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Supply Chain Management of BMW

Discuss Supply Chain Management of BMW within the Elements Of Logistics forums, part of the PUBLISH / UPLOAD PROJECT OR DOWNLOAD REFERENCE PROJECT category; Supply Chain Management of BMW : Bayerische Motoren Werke AG (info) (BMW), (literally English: Bavarian Motor Works) is a German ...

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Supply Chain Management of BMW
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Netra Shetty
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Supply Chain Management of BMW - December 29th, 2010

Supply Chain Management of BMW : Bayerische Motoren Werke AG (info) (BMW), (literally English: Bavarian Motor Works) is a German automobile, motorcycle and engine manufacturing company founded in 1916. It also owns and produces the Mini brand, and is the parent company of Rolls-Royce Motor Cars. BMW produces motorcycles under BMW Motorrad and Husqvarna brands. BMW is known for its performance and luxury vehicles, and is a global leader in premium car sales.
Car manufacturer BMW is using a service management system as part of a wider plan to improve supply chain lifecycles.
quality assurance procedure for supplier parts has been developed for
a number of reasons:
• to ensure that the quality standards of all components and material
used in all BMW Group products continue to please our customers;
• to create a common group-wide operational standard for this very
important activity;
• to ensure that all the responsibilities concerning this activity are
fully understood throughout BMW Group and throughout our
supply chain;
• to help all those involved complete their tasks in a professional
manner and in line with the project timetable.
These procedures have to be implemented under the following
circumstances:
• new product developments;
• modified or new processes;
• use of new production plants, production facilities, tools,
technologies, materials;
• new production location, production re-location.
Suppliers planning to change their product or processes in any way
must inform their BMW Group partners from Purchasing, Development,
Logistics, and Quality Management (the so-called “Clover Leaf”).
The procedure outlined in this booklet regulates the activities and
responsibilities of the supplier and of the BMW Group departments
involved in the quality management system for new supplied parts
and material.
It applies throughout BMW Group in the business areas Automobiles
and Motorcycles and is to be used on all component,
systems, and module projects.
The overall responsibility for on-time supply of satisfactory parts and
materials lies with the supplier.
The overall responsibility within the BMW Group for the purchase and
procurement of production material lies within the Division ”Purchasing
and Supplier Network”.


The engineering and production of quality parts starts with the
nomination of world class suppliers. During the selection process,
our potential suppliers have to prove that they meet the demanding
requirements of BMW Group.
The BMW Group’s Purchasing and Supplier Network Division is
responsible for successful supplier selection and contract drafting.
Purchasing is supported by Development, Parts Quality Management,
and Logistics in what is called a “Clover Leaf” arrangement.
Suppliers are selected across a number of project phases, depending on
the scope of service being contracted out and on the type of supplier
involved. In most cases the schedule is as follows:
In selecting our suppliers, we are looking to find the best in the world for:
• Product innovation and strength of concepts
• Product quality / robust production processes
• Lifetime costs
• Delivery process capability and on-time delivery
• Project management
• Value creation chain / subcontractor management
Type of supplier
Responsibilities Nomination
date
Concept suppliers
Series development
suppliers
Market suppliers
Develop a technical concept
Develop a series production
process based on a given
concept
Supply standard parts
MbS=Months before start of series production
Up to approx.
38 MbS
Up to approx.
30 MbS
Up to approx.

In most cases, there will be a competition between several potential
suppliers. Only if there is a known best practice supplier, a direct
nomination will apply. The supplier selection decision will be taken
by the BMW Group on the basis of the suppliers’ project proposals and
plans in all the areas identified above. If the supplier is already known,
the decision will be taken additionally based on the demonstrated
capability. Supplier evaluation is carried out by Purchasing, Parts Quality
Management, Logistics, and Development.
By completing the contract draft only when the supplier is nominated, the
best possible conditions can be achieved with regard to:
• Clearly stated requirements,
• Agreed targets,
• Achievable objectives,
• Compatible terms and conditions.
“Supplier Contracting” covers the following types of agreement:
• Confidentiality agreement,
• Development contract,
• Warranty agreement,
• Supply contract,
• Combined development / supply contract,
• Requirements specification
• Service Level Agreement (SLA) / QMT Requirements
• Scope of service and logistics (LLQs).
A nominated BMW Group supplier takes a great responsibility for the
overall quality management, as described in this booklet. With the
nomination usually a long-term relationship starts, that needs to be
based on mutual trust, acting as true partners.
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Re: Supply Chain Management of BMW - July 3rd, 2015

What do you mean by Supply Chain Management

Supply Chain Management (SCM) is the management of the flow of goods and services. It includes the movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption.

Advantage of Supply Chain management

1) Ease in business

2) Low cost
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