Successfully Meeting the Changes in the Automobile Industry

Companies in the automotive sector have found themselves faced with a dramatically changing market situation. The broad spectrum of topics and questions involved presents tremendous challenges to management.

Given the numerous factors influencing these companies, Ingenics has identified four crucial industry trends for automotive OEMs:

e-mobility – flexible integration of this generation of cars into existing manufacturing structures
digital transformation and Industry 4.0 – leveraging the potential in each company individually
connectivity, IoT, and big data – in the vehicle itself as well as in combination with logistical and manufacturing structures
automotive logistics – particularly with a focus on processes for inbound and outbound logistics

Based on the industry trends illustrated above and our decades of experience supporting the industry, we have established five specific fields of action for OEMs:

making manufacturing structures flexible
benefiting from efficiency through digitization
optimizing processes throughout the entire supply chain
optimizing supplier management
taking control of complex supply chains

1. Making manufacturing structures flexible

Making manufacturing structures flexible is and remains a major challenge for OEMs when it comes to safeguarding their cost structures and, in turn, their competitive position. Ingenics supports its clients with the identification of potential for flexibility by establishing the company’s individual requirements and matching them with the company’s strategic direction. The existing on-site manufacturing structures have their strategic and operational fitness examined and various performance checks are carried out, such as systematic production analyses (SPA), green-field checks (potential analyses), and automation checks.

Foundational plans are developed based on this and pragmatic recommendations are formulated for implementation in partnership with the client. The following consultancy services are used in line with the company’s individual needs:

As a result, the company will possess flexible manufacturing structures that can be adapted to changing requirements without complication.

2. Benefiting from efficiency through digitization

For OEMs, the major challenges with digitization are normally the existing factories and established structures that need optimization. Digital transformation of these sites and structures can realize the real-time control urgently needed to take control of the complexity. For example, the use of RFID technology can provide updates on inventory levels and part locations, helping control and optimize production planning.

Digitization projects start with a company-specific position analysis which records the processes and IT systems of relevant company divisions. The target vision (master plan) derived from this keeps track of the entire company and interrelationships with outside the company.

For automotive manufacturers, leveraging efficiency benefits through digitization means intelligently combining their manufacturing with their entire supply chain – in real time.

“Assembly/Production 4.0” and the “Internet of Things” are both approaches to digitization that make it feasible to supply data. The data is analyzed and evaluated, and made into KPIs, using IT systems that are integrated vertically and horizontally.

Ingenics Consulting views its role in this as being a digital architect that, together with the company, plans and embarks on an individual journey to digital solutions and makes digital transformation and Industry 4.0 a reality.

3. Optimizing processes throughout the entire supply chain

The supply chain in the automotive sector is marked by increasing complexity. The wide range of parts, tight deadlines, supplier specializations, electronic components with added complexity, and new suppliers (who are not yet fully on top of automotive standards) are but a few of the drivers of this trend. All this makes it difficult for OEMs to keep track of things and manage the supply chain efficiently and in real time.

In keeping with the slogan “Logistics 4.0”, Ingenics Consulting and its clients exploit the potential transparency and efficiency throughout the supply chain while incorporating digital technologies – for example with the Intralogistics Cockpit 4.0. This improves material flows, storage capacities, and logistics concepts to achieve the highest possible degree of efficiency.
Business processes are simultaneously examined and optimized, waste exposed and eliminated, and the employees involved in the process are made aware of the changes.

What results is a holistic logistics concept and a more robust and more efficient business process throughout the entire supply chain.

4. Optimizing supplier management

In the automotive sector, suppliers have an average share of approximately seventy percent of the value created by the OEM. This figure shows just how important it is for the OEM to have an efficient supply chain and high-performance supplier management.

E-mobility and connectivity in particular mean that new suppliers are being listed even if they have not yet fully mastered automotive standards. Additional requirements have developed due to the establishment and enforcement of IATF 16949 (the new quality standard of the International Automotive Task Force).

Ingenics supports its clients in the automotive industry with the safeguarding of product and process quality in the supply chain, and with the establishment of a systematic and digital supplier-management system. This support focuses on the following objectives:

ensuring cost efficiency and supplier reliability
defining and ensuring the quality of supply
optimizing procurement costs
effectively and efficiently managing suppliers
collaboratively optimizing cross-company processes
sustainably minimizing supply risk
establishing and expanding strategic cooperation with important suppliers

The result is a management system based on a concept and performance indicators, with an underlying process that is suitably robust. This allows OEMs to have a detailed overview of suppliers, their current performance, and their development status at any time.

5. Taking control of complex supply chains

Multilayered structures in an automotive manufacturer’s supply chain require individual management systems that create transparency and thereby make it possible to take control of the complexity.

The IT system by itself is just a part of the solution. Even more important are the KPI system, sources of data, interfaces, and harmonization, alongside the concept of “real time” – as a subject, topical issue, and general key word.

A high-performance business-intelligence solution for the supply chain should map out the complete supply chain and all suppliers involved. To meet this need, Ingenics has developed its own business-intelligence solutions which are adapted to companies individually:

“Production Cockpit 4.0”, with a focus on the manufacturer’s own production range
“Intralogistics Cockpit 4.0”, with a focus on the logistics processes on the company’s own premises and potential integration of suppliers

The cockpits combine data-analysis expertise with system expertise and extensive experience on the shop floor, in logistics, with process optimization, and the industrial-engineering approach.

Ingenics Consulting successfully supports its clients in the automotive industry at the strategy and planning levels as well as at the operational-process and organizational levels, and in realizing all these with excellent results.