Daimler Supplier Network

Transcription

1 Daimler Supplier Network

2 2 1) Background: Where do we come from, where are we going Slide 1) In the beginning of the 1990s, the then Daimler-Benz was one of the first auto companies to provide a new basis for cooperation with its suppliers. This first model, Tandem, was enhanced in the course of the merger with Chrysler and given the name Extended Enterprise. With this, the trustful relationship became a performance-based partnership. And now, with our new supplier cooperation model Daimler Supplier Network we will take another step forward. The Daimler Supplier Network is no revolution. It s an evolution of our cooperation with you, our suppliers. You will see familiar elements, but also hear of entirely new things. Our suppliers opinion was very important to us while developing this new cooperation model. That is why, about one year ago, we asked some of you for feedback on our past cooperation. You were also asked about your expectations for a future model. Our own experience from Tandem and Extended Enterprise was also integrated into the model. And we considered current and future challenges.

3 3 So, what are the major components of the enhanced supplier cooperation model? Slide 2) a) Like its predecessor, the Daimler Supplier Network is based on performance. Additionally, we ve highlighted the importance of partnership with you. b) We classify our supplier in various groups. c) We clearly define our expectations and commitments to suppliers per segment. And here the topic of innovation clearly comes to the forefront. This means advantages for both sides for you and for us.

4 4 2) Philosophy of the new concept Slide 3) The Daimler Supplier Network is based on two pillars: performance and partnership. The guiding principle of the model is a mutual Commitment to Excellence. Performance is objectively measured with the help of the four familiar value drivers of the External Balanced Scorecard (EBSC): quality, technology, cost and supply. Partnership is based on fairness, reliability and trust. With the Daimler Supplier Network we want to take into account the great variation in our suppliers. That is why we classified our suppliers into three groups: Slide 4a)

5 5 The foundation of the pyramid is composed of the supply base. For them Daimler remains the same reliable business partner as before. It s followed by the group of Key Suppliers, with whom we generate a significant percentage of our purchasing volume. The top is composed of the so-called Strategic Partners. In this group the strategic exchange is clearly the focus. Which are the criteria used to classify our suppliers into these segments? Slide 4b) First of all, the amount of your sales to Daimler. The higher the volume, the higher the segmentation. Next, your performance, which is measured with the EBSC. Last but not least, the aspect of innovative ability. Which technical, economical or strategic innovations does your company develop for Daimler? This means that small suppliers that don t have high sales volumes with Daimler also have the opportunity to become part of the top segment of our Strategic Partners. Our suppliers are assigned to the three segments on a long-term basis. Nevertheless, procurement, working together with the engineering areas, will review their assignment once a year.

6 6 3) Expectations/ Commitments on the part of Daimler The novelty of the model is that we set the highest expectations for those suppliers with whom we have especially intensive business relations. We don t see partnership as a one-way street. Therefore, in return, we commit to an intensive new level of cooperation and communication. Let me now detail our increased expectations and commitments per supplier segment. Slide 5) The following basic expectations apply to all of our suppliers: All suppliers are evaluated according to your performance in quality, technology, cost and supply. That s the ticket of entry. We expect cost transparency and your full commitment to our mutually agreed cost targets. We assume your active participation in continuous improvement process and projects. Last but not least is following the generally applicable code of conduct and ethics in daily business life. This is as self-evident for you as it is for us.

7 7 In return, we commit to make sourcing decisions on the basis of the achieved performance of every single supplier. The better your EBSC values are rated the higher the chance to continue with our successful cooperation. We also expect our Key Suppliers to appoint a Daimler key account contact from your executive management, to facilitate our direct communication and strengthen the focus on our common needs. We further ask for your full support on our Daimler strategy as well as our global activities. Last but certainly not least exceptionally good results in performance are an obvious expectation to a Key Supplier. We will recognize and reward your good performance by inviting you to our annual Daimler Key Supplier Meeting. With this invitation you are also among the candidates for one of the 14 Daimler Supplier Awards for top performance in a commodity group or in the field of innovation, sustainability or partnership. Finally, our top group, the Strategic Partners, is expected to set the benchmarks in performance. You belong to the best in class in your business area. We furthermore request an open dialogue on and easy access to your innovations, in order to elaborate additional common business opportunities. In return, we offer you a direct contact with the Daimler top management. Specifically, that means engaging in an intensive exchange of information at the so-called strategic dialogs. And you ll have site visits by Daimler top management from all involved functional areas. The aspect of the Daimler Supplier Network that is most important to us is that it offers advantages for both sides -- for you as our suppliers as well as for us.

8 8 Slide 6) For us that means having even better suppliers in the areas of quality, technology, cost and supply. And the possibility of leveraging the full potential of innovation together with you. For you that means: Planning security and reliability in your daily business and over the long term. Access to detailed information and exchange with Daimler top management. Cooperation on the basis of trust And more possibilities of establish new business opportunities with Daimler. Because we are convinced that a fair partnership creates open communications and that leads to more productive cooperation and mutual success. 4) Individual package of measures for each Purchasing Unit incl. concrete implementation measures in 2009 a) PMC We defined concrete measures in each of the three purchasing units that are customized to fit their respective situations.

9 9 What does it mean for Procurement Mercedes-Benz Cars and Vans? We guarantee Key Suppliers a long-term contract instead of the one-year contracts we had before. The requirement for this is, naturally, good or very good results in the EBSC. Especially important to us is closing the gap for reference calculation by the end of We offer our Strategic Partners, who are leading in the field of innovation, the possibility of direct sourcing. In return we expect a clear commitment on reaching the target price. Furthermore, we invite our Top suppliers with the highest business volume once a year to extend an intensive exchange of information. Especially with the first 10 of this group, Rainer Schmueckle, Chief Operating Officer Mercedes-Benz Cars, the respective top manager of engineering and Frank Deiss will discuss current issues, projects and performance. We want to integrate these Strategic Partners into our business area early -- in the strategic development stage of Mercedes-Benz Cars and Vans. Therefore we would like to exchange strategies regarding innovations, technologies, regionalization and future projects. With the focus on your development in new technologies for Cars and Vans we invite selected Strategic Partners to so-called Tech Days.

10 10 During these exhibitions you have the chance to introduce new products and innovations exclusively to Mercedes-Benz buyers and engineers. A perfect way to exchange ideas on new technologies and to deepen the cooperation between you as our suppliers and our procurement and engineering areas. Last but not least, our Suppliers with exceptional performance results: we will take this positively into consideration in our award decisions. b) PTB Professional communications with you, our most important suppliers, is the main focus for us, in Procurement Trucks and Buses. We are looking for an intensive exchange of information on both sides. We want to talk and even more important - we want to listen! We already demonstrated the importance of communication at the Daimler Trucks and Buses Supplier Meeting during last year s IAA. Early involvement of our Key Suppliers is important in the field of new product projects. Linked to relevant Quality Gates of product and engine projects we will foster a timely and intensive communication between you and us: What is the current status of the new product project? What are the precise requirements for you as the supplier? How do we cooperate in the field of change management?

11 11 To strengthen our cooperation we, in the business unit of Procurement Trucks and Buses, commit to regularly inviting all of our Strategic Partners to future strategic dialogs and meetings. During these meetings we want to intensively share information and strategies at top management level. And we want to hear your feedback and ideas. Andreas Renschler, Head of Daimler Trucks and member of the Board of Management, Georg Weiberg, Head of Truck Development, and Stefan Buchner will visit the first suppliers on site this year. In these talks with you we want to define our cooperation: We will exchange information on Daimler s corporate strategy as well as that of your company to define future goals. For example internationalization: How can we co-operate in the so-called BRIC-countries? We will discuss new product projects for Trucks and Buses to integrate ideas and innovations into further developments for new products. And of course into series production if possible. And we will ask for your formal feedback to our cooperation once a year. c) IPS In International Procurement and Services, we also want to strengthen communications with our Key Suppliers and Strategic Partners. Relevant information should quickly and directly reach the right target group.

12 12 For example, IPS and the Daimler IT-organisation commit to presenting the Daimler IT strategy to our most important IT suppliers. All our strategic partners will be visited by the top management of procurement and the respective functional areas for an intensive strategic dialogue. We will offer selected IPS Key Suppliers and Strategic Partners the possibility of using successful projects with Daimler for marketing purposes. And we provide the respective award winners in the categories of non-production material the opportunity to participate in all important requests for quotation in their material groups in the following year. For the first time ever, that apllies to this year s IPS award winners. 5) Conclusion/ forecast Let me conclude our brief presentation on the Daimler Supplier Network: We encourage you to measure us on our new supplier cooperation model, the Daimler Supplier Network. Evaluate us on the principles of performance and partnership in the Daimler Supplier Network. We promise you transparency, reliability and credibility. In return, we ask you to give us your trust and best performance. And to bring us your great ideas! We want to be your preferred customer.