Nissan Cogent Supply Chain Management Case Study

Table of Content

AIM AND PURPOSE INTRODUCTION RELATION WITH OTHER COMPANIES SUPPLY CHAIN WHAT IS SUPPLIER DEVELOPMENT WHAT IS COGENT SWAOT ANALYSIS OJECTIVES OF THE COGENT PROGRAM HOW TO ACHIVE THIS SUPPLIER DEVELOPMENT SUPPLIER AND CUSTOMER MUTUAL DEVELOPMENT BASIC SUPPLY CHAIN PRINCIPLES JUST IN TIME THEORY REDUCTION IN OWERSHIP COST FACTORS CONTROLLING THE TOTAL OWNERSHIP COST REFERENCES

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Purpose and Aim To analysis the Nissan Cogent case video , relationship between supplier and Nissan Cogent , to write the detail report on the case study.

Introduction Nissan Motor Company Ltd is one of the biggest automobile manufacturing company in the world .It ranked 5th number overall in Auto mobile industry It was founded by Mr Yoshisuke Aikawa in 1933 with the name Tobata casting LTD but in 1933 it s name was changed in to Nissan ,its headquarter is in Japan.In 1962 it entered in to European market.Currently the company has income near about 1.5 billions .In 2008 its overall revenue was more than 93 billions.The company manufactured the cars.trucks and outboard motors. Relation with other car companies Ford

In 1993 Nissan stared partnership with Ford to market the Nissan Quest and Mercury Villager there two vans were similar in design but different in manufacturing In 2002 they discontinued their partnership due to plunging sales in a fierce market. Volkswagen

The Production began in 1984 but they finished it in May 1990 Alfa Romeo

They started in their partnership in 1983 both had different aims .A that time Alfa wanted a power full support to remain in the market and Nissan wanted to enter the European Market .Alfa Romeo built Arna with the cooperation of Nissan .They ended this deal in 1987.

Supply Chain Management Supply chain management is a set of approaches utilized to efficiently inte- grate suppliers, manufacturers, warehouses and stores, so that merchandise is produced and distributed at the right quantities, to the right locations, and at the right time, in order to minimize system-wide costs while satisfy- ing service level requirements. (Simchi-Levi et al,2003) Rece ving Man ufact uring Packi ng

Supp lierr

Purc hasin g

Sche dulin g
Master Production

Distri butio n Dma nd Man gem ent Cust omer

Plan

Supply Chain Management (Basu &Navan,2008)

What is Supplier Development Supplier development is the process of working with certain Suppliers on a one-toone basis to improve their Performance for the benefit of the buying organization.. For example giving training to the supplier about the program you develop and give them option be part of this project like Nissan cogent What is Cogent Cogent is a tool or research program started with the cooperation of Nissan, Cranfield universities and its suppliers. The purpose of this research was to increase the efficiency and capabilities of the automobile parts made in England and make the best design to catch the market.The design was acceptable and fully satisfied according to customers demand

SWOT Analysis It is a tool to analysis the internal and external environment of the organization (Mullins L. 1996). Strength weaknesses are internal factors opportunities ,Therats are external factors of the organization Nissan and suppliers

Strength:

1) Brand Image 2) Good number of customers 3) Good quality, low cost and 4) Focus on JIT (Just in time theory)

Weakness: 1) Highly rely on the supplier to meet the target 2) Low status than some competitors 3) Trade secret disclosure

Opportunities: 1) Reduce the waste during the production 2) Good relations with suppliers 3) Time saving techniques

Threats

: 1) Market competitors 2) Rising prices of the fuel and the material 3) Currency exchange rates

Objectives of the COGENT Program

To increase the performance of the design with the cooperation of Cranfield university and suppliers Reduce the cycle time Make more attractive and featured design Eliminate the communication gap between the suppliers and customers

How to achieve this ? Nissan planned strategy for this by as following these points

Supplier Development The process of working collaboratively with your suppliers to improve or expand their capabilities. (Dominick, 2006) For example providing training to your suppliers how to create the products that they had never created before for the purpose of giving you the option to buy rather than make that item, a few years back the new trend of involving the suppliers in in six sigma and lean techniques have been rising Suppler development has four stages 1) Identify assesses and rationalize the supply base 2) Problem Solving Developments 3) Proactive Development 4) Integrated Development

Supplier and customer mutual development Supplier and Customer mutual development can move in the right direction if the customer has the right ability to expand it with the suppliers. According to Henry K. (2001), supplier development is a combine effort by the suppliers and buyer companies to bilaterally develop the suppliers' abilities and potentials in one or more of the following areas. 1) Quality 2) Delivery 3) Cost 4) Technology 5) Environmental responsibility 6) Time to market 7) Financial feasibility 8)Managerial capability

Basic supply chain Principles

1) Improvement in the Quality Improvement in quality gives more customers trust and customer's fidelity

2) Time Time is the most important factor in every field introduce of the product on time is another key factor of success. Different reports and researches show that more than 40% market can be captured if the product can introduced on time . So it is important to minimize the production cycle time and introduce the product on time so more market shares can be captured

Just in Time Theory JIT is an important concept according to supply chain management the main purposes of it to introduce the product at right time and in the right amount. It helps the suppler not to make more supply and maintain inventory Principles 1) Reduction in waste 2) Control of TQM 3) Involvement of the people

Saving time and source approach-Cogent

( P.Southey Nissan COGENT case)

Reduction in ownership cost To get more advantages in supply chain management one important issue is to lower total cost of ownership . When the buyers have divergent options of selecting a particular article, rational way is to look for its total operational cost rather than just focusing on its apparent cost which may be just its purchase cost. An article with low total purchase and operational cost will be fruitful for a long run (investopedia.com)

Factors controlling the total cost ownership Minimize the machine downtime Improvement in the quality with the cooperation of the supplies Increase in efficiency and minimizing the process cost Attractive design Bar gaining on the available cost By reducing the risk cost

(P.Southey Nissan COGENT case)

COGENT Fast Track System

(P.Southey Nissan COGENT case)

Conclusion and Recommendations To get better results and performance from the suppliers face to face communication promotes better understanding.COGENT enables Nissan and suppliers to identify problems and provide solutions. The COGENT was succeeded in reducing cost and improving quality due to these Nissan was able to achieve NEXT21.In the end I would like to say the programs like GOGENTS were successful in there times but with the passage of time we have to think more for creative designs by keep in mind two things JIT theory and flow of material.

References (2012, 12). Supply Chain Management: Nissan Cogent Case Study.StudyMode.com. Retrieved 12, 2012, from http://www.studymode.com/essays/Supply-ChainManagement-Nissan-Cogent-Case-1310011.htm Usatoday30.usatoday.com. 2013. Ford, Nissan to stop minivan production. [Online] Available at: http://usatoday30.usatoday.com/money/consumer/autos/mauto664.htm [Accessed:7Dec2013]http://www.nissanglobal.com/EN/COMPANY/PROFILE/HERIT AGE/1980/ Wikipedia. 2013. Nissan Motor Company. [Online] Available at: http://en.wikipedia.org/wiki/Nissan_Motor_Company [Accessed: 7 Dec 2013]. Christopher, M. 2005. Logistics and supply chain management. Harlow, England: FT Prentice Hall. Nist.gov. 2013. Supplier Development. [Online] Available at: http://www.nist.gov/mep/manufacturers/supplier-development.cfm [Accessed: 7 Dec 2013]. Alfa venture. 2012. The age, 19 august. Ron. Basu & J Nevan Wright,(2008)Total Supply Chain Management, 1St Edition. Dominick, C. (2006, november 1).Charles' Purchasing Certification Blog . Retrieved february 19, 2010, http://www.purchasingcourses.com/2006/11/supplier-developmentdefinition.htm Southey, P,(2009/2010) Coventry University Module Notes Investopedia. 2009. Total Cost Of Ownership (TCO) Definition | Investopedia. [online] Available at: http://www.investopedia.com/terms/t/totalcostofownership.asp [Accessed: 8 Dec 2013]

(Referenced from: http://www.isixsigma.com/DFSS, accessed 29.112013 Nissan Cogent Case Study Video (Simchi-Levi et al,2003) ..Basu, R. and Wright, J. 2008.(p.5) Total supply chain management. Amsterdam: Butterworth-Heinemann

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