Study on Diesel Oil Engine Industry

8/4/2019 Study on Diesel Oil Engine Industry

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` Formal science of market research and statistical predictability ofmarket performance evolved post 2nd world war.

` Last 70s and early 80s familiarity with analysts of FMCG` Yet in industrial market analysis remain a little known.` After globalization necessity of research firm become need of the

companies.` Today about 1664 marketing research consultant and agencies

are active.` Large corporates are now spending $5 million to $100 million on

market research analysis.` MRO revenue stand at $148 million in FY 07 and are expected to

grow at a CAGR of 36% to $800 million by 2012

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` Business Development Bureau India Pvt.ltd established in1989

` 1992-93 was the time of export awakening in India and manyenterprises were exploring ISO certification. Customersatisfaction measurement was an inseparable part of the

exercise, and BDB developed one of the finest analyticalpackages for customer satisfaction measurement and analysis.` 1995-96, BDB was researching the pharmaceutical and

healthcare markets` 2000, BDB was widely recognized as a specialized provider of

failsafe strategies for growth of businesses through incisiveresearch and analysis

` Between 2001 and 2005, BDB concentrated on consolidating itsstrengths and knowledge in every industry segment it hadworked in

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` As a result, in 2006-07, BDB developed a brand new model ofoffering research and consultancy expertise in 15 independentindustry segments where BDBs specific industry knowledge andresearch experience brought dramatic value to clients

` BDB has always been socially sensitive and has actively or

passively participated in causes that impact the Indian quality oflife. For example, appalled at the way our animals are treatedBDB decided to spread awareness about kindness to animalsand set up a Trust called The BDB Foundation. ThisCharitable Trust has worked quietly to encourage NGOs in thisfield and has spearheaded several initiatives to spread wordabout humane treatment of animals and their rehabilitation.

` BDB, 2009-2010 has been christened Quality Resurgence Yearor QRY

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` Identifying new Business Opportunities` Demand Estimation and Forecasting` Identifying Demand Gaps and Niche Markets` Export Market Identification and Export Potential Studies` Techno Economic Feasibility studies` Measurement of Customer Expectation and Satisfaction` Analysis of Consumer Behaviour, Pricing Packaging as well as Buying Attitudes` Employee Training Initiative` Pre & Post Advertising Research` Focus Group Discussions` Corporate Image Studies` Investigating Client Strengths and realigning them to meet the requirements of

the Market` Research involving Dealers, End Users and Potential Customers` Price Sensitivity Analysis` Direct Mailing, Telemarketing, Event Management, Dealer Promotion

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To identify the parameters that form the elements ofsatisfaction, among the randomly selected vendors ofDiesel engine manufacturing company.

To evaluate the Vendor Satisfaction Level (VSL) amongthe selected vendors.

To analyze the VSL for each parameter and torecommend to company suitable strategies based on the

above so as to plan further improvement.

To analyse the qualitative response obtained and presentthem on a structured format.


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The Study has evaluated the Vendor Satisfaction Index (VSI) based on the following ATTRIBUTES

Vendor Satisfaction Index

Communication

StrategicSourcing

CorporateResearch

Engineering

Purchaseprocess

Qualityand

InspectionFinancial Others

OverallPerception

These attributes are further broken down into several parameters and analysed ona scale of 1 to 10. For each question, two measures are recorded -

Satisfaction Scale And Importance Scale

Not important

101 2 3 4 5 6 7 8 9

Somewhat

Important

Very

Important

Extremely

Important

10

Dissatisfied

1 2 3 4 5 6 7 8 9

Quite

Satisfied

Very

SatisfiedDelighted

Satisfaction scale Importance Scale


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ATTRIBUTES AND PARAMETERS COVERED

Communication of company Vision, Mission and ValuesCommunication of future projections of 3 yearsClarity in communication through telephone, letter, fax & emailReach to the Contact person at companyFrequency of interaction with company (operational level)Frequency of interaction with company (higher level)

COMMUNICATION

RELATED

ATTRIBUTES

Involvement of supplier at Design & Drawing phase (wherever applicable)Timely communication of details / requirements of new projectsTimely communication of the engineering changes / modificationsCommercial discussionscompany responsiveness to your suggestionsLead time provided for new product developmentQuality System evaluation and process audits conducted by SQIsSupport and cooperation from Supplier Quality Improvement TeamOverall behavior of sourcing personnel

STRATEGIC

SOURCING

RELATED

ATTRIBUTES

Technical support provided during part development(Applicable only for ancillary suppliers)Completeness and clarity in technical specificationsResponse or willingness of CRE to accept the suggestionsOverall behavior of Corporate Research Engineering personnel

CORPORATERESEARCH

ENGINEERING

RELATED

ATTRIBUTES


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Continue

Completeness and clarity in overall documentation by purchaseTimely receipts of annual requirement in the beginning of the yearTimely receipts of monthly schedule and annual requirementTimely receipts of correct purchase order or schedulesResponse to the Problems by the purchaserReceipts of GRR copies in time(online access)Overall behavior of purchase personnel

PURCHASE

PROCESS

RELATED

ATTRIBUTES

Assistance from KOEL in solving the quality issues with supplierGauges provided by KOELPromptness in providing the details of the rejected itemsSingle point of contact to discuss the quality issuesSupport and cooperation from Receipt Quality Assurance Dept.Platform available with KOEL for the registration of genuine problems faced by youAcceptance of modern manufacturing processCommunication of Quality performance on monthly basisEngineering acceptance norms are well defined and easy to understandOverall behavior and perception of quality personal

QUALITY AND

INSPECTION

RELATED

ATTRIBUTES

Reasonable prices from KOELPayment as per the agreed normsResponse from KOEL Finance DepartmentFinancial support in case of emergencyFairness in overall commercial termsOverall behavior and perception of finance personnel

FINANCIAL

RELATED

ATTRIBUTES


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Continue

Overall satisfaction with KOEL.KOELs contribution in developing long term business relationship with SuppliersRecognition of Supplier performanceFairness in the business deals

OTHER

ATTRIBUTES

Operational efficiencyProfessionalismPro-activenessSuperiority of Quality standards developedDemanding Customer in terms of Quality, cost and delivery

OVERALL

PERCEPTION

ABOUT

KOEL


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7.97

8.26

8.13

8.12

8.20

7.90

8.09

5 6 7 8 9 10

Overall perception

Other

Financial

Quality and Inspection

Corporate Research Engineering

Supply Chain

VSI - company

VENDOR SATISFACTION INDEX OF COMPANY

8.09

1

2

3

4

5

6

7

8

9

10VSI 8.09

Dissatisfied

QuiteSatisfied

VerySatisfied

TrulySatisfied

Other attributes like companys contribution in developing long term business relationship with suppliers, recognitionof supplier performance, fairness in the business deals and Financial related attributes are the drivers for achievingthe overall satisfaction score of 8.09by company.

Many vendors expressed their dissatisfaction on their involvement of supplier at Concept, Design & Drawing phase,Timely receipts of annual requirement in the beginning of the year and Communication of future projections of next 3years are the main attributes which to focus.


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1.21

0.15

COMMUNICATION RELATED ATTRIBUTES

Priorities forimprovement

Parameters withleast gap

8.65

8.97

9.12

9.06

8.29

8.00

8.03

7.76

8.50

8.68

8.15

7.76

5 6 7 8 9 10

Communication of company Vision, Mission and Values

Communication of future projections of 3 years

Clarity in communication through telephone, letter, fax & email

Reach to the Contact person at company

Frequency of interaction with company (operational level)

Frequency of interaction with company (higher level)

Satisfaction ImportanceSatisfaction

gap


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Positive features

Vendors are happy with frequency ofinteraction with operational level executives.Senior executives are also accessible time to

time, if required

Vendors also received the communicationfrom company about their Vision, Missionand Values

Areas of improvement

Vendors perceive that, company shouldcommunicate the future projections for next 3

years.

This shall provide business assurance aswell as time to develop the resources to meetthe demand.

KEY FINDINGS ON COMMUNICATION


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1.53

0.50

STRATEGIC SOURCING RELATED ATTRIBUTES



Satisfactiongap

8.75

8.85

8.62

8.62

8.59

8.91

8.94

8.82

9.26

7.41

7.59

7.68

7.79

7.

5

7.

8

7.88

8.

8.65

5 6 7 8 9 1

Involvement of supplier at Concept ,Design & Drawing phase

Timely communication of details / requirements of newprojects

Timely communication of the engineering changes /modifications

Commercial discussion

company responsiveness to your suggestions

Lead time provided for new product development

Quality System evaluation and process audits conducted bySQIs

Support and cooperation from Supplier Quality Improvementteam

Overall behavior of sourcing personnel


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Positive features

Quality evaluation system andprocess audits has helped vendors toimprove themselves

Support and cooperation fromsupplier to improve the qualityaspects makes them delighted

Vendors perceived that treatmentreceived from company sourcingexecutives is one of the best practice


Vendors feel that their involvement at Concept,Design & Drawing phase shall bring value to theentire value chain of the business

Timely communication of details about new projectsand the engineering modifications shall provide morelead time.

Vendors expect that company should reduce the timefor commercial discussion and finalize the order

KEY FINDINGS ON STRATEGIC SOURCING


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0.93

CORPORATE RESEARCH ENGINEERING RELATED

ATTRIBUTES



0.23

Satisfaction

gap

9.08

8.81

8.78

8.96

8.25

7.88

7.91

8.73

8.20

5 6 7 8 9 10

Technical support provided during part development(Applicable only for ancillary suppliers)

Completeness and clarity in technical specifications

Response or willingness of CRE to accept the suggestions

Overall behavior of Corporate Research Engineeringpersonnel

Satisfaction Index

Satisfaction Importance


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Positive features

Ancillary suppliers are gettingdesired technical support in

development phase by companyteam.

Treatment to vendors by companyCRE team is one of the higheststandards


Vendors feel frequent amendments in the drawingsand respective specifications causes unnecessaryconfusion.

It may not be feasible to implement all the suggestionfrom vendors, however company shouldcommunicate vendors about the feasibility of theirsuggestions

If possible reasons should also be communicated ifsuggestions are not feasible.

KEY FINDINGS ON CORPORATE RESEARCH ENGINEERING


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PURCHASE RELATED ATTRIBUTES



0.62

Satisfactiongap

9.03

9.32

9.26

9.26

8.97

9.38

9.38

8.41

7.76

7.97

7.88

8.00

8.33

8.50

7.90

5 6 7 8 9 10

Completeness and clarity in overall documentation bypurchase

Timely receipts of annual requirement in the beginning ofthe year

Timely receipts of monthly schedule and annualrequirement

Timely receipts of correct purchase order or schedules

Response to the Problems by the purchaser

Receipts of GRR copies in time (online access)

Overall behavior of purchase personnel

Satisfaction Index


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Positive features

Vendors have communicated thatthere has been a significantimprovement in the promptreceipt of GRR copies. This

gives clear communication abouttheir material status.

Documents processed bypurchase department arecomplete and clear.

Vendors feel that there is a good

support from buyer.


Communication about the annual planning is one of thekey requirement of vendors and they expect company tofollow it.

Vendors expect quarterly schedules shall be provided to

them. It help vendors to hedge against the fluctuatingmaterial prices.

Vendors feel that they should get next month schedule inthe third week of the month.

Due to the changes in the schedules the lead time toeffect supplies is shortened. Hence effective long term

planning like quarterly schedules will help vendors toplan supplies in a effective way.

KEY FINDINGS ON PURCHASE


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0.35

QUALITY AND INSPECTION RELATED ATTRIBUTES

1.21



Satisfactiongap

9.03

8.68

9.12

9.15

9.00

9.13

8.83

8.97

8.71

8.79

8.26

8.33

7.91

8.15

7.94

7.97

8.47

7.85

8.03

8.29

8.12

5 6 7 8 9 10

Assistance from company in solving the quality issues with supplier

auges provi

e

y company

Promptness in provi

ing the

etails of the rejecte

items

Single point of contact to

iscuss the quality issues

Support an

cooperation from Receipt Quality Assurance Dept.

Platform availa

le with company for the registration of genuinepro

lems face

y you

Acceptance of mo

ern manufacturing process

Communication of Quality performance on monthly

asis

Engineering acceptance norms are well

efine

an

easy toun

erstan

Overall

ehavior an

perception of quality personal

Satisfaction In

ex



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KEY FINDINGS ON QUALITY AND INSPECTION

Positive features

Company has accepted modernmanufacturing processes andalso insists vendors to adopt it.


Vendors have noticed the improvement in providing theMonthly PPM report is generated and communicated torespective vendors. They have also noticed a significantimprovement in prompt communication about therejection. However they expect further improvement inthese aspects.

Vendors feel that they will be very comfortable with singlepoint of contact to discuss the quality issues.


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1.49

FINANCIAL RELATED ATTRIBUTES



.

Satisfactiongap

9.21

9.62

9.40

9.18

9.19

9.47

7.72

8.21

8.07

8.05

8.39

8.31

8.13

5 6 7 8 9 10

Reasonable prices from company

Payment as per the agreed norms

Response from company Finance Department

Financial support in case of emergency

Fairness in overall commercial terms

Overall behavior and perception of finance personnel

Satisfaction Index



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Positive features

Vendors have experienced a significantimprovement in on time payment.


Few vendors still complain that companydoes not offer them good prices.

KEY FINDINGS ON FINANCIAL


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OTHER ATTRIBUTES

0.72



Satisfactiongap

9.38

9.24

9.24

9.18

8.21

8.30

8.06

8.45

8.26

5 6 7 8 9 10

Overall satisfaction with company

company's contribution in developing long termbusiness relationship with Suppliers

ecognition of Supplier performance

Fairness in the business deals

Satisfaction


1.17

1.17


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Positive features

Due to long relations with most executives in company, vendors feel that an excellentunderstanding has developed between the vendor and company executives.company executives are easily accessible and available.

Vendors also recognize the companys contribution (in monetary and non-monetary form) intheir business.

Vendors perceive company as the best organization in terms of ethics and values (human aswell as business). Vendors find this as one of the reasons for their continued association withcompany despite low volumes and competitive prices.

KEY FINDINGS ON OTHER ATTRIBUTES


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1.25

OVERALL PERCEPTION ABOUT COMPANY

0.85



Satisfactiongap

9.06

8.94

8.88

9.03

9.09

8.09

8.09

7.64

7.94

8.06

7.97

5 6 7 8 9 10

Operational efficiency

Professionalism

Pro-activeness

Superiority of quality standards developed

Demanding Customer in terms of quality, cost and delivery

Satisfaction Index



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1

2

3

4

5

KEY FINDINGS

SATISFACTIONDRIVERS

Payment as per the agreed

norms

Receipts of GRR copies in

time (online access)Companys contribution in

developing long term

business relationship with

Suppliers

Response from company

Finance Department

Timely receipts of correct

purchase order or schedules

AREAS OF

IMPROVEMENT

AT COMPANY

Reasonable prices from

company

Involvement of supplier

at Concept ,Design &Drawing phase

Communication of

future projections of 3

years

Timely receipts of

annual requirement in

the beginning of the year

Commercial discussion

STRENGTH OFCOMPANY

Fairness in the business

deals

Payment as per the

agreed norms

Overall behavior of

purchase personnel

Overall behavior and

perception of finance

personnel

Response from company

Finance Department


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Diesel enginemanufacturer

Cummins Tata Motors

M M Jo n Deere

Supplier response on their top 3 customers by contribution

1st

2nd

3rd

supplier rated our company as t eir top most favorable customer

supplier rated Cummins and Tata Motorsas t eir 2nd favorable customer

supplier ratedM M and Jo n

Deere as t eir 3rd

favorable customer


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30

32%

16%16%

36%

Break up vendor based on their years ofassociation ( No of years)

2 to 5

5 to 8

8 to 10

Above 10 years

20%

22%

33%

1 %

12%

Break up suppliers based on KOEL'scontribution in their business

Up to 10%

10.1% to 25%

25.1% to 50%

50.1% 75%

above 75%


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Thank you