PREMIUM QUALITY FOR PREMIUM BRANDS

Barbara Ferreira Garcia bferreir@jaguarlandrover.com

The Best Relationship Management

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Agenda:

1 – Why I made the decision to submit the entry.

·

2- What made this entry successful

3 - General overview of my entry

2

Decision to submit the entry and why ?

• To be able to Showcase how much Purchasing can influence, promote and facilitate

high impact projects within a company

• To demonstrate that Purchasing is not just about cutting costs

• To incentivise other Purchasing Professionals to showcase what they do day in and

out (great job and adding value to the company)

• To demonstrate that supplier and stakeholder relationship is a crucial skill to have in

Purchasing

• To show how Purchasing must understand the Business Objectives to a level that

the function can help directly those to be achieved

• To show how Purchasing can help and changed the foundations of JLR and G&P

relationship.

• G&P were treated as a commodity supplier, where the main Purchasing objective

was to extract the lowest possible cost from them. Changing the approach by

responding to Jaguar Land Rover Business Objectives, has seen a significant

growth in the value both companies derive from the relationship, which goes far

beyond the simple commercial transaction.

3

What made this entry successful

• Focus on long term saving and hidden costs rather than short term savings and cost

reductions

• The role that Purchasing played being the catalyst of the projects to be successful and

complement/ interact to each other

• Benefits for both companies (Growth, control, right links in and out of JLR)

• Integration within JLR of projects across different areas (Sharing knowledge, learning and

data among the plants) promoting proactive actions and changes in JLR

• Trust built between the different areas in JLR and Gobel & Partner having Purchasing as

a Catalyst

• High level of commitment from both companies in changing the situation

4

General overview of JLR and G&P entry

• The approach to quality was fragmented across the product range and across different

manufacturing facilities.

• 16 different suppliers were used to undertake parts rework and containment across the 3

UK plants

• Differing quality regimes and an inability to share data across the company.

• No central information gathering

• Everything was done via a manual process and valuable information were getting lost

• Reactive work

• G&P were tasked with finding faulty parts, with a perception from other suppliers that they

were living off others failures only

'Premium Quality for Premium Brands‘

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General overview of JLR and G&P entry

• A cross functional team was formed under the leadership of:

• Dr Wolfram Liedtke (Quality Director) and his team

• Terry Sampson (STA Director), and his team

• Barbara Ferreira Garcia (Procurement manager) and her team

• Members of the G&P management team including Managing Director, Dino

Kyriacou.

• The key objective was for JLR (both brands) to exceed the quality levels of

Lexus, Mercedes, Benz, Audi and BMW in the JD Power by 2015.

A big Change was needed

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General overview of JLR and G&P entry

• JLR and G&P wanted now to improve the quality of inbound components

by changing the emphasis from detection (or cure) to prevention of

defects being manufactured in the first place

• 16 suppliers were reduced down to one supplier, G&P, for an initial 3 year

contract

• Far simpler supplier management process

• Opportunity for G&P was far more dramatic

• Green light to start implementing the innovation and ideas they had been

nurturing for the previous 5 years

• Purchasing gave them cause to invest in their infrastructure, and further

develop their Qtrak quality system

• G&P and JLR could now identify those high hurts suppliers and target their

parts more effectively

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General overview of JLR and G&P entry

• Some JLR suppliers clearly required more help to reach the required quality levels than

others

• Together with G&P, JLR developed a joint Supplier Technical Assistance; their staffs

now go into JLR suppliers, review quality and measurement processes and make

recommendations for improvement.

• This has clearly benefited JLR and the quality of its products,

• Gave G&P new product lines it can offer in the market place to its other customers.

8

JD Power reports

In 2008, Jaguar Land Rover (JLR):

JD Power tables for quality;

• Jaguar held the 9th position

• Land Rover held the 34th position

Unsatisfactory situation and an incredible turn around

In 2012, Jaguar Land Rover (JLR):

JD Power tables for quality;

• Jaguar held the 2nd position

(now 1st)

• Land Rover held the 12th position

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General overview of JLR and G&P entry

• The award entry was able to draw a link between improved supplier performance,

through improvement in plant quality performance and finally through to JLR's

performance in the JD Power surveys.

• Reject parts were as high as 65%, reduced to ~ 5%.

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General overview of JLR and G&P entry

• JLR and G&P were in a traditional adversarial relationship

• G&P were one of a number of suppliers that JLR treated as commodity suppliers.

• G&P selection was based on low cost and historic, fragmented relationships with various

JLR staff

• Environment encouraged those suppliers to focus more on beating their competitors and

less on the key aim for JLR, improving quality.

• Reducing the number of suppliers and introducing an environment of

trust and transparency has allowed the relationship between G&P and

JLR to grow and, most importantly, deliver extra value to JLR and its

customers.

Summary

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Personal and team commitment to link the overall Business cross

functional objectives and improvements while generating real

sustainable saving

JLR wanted to improve

its brand quality from its

current position and also

beat Lexus Audi, BMW

and Mercedes in the JD

Power Surveys.

The Jaguar brand has

achieved this objective; it

tops the JD Power

rankings, beating all

other manufacturers

Land Rover has

significantly moved its

position in the table,

sitting just below BMW in

12th place.

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Thank you!

Questions?