Supply Chain Management Agco Harvesting Operations Center Breganze. October 2016

Transcription

1 Supply Chain Management Agco Harvesting Operations Center Breganze October 2016

2 About AGCO OUR VISION High-tech solutions for professional farmers feeding the world OUR MISSION Profitable growth through superior customer service, innovation, quality and commitment

3 About AGCO AGCO CORE BRANDS

4 AGCO by the Numbers GLOBAL 2014 Sales by Geographic Region EAME: 53% North America: 25% South America: 17% Asia/Pacific: 5% DIVERSIFIEDOUR COR VALUE 2014 Sales by Product Tractors: 57% Replacement Parts: 14% Other Machinery: 9% Grain Storage and Protein Production Equipment: 9% Combines: 6% Application Equipment: 5% We have an established presence throughout the world s agricultural growing regions. Our product portfolio provides customers with comprehensive solutions to support their farms.

5 AGCO by the Numbers PERFORMANCE STRENGTH As of Dec. 31 SALES ADJUSTED EPS* $4.70 $9.7 B $5.3 B $ * Please see the reconciliation to the GAAP metrics in the appendix of this presentation

6 AGCO by the Numbers LEVERAGING A GLOBAL PRESENCE EAME & APAC EAME ASIA/PACIFIC GLOBAL SALES 53% GLOBAL SALES 5% DEALERS 1,160 DEALERS 300 CORE BRANDS DISTRIBUTED Challenger, Fendt, GSI, Massey Ferguson, Valtra MAIN CROPS Wheat, barley, corn, oil seeds, dairy and livestock CORE BRANDS DISTRIBUTED Challenger, Fendt, GSI, Massey Ferguson, Valtra MAIN CROPS Cereal grains, rice, palm oil, corn, sugarcane, dairy and livestock * Dealer number includes GSI, as of December 31, 2013

7 AGCO by the Numbers LEVERAGING A GLOBAL PRESENCE EAME & APAC OUR COR VALUE NORTH AMERICA SOUTH AMERICA GLOBAL SALES 25% GLOBAL SALES 17% DEALERS 1,300 DEALERS 340 CORE BRANDS DISTRIBUTED Challenger, Fendt, GSI, Massey Ferguson MAIN CROPS Wheat, hay, corn, canola, soybeans, cotton, dairy and livestock CORE BRANDS DISTRIBUTED Challenger, GSI, Massey Ferguson, Valtra MAIN CROPS Soybeans, sugarcane, corn, coffee * Dealer number includes GSI, as of December 31, 2013

8 The People of AGCO A SINGLE FORCE. THOUSANDS STRONG. 9,396 OUR CORE VALUE 5,466 4,046 ACCOUNTABILITY 1,920 TOTAL 20,828* INTEGRITY RESPECT TEAM SPIRIT North America South America EAME APAC TRANSPARENCY *As of December 31, 2014

9 AGCO global combine sources Shandong Dafeng Machinery Co Ltd. Hesston USA Breganze Italy Santa Rosa Brazil Only South America

10 The history PROPERTY BRANDS 1873 Settlement of the Company Pietro Laverda 1981 Laverda becomes an active part of the Fiatagri Group Laverda 1983 Laverda Fiatagri New Holland 2000 ARGO Spa, the Morra s family holding company, acquires Laverda Laverda Joint-Venture ARGO-AGCO Laverda Fendt Massey Ferguson Challenger 2011 AGCO confirms the full ownership of Laverda

11 AGCO EAME Harvesting Operations Center Breganze Employees: %agency Net Sales: 133Mln/ (2013) Tot covered surf m2 Total area: 22 Hectares 11

12 Market Sampo-Rosenlew Ltd partecipazione societaria del 10% in OEM Hesston USA Breganze Italy Santa Rosa Brazil Only Sout America 12

13 Manufacturing system Average cycle time to complete work on each station 1.5 H Number of pre-assembly areas 12 Maximum production capacity per day 7 13

14 Supply ChainMaterial Cost Improvement: SUPPLIERS 270 PURCHASING CODES 8500 Results 150 MODELS 3500 PARTS PER COMBINE 600 DEALERS 4000 FABBRICATION PARTS MOQ = MODEL MIX LINE

15 Planning process Material Cost Improvement:

16 Suppliers information Material Cost flow Improvement: Suppliers web portal EDI for incoming goods documentation Kanban call KA NB AN The suppliers is integrated with our manufacturing system with a Web Portal where we can share: Delivery schedule Daily delivery status Communications

17 Internal material Material flowcost Improvement: Fornitore Results Assembly line feeding: PUSH FORNITORE SUPERMARKET KIT Kanban: components are by the operator with Kanban card when the container used is empty. The Kanban is distributed from the central warehouse or supplier using internal milk-run. PULL PULL PULL PULL KA NB AN KIT KIT KA NB AN KIT Kit: the components are grouped by kits and supplied by pull system using internal milk-run from the internal supermarket or suppliers following the line sequence. AREA DI PREMONTAGGIO AGCO Corporation

18 The market expectations Material Cost Improvement: Volumes seasionality Flexibility & reactivity Competitiveness Quality perception Delivery Results

19 Breganze Supply Material Chain Cost Improvement: Transformation Project The target of the Breganze Supply Chain Trasformation project it sto support the company strategy following the increase expectations of the farmer Results ITMS 360 On Time Delivery reporting Supplier Development Program Logistics agreement Lean Supply Chain Suppliers on Time Delivery Delivery to promise Model Mix line MOQ=1 Internal material flow Quality trasformati on project New layout implementation New organization People motivation

20 360 ITMS Center Material Cost Improvement:

21 360 ITMS Center Material Cost Improvement: The concepts principle is to integrated Planning, Optimization, Controlling and Reporting for Transportation at the central AGCO 360 itms Center Current Situation Future situation AGCO 360 itms Center No network integration EAME network integrated AGCO plant Supplier Crossdock

22 360 ITMS Center Material Cost Improvement: The AGCO 360 itms Center will cover all activities from strategic planning Strategic Network Planning Tactical Transportation Optimization & Implementation Dynamic Balancing Integrated transportation management system Optimize overall network structure Optimize and implement routes based on future demand Optimize next day s shipments and order transportations

23 360 ITMS Center Material Cost Improvement: to daily execution including freight cost control, controlling and reporting integrated in one system. Execution Freight Invoice Audit and Control Controlling & Reporting Integrated transportation management system Transportation status, identify and solve exceptions Check invoices and manage claims Measure, analyze and report cost and performance KPIs

24 SDP- Suppliers Material Development Cost Improvement: Program

25 Logistics agreement Material Cost Improvement: Breganze Plant Supplier Logistics guidelaines Logistics data sheet Packaging data sheet Info Goods Logistics guidelaines Order & forecast process Performance monitoring Phase out parts management Delivery delay and rework cost Standard SCM process Container management Transport management EDI, WEB Logistics data sheet SCH method Transport mode & Incoterm transport lead time Safety stock for critical parts Capacity & Flexibility agreement Contacts Communications method Packing data sheet Parts number Container Quantity Storage rules

26 Logistics agreement Material Cost status Improvement: Others 58% Turnover Others 49% Parts number Work in progres 6% Closed 36% Work in progres 6% Closed 45%

27 Lean supply chain Material Cost Improvement: Re-Layout & Balancing Results Lean Material Flow (PFEP) Lean Supply Chain Optimize material flow and area layout. Increase material handling and storage efficiencies. Reduce shortage. Recover space. Eliminate volume increase constraints.

28 Lean supply chain Material Cost Improvement: Plastic shieldings Cabs Results After Kaizen Before Kaizen

29 Actual state material Material Cost flow Improvement: ) In the actual layout we have material crossing, long transport Resultsdistance, inefficient material handling/warehousing and no transparency. New paint shop The location of the new paint shop was chosen considering the further extension. The central warehouse is very inefficient kitting area: we want to eliminate it.

30 Actual state material Material Cost flow Improvement: Inefficient kitting activity before and after paint department Results N kit prepared per combine Kitting area before paint Kitting area before assembly FTE 5 16 N of shifts shifts does not give the opportunity to manage kitting on due time to the assembly line resulting on. Oversize of access of material in front of warehouse. Outside tenth of staging/kit preparation. Weekend overtime.

31 New layout principles Material Cost Improvement: model mix line fishbone layout Results product orientation Process 1 product family A B C Process 2 Process supermarkets / PULL plan for every part decentralization

32 Future state material Material Cost flow Improvement: new paint system Linear flow & cell design in fabrication Results current state: header assembly assembly kitting dynotest prepaint kitting CNC New receiving areas Efficient supermarkets welding combine assembly kitting Improved line layout Inverted assembly line direction JIS delivery cutting, bending New cutting and bending area

33 Future state material Material Cost flow Improvement: 100% kit New supermarket to kitting on the floor Less handling thanks to move the high runners items from kit to kanban KLT box to optimize the handling Results 3 shifts kit + kanban = less handling 1 to 2 shifts max = less waiting time

34 Organization Material & change Cost management Improvement: Suppliers Vision People on board Agco People Process Analysis (VSM, PM, Ciclo di lavoro, Group Tecnology, ) Tools ( Kanban, Kit, Milkrun, Visual Management, IT )

35 Organization Material & change Cost management Improvement:

36 KPIs IMPROVING MARGINS Material Cost Improvement: Results Days On Hand On Time Delivery Delivery To Promise Shortages

37 AGCO Supply Material Chain Cost Strategy Improvement: Logistics as key driver for success Standardization & Definition of Requirements Logistics agreement Standard supply modes EDI Standardization Container Management Packaging guidelines Standard labeling Incoterm transformation Integration & Performance Tracking Supplier Development IT Integration Inbound Consolidation Milk run/trailer concept WEB-EDI and EDI integration Supply Chain Event Management PFEP lean logistics Collaboration & Continuous Improvement Collaborative forecasting and replenishment Implementation of VMI/CMI Concepts On-time-Demand-Capacity Alignment Integration of logistics requirements in all relevant processes In future AGCO will source processes and not only parts

38 Conclusion Achieve best supply solutions for our customer needs!