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
Priorities forimprovement
Parameters withleast gap
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
Areas of improvement
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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17
0.93
CORPORATE RESEARCH ENGINEERING RELATED
ATTRIBUTES
Priorities forimprovement
Parameters withleast gap
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
Areas of improvement
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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19
1.56
PURCHASE RELATED ATTRIBUTES
Priorities forimprovement
Parameters withleast gap
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.
Areas of improvement
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
Priorities forimprovement
Parameters withleast gap
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
Satisfaction Importance
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KEY FINDINGS ON QUALITY AND INSPECTION
Positive features
Company has accepted modernmanufacturing processes andalso insists vendors to adopt it.
Areas of improvement
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
Priorities forimprovement
Parameters withleast gap
.
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
Satisfaction Importance
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Positive features
Vendors have experienced a significantimprovement in on time payment.
Areas of improvement
Few vendors still complain that companydoes not offer them good prices.
KEY FINDINGS ON FINANCIAL
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OTHER ATTRIBUTES
0.72
Priorities forimprovement
Parameters withleast gap
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
Satisfaction Importance
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
Priorities forimprovement
Parameters withleast gap
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
Satisfaction Importance
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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