Customer/Supplier Partnership for Quality Improvement and Cost Reduction

Paper #:
  • 940663

Published:
  • 1994-03-01
Citation:
Gupta, O. and Eighmy, S., "Customer/Supplier Partnership for Quality Improvement and Cost Reduction," SAE Technical Paper 940663, 1994, https://doi.org/10.4271/940663.
Pages:
7
Abstract:
As the automotive industry establishes itself for a global position in respect to Cost and Quality, the supplier industry must follow by making quantum cost reductions and quality improvements.Zexel-Gleason, Inc. manufactures a unique TORSEN1 traction differential system. Drastic cost reduction was the only way to improve competitive position and increase sales. As part of an overall product cost reduction project, a long term component supplier was given an opportunity to reduce cost which was not accomplished due to the culture barrier of “business as usual.” Zexel-Gleason selected American Turned Products (ATP) as the new supplier for the Journal Pins used in its TORSEN T1 product.This paper covers a unique customer/supplier partnership which has developed between these two companies. Both Zexel-Gleason and American Turned Products have benefitted. These benefits are presented in this paper.Zexel-Gleason benefitted by meeting its cost reduction and quality improvement target on a long term basis and developed a supplier who will assume full component responsibility---Quality, Cost, Delivery and Flexibility. American Turned Products benefitted by learning the benefits of up front quality planning, learning the effective use of SPC and fool-proofing the processes as well as being proactive in cost management. This has helped ATP in gaining other business as well.The stage has been set for both companies to learn from these positive experiences relating to Quality Improvement and Cost Reduction and help them to grow their respective businesses. Other companies in the automotive industry may benefit from the lessons learned by this unique customer/supplier partnership.
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