU levelhas limited application.Requires attach rate forecastingPage 1 of 2 | © 2013 Steelwedge Software, Inc. All rights reserved. – info@steelwedge.com – 925.460.1700Automotive manufacturers are faced with complicated supply and demand planningchallenges—from customizable order options to expanding sales lines to high levels ofcompetition. In just the past 3 years, manufacturers have been forced to balance betweenthese pressures in a variety of ways:Emerging countries—especially China, Brazil and India had rampant double digit growthNorth America rebounded from the extremely difficult conditions from 2008-2010 butshowed continued exposure to market volatilityThe tsunami and earthquake in Japan and the floods in Taiwan posed major challenges tothe supply chainChanging demographics in Europe and North America driving preference for sustainableproducts and increased demand for battery powered vehiclesThe right planning creates a medium-to-long-term volume program plan based on: top-downfinancial budget considerations, global capacity, material restrictions and customer demand.Using an integrated technology that provides insight into multiple data sources, you can:Manage a global financial budget tied to sales numbers, revenues and operational forecastsModel dealer hierarchy and perform allocation of supply across various levels of the hierarchyForecast and plan at a vehicle option level instead of only at product family model level(lower level of granularity)Perform option attach-rate forecasting (statistical bill of materials)Allocate capacity and raw materials across multiple suppliers based on overall capacityutilization and overall profitsModel lead times associated with transportation, tooling, manufacturing as part of the longterm capacity planning”“ Organizations seeking industry leadership must establish demand-drivenbusiness excellence and agile value networks that emphasize supplier-partnercollaboration, and achieve process optimization.
  • 2. Page 2 of 2 | © 2013 Steelwedge Software, Inc. All rights reserved. – info@steelwedge.com – 925.460.1700Steelwedge Software, Inc.Steelwedge integrated sales, operations and finance planning solutions provide the "shock absorbers" to recognize, recalibrate and respond in a volatile environment.Business agility starts with Steelwedge for a clear line of sight from plan to performance to profit. For additional information, please email us: info@steelwedge.com.INTEGRATED BUSINESS PLANNING FOR AUTOMOTIVE MANUFACTURING DATA SHEETSteelwedge Advantages for Automotive ManufacturersFor the Sales Team:Enable collaborative forecasting for sales reps and sales managementPower plans at any level of detailIntegrate with sales pipeline from CRM to support opportunity managementProvide annual operating plan (AOP) visibility as part of S&OP processView cross-functional demand plans (sales, marketing, product management, etc.)For the Product Management Team:Develop attach-rate forecasts to drive mix forecasting for complex automotive products andkey components.Forecast using region- or dealer-specific terms, such as customer specific product packages,while aggregating independent and dependent demand for products and components.For the Planning Team:Drive company specific planning processes with One-Click Planning™ alert-driven workflowProvide planning process visibility and progress reportingDrive assigned or exception-based review policiesIntegrate with ERP, SCM, CRM and financial systems that widely differ in their taxonomyor granularityEstablish role-specific planning views, automatic semantic resolution, parent analysis anduser driven catalogsFor the Executive Team:Consolidate supply, demand and finance hierarchies into one comprehensive modelEnable more detailed planning assumptions via relationship attributes(e.g., customer specific pricing, source specific costing)Best Practice Spotlight: European Automotive ManufacturerA large, global luxury car manufacturer is currently experiencing high growth across their twomajor brands but the company wasn’t maximizing the success through a single S&OPprocess. Their sales forecasting—which incorporated dealer/importer forecasts, regional andmarket forecasts, production forecasts, and more—were each created independently andwere not reconciled with the top-down finance projections. The forecasts were alsoperformed at different planning levels. For example, the production forecast was managed atthe plant level while the sales and market forecasts were planned regionally, around theworld.The company explored a variety of solution providers but only one, Steelwedge, could solvethe unique challenges associated with the automotive industry.Using Steelwedge’s integrated S&OP platform, the company can:Optimize the allocation of production to markets, centrally and/or regionally.Develop collaborative forecasting to achieve a consensus operations strategy and plan.Integrate third parties, such as importers, dealers and suppliers,into a common planning process.Monitor key metrics and automatically produce company-specific reports.Leverage investment in existing systems of record; acting as a system of differentiation.