8/13/2019 Holding the Key to Global Expansion

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Website: www.connectingindustry.com

Industry Focus Automotive Supply Chain

Facedwitha growing need toexpand into new markets such asChina Indiaand Brazil and gain

marketshareas quickly aspossble , automotive manufacturersincreasingly need to set-up productionfacilities and onboard trading partnersin ever shorter periods of time.

Many manufacturers have turned toglobal vehicle platforms to help meetthis demand , which sees them sharingdesigns , components and productionefforts across multiple models andtypes . This in-turnhelps to rationalisesuppliers and standardiseoncomponents and othersub-systems used inthemanufacture of the vehicles.Uniting vehicle platforms naturallyprovides an opportunity toconsolidae internal IT business andassocaed production systems as well.

Having a standard vehicle platformthatcan be used acrossmultiplemarkets provides the most cost efficientwayof undertaking internationalexpansion projects , and Volkswagen

( VW )has been a particularly strongexample of this . The company ownsmore car brands than any other carmanufacturer and hasachieved a highlevel of commonality across theirvehice platforms and parts , whilst at thesame time retaining the individualidentity of each carbrand.VW s next generation MQB platformwill provide a significant competitiveadvantage in themarket , and is tippedby some analysts to be as significantfor the industry as Henry Ford ' sproduction line and Toyota s Just-In-Timeproduction system . Even though it hastaken six years and 70bn to developtheplatform , it is expected to see a

19bn saving by 2019.Rapid global expansion stillpresents a number of wider challenges forsupply chain ,logistics and ITinfrastructure professionals supportingnew facilities , however To addressthis , manufacturers shouldcomplement the benefits of a sharedplatformwith cloud-basedB2B integration toprovide the flexibility and agility theirexpanded supply chains need In factcloud B2B integration and globalvehice platforms are remarkably similaracross threekey areas.

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Above : Mark Morley ,director of industrymarketing formanufacturing , GXS

Below :asglobalisationcontinues , automotiveproduction and cloudB2B environments willshare manycharacteristicsconsolidation ,standardisation andreduced complexity

Increased standardisationCommon vehicle platforms allowmanufacturers to consolidate partsand hence rationalise suppliers10 UIDN N CT AUTONIP TION

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Holding the key to global expansionMark Morley ,director of industry marketing for manufacturing at GXS ,takes a closer look at howautomotive manufacturers can expand into new markets via the use of global platforms and cloud B2B

which also helps to reduce inventorylevels but more importantlysmplifies global supply chains . The onlydownside with introducing morestandard parts across multiple carbrands is that it significantlyincreases the chance of more vehiclerecalls if a part fails.

This in turn places more pressure onthe Tier suppliers to increase thequaity of heparts they supply to theircustomers . Introducing a cloud based B2Bplatform helps to standardise theway inwhich a carmanufacturer engages withits suppliers .A centrally hosted suite ofSoftware-as-a-Service ( SaaS )applicaions can be deployed very quicklyacross an existing trading partnercommunity and they alsohelp to onboardnew suppliers in remote locations.Deploying a cloud-basedplatformcan provide a significant competitiveadvantage when entering a newmarket Companies can alsosa da dis in other areas such as usingcommunication protocols such as OFTP2or even a standard message set .TheGerman automotive industry iscurrently working towards standardisingon a new global message set based onEDIFACT , as they find the traditionalVDA message set too restrictive whensupporting their global operations.Reduced complexityCommon vehicle platforms allowvehicle sub-systems to be used acrossmultiple vehicles , which helps tosimplify theproduction process . Theproduction environment itself can also besignificantly simplified allowing newproduction lines to be established innew regions around the world in a rel

atively short period of time.Forexample Just-In-Timeproducion has been used for many years ,but common vehicle platforms willencourage more ' Supply In LineSequence' ( SILS ) production to takeplace i.e .different vehicles beingassembled on the same productionline . Cloud B2Bplatforms help toremove the complexity of managingtoday s supply chains . Fromsimplifying the management of tradingpartners to improving end o endvisibility of global shipments , cloudB2B platforms offermany advantagesover more raditional behind hefirewall B2B software environments.

From mediating between differentcommunication protocols ,documentstandards or even integrating with aback end ERP platform such as SAPcloud B2B platforms help to shieldusers from he complexities of bothdeploying and managing a globalB2B platform.As globalisation continues ,automotive production and cloud B2Benvironments will share manycharacteristics , consolidation ,standardisation and reduced complexity.Cloud B2B allows vehiclem a uf a ur e s to scale heir B2B requirements tomeet he needs of their globalproducion environments and associatedsupply chain network .Increasedadoption of common vehicle platformswill help to drive furtherwidespreadadoption of cloud-based B2Bplatforms over the next fewyears.GXSwww.gxs.co.ukT :01932 776 047 Enter201

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