Final Report Agile Electric

Topics: Supply chain management, Supply chain, Management Pages: 28 (6985 words) Published: February 19, 2015
AGILE ELECTRIC CASE ANALYSIS
QUALITY ISSUES
IN A GLOBAL SUPPLY CHAIN

PARAMON CHIMTAWAN
LIUDMILA LYAPINA
KYAWT THANDAR WIN

MGN562 Managing Operations: Dr. Ronald Vatananan

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CONTENTS
CONTENTS……………………………………………………………………...

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LIST OF FIGURES…………………………………………………………..…..

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EXECUTIVE SUMMARY………………………………………………………

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CHAPTER 1 SITUATIONAL ANALYSIS
1.1 Company background…………………………………………………......

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1.2 Development of Agile as a supplier for actuator assembly……………….

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1.3 Development of Tier 3 and Tier 4 suppliers………………………………

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1.4 The products……………………………………………………………….

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1.5 Manufacturing problems…………………………………………………..

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CHAPTER 2 PROBLEM ANALYSIS
2.1 Problem statement…………………………………………………………

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2.2 Question 1…………………………………………………………………

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2.3 Question 2…………………………………………………………………

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2.4 Question 3…………………………………………………………………

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2.5 Question 4…………………………………………………………………

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CHAPTER 3 RECOMMENDATIONS
3.1 Supplier selection processes……………………………………………….

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3.2 Communication processes…………………………………………………

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3.3 Standardization…………………………………………………………….

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CHAPTER 4 CONCLUSION……………………………………………………

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REFERENCES………………………………………………………….………..

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APPENDIX…………………………………………………………….…………

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LIST OF FIGURES
Figure 1 Actuator Assembly supply chain……………………………………….

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Figure 2 Basic communication process………………………………………….

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EXECUTIVE SUMMARY
The case study analysis describes the development of the global supply chain with one of the world's largest automotive Original Equipment Manufacturer - Ford, its Tier 1 supplier Automek, American global corporation, and Tier 2, 3, 4 suppliers, based in India.

Since 1998, Tier 2 supplier – Agile had successfully supplied motors and other auto parts to Automek. Had no defects or delivery problems and had a competitive advantage in price. Based on this experience, in 2004 Automek proposed Agile an order for the new product - the actuator assembly. In turn, Agile having no experience in the manufacture of this critical product, appropriate equipment and knowledge, wanted to reject the proposal. But Automek promised to find a supplier of necessary components, help with evaluation and approval of suppliers, based in India. Agile took the offer and signed the contract. After that Agile invested money in a new production line and developed the actuator assembly.

When delivery began in 2008, Ford reported many quality issues coming from parts supplied by sub-suppliers, located in India.
Now raises the questions of liability in case of followed cars recalls by Ford. Agile figured that since they do not have the necessary knowledge, experience and resources when signed the contract, then Automek must take the responsibility to solve the quality problems in the supply chain.

However, the authors do not agree with this opinion and believe that the responsibility for the failure lies with all tiers of the chain. Automek disregarded procedures, established standards and did not put their resources into the development of suppliers and passed responsibility for managing suppliers to Agile. However, the lower suppliers have done mistakes in the production process. For this reason, it's possible to divide the cost of failure of the project between Automek and tiered suppliers by 25% and 75% respectively.

Case analysis showed the importance of the process knowledge and experience related to the automotive industry for each supply chain member. First of all, Tier 3 and Tier 4, located in India, had no experience in supplying parts directly to the global auto manufacturer. Another important problem in this case was the lack of !

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communication and integration between all chain members. Also, sub-suppliers had no interest and resources to develop their production processes, so the problems in the product production were inevitable.

At the moment, the...

References: Ketchen, J., David J., Rebarick, W., Hult, G. T. M., & Meyer, D. (2008). Best value
supply chains: A key competitive weapon for the 21st century
(2012). Retrieved from http://www.isixsigma.com/methodology/total-qualitymanagement-tqm/eight-elements-tqm/
Porter, A
Stevenson, W. (2002). Operations management (7th ed.). Boston: McGraw-Hill.
Stevenson, W. (2009). Operations management (10th ed.). Boston: McGraw-Hill.
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