Case Study Ford Motor Company
CASE STUDY
Ford Motor Company
Ford Motor Company, one of the world’s largest automotive manufacturers, has worked with Penske on several Six Sigma initiatives. As its lead logistics provider (LLP), Penske’s quality team of associates are trained in Six Sigma practices and work closely with Ford to streamline operations and create and maintain a more centralized logistics network. Together, they uncovered several areas for real cost savings as a result of reducing inbound carrier discrepancies, eliminating unnecessary premium costs and reducing shipment overages. Plus, Penske implemented accountability procedures and advanced logistics management technologies to gain more visibility of its overall supply network.
Six Sigma initiatives streamline operations
Penske Logistics began its relationship with Ford as lead logistics provider (LLP) for Ford’s assembly plant in Norfolk, Va. At the time, each of Ford’s 20 North American assembly plants managed its own logistics operations. A decentralized approach provided total control of logistics at the plant level, but presented costly redundancies in materials handling and transportation. Ford conducted studies to determine the benefits of transitioning the company’s decentralized logistic operations to a centralized approach. The decision was quickly apparent – centralization of the company’s logistics operations would increase both velocity and visibility throughout the network, as well as reduce supply chain costs. Shortly thereafter, Ford selected Penske as its North American LLP. Under the contract, Penske would centralize and manage all inbound materials handling for 19 assembly plants and seven stamping plants.
Challenges
• To develop, implement and operate a centralized logistics network for Ford • To streamline supplier and carrier operations for improved performance and accountability • To provide Ford with real-time supply chain and financial visibility
Consolidating Logistics Operations
Penske immediately
Ford Motor Company
Ford Motor Company, one of the world’s largest automotive manufacturers, has worked with Penske on several Six Sigma initiatives. As its lead logistics provider (LLP), Penske’s quality team of associates are trained in Six Sigma practices and work closely with Ford to streamline operations and create and maintain a more centralized logistics network. Together, they uncovered several areas for real cost savings as a result of reducing inbound carrier discrepancies, eliminating unnecessary premium costs and reducing shipment overages. Plus, Penske implemented accountability procedures and advanced logistics management technologies to gain more visibility of its overall supply network.
Six Sigma initiatives streamline operations
Penske Logistics began its relationship with Ford as lead logistics provider (LLP) for Ford’s assembly plant in Norfolk, Va. At the time, each of Ford’s 20 North American assembly plants managed its own logistics operations. A decentralized approach provided total control of logistics at the plant level, but presented costly redundancies in materials handling and transportation. Ford conducted studies to determine the benefits of transitioning the company’s decentralized logistic operations to a centralized approach. The decision was quickly apparent – centralization of the company’s logistics operations would increase both velocity and visibility throughout the network, as well as reduce supply chain costs. Shortly thereafter, Ford selected Penske as its North American LLP. Under the contract, Penske would centralize and manage all inbound materials handling for 19 assembly plants and seven stamping plants.
Challenges
• To develop, implement and operate a centralized logistics network for Ford • To streamline supplier and carrier operations for improved performance and accountability • To provide Ford with real-time supply chain and financial visibility
Consolidating Logistics Operations
Penske immediately