Assessment of

Fords supply chain

Group 1
Abhinandan Misra (166002)
Arpit Jaiswal (166024)
Debjyoti Dey (166040)
Pankaj Sharma (166102)
Sajal Gupta (166143)
Sumit Kumar (166177)
Aligned Business Framework (ABF)-Background
Long term agreement with
strategic suppliers
Avoids development of
gaming reaction on
suppliers part

Compliance ensured through

sampling basis on site

Reduction in number of
suppliers
 ABF Description and activities

Formally spelled out business practices Implementation of macro approach of

Ford suppliers

Executive fully responsible to

Each supplier tags an executive to lead
report on established metrics
code and processes
 Conditions for suppliers
Establishment code of
conduct covering working
condition and environmental Drive environmental
responsibility performance
through responsible
environmental
management system
Promoting activities in
working conditions in
through training and
compliance processes
 Impact of ABF

1 Increase in
mutual
profitability

2 Innovation

Reduction in
3 operational
problems

Collaboration

4 leading to better
working
relationship
Inbound Logistics Problem

Key challenge
To balance inbound freight costs for parts across hundreds of suppliers with
the high frequency of deliveries needed to support JIT manufacturing.
Its freight cost rises upto over $6 billion a year
Overspend on logistics to making sure production not hampers
No network-wide plan to consider the impact of design and part changes
on logistics, poor linkages between logistics and plant operations
They dont have any medium to consider trade-offs between the many
variables in the supply chain equation.
Solution - Viewlocity Inbound Planning Engine
The software The software
was introduced was introduced
to optimize for which helped to
the lowest total accurately
cost for over predict logistics
20,000 SKUs costs

It met all expectations, drove

cost reductions and resulted
in no stock out situations
Results
Reduced TL and LTL freight due to effective planning
of milk run truckloads.
Better Trailer utilization improved load planning
Reduced premium LTL and air freight due to fewer
spillover situations.
Integration of part container returns to suppliers within
the logistics plan.

Ford estimates their overall savings from this project

to be 5% of their total inbound logistics spend.
Issues at Ford

Waste Minimization

Not sacrificing productivity

MASS PRODUCTION => LEAN MANUFACTURING

 Vision of FPS
(ford production system)

defined by a Learning and

FPS is a set of working safely
common principles production
and and delivery Quality
production
system processes of products
Cost
Lean employs consistently
groups of exceed Time
Flexible
capable and customers'
Disciplined empowered expectations
people in :
Thank You