Automotive supply chain management: as good as it gets? Many observers agree that the automotive industry is running its supply chain well. They also agree there's room for improvement

Automotive Design & Production,  Feb, 2003  by Lawrence S. Gould

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What would be a perfect end state? Think of the design-to-order program at Bob's Store, which lets you design your own chinos and jeans with the help of technology. Customer cost: Forty bucks. (Trawl over to http: //www.bobsmade2order.com/cgibin/bobs.pl. For more details, go to the "tier 1"--Archetype Solutions, Inc. (Emeryville, CA)-at http://www. archetype-solutions.com/.) Lands' End has a similar program for chinos. And check out the Nike iD program (http://nikeid.nike.com). There you can design a logo that Nike will fabricate onto your very own pair of Nike athletic shoes.

("That's the fashion industry," you huff. "Everyone knows that people will pay extra for good-looking, good-fitting clothes." Now think about all the people you know who consider their cars a fashion statement.)

What's a more realistic end state? "Move away from a single-mode mass production model to a more flexible manufacturing supply chain," suggests Pethick. "Maintain the mass production model for high-volume vehicles, but have separate supply chains, even separate types of plants, geared to lower-volume niche markets, niche-product supply chains." Of course, admits Pethick, this will involve reengineering the basic capability and flexibility of the automotive assembly process.

"You have to treat supply chain performance just like you treat manufacturing quality," concludes Lundstrom. "You have to create continuous improvement programs, meaning you have to monitor and manage and adapt yourself on an ongoing basis."

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RELATED ARTICLE: What Makes a "Perfect Order"?

A recent study by AMR Research defines several ways automotive orders can be "imperfect." They can be late, contain poor quality, damaged, or incorrect parts, contain the incorrect quantity, or they can be the correct parts but incorrectly labeled. A perfect order, says Scott Lundstrom, AMR's chief technology officer, "is absolutely exactly what the customer ordered. Right quality, right timing, right delivery.

"Anyone in the automotive industry that isn't [an excellent supplier] is already dead."

COPYRIGHT 2003 Gardner Publications, Inc.
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