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    BMW Case Study Solution

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    saras
    The document provides details about a case study on BMW's 7-Series project. It discusses issues BMW faced with the quality of its newly launched 7-Series model, including using fake materials in prototypes that did not match the real production materials. This led to quality problems in the final production models. It provides recommendations for BMW such as using real materials in prototypes, involving suppliers earlier, and separating new model production lines from existing models. The document also recommends changes BMW should make when developing new models, such as simplified designs and testing all aspects early. This would be expected to improve attributes like reducing problems bringing new models to market while some costs may increase.

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    © All Rights Reserved
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    BMW Case Study Solution

    Uploaded by

    saras
    276 views10 pages
    The document provides details about a case study on BMW's 7-Series project. It discusses issues BMW faced with the quality of its newly launched 7-Series model, including using fake materials in prototypes that did not match the real production materials. This led to quality problems in the final production models. It provides recommendations for BMW such as using real materials in prototypes, involving suppliers earlier, and separating new model production lines from existing models. The document also recommends changes BMW should make when developing new models, such as simplified designs and testing all aspects early. This would be expected to improve attributes like reducing problems bringing new models to market while some costs may increase.

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    The document provides details about a case study on BMW's 7-Series project. It discusses issues BMW faced with the quality of its newly launched 7-Series model, including using fake materials in prototypes that did not match the real production materials. This led to quality problems in the final production models. It provides recommendations for BMW such as using real materials in prototypes, involving suppliers earlier, and separating new model production lines from existing models. The document also recommends changes BMW should make when developing new models, such as simplified designs and testing all aspects early. This would be expected to improve attributes like reducing problems bringing new models to market while some costs may increase.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    276 views10 pages

    BMW Case Study Solution

    Uploaded by

    saras
    The document provides details about a case study on BMW's 7-Series project. It discusses issues BMW faced with the quality of its newly launched 7-Series model, including using fake materials in prototypes that did not match the real production materials. This led to quality problems in the final production models. It provides recommendations for BMW such as using real materials in prototypes, involving suppliers earlier, and separating new model production lines from existing models. The document also recommends changes BMW should make when developing new models, such as simplified designs and testing all aspects early. This would be expected to improve attributes like reducing problems bringing new models to market while some costs may increase.

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    © All Rights Reserved
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    SUPPLY CHAIN MANAGEMENT

    SUPPLY
    CHAIN
    MANAGEMEN
    T

    SUPPLY
    MANAGEMENT

    CHAIN

    NATIONAL COLLEGE OF
    BUSINESS ADMINISTRATION &
    ECONOMICS| WCC

    SUPPLY CHAIN MANAGEMENT

    BMW: THE 7-SERIES PROJECT (A)


    CASE STUDY
    QUESTION & ANSWERS
    QUESTION NO. 1.
    Give an overview/ synopsis of the
    case.
    ANSWER:

    SYNOPSIS OF CASE PROBLEMS


    The customer complaints about low quality launch as compared to competitors.
    The decisions to be taken over the Cockpit Design. Either they will be Hand Crafted or will

    be automated production.
    The ways to improve quality, flexibility and creativity in new models.
    Were to be launched in 1994
    Introducing new methods of fabrication of interiors
    Suppliers would now fabricate the cockpit designs
    Would increase product quality.

    BACKGROUND

    Formed in 1916 by Gustav Otto and started producing aircraft engines.


    In 1920 began producing cars.
    From 1930-1950 gained reputation for high-performance engineering.
    1n 1966 introduced 2nd series (high performance engineering, styling & comfort).
    70% sales were from Europe & 30% from US.

    LUXURY CAR MARKET

    Had 1.5% share of the world market


    Highly competitive market
    Prices were as high as $1,00,000
    Japan was giving fierce competition as compared to Nissan, Toyota, Honda.
    Was targeting $20,000- $40,000

    NCBA&E

    Page 1

    SUPPLY CHAIN MANAGEMENT

    C o m p etent
    Featu res

    Tan g ible
    Features

    In tang ib le
    Featu res

    STRATEGIC ISSUES
    3 Steps
    Involve
    d

    Increased Product Variety

    More Frequent Product


    Introduction
    Improved Quality Of Newly
    Launched Models

    NCBA&E

    Page 2

    SUPPLY CHAIN MANAGEMENT

    THE LAUNCH OF REDESIGNED MODEL


    Took almost six years
    Put more effort in styling and design
    Typically

    BMW

    product

    passed

    through 3-5 design process

    LAUNCH CYCLE

    Pilot
    Producti
    on &
    Manufact
    uring
    Start-up
    Pilot
    Producti
    on In The
    Pilot
    Plant

    Prototypi
    ng At
    Bmw

    Factory
    Pilot
    Producti
    on Run

    NCBA&E

    Full
    Producti
    on Rampup

    Page 3

    SUPPLY CHAIN MANAGEMENT

    QUESTION NO. 2.
    What are the causes and consequences of BMWs quality problems with newly
    launched product? What should be done to improve launch quality?
    ANSWER:

    ISSUE 1:
    They use fake tools and materials in the prototype, but in real production models
    they use real materials.

    CONSEQUENCES:
    The outcomes of analysis gained from
    materials and tools used in prototype testing do
    not fit in with desired results in final
    production models.

    RECOMMENDATIONS:
    Pre-fabrication tools should be used in prototype model so that accurate results could be gained
    in order to launch quality BMW Model. They should also reduce the space between prototype
    and production process in means of tools and materials.

    ISSUE 2:
    They use drawings and clay models in prototype rather than pre-fabrication tools in
    the first prototype stage.

    CONSEQUENCES:
    The use of fake materials had covered many
    designs and manufacturing problems. It reduced
    their opportunity to realize and fix quality
    problems. It took highly skilled craftsmen and
    labor to take care of the handmade clayed
    prototype. The labor costs were increased and it
    took more time than normal.

    NCBA&E

    Page 4

    SUPPLY CHAIN MANAGEMENT

    RECOMMENDATIONS:
    They should automate the prototype model. They should use real material instead of clay or 3D
    drawings to judge the weakness of prototype models. It will also help them to reduce their labor
    cost and it will save time too. By using pre-production tools to build most of prototype parts in
    early prototyping will increase their quality production.

    ISSUE 3:
    The Mixed-model ramp up strategy. They produces the new series of BMW on the
    same production line where the old models are produced.

    CONSEQUENCES:
    Due to same production line where old and new series are produced, countless confusion was
    being noticed among workers due to minor problems.

    The

    same production line made the logistics more complex.


    Probably not all problems were being discovered

    or solved in the pilot

    production phase only major problems were

    been taken into consideration. The

    workers spent a lot of their time identifying

    and solving

    the big problems. So that less time for minor


    problems 1and fine tuning were left. The
    customer complaints remained on their place
    although of severe or extra resources for quality assurance, inspection and rework was done for
    improvements. Due to same production line new models quality were being affected.

    RECOMMENDATIONS:
    Separate ramps should be built for New Series Models. They should use sudden changeover
    approach. Separate minor problems identifying racks should be built. For this purpose they will
    give cross-training to labors to improve the ability and flexibility in switching the design and
    production of different models. Customer relation departments should be improved to higher
    extent.

    NCBA&E

    Page 5

    SUPPLY CHAIN MANAGEMENT

    ISSUE 4:
    The suppliers werent involved in the final engineering drawings and commercial
    production process later after.

    CONSEQUENCES:
    If the commercial suppliers does not came

    across

    problems during the commercial production,

    the

    later on they

    will take time for sorting out the things and

    then

    time will be again needed for the adjustment in

    the

    designs.

    The suppliers wouldnt be able to know


    exactly what kind of materials or tools that
    BMW wants to procure, and what they
    should supply.

    RECOMMENDATIONS:
    The commercial suppliers should be in the factory at earlier

    in the development process,

    when commercial production takes place. If the commercial suppliers came across the problems
    during the commercial production, it will help them to sort the problem on time. It will also save
    time for adjustment in design later. The paying advantage will be they would get it straight what
    BMW wants them to procure.

    QUESTION NO. 3.
    What are your recommendations to Carl-Peter Forster concerning the 7-series
    prototypes? What should he do regarding future development projects?
    ANSWER:

    RECOMMENDATIONS CONCERNING THE 7-SERIES PROTOTYPES


    New pre-fabrication tools should be used at the early prototype stage. So that one can learn

    more from the prototypes.


    Workforces in the factory should be well-trained and up to date.
    Reduce the time spent in development process and try to prepare for regular prototypes.
    Make best use of the present tools.
    Focus on core competencies and try to outsource if it is needed.
    The suppliers should get involved earlier in the design of prototype parts.

    NCBA&E

    Page 6

    SUPPLY CHAIN MANAGEMENT


    Invite other outside salespersons to support as well as add-on the company.
    Separate minor problems identifying racks should be built.
    Customer Relation departments should be improved to higher extent.

    RECOMMENDATIONS CONCERNING FUTURE DEVELOPMENT PROJECTS


    STRATEGIC OBJECTIVE ENHANCEMENT
    Consider and apply lean production/manufacturing.
    Reduce the development lead time.
    Competitive
    benchmarking/lower
    customers
    complaints per car)
    ADOPT PARALLEL ENGINEERING
    Expand the relationship with the
    third party logistic.
    Promote the interaction and communication among
    departments, suppliers and sellers.
    Hire specialists and experts to
    participate in the production process.
    Increase the manufacturing capacity.
    Corporate with potential sellers, suppliers and innovative people.

    QUESTION NO. 4.
    What changes would you recommend in the BMW develops new models? What attributes
    of newly launched products would you expect to improve as a result of these
    recommendations? Which attributes might deteriorate?
    ANSWER:

    RECOMMENDATIONS FOR CHANGES IN DEVELOPING OF NEW MODELS


    In creation of prototypes for new model:
    Using the actual parts instead of substitute parts.
    It will help to avoid problems and complications.
    The investment will pay off in the long run.
    Simplify the production process & minimizing the number of parts in a product:
    Design for Manufacturing (DFM)

    NCBA&E

    Page 7

    SUPPLY CHAIN MANAGEMENT

    Design for Assembly (DFA)


    Reduce product assembly

    cost,

    number of assembly operations and


    design complexity for new models.
    Testing all things from the design stage.
    Beside investment in R&D and styling,
    need to conduct marketing studies.
    Employ Lean Product Design elements.
    Applying synchronized engineering.

    EXPECTED IMPROVEMENTS:
    With new construction of prototypes:

    ensembles techniques used to build in high-volume production vehicles


    Reducing problems associated with bringing new models into production.
    Maintaining high-quality image
    Increasing market share
    Reduce customer complaints
    be more customer-friendly

    QUESTION NO. 5.
    What recommendations would you make to Chairman Von Kuenheim regarding BMWs
    strategy to compete against new Japanese entrants into the luxury car market?
    ANSWER:

    1: COMPETITIVE AND OPERATION STRATEGY:


    BMW: Competitive benchmarking with 1.5 customer complaints per car
    Differentiation strategy
    1. Breakthrough
    2. Continuous improvement
    Focus on moderately big changes
    Sig Sigma for operation management

    2: MARKET EXTENSION
    BMW: Expanding target market to the upper-middle class clients.

    NCBA&E

    Page 8

    SUPPLY CHAIN MANAGEMENT

    Increasing customer base, bigger market share and sale volumes.


    Using lean production to promote customization for variously different ordered products.
    Focusing Sig Sigma to help improve product quality and operation efficiency
    Reusing some standard machines and pre-production tools.

    NCBA&E

    Page 9

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