NEW TECHNOLOGIES AND INNOVATION IN THE SUPPLY CHAIN …

Abteilung, Datum

NEW TECHNOLOGIES AND INNOVATION IN THE SUPPLY CHAIN OF BMW GROUP SUPPLY CHAIN INNOVATIONS 2015 LINT, ANTWERP 26.03.2015

Alexander Scholz, BMW Group

Seite 2

BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. AGENDA.

1 Overview of BMW Group and BMW’s Supply Chain

2 Challenges within BMW’s Supply Chain

3 Solutions based on New Technologies

4 Benefits for the Supply Chain: Examples

5 Success Factors & Conclusion

BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. A VERY SUCCESSFUL YEAR 2014 BEHIND US.

1.811.719

302.183

123.495

+ 9,5%

- 0,9%

+ 7,2%

2.117.965

4.063 + 11,9%

+ 7,9%

BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. WE OPERATE A GLOBAL PRODUCTION NETWORK.

LEIPZIG

REGENSBURG

SPARTANBURG

DINGOLFING MÜNCHEN

OXFORD

GOODWOOD

ROSSLYN

SHENYANG

BMW 5-,6-,7-Series

BMW 1-Series/ BMW i3/i8

BMW Local Models

BMW X-Models*

BMW 3-Series

BMW 1-,3-Series

Rolls Royce

BMW F06 M

MINI

BMW 3-Series

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. BMW GROUP IS FACING SOME PARTICULAR CHALLENGES.

1

2

3

4

5

6

7

Management of global supply chain networks.

Best cost country sourcing and natural hedging.

Flexibility vs. standardisation.

Optimisation of global inventories.

Value chain management.

New supplier structures/changing supplier structures.

Focus on emerging markets (so-called BRIKT markets).

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. MISSION STATEMENT OF THE INTEGRATED SUPPLY CHAIN FUNCTION: WE SUPPLY FOR SUCCESS!

BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. RIGHT PARTS AT THE RIGHT TIME, IN THE RIGHT QUANTITY/QUALITY, AT RIGHT COST AND THE PLACE.

Strategy, management, projects

Provision

Quality management parts

Car body

Interior, E/E

Driving dynamics

Drivetrain

Investment, goods, services

Body-in-

white Paint

shop Assembly

Press

plant Production

Purchasing and Supplier Network

Engine

PURCHASING

Production material.

Indirect purchasing.

Cost engineering.

Strategy.

Complexity management.

Sustainability.

PROVISION

Material management.

Design of the value chain.

Process and structural

planning.

COMPONENT PRODUCTION

Seats, cockpit, equipment.

Bumpers, exterior scopes.

Light-metal foundry.

Innovative lightweight.

construction concepts.

QUALITY

Quality validation.

Recourse.

Warranty and goodwill.

Quality management

system .

t

F./ Fzg.

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Evolution of the

Internet towards

a collaborative

network.

Users do not only

consume con-

tent, they rather

contribute con-

tent and share

knowledge.

New services and

software (Blogs,

Google Earth

etc.) are as easy

to use as com-

mon desktop

software and

become increa-

singly powerful.

The ease of

access to techno-

logy and services

enables a far

greater number

of users to pub-

lish content and

provide themsel-

ves information.

Common stan-

dards are the

basis for the

exchange of

information

between users

and services (e.g.

XML, RSS etc.).

Big data

management

enables insights

into supply

chains.

BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. DEPLOYMENT OF WEB 2.0 TECHNOLOGIES TO BETTER MANAGE SUPPLY CHAIN RISK.

1 2 3 4 5

Secure supply and capacities.

Implement flexibility and

reactivity within supply chain.

Guarantee access to Innovation

and state-of-the-art technology.

Optimise internal

and external collaboration.

Media Monitoring, Big Data & E-

Listening.

Geo-visualisation

with Google Earth.

Sharepoint for distribution.

Innovative tools for collaboration.

(iPads, NiCe Walls etc.).

BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. ENTERPRISE 3.0 SOLUTIONS SUPPORT THE REQUIREMENTS OF A GLOBAL SUPPLY CHAIN.

Enterprise 3.0

Information at the earliest possible point along with integration of different pieces of information allows

quicker response. The long term goal is to manage and to secure a competitive supply chain.

Mission critical requirements

BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. INNOVATIVE TECHNOLOGIES SUPPORT THE SUPPLY CHAIN – FROM REACTION TO STRATEGIC SOURCING.

E-Listening

technology scouting.

Various projects:

Knowledge sharing

with sharepoint 2010.

Verification of locations visualisation of value

chains (Tier-n) for supplier selection

highlighting of chances/risks.

Visualisation and verification of

supplier locations comparing

compliance, sustainability and risk

by location, natural disaster,

political, financial.

What can be found in the Internet?

e.g. compliance, sustainability,

financials, press releases.

Project

Strategic supplier management

Supplier selection Capacity management

Strategy Idea-to-offer (development) Production

BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. DE-RISKING THE SUPPLY CHAIN BY COMBINING DIFFERENT SOURCES OF AVAILABLE INFORMATION.

VISUALISATION FRAMEWORK

Sustainability, social

aspects, compliance

Sort (type, impact,

location)

Processing

and geo-coding

Pre-defined set-list

Private org., national stats.,

NGOs, news agencies

Natural risks

Sort risks (type,

impact, location)

Processing

and geo-coding

Pre-defined set-list

Government inst., educational inst.

NGOs

Sort activity clusters

(type, location)

Undefined set-list

Websites, journals, micro blogs…

Suppliers suppliers

(supply chain)

Suppliers’ facilities

address

Suppliers’

geo-codes

To be obtained in the

supplier contract

To be ordered in the

supplier contract

BMW production

facilities

BMW’s

geo-codes

BMW facilities

address

Processing

and geo-coding

Activity clusters

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. E-LISTENING INDENTIFIES, COLLECTS AND STRUCTURES SUPPLY CHAIN RELEVANT DATA.

Bundles information between

BMW’s engineers/buyers and

external supplier’ engineers/sales.

All information is shared on a

common platform. Information

is used to evaluate suppliers.

System can be expanded to

incorporate suppliers in the

innovation process.

Reduce information overload and

avoid information over-exposure.

1

2

3

Information sor-

ting algorithm

(Example: Google

Ad, Amazon)

Information

delivered to each

user is besboke Useful

information

Unstructered

information

Technology Innovation Suppliers

Seite 15

BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. LAYERED COLLECTIVE INTELLIGENCE FRAMEWORK VISUALIZES DATA.

INPUTS TO THE FRAMEWORK PROCESSING FRONT END

Production

sites layer

Factory

locations of

sup-pliers.

Production

sites of

BMW.

Supply

Chain

network

routes.

Risk layer

Natural.

Economic.

Social.

Opportuni-

ties layer

Innovation.

Sustai-

nability.

Supply

chain hubs.

Activity

clusters.

Re-search

centres.

Commodi-

ties layer

Exhaust

systems

(use case).

Expansion

to other co-

mmodities

such as

semi-con-

ductor wa-

fers.

Impact

layer

Damage.

Frequency

of occur-

rence.

Probability.

Interaction

& accessi-

bility layer

User in-

teraction

and in-put.

Links with

NSI Hot to-

pics search.

Defines ac-

cess rights

and acces-

sibility.

Global

locations

layer

Map high-

lights the

locations

and regions

impac-ted.

A number of

sub-layers

for risks, in-

novations

and oppor-

tunities.

BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. SOURCE OF INFORMATION – RELIABLE AND SUPRANATIONAL.

Information Sources (examples)

Oppor-

tunities

Wage data Bureau of Labour Statistics (BLS)

Political data National Statistical Institutions

Unemployment Arbeitsmarkt Service Austria (AMS)

Political risk Crime Rate in South Africa: South African Police Service (SAPS)

Trade barriers Market Access Database (European Commission)

Technology cluster German Ministry of Research and Education

Risks Tropical storms National Oceanic and Atmospheric Administration (NOAA)

Wild fires US Wildfires Geomac (USGS)

Global Disaster and Alerting

Coordination System (GDACS)

European Commission & United Nations

Climate Climate Hot Map (CHM) Union of Concerned Scientists

(non-profit, at Massachusetts Institute of Technology)

Earthquakes U.S. Geological Survey (USGS)

Floods National Flood Hazard Layer (FEMA)

Vulcanoes U.S. Geological Survey (USGS)

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. CONCLUSION: AN INCREASINGLY COMPLEX WORLD REQUIRES NEW WAYS TO DEAL WITH.

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7

Complexity of products increases, volatility of markets increases.

Current information management is short-term oriented (e.g. sustainability, risk etc.).

New technologies offer tools to deal with the challenges.

Proactive information management needs to be integrated into business processes.

4 disciplines: Collection, interpretation, visualisation and distribution.

Timely access to information is key differentiator of any supply chain.

Organizational change management is a key element to successful implementation.

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. GEO-VISUALISATION EXAMPLE: TROPICAL STORM FORECAST.

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. GEO-VISUALISATION EXAMPLE: TROPICAL STORM FORECAST .

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. GEO-VISUALISATION EXAMPLE: TROPICAL STORM FORECAST .

Tasks

Identify relevant suppliers.

Golbal Disaster und Forecast erkennen.

Early-warning for BMW supply

chainmanagers.

Early-warning ansd information for

relevant suppliers (up to tier-3).

Define counter measures.

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. GEO-VISUALISATION EXAMPLE: EARTHQUAKE IN GREECE.

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. GEO-VISUALISATION EXAMPLE: CURRENT US WILDFIRE.

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. GEO-VISUALISATION EXAMPLE: POPOCATEPETL – 50KM RADIUS.

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. GEO-VISUALISATION EXAMPLE: NORTH KOREA - 200KM MISSILE RADIUS.

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. GEO-VISUALISATION EXAMPLE: REAL-TIME TRAFFIC AND KEY SUPPLIERS.

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BMW GROUP: NEW TECHNOLOGIES UND INNOVATION. MEDIA MONITORING: TAG CLOUD BY TECHNOLOGY AND DETAILS.

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BMW GROUP: NEW TECHNOLOGIES UND INNOVATION. MEDIA MONITORING: TAG CLOUD BY TECHNOLOGY AND DETAILS.

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. THE ENTERPRISE 3.0 PROJECT@BMW: SEVEN SUCCESS FACTORS.

1 Start from a business perspective rather than from an IT solution view

2 Use existing structures wherever possible

3 Implementation needs to follow Agile Project Management

4 Identify relevant pilot categories and start the project step by step

5 Focus on data cleansing, e.g. supplier data

6 Top level sponsorship or top-level attention

7 Organisational change management is a key element to successful implementation

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BMW GROUP: NEW TECHNOLOGIES AND INNOVATION. Q&A.

Contact Details:

BMW Group

Alexander Scholz

Head of Project Management Supply Chain

[email protected]

+49 151 601-20850

mailto:[email protected]

NEW TECHNOLOGIES AND INNOVATION IN THE SUPPLY CHAIN …

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