Rockwell Collins established a goal to automate much of its supplier interfaces, including (but not limited to) the request for quote (RFQ) and purchase order processes. To do this, the company had to become more tightly integrated with its many suppliers. In mid-2002 the Rockwell Collins Cedar Rapids facility went live with www.SupplyCollins.com, a Web portal that acts as the primary business interface between the company and its supply chain. The development of the SupplyCollins portal was needed to enable suppliers to meet quality, delivery, and other business expectations as well as to refocus valuable company material and personnel talent on more strategic supply chain development and monitoring.
Rockwell Collins can now monitor suppliers to see how effectively they are integrated with business processes that are considered most important for its success. The company implemented an assessment methodology that uses red, yellow, and green color codes to quickly indicate whether suppliers are on target. The tool monitors specific criteria, including: Measurement is on a scale of 1 to 3 and quickly highlights areas for improvement with the Material Management Team
The portal contains several other supply chain tools as well as financial tools that enable the users to manage open orders, review the supplier scorecard, access accounts payable, download e-drawings, respond to electronic quotes, view parts on consignment, make long-range plans using a requirements forecast, manage information through self- service, print purchase orders, print bar codes for scanning, and send secure communications. Users can access general information and tools, and registered users can access company-specific information in a secure environment.
Approved suppliers can access drawings on-line using the portal’s E-drawings tool, which is integrated with SAP and Product Data Management. Users can view, print, and download Rockwell Collins drawings and specifications where they are an approved source in SAP. This tool gives the supplier quick visibility of company products and supports design collaboration between designers and suppliers.
Suppliers can access their quality and delivery performance scores through the Supplier Performance Scorecard tool. This tool provides the current month’s quality and delivery scores as well as a 6-month average and scores from the previous 12 months. Suppliers are able to use the scorecard to determine why quality or delivery performance on a certain product may have decreased from the previous month. The supplier can then establish plans for improvement and track these plans in future performance scores. Additionally, monthly e-mails are sent to suppliers with their quality and performance scores.
The Requirements Forecast tool is critical for supplier planning with its capability to build and release per forecast while maintaining optimum inventory levels for suppliers. Suppliers have visibility into company forecasts for parts on long-term agreement as well as for non-agreement part numbers with requirements.
Suppliers can see their open orders and delivery status using the Delivery Order Status tool. This tool contains all of the pertinent information for an order, including plant, buyer, part number, purchase order number, delivery date, material resource planning need-date, and quantity. Any changes or inputs made by the supplier flow into the SAP system, alerting the buyer of a change.
The Electronic Request for Quote (eRFQ) and Automated Purchase Order (APO) tool (eRFQ/APO) provides an automated process for issuing an RFQ and awarding a supplier (Figure 2-4). The RFQ/APO process was previously very time-consuming and both labor- and transaction-intensive. The original process called for a significant amount of tactical work by professional personnel on parts that are not on agreement. The new eRFQ/APO process uses the SAP to evaluate purchase requisitions, determine availability of pricing, generate an eRFQ, and send the eRFQ to the portal. The system generates a total-cost-of-ownership analysis (TCO), selects a winner based on the TCO (not necessarily the lowest price), fixes the supplier, and places the order using the winning quote. The eRFQ/APO system has shortened the lead-time on products.
The Consignment and Accounts Payable module supports virtual reconciliation of consigned inventory and tracks the process of consigned inventory from receipt to payment. The supplier can view and print reports that show material movement. Suppliers can also check payment status as well as current and prior transactions. Eighty-seven percent of payables transactions are paid through electronic funds transfer.
Since January 2004, the number of suppliers on the portal has increased from approximately 280 to 1,500. Since the portal went live, the number of monthly visits has also increased from 5,000 to nearly 50,000. Other key metrics include a dramatic decrease in material shortages, with approximately 80% of direct procurements now going through the eRFQ and APO processes. By automating the various supply chain functions, Rockwell Collins has been able to redeploy talented personnel to more strategic tasks, which has resulted in an increase in supplier performance and quality.
Figure 2-4. eRFQ/APO Process
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