MMOG/LE - Tips for Complying with the OEM Submission

MMOG/LE - Tips for Complying with the OEM Submission

MMOG/LE - Tips for Complying with the OEM Submission Terry Onica, QAD [email protected] Director, Automotive MMOG/LE Tips for Complying with the OEM Submission Presentation Agenda MMOG/LE overview Answering the MMOG/LE assessment OEM Assessment Expectations QAD support Summary 2 MMOG/LE Tips for Complying with the OEM Submission

MMOG/LE Overview 3 MMOG/LE Overview What is MMOG/LE? Materials Management Operations Guideline Logistic Evaluation

4 MMOG/LE Overview MMOG/LE Authors & QAD Contributions Developed by: - AIAG (North American Industry Association) - Odette (European Industry Association) - Automotive OEMs & Tier 1 Suppliers Contributions from QAD: - Member & author Leader of work group efforts Lead speaker at worldwide events Trainer provider on behalf of AIAG/Odette Provider of software that meets requirements

5 MMOG/LE Overview What is MMOG/LE? Assessment tool to evaluate/select suppliers according to: Supply chain capabilities Industry best practices Provides plant score (e.g., A, B or C) MMOG/LE = Delivery ISO/TS-16949 = Quality 6 MMOG/LE Overview A B C Classification Definition Classification F3

F2 F1 A Score Compliance to ALL Noncompliance to <6 No limit > 90% Unstable or inconsistent processes Compliance

to ALL Noncompliance to 6-12 No limit 75-89% C Not compliant to ANY Noncompliance to > 13 No limit < 75%

Best practice B Deficient in key critical areas 7 MMOG/LE Overview What is MMOG/LE? Assessment in an excel spreadsheet with: Six chapters 206 criteria Answer responses: Yes, No, N/A 3.1 Product Realization 3.1.1 The MP&L function shall formally participate in, and sign

off, the Product Realization process. Why? The material organization is involved in each stage (e.g., quoting, engineering) of the Product Realization process to ensure supply chain issues are addressed and parts are available for all phases of production (e.g. prototypes, preproduction, production). X Criterion: 1) F3 The MP&L function shall participate in the Product Realization

process to ensure all material planning and logistics requirements are addressed and all changes which affect the supply process are planned, executed and communicated in a synchronized manner (e.g. bill of material (BOM), routings, effectivity dates, supplier notification, scheduling, shipping). Back-up plans shall be in place to ensure continuity of supply. The engineering change process is outline in WMM- 3111. Engineering Change meetings are held weekly. The materials manager is involved in the meeting. See WMM-3111 for an example of the meeting minutes and invited participants as well as what is included in the organization's engineering change checklist. 8 MMOG/LE Overview Areas Covered in MMOG/LE

9 MMOG/LE Overview MMOG/LE Customer Usage with Suppliers OEMs Using Tier 1 Using Tier 1 Using (cont) Chrysler Autoliv SNOP CNH Latin America Benteler Valeo Ford

Beru Wabco GM Bosch ZF Iveco Brose Jaguar/Land Rover Continental PSA

Gates Renault Johnson Controls Under Review Tofas Fiat (Turkey) Lear BMW Volvo Car MGI Coutier Daimler Volvo Truck

Pierburg Honda NA VW (US Pilot) Selzer Automotive VW 10 MMOG/LE Overview OEM Submission Requirements Annual Submissions Chrysler (Jan-March), Ford and GM (May-July) Audits Poor supplier performance New business

Growing suppliers New product launch OEM at risk Suppliers (impacts ability to bid) Level C Not submitting MMOG/LE assessment 11 MMOG/LE Tips for Complying with the OEM Submission Answering the Assessment 12 Answering the Assessment Surprise Quiz! A. How long will it take you to complete the assessment? B. How long has your boss given you to do it?

C. How many departments will need to be involved in completing it? 13 Answering the Assessment Lets Take a Look at a Set of Criteria Criteria for 3.2.1 Capacity and Resources Comparison of resources versus customer requirements shall be reviewed upon receipt of forecast requirements (e.g. 830/DELFOR/planning 1) F3 release), comparing every week of the forecast sent by customers. Capacity planning volumes negotiated with the customer shall also be incorporated in the capacity planning process. Resources versus customer requirements shall be reviewed upon receipt of shipping requirements (e.g. 862/DELJIT/ shipping schedules, 2) F3

866/DELJIT/sequenced shipping schedules), comparing daily ship requirement sent by customers. There shall be a process in place to notify 3) F3 customers of any significant resource limitations 14 in meeting the requirements. Answering the Assessment How Would You Answer the Criteria? What departments would you interview? What questions would you ask to determine compliance? What objective evidence would you expect to see? 15

Answering the Assessment How Would You Answer the Criteria? What Role or Title would you interview? - Top Management Supply Chain Purchasing Production Engineering Human Resources Quality IT Sales Possibly others, as required 16 Answering the Assessment

How Would You Answer the Criteria? What questions would you ask to determine compliance? - How is capacity negotiated with the customer? How often is capacity reviewed and when? How are resources versus customer EDI analyzed? Does analysis include all areas of the business? Are resources for administrative and containers included? - Does analysis include production, prototype, preproduction and after sales? - Are contingency plans in place for capacity constraints? 17 Answering the Assessment

How Would You Answer the Criteria? What objective evidence would you expect to see? - Work instructions including how capacity is negotiated, how customer EDI is integrated - Reports from QAD that shows anything out-of-tolerance - How the customer is alerted of significant resource limitations - Comparative analysis Release, shipping, financial volumes, industry projections - Meeting minutes including action items - Training - Job descriptions 18 Answering the Assessment

Quiz Have Your Answers Changed Yet? A. How long will it take you to complete the assessment? B. How long has your boss given you to do it? C. How many departments will need to be involved in completing it? 19 MMOG/LE Tips for Complying with the OEM Submission OEM Assessment Expectations & Common Supplier Mistakes 20 MMOG/LE: Tips for Satisfying the OEM Requirement

Extensive Use of Spreadsheets = Level C Planning Scheduling Sub Suppliers A 21 MMOG/LE Tips for Complying with the OEM Submission Who is Leading the Assessment? ISO/TS 16949, is a technical specification for quality management MMOG/LE is similar, but focuses on supply chain processes. MMOG/LE has adopted

the same process approach as ISO/TS 16949 Example: Scrap process Quality 22 MMOG/LE Tips for Complying with the OEM Submission Is MMOG/LE Being Driven by Management? Driven by Operations and Executive Management teams, championed by Materials Management The Corporate Delivery Champion (CDC) is responsible for improving and standardizing delivery performance across the enterprise

Understand the customers supply chain and delivery requirements as outlined in the: - Global Terms and Conditions Supplier Manuals and Reference Guides Supplier Web Sites MMOG/LE MMOG/LE Tips for Complying with the OEM Submission What is a CDC? Required/requested for suppliers with multiple sites by Ford, Chrysler and GM Serves as the corporate supply chain contact for all manufacturing and ship sites for delivery performance Standardizes and improves supply chain processes and procedures Oversees MMOG/LE compliance

Ensures corrective actions are resolved in a timely manner Documents and shares lessons learned MMOG/LE Tips for Complying with the OEM Submission Is the Right Person Answering the Question? Process owners, including management All facilities and shifts Areas with vital involvement in the assessment process include: - Top management Supply chain Corporate delivery champion Purchasing Production Engineering Program manager

Human resources Quality IT Logistics Sales 25 MMOG/LE Tips for Complying with the OEM Submission Are You Thoroughly Documenting Responses? Comments box best practices Evidence Comments Work instructions Non applicable Annual review

Customer specifics 26 If you were the OEM, what would you think of the supplier response to 3.2.1 Capacity Planning? F3 Comparison of resources versus customer requirements shall be reviewed upon receipt of forecast requirements (e.g. 830/DELFOR/planning P release), comparing every week of the forecast sent by customers. Capacity planning volumes negotiated with the customer shall also be incorporated in the capacity planning process. Capacity planning worksheet (Weekly and Quarterly)

F3 Resources versus customer requirements shall be reviewed upon receipt of shipping requirements (e.g. 862/DELJIT/shipping schedules, P 866/DELJIT/sequenced shipping schedules), comparing daily ship requirement sent by customers. JIT and daily meeting F1 Resources for administrative (e.g. receiving, planning, and dispatch) and physical (e.g. loading, P unloading of trucks) operations within the MP&L function, including time and cost, are reviewed and incorporated in the capacity planning process.

Informal system If you were the OEM, what would you think of the supplier response to 1.2.1 MP&L Objectives ? When Quality Answers F2 F2 F2 Objectives are documented, specific, measurable, achievable, realistic, timely and consistent with the organization's MP&L strategy. Objectives are accepted by all relevant functions and are clearly communicated throughout all levels of the organization. Quality Objectives added into

Managament Review. Records available on site. Quality Objectives added into Managament Review. Records available on site. Objectives are reviewed with top management at planned intervals. Management Review daily, members Quality Plan & Staff reviewing trends and performances for the scrap control, external PPMs, Internal PPMs, inventory and effectivity. Objectives added into Management Review ISO/TS . Records available on site. Good Assessment Comments 4.3.2 Shipping 1)

P 2) P 3) 4) P P Work instruction for ASN process is WI-ASN-0030-EM FORD. Ford Ranger wax frames will not have a shipping label they will be stenciled due to Ford spec and nature of waxed product. Econoline ecoated frames are labeled and scanned coming out of e-coat prior to loading for shipment. Shipper creation 50.6.4 requires that customer-specific

fields are populated with appropriate data to complete the shipper. ASN export 50.6.22 also requires customer The organization shall ensure that the data content of all ASNs specific data (according to Ford EDI Implementation is complete, accurate and processed in accordance with Guideline) and uses data fields from shipper creation to customer requirements. When master labels are used, generate ASN data. Master labels not used. eDDL & individual container labels shall be reconciled to master labels. CMMS instructions for shipment follow-up are located in MPL in a box. Process is documented in WI-ASN-003EM-Ford for creating an ASN. The shipping label shall be reconciled against the customer ship requirements. The data content of the shipping labels shall be verified at the last possible point in the shipping process, such as RFID or scanning, to ensure consistency between container content, labels, and documentation. All shipments, including documentation and labeling, shall be prepared to customer, industry, and government/international standards and requirements (e.g. customs handling, C-TPAT, PIP, AEO) including carrier routings.

Only documentation required is the packing slip (50.6.4) and the shipper (50.6.8); ASN export screen is (50.6.22). Labeling is covered in MMOG/LE 4.3.2.1. Ford labeling specs are listed in MP&L In A Box as indicated in Work instruction for ASN process is WI-ASN-0030-EM -FORD The shipment process shall ensure that each ASN is transmitted at the time of conveyance departure. ASN is transmitted at the time of truck departure. The 997 document is reviewed upon receipt and transmission errors are reported to supervisor/manager. Corrections are made and re-sent ASAP, no later than 30 minutes. eDDL AJAA is monitored after each shipment to ensure shipment/CUM accuracy. Work instruction for ASN process is WI-ASN-0030-EM FORD. MMOG/LE Tips for Complying with the OEM Submission

Have You Documented Customer Specifics? Where will you find customer specifics? - Customer training Global terms and conditions Materials planning and logistics agreements Supplier manuals Customer web sites and applications EDI portals Delivery rating Capacity Packaging and labeling Container management

30 MMOG/LE Tips for Complying with the OEM Submission Are Your Work Instructions Detailed Enough? Used for training and back-ups Instructions should Include: Step by step instructions Person(s) responsible Customer specifics Customer references Metrics Error handling Contingencies Document version control Last date tested Explanation of any acronyms Obtaining user logins 31

MMOG/LE Tips for Complying with the OEM Submission Answers to the Quiz A. How long will it take you to complete the assessment? - It can take up to six weeks to gather evidence It can take up to four months to close gaps B. How long has your boss given you to do it? - See answer to A! C. How many departments will need to be involved in completing it? -

Just about every department! 32 MMOG/LE Tips for Complying with the OEM Submission QAD Support 33 QAD Support 107 Automotive Process Maps 34 QAD Support QAD MMOG/LE Process Map Features

Work Instructions System Access Tool Tips Operational Metrics Compliance Check Points Training Material 35 QAD Support 600+ QAD Work Instructions 36 QAD Support

115 Integrated Training Courses 37 QAD Support QAD MMOG/LE Answer Sheet MMOG/LE Criteria QAD Answer Probing/ Location on Evidence Process Map Questions 38 QAD Support

MMOG/LE Q-Scan Review critical questions & top criteria Review processes, procedures & work instructions Present findings to management 39 QAD MMOG/LE Support QAD MMOG/LE Review Outcomes Validation of your assessment score (e.g., A, B, C) Proper usage of ERP (spreadsheets are eliminated) - Using spreadsheets = Level C The right people are answering the assessment Customer specifics are being addressed Criteria Comments Boxes are properly documented Work Instructions are to the right level of detail

Management understands the score and any gaps 40 QAD Support Additional Support White Paper Solutions Brochure www.qad.com/mmogle AIAG/Odette MMOG/LE Level 1 Training - Register at www.aiag.org or www.odette.org Corporate Delivery Champion Meeting - Operational management - Ford, Chrysler and GM

- November 14, 2012 in Detroit area 41 Thank you! 42

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