Improving Operations for

XYZ Motors

Automobile Sector
Value Chain & Value System
Transporters , Convoy Drivers Association
Dealer Network , Marketing Research Firms , Vehicle F

SAP , VCM

Inbound Outbound
Operations Marketing Service

Logistics Logistics

SAP , CRM - DMS

Suppliers , Contractors
Regional Warehouses , Dealer Workshops , Dist

Strategic Alliances

2
 Different parts of the Value
Chain
• For maximum profits to the
Company, it is essential to work on
all the sub-components of the Value
Chain.
• This requires integration of
operations, a common vision and
co-operation and co-ordination
throughout the company.
•
Development of a Common
Mission & Vision Statement
Inbound Logistics
 Procurement
• Implementation of SAP can help in e-
procurement.
• Suppliers can also be asked to be
linked to the company’s SAP portal
so that the company can monitor
the suppliers’ inventory level.
• Vendor Inventory Management
• In case of multiple plants, C e n tra lize d
S tra te g ic S o u rcin g fo r ke y
co m p o n e n ts
 Warehousing
• Each component to be recognized by
a unique code to enable its efficient
storage and retrieval.
• SAP to be implemented for better co-
ordination across departments.
• This would be in-line with the
Technological image of the
company, and would also lead to
savings in the long-run.
 Product-Process Matrix

Ours is an Assembly Shop and hence we need to

focus on the bottleneck machine
Tackling with Bottleneck
Problem
 Operations
• Reducing Lead Times

Lower lead times and Safety

 Inventory
• Maintain inventory of some special,
cutting-edge technology products,
which cannot be supplied by local
suppliers.
• Take into consideration factors like
strikes, bandhs while deciding this
inventory
• For majority of the products, use
local suppliers resulting in a system
resembling JIT. Keep maximum 1
 Manufacturing Process
• Gradual improvement to Automated
Manufacturing System
• At the moment, go for Line Balancing
so that each worker is utilized fully.
• Can go for Job Rotation in order to
prevent fatigue of workers.
Maintenance
Follow the 4
mantras of
Maintenance in
order to avoid
breakdown

Any breakdown can

stop the entire
production run
Quality
 Capacity Utilization
• Some processes and shops, like the
Paint Shop, remain idle for a long
time as the time involved here is
much less than the Cycle Time or
the process is performed only in
batches
• In such cases, company can take
contracts from other companies in
order to utilize its capacity fully,
thereby adding to the revenue.
Technology Development
ØApproximately 2% of the annual profits of the company
to be invested in research and development.
ØKnowledge portal – to helps employees and technocrats
keep abreast with the latest technologies.
ØDeveloping prototype building and testing facilities.
ØStrategic partnerships with technology institutes
ØFormal benchmarking process.
Ø“Technology Day” to be organized across all plant
locations.

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 Process Benchmarking in
Operations
Ø Optimize the value chain using Distributed
Manufacturing
Ø Leveraging the power of IT through SAP
Ø Utilizing state-of-the-art CAD and CAM services
integrated design across multiple disciplines
Ø IT can help the company shrink the design cycle time
Ø Employing Service-oriented management architecture
treating services as assets and managing them on a
life cycle basis.
Ø Developing technologically superior In-house
manufacturing capability with CNC manufacturing
operations
Ø Implementing Six-sigma and Kaizen and motivating
employees for the same.
Ø
Ø 17