Automotive Spare Parts Manufacturing Supply Chain

Automotive Sp ar Parts Manu situationuring show range of a functionAbstractThis query aim is objectively aimed at thinking parentage vigilance in the global cut stove. The case study of an enterprise in the automotive spare move manufacturing sector is fall ined to derive important grammatical constructions of functioning related to to origin delay concern in the global append chain.The automotive constancy has always been a booming manufacture and continuous to re master(prenominal) the alike on a all aims i.e. local, national and global. The show of automotive regions forms a vital link and procedure in the automotive industry. Many caper grim, medium- surface and freehanded through and through lineage counsel form a part of the global sum up chain effectively.The enquiryer, proposes to present a case study analysis of Kapoor Automobiles (India), a medium-sized organization of repute and good merchandise stand up in the globular ply chain of auto motive components. This research would throw light on the scroll management system employed by the organization, its effectiveness, shortcomings and remedial measures taken to carry through consumer require, retain them and grow through effective modes of Inventory control in the Global make come out of the closet concatenation.The tec, further proposes to utilize business analytical tools of primary research i.e. qualitative research and quantitative research, secondary research, S.W.O.T analysis (Strength, weakness, opportunity and threats) and P.E.S.T.L.E. analysis (Political, economic, social, technological, heavy and environmental) to as accredited the above mentioned objective of the research.IntroductionKapoor Automobiles (India) was incorporatedd in the year 1965 in Mumbai (India). In the counter symmetry Kapoor Automobiles (India) functioning in the capacity of a trading keep company for the sale and purchase of automotive hawkshaw parts. In the year 1990, the bus iness enterprise ventured into manufacturing activities and gradually advanced towards gaining a secure and permanent market position overseas in the automotive rubber parts replacement segment of the market. Kapoor Automobiles (India) succeeded in doing so on level of the provision of senior high school theatrical role services to their growing backup.Kapoor Automobiles (India) places a high order of magnitude of emphasis on high quality and increased produceivity to meet the global consumer indigence and counter-attack competitor. The query and Development team of Kapoor Automobiles (India) focuses in continuity research on the changing consumer needs and the firm attempts to incorporate those needs in their employment activities.Kapoor Automobiles (India) has been recognized as an organization of international repute by the by-line certificationISO 9001 2000 Quality attention System Certificate by French giants SGS.From humble beginnings of a sharp workshop, Kapoor Au tomobiles (India) currently has a manufacturing plant with an area of 12000 sq meters with acres-of-the-art anti vibration connection technology. Here, assembly elements of rubber-metal write material are manufactured.The highlighting aspects of Kapoor Automobiles (India) are as followsThe organization has a staff of 127 crossingion staff, 12 administrative officials and 2 rubber technicians.The produces of the organization are a varied range of automotive rubber components for vehicles such as Bedford, BMC, BMW, Fiat, Hino, Isuzu, Iveco, Lada, Land Rover, Mazda, Mercedes, Mitsubishi, Nissan, Opel, Peugeot, Renault Toyota, VW, Volvo to name a few for the purpose of exemplification.Kapoor Automobiles (India) focuses on four major production wait onesRubber mixture preparation and PreformingMetal forming and MachiningMetal and pipe uprise preparation.Vul assizationKapoor Automobiles (India) has a clientele spread across the African and European continent and the pump East.Aim s and Motivations of the search StudyThe automobile industry is a global industry which is witnessing a high level of growth. The competition in this global industry necessitates a comfortably-coordinated work of cater of the automotive parts to car manufacturers as an when thither is a demand for the same. Thereby the need to train good level of inventory management in the global supply chain is of prime importance to meet the demand of the market, help the business to survive and grow in this war-ridden market.My motivation and aim of this research study is to comprehend all the aspects which take form possible made inventory control in global supply chain management. My area of research and analysis in this context would lay focus on the automotive parts manufacturing sector.General ObjectivesThis study aims at on a general or basic level understanding Global grant twine trouble and its significance in today day and age of excessive competition. The objective is in ad dition to learn well-nigh all the factors which influence inventory control in global supply chain management in a positive and negative way especially the automotive spare parts industry. To gain intimacy more or less how an improvement in the smooth functioning of global supply chain management can be brought about by a good level of inventory control.Specific AimsThis research is specifically aimed at understanding the functions of Kapoor Automobiles (India) with regard to inventory control in global supply chain management. In this regard its current activities, the positive aspects, the shortcomings and how improvisation could be brought about in the process of inventory control of Kapoor Automobiles (India) for global supply chain management.Research QuestionsThis dissertation is aimed at answering the following questionsWhat is Global cosmic string Supply circumspection?What is inventory control?How does Inventory Control in Global Supply Chain Management function in cont ext to the automotive spare parts industry?How do firms in the automotive spare parts industry effective manage inventory control as a part of Global Supply Chain Management?Kapoor Automobiles (India)s outline of Inventory Control in Global Supply Chain Management?How could Kapoor Automobiles (India) improve on their Inventory Control in Global Supply Chain Management and compete better in the overseas market?What are the future trends perceived in the Automotive parts Inventory Control in Global Supply Chain Management?Dissertation StructureThe structure of this dissertation incorporates the following Chapter 5 lays focus on the theoretical earthing for the research, reviewing a generous selection of literature on Supply Chain Management, Inventory control, all the aspect necessary to be taken into consideration for successful inventory control, the need of it and Global Supply Chain Management. Furthermore the literature review in any case lends forth the importance of good in ventory control in the global supply chain management of the automotive parts industry. Chapter 6 introduces the method of study to be employed to analyze inventory control in global supply chain management of Kapoor Automobiles (India). Chapter 7 presents the studys findings and discussion which are initially presented in diagrammatic form, then discussed. Chapter 8 leave collate the main findings of the study to result solid conclusions. The limitations are given, followed by an appraisal of the projects main strengths and weakness. Recommendations for future research are also provided.Literature ReviewSupply Chain ManagementA Supply Chain Management activity could be understood as the management of materials, vital info and finances as they are channelized from a supplier to the manufacturers then to the wholesaler, retailer and netly the consumer. The activity of supply chain management comprises of simply coordination and integration of the above aspects within organizati ons and among them. The final goal of an efficient supply chain management process is to bring about a reduction in stock with the basic ideology that products are getable when needed. (Cooper, M.C., Lambert, D.M., Pagh, J. (1997)Supply chain management flows can be divided into three main flows which are as followsThe product flowThe information flowThe finances flowThe product flow constitutes the flow of products or commodities from a supplier to a consumer. The second aspect which is information flow comprises of transmission of orders and updates on perspective deliveries. The third aspect is the financial flow which comprises of terms of credit, payments, consignment and title ownership arrangements. Supply Chain Management of different organization differs depending on the size and nature of the organization and the product manufactured. An effective supply chain management ensures process of obtaining supplies and components, conversion of the same in to finished product s and making supply of these products to the final consumer. Supply Chain Management is the management of all these aspects aptly without delays and at a low appeal fulfilling the needs of the consumer in the process. (Haag, S., Cummings, M., McCubbrey, D., Pinsonneault, A., Donovan, R. (2006)There are six key elements to a supply chain (Ketchen Jr., G., Hult, T.M. (2006) productionSupplyInventoryLocation exileation, andinformationThe following describes each of the elements1. mathematical productThe needs (Kouvelis, P. Chambers, C. Wang, H. (2006) and demands of the consumer is taken into handbill prior to production. Decisions regarding what to product, how to produce and how many units need to produced are taken. Furthermore, it is also decided upon whether to produce the whole product or certain(a) parts should be out bloodd. These vital decision regarding production activities should be made memory in mind the volume of goods, the quality, capacity and the consumer want s and levels of satisfaction. Decision regarding operational activities should focus on equipment maintenance, scheduling and quality control.2. SupplyAn organization (Larson, P.D. and Halldorsson, A. (2004), cannot produce all the components need for the manufacture of a product and the need to outsource parts arises. The organization should be cautious in the choice it molds of the supplier of components. The focus of the organization period engaging a supplier to supply components should be on quality, flexibility and the development of velocity and at the same time should maintain low be. In summation, vital decision has to be taken to make the outsourcing partnership or activity a viable one for the manufacture and supply of the final product.3. InventoryImportant decisions (Lavassani, M. K., Movahedi B., Kumar V. (2008) regarding how much should be stocked in the organization should be taken. A proper proportionateness should be maintained as inventory keeping is an impo rtant aspect of a good supply chain management process. The consumer demands should be met up without any supply delay and and so optimum level of inventory should be decided upon and place at strategic consumer points to serve the consumer as and when the demand for the product arises. Control policies must be checked upon to maintain slump levels of supply at order and order points.4. LocationStrategic decisions (Movahedi B., Kumar V. (2008) regarding location of the production plant, facilities of stocking and distribution should be made to ensure that the consumer avails the product when he demands without any delay. When the parts or components are light in weight and market driven, manufacturing units should be primed(p) near the final consumer. In heavy industries, sources of raw materials should be taken in consideration date deciding where the manufacturing plant should be located. Tax and tariff issues should be looked into while making strategic decisions.5. Transpor tationIn context (Mentzer, J.T. et al. (2001) to fulfilling consumer demands, decisions related to transportation and inventory are quite closely connected. Utility of job transport is quick but expensive in comparison to water or road transport but makes the product on tap(predicate) in a short span of time to the consumer. Water or road transport means being in possession of high levels of in-house stock to meet flying consumer demands. Depending upon the demand the product generates, the cost of the product and the stock available decision relating to transportation should be made.6. InformationA (Simchi-Levi D.,Kaminsky P., Simchi-levi E. (2007) supply chain management in order to be effective focuses on getting information for point of final consumption and connecting the information resources all through the entire chain to bring an effective flow. A good organization of information is required to bring in innovation in operation. Connecting computers through networks and having the information flow streamlined helps consolidate intimacy and helps in creating velocity for the products. Account management software, product configurators, enterprise resource planning systems, and global communications are important factors to be considered. prosaic ApplicationsToday the market scenario (de Kok, A.G., S.C. Graves (Editors) 2003) demands fast deli truly of goods. By high levels of stocking, many organizations try to fulfill this market demand. The organizations are at times unable to produce goods as and when the market demands and indeed maintains high stocks. If processes are analyzed in the supply chain then the causes and solutions could be found to bring reduction in throughput time. Reducing the time in the chain of events proper(ip) from the moment the consumer places to the order to the delivery for the same could help a company gain a competitive edge without the need to declare grown stocks.Need for an effective Supply Chain ManagementTher e is a high degree (Stock, J.R., D.M. Lambert. 2001) of competition in the business scenario today which demands that an organization in order to rich person a competitive vantage should utilize its resources to do what it is good at and indulge in outsourcing those processes that are not significant from an general objective of the organization. SCM enable an organization to restructure its complete operation focusing on core competencies and outsourcing certain processes which would help the organization gain apt market positioning. Furthermore, is important to make the right decisions of partners, resources and manpower. The organization should understand which process or pattern could reduce wastages and raise levels of competence.For the sake of exemplification, the Japanese (Coyle, J.J., E.J. Bardi, C.J. 2002) car industry manufactures small cars by capitalizing on its available resources. The Japanese car industry effectively utilizes supply chain management to maximize cor e competencies and create niche market positioning. Toyota Motor Corporation, a Japanese company, is state to be the number one auto car maker overpowering Ford and General Motors of the United States. rate AdvantageSupply Chain Management (Bowersox, D.J., D.J. Closs, M.B. Cooper. 2002) has made provision for business straightadays to not just have benefits of productivity alone but also on value receipts. Productivity advantage provides a lower cost profile and the value advantage gives the product an extra plus over competitive offerings.Through maximizing added value there is cost reduction and more innovation can be brought to the product and process. Mass manufacturing offers productivity advantage and through mass customization, consumers are given the value advantage. For illustrative purposes, the Toyota Production System practiced in Toyota, evaluates (Ballou, R.H. 2003) its supply chain and determines what is value added activities and what is not value added activities .Inventory keepingAdvantagesThe aspect which proves to be an (Silver, E.A., D.F. Pyke, R. Peterson 1998) advantage with regards to high inventory holding is that it acts as a buffer to the company when market demands are high. If prices are expected to rise then high stocking results in capital advantage or gain. The risk of supply shortage is overcome by high inventory. Market shortage of goods is also met with by high inventory.DisadvantagesHigh cost warehouse management is the main disadvantage of having man-sized inventory of finished products. There could be a possible capital loss to the business if the prices fall in the market in future. Cash is bound in carrying stocks and there is a risk of loss on account of degradation, defects and write-offs. Lack of proper management of inventory could lead to losses too. It should be flavourd that though inventory assists in operations, it is an asset that ties up funds i.e. working capital and the related opportunity cost. some ot her disadvantagesStock could be stolen, lost or forgotten susceptibility be dangerous to storeMight involve high cost to store particularly in terms of value.There is a calamity of replication or duplication at several different points e.g. retail stores, hospitals, builders, merchants.There are redundant costs such as administrative and insurance costsTechniques to purchase stock and manage inventory efficientlyIt is vital for any (Blackburn, J.D. 1990) business organization to learn to manage inventory with efficiency thereby making possible a company to stock inventory satisfactoryly to meet the consumer needs. Lack of sufficient stock leads to delays and causes disrepute to the business. On the contrary, large inventory block organizational funds. A business which is originally retail makes money only on the sale of stock and maintenance of stocks involves the following costsCharges of pertain on any loans taken to buy goods.Charges for storage space.Transportation costs fo r stock movement and for its display. comprise of time involved in stock management.Cost involved in stolen of damaged stocks.Payroll expenses. literal amounts of an organizations funds could be blocked in inventory. Apt management of inventory essentially leads to high gelt and lower costs.Purchase the right productsEmploy market research to make the identification of right products for the right market.Analysis of sales charts of previous financial years.Identify needs of consumers and create those products to satisfy needs.Analysis of economy forecast in the periods to come and make a determination of how market would function or react. linkup comparison between you and your competitors sales.Make the right decisions based on experience regarding what to products to buy and at what measuring rod. start Correct QuantitiesIn order to meet the varying market demand, it is necessary to maintain the right quantity of inventory. In the process of maintaining the right quantity of i nventory care should be taken to not have overstocking of disused products. (Gilmore, J.H., B.J. Pine. 2000)To do this you mustHave knowledge of the right product to orderOrder the right quantity of the productHave knowledge of the right time to order the productHave knowledge of product arrivalHave knowledge about the right quantity of product to stock during the business cycleHave knowledge of when reorders need no submissionHave knowledge of when products should not be stockedThis knowledge is stupefyd by analysis and experienceEnsuring suppliers have market repute and would supply products in needed quantities.Making a study of lead times for the purpose of supply and delivery to make possible ordering at the apt time, or determining the delivery time for the consumers is more products have to be ordered.Overbuying should be avoided just to take advantage of special supplier deals.Re-check buying plans weekly and revise as needed. If the stock is being sold or being utilized faster than expected, look to source more products as soon as the trend is identified and in existence.Make a note of required stock levels (minimum, maximum and at the point to re-order).Success of Inventory ControlThe regular and bimestrial (Stalk, G., T.H. Hout. 2003) evaluations of key performance indicators in companies help determine the success of an inventory system. The basic group of indicators reveals how well the inventory system fulfills the business needs and does it exceed the customer expectations. The inventory system should have the dexterity of accounting for that exists at the finished goods inventory with the inclusion of what was manufactured in the latest production cycle. This process makes it possible to bring forward units for consumer orders in at the right time without delays and help companies shorten the lead-time and and then building repute in the process.An efficient system makes it possible to maintain a good balance between the stock that is in possession and the stock that is required to operate the business efficiently.Global Supply Chain ManagementFor many business (De Geus, A., (1998) organizations, Global Supply Chain Management has become increase important as there has been an increase in offshore sourcing and globalization. As global supply chain management involves many countries thereby the issues or difficulties to be tackled are many too. Primarily the overall costs need to be considered. Though labor cost could be minimal, cost of space, tariffs and other costs needs to considered with doing business abroad. The exchange (Drucker, P. (1988), rate too needs to be factored. The companys lead-time could positively or negatively adjoin depending on the productivity of the employees overseas and the shipping time involved. There could be time lags on account of custom clearance time and other governmental red tape. (Gersick, C. J. G. (1991). Supplier selection is also some other important aspect of global supply c hain management. Extensive research should be carried out by the company to help make the right choice. Logistical issues such as deciding the number of plants and their locations to sur saying and have to be worked out care amply. (Romanelli, E. and Tushman, M. L. (I994)Assembler-supplier relationships in the global auto industryFor the last two decades, there has been a change in the relationship between assemblers and suppliers. Initially there has been a shift from supply of individual components to supply of complete function such as corners, systems, modules or sub-assemblies.(Sadler, D. (1998) a supplier who is first-tier assembles parts and makes a supply of them as complete units (such as dashboards, rear axle assemblies, body panels and seats). Operations earlier carried out in-house by the assembler, such as the manufacture of seats and exhaust systems, are moved on to the first-tier supplier. Second, component producers have taken an further role in the creating design o f components and systems (Humphrey, J. and M. Salerno (2000) First-tier component producers assert more elaborateness with their consumers and have transited to providing black box parts or systems. While the assembler gives overall performance specifications and information about the interface with the remaining aspect of the car, the supplier designs a solution using its own technology, oftentimes taking in a basic design to the customers specific exigencys.3 This shift has facilitated car assemblers to transfer R D costs to component manufacturers and to take advantage from the specialized technological skills of these producers.ConclusionAs supply chains have moved from a cost focus to a customer focus and now currently to a strategic focus, the need to think strategically about the supply chain has never been more important. The success of a strategy is only as good as the companys ability to fully and properly execute it. A great supply chain strategy, linked with operatio nal excellence, can provide success for not only the company in question but also its partners and customers.MethodologyThis chapter will essentially focus on the method employed for the conduct of research and analysis. The reasons governing the techniques chosen would be furnished. Furthermore, the chosen method of analysis of data compiled and the ethical consideration therein would be discussed.Primary ResearchEthical ConsiderationsThe researcher is of the conviction that no research should be carried out without attention being compensable to the implications which are of ethical nature. On ethical grounds, the researcher presented in all clarity to the participants or volunteers for this research study that the research was purely for academic reasons and the data compiled and analyzed would be utilized for the purpose of academician projects and would not be in any manner shared with any other individuals other than Academicians evaluating the research conducted nor would the data collected be employed for commercial usage. The researcher provided this indemnification and hence the participants agreed to volunteer vital information regarding Kapoor Automobiles policies of Inventory holding and Global supply chain management.Furthermore the participants were informed of the fact that no participation fee would be levied or charged.Face to Face InterviewsFace to face interviews were conducted with the C.E.O. of Kapoor Automobiles (India) and the visiting card of Directors of the company to gain an understanding into the overall aspects of the functioning of the organization and to also gain information about their modes of Inventory control in their Global Supply Chain Management activities. Information about this was provided it in depth and the research succeeded in getting a clear practical picture of their operations. The researcher failed to acquire figurative data relating to inventory control as the C.E.O and the Board of Directors expressed c onfidentiality issues. The interviews too were conducted in an cosy manner as they the participants (C.E.O and Board of Directors) insisted on anonymity and the researcher assured them of the same.For gaining an understanding of the production process and actual physical inventory control process, rubber technicians and warehouse supervisor of Kapoor Automobiles (India) were interviewed and productive insight was gained by the researcher.Time and AccessLimitations emerged in the form of lack of time and glide slope in the case of certain Board of Directors of Kapoor Automobiles. Of the 8 Board of directors, 2 of them could not be accessed as they were overseas to conduct negotiations of Kapoor Automobiles (India) and hence they could not be interviewed. Some of the available Board of Directors could not spare sufficient time of the interviews as they had to attend to the day to day management affairs of the organizations. Though the time they made available was limited, their sti mulant were undoubted valuable.The C.E.O. expressed inability to even provide approximations of figurative data citing confidentiality issued and hence the researcher failed to have access to any figurative data whatsoever.Secondary ResearchThe techniques of secondary research employed by the researcher were essentially gaining vital data from the online library provided by Cardiff Business School. This library of the Cardiff Business School was of large utility as all the theories relating to Inventory Control and Global Supply Chain Management were available in abundance and facilitated a process of ease in understanding and compiling the much required theories and data. The search engines of Mintel and Ebsco proved to be of immense use to the researcher.Besides the above mentioned source, the researcher referred to several books written by experts in the field of Inventory control and Global Supply Chain Management to acquire multiple perspectives on the area of research and ana lysis. The information gained was significant and hence employed by the researcher in his research study.Findings and AnalysisIntroductionEmploying the primary research techniques, the researcher learnt through face to face interviews of the C.E.O and Board of Directors of Kapoor Automobiles (India) that the organization being medium-sized, financially they are not in a position to have high levels of inventory to meet unforeseen demands of the consumers in the Global Supply Chain Management process. Kapoor Automobiles (India) initially commenced as a very small business outfit carrying out its production, stocking and distribution activities from a very small workshop. Kapoor Automobiles (India) grew successfully over a period of time and now possess a large production and warehousing unit in comparison to what they had when the business commenced and this is owing to the fact that business leaders at Kapoor Automobiles (India) formulate the apt strategy to meet demand of consumers spread across the continents of Asia, Europe and the Middle East. Financial constraints necessitate Kapoor Automobiles (India) to follow the Just-in-time inventory management process.Just-in-time (JIT) could be defined as a strategy of inventory management. This methodology focuses on bringing about an improvement in the firms return on investing by bring down or reducing the in-process inventory and related carrying costs. Just-In-Time production method is also termed as Toyota Production System. In order to fulfill objectives of Just-In-Time, this inventory management method is reliant on Kanban or signals emerging between different points in the link, which indicate the production department as to when the following(a) batch should be produced.Initially, Kapoor Automobiles (India) was following this method on account of financial constraints which did not permit holding large inventory but now Kapoor Automobiles (India) prefers this method as the market trend is changing in co ntinuity on account of new technological developments at regular and short intervals and this required invariant change in product and the production methods and the other obvious reason as stated by Kapoor Automobiles (India) is the fact that they are yet a medium sized enterprise and would not be in a position to have large inventory.They further stated that large inventory for the Global Supply Chain Management process could lead to financial losses as the inventory could go obsolete as the automobile industry is a progressive and booming industry and there is a requirement of constant modification in the spare parts or components utilized for the manufacture of automobiles.Conclusively, Kapoor Automobiles (India) have stated that Just-In-Time inventory management system helps them reduce the in-process inventory costs and other related costs and hence is the most preferred mode of inventory management. They further state that their organization is in a state of growth in contin uity and they objective aim at converting Kapoor Automobiles (India) which is currently a medium sized organization into a large sized organization and when Kapoor Automobiles (India) attains this objective they would continue to function utilizing Just-In-time inventory management system to meet the demands of their clients in the Global Chain as the product features and demands related to it are changing continuously and maintaini