SUPPLIER MANAGEMENT IN AUTOMOTIVE

CONTRIBUTING RE.ENGINEER

Martin Stephens Jr.

CHALLENGE

An automotive manufacturing company was experiencing annual net losses in the millions of dollars due to production part cycle losses related to supplier challenges with bulk materials, assemblies, purchased parts, etc. Out of the 11 facilities, they chose to implement solutions for 1 facility because it was within the span of control of their material planning and logistics expertise.

SOLUTION

A team of Six Sigma Black Belts and subject matter experts used the DMAIC process to identify the challenges within each commodity. Using regression plots, cause & effect analysis, and capability studies, they identified the causal factors that were contributing to cycle losses; issues with computerized maintenance management system, receiving and shipping practices, returnable dunnage, scrap processing, integrity of records, pilferage, truck shipping/unloading, supplier discrepancies, etc.

RESULT

After the implementation of the improvements within each commodity code, the facility realized a savings of $581,248.

IMPACT

Savings of $581,248