An evaluation of demand and capacity planning processes – a qualitative case study on completely-knocked-down vehicles at Mercedes-Benz Cars

Chemendy, Natascha (2018-03)

Thesis (MCom)--Stellenbosch University, 2018.

Thesis

ENGLISH SUMMARY : Sales and operations planning (S&OP) describes an integrated business management process, enabling management to achieve cross-functional focus and alignment throughout an organisation. This process plays a critical role in managing external demand and internal capacities. Specifically in times of demand volatility, S&OP has the potential to improve supply chain performance. Successful S&OP requires integrated and effective processes as well as appropriate external collaborative processes with key channel partners to enhance supply chain performance in a sustainable manner. As a globally operating business, Daimler Aktiengesellschaft also requires effective S&OP. The business unit for passenger vehicles, Mercedes-Benz Cars (MBC), follows two import strategies to increase market potential, namely completely-built-up (CBU) and completely-knocked-down (CKD) vehicles. Demand and capacity planning is a crucial component of supply chain management at MBC, both for CKD- and CBU-vehicle management. The CKD-vehicle business only accounts for a small portion of MBC however with continuously increasing production output. The increasing production volumes of CKD-vehicles stress the significance of effective demand and capacity planning processes. In order to remain competitive, the company identified the need to gain deeper insight and to investigate potential improvement opportunities for demand and capacity planning processes for CKD-vehicles. The aim of this study was to provide a foundation for MBC to improve the processes for demand and capacity planning for CKD-vehicles. Further, the study aims to provide recommendations towards appropriate performance metrics to track the improvements mentioned. This research followed an intra-case, cross-sectional case study design in an exploratory manner. The combination of primary and secondary data provided a comprehensive foundation for this study. Data were collected through observations, interviews and a focus group. The qualitative analysis of primary unstructured textual data took place in the form of content analysis. The results of this study consist of the identification of key planning processes for demand and capacity management for CKD-vehicles, followed by an evaluation of these processes and recommendations on suitable metrics to measure the performance of these processes. Main findings indicated that MBC operates cross-functional processes that lack system integration and availability of information. These factors lead to uncertainty regarding CKD-vehicle planning processes, increased lead times and forecasting inaccuracy. The main improvements recommended include the advancement from manual data processing to more computerised data processing, availability of information throughout the supply chain and the implementation of metrics to measure the performance of demand and capacity planning processes. The implementation of these recommendations could enable MBC to improve subsequent processes, such as shortfall management. In conclusion, the demand and capacity planning processes for CKD-vehicles at MBC provide a solid basis for S&OP with potential for improvement. In order to manage growing vehicle production output, it is recommended that MBC enhances demand and capacity planning processes further, aiming at an alignment with the equivalent processes for CBU-vehicles. Additionally, the monitoring of process performance guides the business further in process development by identifying further improvement areas. The incorporation of recommended improvements could allow MBC to significantly enhance their performance, and overcome the shortcomings identified in this study.

AFRIKAANSE OPSOMMING : Verkope en bedryfsbeplanning (S&OP) beskryf 'n geïntegreerde sakebestuursproses wat bestuur in staat stel om kruis-funksionele fokus en belyning regdeur 'n organisasie te bereik. Hierdie proses speel 'n kritieke rol in die bestuur van eksterne vraag en interne vermoëns. Spesifiek in tye van vraagvolatiliteit, het S&OP die potensiaal om die voorsieningskettingprestasie te verbeter. Suksesvolle S&OP vereis geïntegreerde en effektiewe prosesse asook gepaste eksterne samewerkingsprosesse met sleutelkanaalvennote om die voorsieningskettingprestasie op 'n volhoubare wyse te verbeter. As 'n wêreldwye operasionele onderneming vereis Daimler Aktiengesellschaft ook effektiewe S&OP. Die besigheidseenheid vir passasiersvoertuie, Mercedes-Benz Cars (MBC), volg twee invoerstrategieë om die markpotensiaal, naamlik "completely-built-up" (CBU) en “completely-knocked-down” (CKD) voertuie, te verhoog. Vraag- en kapasiteitsbeplanning is 'n belangrike komponent van voorsieningskettingbestuur by MBC, beide vir CKD- en CBU-voertuigbestuur. Die CKD-voertuigbesigheid is egter slegs verantwoordelik vir 'n klein gedeelte van MBC, maar met voortdurend toenemende produksie-uitset. Die toenemende produksievolumes van CKD-voertuie beklemtoon die belangrikheid van effektiewe vraag- en kapasiteitsbeplanningsprosesse. Om mededingend te bly, het die maatskappy die behoefte geïdentifiseer om dieper insig te verkry en potensiële verbeteringsgeleenthede vir vraag- en kapasiteitsbeplanningsprosesse vir CKD-voertuie te ondersoek. Die doel van hierdie studie was om 'n grondslag vir MBC te bied om die prosesse vir vraag- en kapasiteitsbeplanning vir CKD-voertuie te verbeter. Verder streef die studie daarna om aanbevelings te maak oor toepaslike prestasie statistieke om die verbeteringe na te gaan. Hierdie navorsing het op 'n ondersoekende wyse 'n intra-saak, dwarsdeursnee gevallestudie-ontwerp gevolg. Die kombinasie van primêre en sekondêre data het 'n omvattende grondslag vir hierdie studie verskaf. Data is ingesamel deur middel van waarnemings, onderhoude en 'n fokusgroep. Die kwalitatiewe analise van primêre ongestruktureerde tekstuele data het plaasgevind in die vorm van inhoudsanalise. Die resultate van hierdie studie bestaan uit die identifisering van sleutelbeplanningsprosesse vir vraag- en kapasiteitsbestuur vir CKD-voertuie, gevolg deur 'n evaluering van hierdie prosesse en aanbevelings oor geskikte statistieke om die prestasie van hierdie prosesse te meet. Belangrikste bevindings het aangedui dat MBC kruis-funksionele prosesse bedryf wat die stelselintegrasie en beskikbaarheid van inligting ontbreek. Hierdie faktore lei tot onsekerheid rakende CKD-voertuigbeplanningsprosesse, verhoogde loodstye en voorspellings-onakkuraatheid. Die belangrikste verbeteringe wat aanbeveel word, sluit in die bevordering van handige dataverwerking tot meer gerekenariseerde dataverwerking, beskikbaarheid van inligting regdeur die voorsieningsketting en die implementering van statistieke om die prestasie van vraag- en kapasiteitsbeplanningsprosesse te meet. Die implementering van hierdie aanbevelings kan MBC in staat stel om daaropvolgende prosesse, soos tekortbestuur, te verbeter. Ten slotte bied die vraag- en kapasiteitsbeplanningsprosesse vir KKD-voertuie by MBC 'n stewige basis vir S&OP met potensiaal vir verbetering. Om die groeiende voertuigproduksie-uitset te bestuur, word dit aanbeveel dat MBC verdere vraag- en kapasiteitsbeplanningsprosesse verder bewerkstellig, met die oog op 'n belyning met die ekwivalente prosesse vir CBU-voertuie. Daarbenewens lei die monitering van prosesverrigting die besigheid verder in prosesontwikkeling deur verdere verbeteringsareas te identifiseer. Die inkorporering van aanbevole verbeterings kan MBC toelaat om hul prestasie aansienlik te verbeter en die tekortkominge wat in hierdie studie geïdentifiseer is, te oorkom.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/103797
This item appears in the following collections: