Our client, a large European passenger and light commercial vehicle manufacturer, was making progress in a European New Car Buyers Survey of defects in the vehicle’s first few months of use. However, it lagged behind best-in-class Japanese manufacturers, and customer perception of its product quality was low.
The company was struggling to reduce vehicle recall costs, and its warranty and policy spend, as a percentage of net sales, was trailing best in class.
Thomas Group was engaged for the implementation of a Total Vehicle Quality program focused upon:
A low customer perception of vehicle quality had contributed to a fall in market share and profitability. The lack of a standard approach, in the vehicle development process for measuring perceived quality, was identified as a key barrier. A cross-functional team led by Thomas Group:
Cost in Service was significantly behind best in class. A client team, led by Thomas Group, set the target of improving Cost in Service ratios by 20% to compete against the industry benchmark. As a result:
A client cross-functional team carried out a deep-dive analysis and identified 42 key issues that had contributed 60% of total recall costs over the previous six years. The team identified holes in the existing FMEA, PPAP, and Validation processes, which had allowed recall issues to slip through. It defined improvements to integrate the processes and established a methodology to ensure that root causes of past recalls would not re-occur.
The company lacked a consistent and measurable process to develop market requirement specifications that could be accurately translated into a set of vehicle specifications by design engineers. A high level of rework, throughout the development process, was primarily due to the late removal of vehicle options and features in order to meet cost objectives.
A new translation process was defined and implemented. The vehicle development process was enhanced so that it could be more effectively applied to projects of varying complexity, ranging from minor facelift to new vehicle platforms. A measurement system was introduced to clearly identify functional differentiators against target competition. This system enabled a balancing of cost against feature throughout the development process.
Historically, component re-use in all projects was low. Key issues included the lack of a clear cross-platform strategy, no yardstick by which to measure re-use benefits, the lack of a change control methodology to drive re-use, and a culture of design optionalism. A cross-functional team:
The application of different quality procedures to internal manufacturing and external suppliers had created complexity and inconsistency. The major hurdle, in introducing a 16-step external supplier process to internal manufacturing, was cultural resistance to change.
A high level team overcame this barrier to deliver higher PPM quality performance and to reduce overhead in checking and fixing. In the process, internal suppliers became more customer oriented and opened the door to significant savings.
Product, dealer, and sales launch activities did not take place in a coordinated manner. Consequences of missed deadlines were not always understood. Without launch process leadership, lessons learned were not fed back to improve future performance.
A team, led by Thomas Group, mapped all elements of vehicle launch, combined these into a common process, and implemented this as a project management tool. It introduced cycles of learning and trained brand teams to use the new process.
The quality of delivered vehicles had improved in recent years but dealer costs had not fallen in line.
A team identified existing best practices and applied these across Europe to save time in technical preparation and to reduce optical checks by 10%.
Within the existing quality control process, the first quality gate came in late, there was no central monitoring point, and time between reviews was long. The process was firefighting oriented, that is, focused on problem solving and not prevention.
To address these failings, a team established new executive critical quality criteria and integrated these within the vehicle development process. This gave an early warning of actions to be taken and made time to advance quality performance without rework.
“You are experienced, senior executives…solid in depth and with a wealth of knowledge.”
“Could not have done it without them. Didn’t think we would have made the progress that we did. They persevered through the project and this diligence is what got us to the good point we are currently at.”
“These guys supported our implementation by ‘leading and doing’ not just by pointing the way.”