The case depicts issues related to supply chain quality and the way they develop in the perspective of a multi-tiered global supply chain. The case scenario engages a global multi-tier automotive supply chain composed of one of the world’s biggest automotive original equipment manufacturers (OEMs), its grade 1 supplier that is also a U.S.-based global corporation and the tier 2, tier 3 and grade 4 suppliers based in India. Founded on this particular experience with the business, Automek buyers put an order with Agile for a fresh commodity (an actuator congregation). In developing this merchandise with little reinforcement from Automek, Agile was anxious because of its dearth of knowledge concerning the suppliers for the actuator assembly parts and also the critical conditions.
To allay its concerns, Automek guaranteed to support Agile by (a) locating the crucial global providers for specialized parts and (b) evaluating and validating the crucial suppliers based in India on behalf of Agile. Agile developed the actuator assembly and then invested in the assembly line. Many quality problems that were traced to the tiered providers were reported by the OEM, when supplies commenced. Together with the caliber and part supply problems, the dilemmas of succeeding accountability in the case of a recall by the OEM were faced by the members of the supply chain. Agile felt that since the suppliers had been selected or approved by Automek, and also as Agile had no knowledge of the item, that Automek should take the responsibility of solving the quality issues originating from the supplier base. To confuse matters, a number of the tiered supply chain members were unwilling to invest time plus efforts in executing process control practices and improved manufacturing by Automek as needed.
PUBLICATION DATE: July 18, 2012 PRODUCT #: W12056-PDF-ENG
This is just an excerpt. This case is about STRATEGY & EXECUTION
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