Tata Indica - The Making Of The Small Car
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VENDOR DEVELOPMENT contd...
Telco even involved its vendors in the design-process to
give suppliers more lead time to innovate, and for better supply chain
coordination. Commented T.K. Balaji, CEO, Lucas-TVS, which supplied
electrical components and fuel-injection systems for the Indica, “By making
vendors its partner early, TELCO ensured both quality and price-conformity.
Late involvement would have yielded different results.”
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M.S. Kumar, Director & CEO, Rane TRW Steering Systems
(Rane), which supplied the steering systems for the Indica, added,
“TELCO has been extremely supportive, making available its entire R&D
resources to our engineers. It is one of the best experiences we have
had in product-development.” Telco wanted Rane to design a system that
would meet the peculiarities of Indian road conditions.
Besides offering both manual and power systems, Rane also had to come
out with a left-hand drive variant for the export market. Rane had to go
deep into application engineering because the front axle-weight of the
Indica was heavier, and its engine-displacement, higher. Indica was not
only compact, which left less space, but also heavy, which strained the
system. Telco wanted Rane to benchmark the maneuverability of the Indica
against the Zen, a much-lighter car. |
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Rane took about 16 months to develop and get the
steering system approved, spending close to 2 man-years on it. It spent
Rs 16 million on development costs for the power steering
system--including tooling and dies--and Rs 10 million for the manual
steering system. Said P.R. Sarathy, President, Rane (Madras), “TELCO
gave us price-targets.
We worked within them, using value-engineering and concurrent
engineering to lower our development costs. For all effective purposes,
we were an arm of TELCO during the process.” In the case of small
vendors, Telco examined their processes- and cost-levels. Telco
configured its suppliers in 2 tiers. Tier I suppliers had to assemble
sub-systems using components provided by Tier II vendors.
Telco asked the latter to supply products at low margins to the former.
On its part, Telco helped them lower their costs by solving
quality-related problems. For instance, SBL, which supplied
clutch-facings and rear (drum) brake linings for the Indica, developed
them in-house. V.R. Janardhanam, President, SBL, remarked, “Despite its
size, Telco has a lot of humility. It is willing to work with even the
smallest of vendors to meet its targets.”
A typical brake-lining usually went through the following steps: the raw
material was converted into slabs; the slab was cut into the required
length; the cut piece went through 2 stages of grinding for the inner
and the outer diameters; then, the piece was drilled, and, finally,
champered. But SBL brought down the number of operations to 3: the raw
material was straightaway converted into pieces of required length, and
the grinding was done to only the outer diameter.
And the company saved 15% because of this single-piece flow technique.
K. Pandarinath, Deputy General Manager (Research), SBL, commented,
“Telco is a transparent company. It allowed us to use all their
facilities as long as it helps develop a better product. Our engineers
spent several weeks working with Telco's engineers on perfecting the
brake-linings.”
SUPPLY CHAIN
LEVERAGING THE SUPPLY CHAIN
QUESTIONS FOR DISCUSSION
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