DaimlerChrysler includes the Chrysler Group, the Mercedes and Smart Passenger Car Group, and the Commercial Vehicles unit. It operates 104 plants in 37 countries, using 14,000 different suppliers and 13,000 sales outlets in 200 countries. The auto industry is known for tough competition and fickle customers. Survival depends on bringing new models rapidly to market as economically as possible.

           DaimlerChrysler studied every step in the vehicle production and sales process, starting with the first stage of vehicle design and ending with its service and repair. It then built a series of information systems that automate and streamline all of its transactions with suppliers. An Integrated Volume Planning system gathers sales data and sends them back to production planning systems and from there to suppliers so that they can adjust deliveries of parts and production to make exactly the right amount of the vehicle models that are actually selling in dealer showrooms.

          A Global Supplier Portal presents a common interface and system platform that handles every type of interaction between DaimlerChrysler and its suppliers. About 6,000 DaimlerChrysler suppliers registered for this portal use it to interact with DaimlerChrysler's various business groups. DaimlerChrysler also uses the portal internally to share information among different divisions and business units.

          At the earliest stages of design, the Chrysler Group and 3,400 of its suppliers use a Web-enabled system called Powerway to track parts through nine quality control "gates" before they're certified for use on production lines. In the past, quality specialists used to store thousands of pieces of paper in hundreds of binders to deal with quality issues that surfaced with the thousands of companies that design Chrysler's parts. If a drive train was an eighth inch too short, it could take up to three weeks to notify the supplier, fix the problem, and incorporate the corrected part back into the design process.

          Powerway replaces paper-based processes with digital links to supplier systems. It helps Chrysler identify potential design and engineering problems before physical parts are actually constructed, so that they can be more rapidly resolved. That in turn helps Chrysler design news cars much faster-and remain competitive.

Sources: Tracy Mayor, "The Supple Supply Chain," CIO Magazine, August 15, 2004; Larry Gould, "Effectively Managing Inventory in the Supply Chain," Automotive Design & Production, www.autofieldguide.com, accessed September 3, 2004; and www.daimlerchrysler.com, accessed September 3, 2004.w