Driving Supply Chain Convergence

Empowering Continued Leadership in Tier 1 Automotive Industries

“ For 100 years, the automotive industry has been refining its processes around the Internal Combustion Engine. The historic pace of change for OEMs and suppliers will seem like a Sunday stroll compared to the simultaneous surge of disruptions it is facing today.

In the new world, vehicles are differentiated not by stylish sheet metal or powerful engines but by advanced driver assistance systems, infotainment, telematics, LiDAR sensors, image-recognition systems, 5G communications and electric powertrains. These CASE initiatives (Connected, Autonomous, Shared Mobility, Electric) depend on ingesting increasing amounts of data that needs to be processed at ever faster speeds. The impact is profound. The good news is that the overall size of the automotive market is increasing from 3.6T to 7.2T, a tsunami of change representing an opportunity as well as a threat. ”
Salim Shaikh, VP Automotive Industry Strategy - Blue Yonder
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Challenges in the Automotive Industry

The automotive industry is experiencing relentless growth in complexity from both the demand and the supply side.

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Digital Supply Chain Trends in Automotive Industry

From collaboration to planning to control towers and logistics, automotive companies and suppliers are digitalizing processes and systems at a historic pace to improve competitiveness, profitability, and customer-centricity.
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McKinsey’s ‘Automotive revolution – perspective towards 2030’ study estimated that by 2030:

100%
of passenger vehicles will be autonomous
50%
Decrease in stockouts.
30%
of all miles driven will be shared
30%
of automotive will be Electric Vehicles

Priorities for the Automotive Industry

Illuminate your supply chain network
Only when you can visualize the entire flow of goods across this network, you can measure the impact of a supply disruption or a demand mix change. When you see the impact of the disruption in real-time, you can come up with proactive risk mitigation plans.

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Demand and supply variability
Supply chain resiliency can be enabled through better scenario planning and simulation capabilities. These include the ability to develop a range of scenarios and robust contingency plans to navigate and understand the tradeoffs on cash flow, P&L, and the balance sheet.

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Strategic network design
Organizations are increasingly coming up with proactive risk mitigation plans by revisiting their supply chain network design. This includes reconfiguring their global and regional supply chain flows, sourcing critical components from local suppliers, and conducting trade-offs according to needs, cost, service and risk scenario analysis.

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Working capital reduction
Resiliency is about being agile and lean at the same time. By reducing costs, working capital reduction and cash flow preservation is key, especially since inflation is at a 40-year high. 55% of CEOs expect a significant rise in inflation over the next three years and hence 75% are increasing their supply chain initiatives year over year.

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Taking control of outsourced transportation functions
Organizations are increasingly bringing selective transportation functions in-house to gain better control, reduce cost, and become more resilient.

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Line side replenishment
The goal of leveraging Warehouse Management to help automate line side replenishment is to reduce bottlenecks, ensure there are no production downtimes, and optimize inventory management for our customers.

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Personalized fulfillment experiences
The automotive industry is shifting gears to eCommerce, and competitively delivering a superior customer experience is top of mind.

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Blue Yonder’s Luminate® Platform enables the Auto Tier 1 industry to scale.

The three Cs of COVID-19, C.A.S.E. and Convergence along with the chip shortage have demonstrated that the pace of disruption and evolution is accelerating. It is no surprise that auto manufacturers are looking to AI and ML for solutions. Clearly, the introduction of predictive, prescriptive, and autonomous technology is also the future of end-to-end supply chains as ecosystem-level “predict-and-pivot” capabilities become the new competitive advantage.

Real-time supply chain visibility and multi-tier supplier collaboration

The digital world is being defined by its agility in processing change. AI-powered visibility enabling a real-time reaction is giving auto companies the edge.

Business Case:

Capacity and forecast collaboration must be extended beyond Tier 1 manufacturers out to Tier 2 and Tier 3 suppliers of semiconductor wafers. In the event of a missed part delivery, the control tower can weigh such options as expediting a replacement from the Tier 1 supplier or shipping from an alternate source. It can evaluate the speed of different carriers and route to minimize any negative impact caused by the disruption, thereby enabling the most cost-efficient outcome, improving customer service levels and increasing revenue and margin. The result is a more agile and resilient supply chain.

Integrated Demand Supply Scenario Planning

In today’s environment, unexpected market demand and supply chain disruptions can occur at any time. The keys to planning and executing smooth operations are understanding how different demand realization and supply risk scenarios impact your business.

Driving automotive success
at Adient

With 202 manufacturing facilities across 32 countries, Adient is a world class seating manufacturer, that provides more than 19 million seats per year. That equates to one out of every three seats in automotive vehicles worldwide, that’s a large volume and we have a large supply chain that really works well moving things around the world, even in the face of challenges. However we did identify that we needed some additional assistance looking at our collaboration efforts and our technology. And that’s where Blue Yonder comes in.” Jill Hays Inventory Optimization Manager, Adient

Analyst Recognition

Forrester’s Total Economic Impact™ Study shows huge ROI for Luminate Planning

Commissioned by Blue Yonder, a Forrester Consulting study found diverse customers in the manufacturing and distribution sectors achieved compelling economic benefits and return on investment by replacing their labor-intensive, spreadsheet-based supply chain planning processes or legacy applications with Blue Yonder Luminate Planning™. The findings showed that integrated planning workflows enabled by the solution can help customers realize the following gains:

524% ROI

524% Return on investment over three years
$129.8 million

Total benefit of $129.8 million over three years
$109 million

Total Economic Impact™ $109 million over three years

*Figures based on a $10bn company implementing Blue Yonder Inventory Optimisation and Demand and Fulfilment.

Learn how Luminate Planning Delivers ROI

Blue Yonder is Proud to Support the Automotive Industry

Driving automotive success at Adient

“We have a large supply chain that really works well moving things around the world, even in the face of challenges. However, we did identify that we needed some additional assistance looking at our collaboration efforts and our technology. And that’s where Blue Yonder comes in.”
- Jill Hays Inventory Optimization Manager, Adient

Watch Adient’s Story