Digitization is impacting the businesses globally. In context of automotive industry, clearly 3 trends are emerging as a result of digitization: Autonomous Vehicle, Vehicle-as-a-Service and Smart Manufacturing. These trends will lead to operational efficiencies in manufacturing, quality after-sales service for consumers and to innovative business models resulting into tremendous opportunities for OEM, Suppliers and Dealers. To enable Automotive Industry adapt a new digital business framework and maximize unprecedented opportunities, SAP offers a comprehensive solution portfolio for Automotive Industry
Making Supply Network Responsive by enabling Just-In-Sequence Processing
One of the important process in vehicle manufacturing is: forecasting parts demands to suppliers. While the parts are needed as per the assembly sequence and in-time, OEMs also need to keep inventory levels down and optimize the use of assembly line space. The challenge multifold as the demand fluctuates and customer’s expectations change. These challenges require automotive companies to transition from supply chain silos to product and demand networks. One of the ways to establish this demand network is to enable Just-In-Sequence (JIS) processing to proactively exchange demand of parts, between OEM and Supplier, as per the production sequencing.
Just-In-Sequence process sits right in middle of planning (translating the actual production requirements into actual production sequence) and actual production process at assembly line. There are various conditions (such as: engineering changes, unplanned resource outage) which impact the planning and production conditions, therefore impacting the JIS process. Since result of JIS execution serves as planning and execution input for the suppliers, a JIS solution needs to be framework driven to factor-in impact of any condition change, to minimize the impact on supplier side. Some key applications of a JIS solution are:
- To cut lead times by sourcing material in the sequence it was to be used.
- To minimize the impact of engineering changes due to minimum inventory level, thereby reducing production cost per vehicle.
- To eliminate the need of multiple interfaces to facilitate reporting and help ensure data consistency.
- To ensure non-disruption on existing processes and minimize the impact on supplier side
Improve After-Market-Service by monitoring your vehicle’s performance
The recent innovations have made the question “By When?” more relevant than “how?” on reality of Autonomous Vehicle. Like that of human evolution, there are critical junctures & mile-stones in-between, before a functioning autonomous vehicle becomes day-to-day reality. One of the significant step is to have an ability to constantly “listen” to your vehicle and take necessary actions based on what you listen. For example, Fleet operators of a trucking company would like to monitor real-time performance of trucks in fields and reward drivers with best driving practices. Thanks to Internet-of-things (IOT) revolution, telematics and connected vehicles are reality. As constant endeavour to differentiate from competition, provide value added services and better stakeholder collaboration, OEMs are developing a mobile enabled vehicle analytics platform. Some basic applications of such a platform are:
- Provide fleet operators with real time actionable insights leading to reduced cost.
- Support dealers in providing better quality support in case of vehicle breakdown
- Help in providing effective repair and maintenance services.
- Enable all product development team and quality team to consolidate critical vehicle usage and part replacement statistics that would eventually lead to better products
- Enable adaptive logistics by providing the necessary parts at the right-time, right-place and for right product
- Wear & tear details on a specific route can serve as an input / feedback to local governments, contributing to the smart city initiatives
These new insights will immensely help to improve the product quality and at the same time, offering of new value-added services to ecosystem, will open-up the new revenue streams.
What does future hold….
Worldwide population growth is already increasing pressure on existing infrastructure. The infrastructure in emerging economies is not feasible to have every individual own a vehicle. Although we expect the clean energy be the fuel of future transport, still the petroleum will continue to be a prime source of fuel for next 15-20 years. Even a 20% rise in global vehicle ownership will put 17 million more cars on street, leading to the huge environmental impact. Therefore, while clean energy will continue to replace bio-fuel as a prime source of energy, at the same time, “vehicle-as-a-service” business model will continue to grow. This trend will add new dimensions to “after-market-service” and nuances to managing customer-relations.
These new models will also put tremendous pressure on improving the operations and cut per vehicle products cost. There will be heavy use of Big-data (pattern detection with algorithms), sensors (infrared scan, sensor controls) and active process control, during production process, to catch defects early and to lower per vehicle cost.
These are exciting times for automotive industry and Automotive Team at SAP Custom Development have been working closely with customers to help them tackle these new realities of volatile markets, individualization of products, manufacturing automation, and increased regulations by delivering innovative business solutions and products. (Click here for a detailed overview of products and projects in automotive industry)
To learn more on Just-In-Sequence, telematics and other solution delivered by SAP Custom Development, register for SAP Best Practices for Automotive event in Detroit from 12th October thru 14th October or write an e-mail to Amit Sharma
**Amit Sharma is based out of SAP’s Silicon Valley campus. In his role, he is globally responsible for Discrete Manufacturing Industries (Automotive, Aerospace & Defense, High Tech, and Industrial Machinery) for SAP Custom Development organization. You can follow him here
