This is a presentation given by Dr. Hank Campbell (my father) and myself at the 2003 NAIT convention. I was featured as an industry speaker regarding Motorola\'s Supplier Development Engineering philosophy of procurement and quality vs. buying at the chapest price.

1. Global Sourcing and
Supply Chain Management
at Motorola Corporation:
A Key Strategy for Economic Survival
Presented By
Ryan Campbell Supply Development Engineer
Motorola Corporation Arlington Heights, IL
Dr. Hank Campbell Professor
Illinois State University Normal, IL
NAIT Conference 11/19/2003 Nashville, TN

2. What is Supply Chain
Management?
 A supply chain has interrelated organizations,
resources, and processes that create and deliver
products and services to end customers. (Taylor,2001)
 Functions include planning and managing
supply/demand, acquiring materials, qualifying
suppliers, producing schedules, warehousing, inventory
control, distribution, delivery, customer service, and
with highest quality at least cost.
November 19, 2003 2

3. Purchasing wants…
 Stable volumes
 Flexible delivery
 Conformance to
specs
 Large quantities
 Reduced costs
November 19, 2003 3

4. Manufacturing wants …
 Long run economics
 High quality inputs
 High productivity
 Low cost facilities
 Low labor input
 High consistency
 Lean operations
 Good profit margins
November 19, 2003 4

5. Customers want …
 Short lead times
 Low prices
 Individual attention
 Satisfaction every time
 Ability to change their
minds
November 19, 2003 5

6. Why is SCM so complex?
 Wrong forecasts  Engineering changes
 Poor quality  Poor market demand
parts/service  Too much inventory
 Downtime  Too little inventory
 Labor shortages  Canceled orders
 Global transportation  Slow decision making
 $ exchange rates  Poor information flow
 Political changes
All the UNCERTAINTIES!!!
November 19, 2003 6

7. What is the up-side of effective
Supply Chain Management?
 Competitive advantage
 Catching peak demand
 Reduced system costs
 Satisfied customers
 Company reputation
 Stakeholder rewards
(Increased Stock Price)
November 19, 2003 7

8. Motorola’s Supply Chain:
The role of
“Supplier Development Engineers”
Presented By
Ryan Campbell Sr. Supply Development Engineer
Motorola Corporation Arlington Heights, IL
Dr. Hank Campbell Professor
Illinois State University Normal, IL
NAIT Conference 11/19/2003 Nashville, TN

9. MOTOROLA CORPORATION
A company that practices Supply Chain Management.
A case study presented by a member of the
Motorola Global Strategic Sourcing team,
Ryan Campbell

10. About Motorola
Motorola is a global leader in providing
integrated communications solutions
and embedded electronic solutions.
Motorola’s Intelligence EverywhereTM solutions include:
 Software-enhanced wireless telephone and messaging, two-way radio
products and systems, as well as networking and Internet-access
products, for consumers, network operators, and commercial,
government and industrial customers.
 End-to-end systems for the delivery of interactive digital video, voice
and high-speed data solutions for broadband operators.
 Embedded semiconductor solutions for customers in wireless
communications, networking and transportation markets.
 Integrated electronic systems for automotive, Telematics, industrial,
telecommunications, computing and portable energy systems markets.
November 19, 2003 10

11. We make things smarter, simpler, safer and synchronized for
people and the environments in which they live, work, and play.
The Work
The Person Team The Home The Auto
Wireless Broadband Internet
November 19, 2003 11

12. Motorola’s
Global Telecom Solutions Sector
Wireless infrastructure: CDMA, GSM/UMTS and iDEN
November 19, 2003 12

13. In 2002, Motorola’s
Global Telecommunications Solution Sector
saved $650+ Million
A significant portion of these cost reductions were the
result of Supply Chain efforts to:
 Team with Development Engineering at the concept stage
 Negotiate significant material savings through increased
leverage
 Transition to global suppliers with low-cost locations
 Outsource manufacturing lines to low-cost regions
November 19, 2003 13

14. “We had to get further upstream in the design &
development process.
We knew we could make an even bigger impact to
the bottom line if we put our heads together with
DE (development engineering) at pre-design …at
the “notes on a napkin” stage.
And we couldn’t just do that here & there; we
had to do it Globally .”
--- Randy Peters, Global Manager of
GTSS Supplier Development Engineering team
November 19, 2003 14

15. What Is
Supplier Development Engineering?
Supplier Development Engineering
(SDE)
is a Procurement Function,
 Procure (verb)
To bring about; To effect
Not a Purchasing Function
Purchase (verb)
To obtain in exchange for money
SDE seeks ways to align the goals of the company with
those of strategic suppliers, then considers ways to
November 19, 2003 reduce costs & enhance capabilities. 15

16. SDE Core Goals
 Cost Reduction & Avoidance
 Low Cost Sourcing
 Use of Approved Suppliers
 Multiple Sourcing
 Technology Alignment
 Lead Time Analysis
 Risk Mitigation
November 19, 2003 16

17. SDE New Product Introduction
(NPI) Engineers
 Focus on individual programs, participating at
the concept phase and acting as a program
manger for all Sourcing-related aspects of the
design.
 Gets input from the SDE Commodity
Engineers infused into the design process
before parts or suppliers are finalized.
 Continue the implementation of changes
intended to mitigate risk, lower costs, improve
lead-time, and improve profitability.
 Follow the design from prototype to product
launch
November 19, 2003 17

18. SDE Commodity Engineers
 Experts in their commodity
 Informed as to industry trends, manufacturing
techniques, part obsolescence, process control,
lead-times, and especially risk mitigation.
 Responsible for completing Material Risk
Assessments.
November 19, 2003 18

19. Key Traits for All
Supplier Development Engineers
 An analytical mind & good common sense.
 A strong working knowledge of Six Sigma, quality methods,
and process control.
 Good people skills -- The ability & willingness to work
toward common goals is essential.
 Good negotiation skills -- The ability to create consensus
with those who do not report to you is invaluable, as SDEs
work as team members just as often as work as team leaders.
 The Commodity Engineer should have, or acquire, a strong
industry and process knowledge of the commodities for
which they are responsible.
 The NPI Engineer must have a strong knowledge of Project
Management
November 19, 2003 19

20. Responsibilities of all SDE Engineers
 Interface with Strategic & Tactical Suppliers
• Synchronizing Technology Roadmaps
• Introduce new programs & manage Early Supplier
Involvement
• Training on Six-Sigma methodology & Process
Characterization
• Feedback & Forecasts – Help suppliers prepare for
business changes
 Cost Savings / Reduction / Avoidance
• China Sourcing - SDE Team
• Event Driven Cost Reduction with Global Cost Teams
November 19, 2003 20

21. Responsibilities of all SDE Engineers
 Interface with Development Engineering
• Bring commodity focus and expertise ………..
Technology Roadmaps
• Work on new programs ………………Deliverables &
Assignments
• Work with suppliers …….Archive presentations, notes, mtg
minutes
 SDE Champions Supply Chain Processes
• Supplier Capability Assessments (Capability Mapping)
• Supplier Technology Assessments (Tech Mappings &
Addendums)
• Material Risk Assessments (MRA)
• Early Supplier Involvement (ESI)
• Manufacturing Readiness Reviews (MRR)
November 19, 2003 21

22. Key Internal Relationships
 Global Sourcing Organization
• Commodity Teams, which determine:
 Commodity strategy
 GTSS Forward Looking Approved Supply List (FLASL)
 Cost Reduction Strategy
• Source Boards
 Formal management review of supplier selection
 Centers Of Excellence / Development
Engineering
• Develop, certify, qualify products for the market
 Marketing
• Forecasts Demand
• Represents customer
November 19, 2003 22

23. More Key Internal Relationships
 Manufacturing NPI (New Product
Introduction) Organization
• Program Management (PM)
responsibility
• Prototype Scheduling
• Selection of Contract Manufacturers /
Outsourcers
 Component Engineering Organization
• Component qualification
 Purchasing / Buyers
• Must Purchase per Approved Supplier
List
• Tremendous resource for feedback on
November 19, 2003 23
deliveries, price, etc.

24. A Supply Chain Job Sounds like
Something I’d Like to Pursue…
But at most Universities, there is not a
fully developed curriculum for
Supply Chain Management.
What can I do?
November 19, 2003 24

25. Essential SC skills from an
Industrial Technology Program
 Quality systems: 6 Sigma, SPC,
Systems Thinking
 Negotiation skills
 Financial savvy: cost, price, value
 Process knowledge
 Appreciate diversity in the workplace
 People skills: local, regional,
national, international
November 19, 2003 25

26. Essential SC skills continued
 Project management skills
 Scheduling, estimating, forecasting
 Risk mitigation and assessment
 Agile fundamentals
 Value engineering fundamentals
 Computer skills - electronic media
 Leadership and ‘followership’ skills
November 19, 2003 26

27. end
November 19, 2003 27

28. Further Detail on the
Functions of the SDE Team
NAIT National Conference
Nashville, TN
November 2003
Ryan Campbell – Global Supplier Development Engineer, Motorola GTSS
Dr. Hank Campbell – Illinois State University

29. SDE Roadmap Highlights
• Early DE input from Sourcing MRA
• EOL prediction/forecast MRA
• Drive use of industry std. components MRA/PPLs
• Decrease lead time/supply chain complexity ESI
• Drive for multiple sources ESI
• Maximize cost avoidance ESI/ e Auctions
• Drive for low cost China sources Tianjin/SDE
• ASL clean-up and ePIMS roll-out Oracle
• Readiness to launch production MRR
November 19, 2003 29

30. High Level Sourcing Process DE
SDE
#3b #4 CE
• Material#3a DE/SDE/CE/NPI
#1a #2a Mgt Review Capability ESI NPI/PUR
Mapping?
Proactive
SDE-DE
Comp
Planning Engr #9
Risk Qual Path? #5
FTR
Review
#6
#1b D&B? PC/
AQP
#2b Final
New • Oracle Critical Parts /
Source Initial
Suppliers
Part Initial Material Board Qualification
Request
…ESI?
#7
Supplier Risk
Selection Assess Training? MRR
• Config.
Control
• PART ECO #2c PC/AQP?
#8a
Supplier MRR?
Specs / #8b
Protocol Drawings
Etc.?
PAF
November 19, 2003 30

31. Helpful Web Links
Motorola University
Supplier Resources
November 19, 2003 31