Automotive parts giant Valeo knows first-hand about the complexities of globalization. With 10 product families manufactured at 121 plants and designed at 61 R&D centers, it supplies every major automaker with original equipment market (OEM), original equipment spares (OES) and independent aftermarket (IAM) parts and services. Since 2000, Valeo’s operations and logistics teams have improved manufacturing and supply chain processes by embracing Lean and other continuous improvement initiatives.
Valeo’s vision is to continuously improve product innovation, operations, and logistics performance. As part of this vision, Valeo standardized on a dual platform IT strategy. Valeo selected SAP as a platform for Enterprise Resource Planning (ERP) and Apriso as a platform for Manufacturing Operations Management (MOM), including logistics execution across their entire organization.
Continuous Process and Innovation Improvement
Apriso is installed at 82 locations to achieve inventory tracking, material flow visibility, and packaging and labeling compliance goals across its enterprise. Valeo sees Apriso as an “end-to-end” solution for manufacturing operations management and execution to streamlining operations while supporting and enabling continuous process and product innovation. Valeo partnered with Accenture as part of their Apriso deployment to help accelerate implementation by standardizing best-practices and sharing these processes across multiple locations. Apriso applications share a common unified data model and Business Process Management (BPM) capability to deliver real-time visibility and control for superior operational performance and an unprecedented ability to respond quickly to changing market conditions. Apriso has a Services Oriented Architecture (SOA) for simplified integration to third party enterprise applications, including SAP’s ERP.
Platform for Global Lean Initiatives
Consistency and product excellence at the lowest possible cost are core values at Valeo. As a result, Lean manufacturing plays an important role within Valeo’s operations. Even though they generally manufacture parts where they sell them, parts in China must be exactly the same as parts made in Spain to ensure global brand integrity is maintained.
As an enterprise MOM solution, Apriso helps to standardize business processes, operations performance and logistics execution on a global scale. A Center of Excellence collects, evaluates, prioritizes and delivers global business processes. As new products are launched, best-practices are identified and tested, to then be easily uploaded to some or all of the firm’s locations, creating a highly flexible platform for executing and maintaining Lean initiatives. The Apriso solution has helped slash inventory levels and waste while maintaining customer compliance requirements.
The results of Valeo’s process improvement program have been impressive. Implementing Apriso has had a direct impact on reducing logistics defects, helping to improve overall customer returns from 185 parts per million (PPM) in 2003 to just 10 in 2007, with 77 percent of sites demonstrating single-digit returns by 2008. Even more remarkable is the fact that 26 plants achieved return rates of zero PPM, indicating flawless performance.
- Logistics incidents reduced
- Transportation cost reduction
- Customer returns declined
- Idle inventories dropped at multiple locations
- Real-time inventory tracking provides accurate visibility to help reduce inventory levels