Catapulting automotive ancillary industry to the next level

The automotive ancillary industry has come a long way in terms of quality of products and technical capabilities. As India becomes the hub for global automotive giants and Indian manufacturers alike, unprecedented opportunities present themselves to the auto component industry.

The auto component industry is at an inflection point

However, challenges need to be overcome to unlock the true potential:

� Low productivity

� Pressure on margins

� Raw material price volatility

� Need for continuous technology and quality upgradation

� Shortage of skilled manpower

ABOUT VALCONValcon is a consulting company with Scandinavian roots and a global reach.

Our local presence and insights currently cover Denmark, Sweden, Norway, India, China and Eastern Europe.

We help you manage both strategic and operational challenges to growth, efficiency, innovation, globalisation and transparency.

Managingsupplychain

Procurementcosts

Continuousmanufacturing capabilityand quality improvement

� Significant differences in actual and estimated cost of new product

� High variability in process post start of production (SOP)

� Delays in project delivery due to multiple iterations in developing required proto-parts

� Lack of understanding of export market requirements for new products

Product developmentRobust product development process ensuring new product on time at the right cost

Challenges Imperatives

� Improve cost estimation by using scientific techniques like ZBC, ABC, etc.

� Improve process controls

� Implement robust project management approach to meet delivery and performance requirements

� Establish system to study export market requirements using techniques like voice of customer (VOC), quality func- tion deployment (QFD), etc.

Valcon’s value proposition

� Product cost reduction

� Product and technology planning

� Manufacturing and process technology

� Reduction in go to market time

� Increase productivity

� Innovation

CLIENTA global renewable energy company

VALCON INTERVENTIONSPartner in developing new products

BENEFITS ACCRUED � Development time reduced to

less than 6 months � 3 patents – allowing the

company to take control of the solution space. Competitors are left behind with the traditional heavy design solution

� Non standardised procurement practices

� Multiple suppliers for indirect items and services

� High procurement costs of imported components/raw material/technology

� Low bargaining power with bigger suppliers

� Rising share of procurement costs in COGS

ProcurementAchieving highest value for sourced products and services at lowest prices

Challenges Imperatives

� Creating standard procurement document and sourcing strategy

� Supplier rationalisation

� Identification of localisation opportunities

� Alternate source development, global sourcing

� Analysis of spend, setting up category management

Valcon’s value proposition

� Cost savings

� Performance measurement

� Risk management

� Supplier development

� Setting up international procurement offices

CLIENTAn engineering major faced with high procurement costs

VALCON INTERVENTIONSExecution of procurement transformation program

BENEFITS ACCRUED � Cost savings of INR 650

Million � Streamlined 80 processes � Improved visibility of procure-

ment spend across categories

� Under-utilisation of plant capacity due to poor asset performance

� Cost leakages due to high rework/quality rejections

� Rising conversion costs

� Excess inventory affecting turnover rate and space utilisation

� Demand fluctuations affecting production scheduling

� High plant wastages

ManufacturingCreating a flexible, efficient production system that delivers highest quality at lowest cost

Challenges Imperatives

� Implementing operational excellence program to improve OEE and throughput

� Focus on supplier quality improvement and achieving superior process control

� Improving flexibility in production

� Reducing inventory by improving flow of material on shop floor

� Focus on cost reductions by improving process yield

Valcon’s value proposition

� Operational excellence

� Cost reduction

� Quality improvement

� Throughput and capacity enhancement

� Lean manufacturing

CLIENTTier-one component supplier for the world’s largest motorcycle manufacturer facing capacity and quality issue

VALCON INTERVENTIONSImplementation of operational excellence program

BENEFITS ACCRUED � Overall throughput increased

by 10-20% � Increased up-time by 20-30% � In-process rejections reduced

from 2.4% to 0.06% of net sales

� Inconsistent delivery performance

� Volatility in demand affecting responsiveness

� Margin erosion due to rising supply chain and distribution costs

� Poor delivery and quality performance of suppliers

� Ineffective supply chain performance metrics

Supply chainDeveloping an agile supply chain to deliver the right product at the right time with maximum cost efficiency

Challenges Imperatives

� Implementing integrated supply chain planning system

� Improving forecasting and demand planning

� Implementing suitable inventory management system in supply chain

� Developing supply chain performance scorecard

Valcon’s value proposition

� Inventory optimisation

� Inbound and outbound logistics optimisation

� Sales and operations planning

� Supply chain process planning

CLIENTWorld’s leading heavy machinery manufacturer facing challenges in stabilising supplier operations

VALCON INTERVENTIONSImplementation of supplier development program involving

� PPAP activities � Capacity and production

planning � Material planning and

coordination � Delivery planning

BENEFITS ACCRUED � PPAP activities completed

within record 70 days � RCCP, WIP planning modules

implemented � Cost reductions by migration

from air to sea freight

Valcon = Value ConsultingOur offerings come with a promise of taking our clients further and leave lasting footprints

Our areas of competence

� Business strategy execution

� Marketing and sales

� After sales service

� Production

� Logistics

� Procurement

� Research and development

OUR CLIENTSWe have worked with customers in India across pharma, auto and engineering, EPC and FMCG sectors with prestigious companies like

� Saint Gobain

� FLSmidth

� Castrol

� Biocon

� Novozymes

� Chandra Pearls

� Rangsons Electronics

� Caterpillar

� Hero Group

� Murugappa Group

� Uniparts

OUR PHILOSOPHYValue Consulting means that creating value is the starting point for our efforts. The values that we create are traceable throughout our client companies. We believe in professionalism as foundation of all our efforts .

Valcon is action – oriented. We will not only tell you what needs to be done- but also how. And if necessary we can do it for you as well.

In short: Valcon will take you further.

OUR TEAMYou will always be assisted by a team of highly skilled and experienced management consultants – as well as seasoned subject matter experts. Every one of them is thoroughly competent within their area; a competence built through impressive careers on the other side of the desk – and in the field.

Our consultants have previous working experience in Ford, Toyota, Suzuki, Ashok Leyland, Volvo, Caterpillar, Nokia, Saint Gobain, Escorts Hospital, Motorola, Bajaj, McKinsey, PwC, Wipro, ISRO, Dalmia, Asian Paints, Castrol, Coca Cola, and Schlumberger.

Connect with usOur offerings come with a promise of taking our cli-ents further and leave lasting footprints

Krishnan NaganathanCEOkrn@valcon.in+91-97 9103 3967 & +91-44-4210 2121

Sandeep DahiyaAssociate Directorsada@valcon.in+91 9008 366300

Valcon Management Consultants Pvt. LtdNo. 608A, 6th Floor, Spencer Plaza, 768/769, Annasalai, Chennai, India-600 002

Anirban MazumdarAssociate Directoranma@valcon.in+91-98 104 76116

Valcon Management Consultants Pvt. Ltd001, U & I Corporate Center, Plot 47, Sector 32, Gurgaon, India-122 001

www.valcon.in