Fire Department in a Package
In the past, body manufacturers received individual orders on different dates. In future, Procurement will send out RFQs, negotiate and source identical bodies for the Daimler factory fire departments in packages. With many advantages for the manufacturers of fire-fighting bodies.
They rescue, put out fires, save lives: the factory fire departments of Daimler AG. To this end, the fire stations of the German factory locations have 168 special-purpose vehicles at their disposal. The fire trucks, command vehicles, or equipment carriers have to withstand extreme stresses during up to 40 missions a day. They are replaced after delivering maximum performance for up to 20 years. The buyer team responsible for vehicle bodies and conversions at International Procurement Services (IPS) receives customized performance specifications from all fire department specialist units to negotiate and source individual bodies. A complex process that involves lots of moving parts in light of 13 factory fire departments and 42 different body types. That also goes for the commissioned suppliers.
To make it easier for all parties involved and take advantage of synergy effects, buyers Ulrich Posselt and Stefan Knödler in close cooperation with the fire departments have developed a new procurement system. They are fleshing out this system with the specialist units, and are testing them in pilot projects.
Give me five – the components
The new comprehensive system comprises five elements: the specifications master, the package sourcing, the supplier set, the acceptance checklist, and the feedback of lessons learned. They all work in concert and make work easier for the body manufacturers.
Specifications master – concentrated efficiency and transparency
For the first time, the complete specifications break down all equipment options in detail. From the telescopic mast and hose to the helmet or ax. Some 450 positions – for each vehicle model, with uniform order number valid for all plants. The key feature: All positions can be selected at the click of a mouse and quickly checked for plausibility. The body manufacturer receives unambiguous, technically validated specifications. As a binding standard for the request for quotation (RFQ), bid, order processing and acceptance.
Away from individual RFQs towards standardized packages
The goal is to aggregate the orders of the factory fire departments for vehicles identical in construction. And who profits from the order packages? In Ulrich Posselt’s experience: everyone! The volume effect allows body manufacturers and specialist units to lower costs. In addition, the body manufacturers are able to produce small series faster and improve their products. After the second or third body, the workers have the job down pat. Thanks to periodic RFQs, body manufacturers are able to plan their capacities better in advance. Last but not least, the industry is taking notice of the attractive order volumes. The commissioned body manufacturers are able to raise their market profile as a result.
Good, better, supplier set
Ulrich Posselt and Stefan Knödler are optimizing the supplier set to ensure that the right body specialists are selected for every package RFQ. To this end, the buying team looks for new body manufacturers to supplement the existing set. In addition to the question of who can produce what types of bodies and scopes, the focus is also on the demanding quality standards. To meet these standards, Daimler conducts cross-functional supplier visits and in so doing furthers their qualification.
Optimal: Checklist and feedback
The acceptance process for the vehicle body is also accelerated. A PC checklist with the acceptance items is generated automatically from the performance specifications. Green, yellow, red – color-coded checkmarks tell the supplier immediately where he stands. Another advantage: Comments or information about weak spots can be bundled on a cross-plant basis and are incorporated into the complete specifications. The body manufacturer is thus able to continuously improve his processes – and always build on the latest technologies and equipment features.
Our checklist makes work tremendously easier. Each vehicle requires just 4 to 6 hours for acceptance, instead of 2 to 3 days. Our supplier was thrilled – and we set new standards.
After the successful pilot project, standard package RFQs are planned starting in 2017. “In the medium term, we are able to synchronize and bundle the times when we need new vehicles through the year 2045. This allows us to place the packages on the market and source them earlier,” explains Ulrich Posselt. In the long run, the new system could become a shared model for success for the Daimler plants and body manufacturers in China as well as in North and South America. An opportunity for suppliers around the world to be active for Daimler in this project.