Reduce Fulfillment Time Increase Flexibility Organize for Mass Customization Collaborate with Engineering Collaborate with Suppliers in Fulfillment Outsource for the Right Reasons Improve Quality and Reliability Eliminate Production Losses

• Use robust manufacturing and test processes
• Maintain quality at all times using standard operations
• Maintain daily inspection of equipment to avoid manufacturing defects
• Train and certify operators to run multiple processes and operations
• Buy quality parts and sub-assemblies from suppliers in fulfillment
• Promote continuous improvement

• Allow variability from shift to shift
• Accept unreliable, low quality parts from suppliers in fulfillment
• Rely on incoming inspection to screen and find defects
• Inspect quality into the product rather than building it in

• Retains happy customers
• Lets customers get what they want
• Permits consistent fast throughput of quality products
• Eliminates customer returns
• Reduces warranty expenses

"GM spends about $3.5 billion a year paying dealers to fix things that break on GM vehicles under warranty in North America, where the company's typical warranty lasts three years. GM has made it a top priority for the entire company, from designers to dealers, to reduce warranty repairs with improved design and quality and early detection of problems. The goal is to eliminate some nine million claims and to save $1.6 billion in costs by 2001. Detecting problems early also is critical to avoiding costly recalls like the one of about a million trucks that GM announced last month, in which it will foot the bill to fix a switch miswired during manufacturing." - GM Takes Tips From CDC To Debug Its Fleet of Cars, Wall Street Journal, April 8, 1999

"Firestone, a unit of Japan's Bridgestone Corp., recalled 6.5 million tires on Aug. 9 due to complaints of tread separations and blowouts now blamed for at least 101 U.S. highway deaths. Most of the tires were fitted as standard equipment on Ford's popular Explorer. Ford will buy a substantial percentage of tires for the new Explorers from French tire maker Michelin, which previously made no Explorer tires. Ford's customer-choice program further distances it from Firestone and could result in huge losses for its long-time and largest tire supplier which makes every tire for the current Explorer. Making matters worse for Firestone, Ford also continues to talk with Goodyear Tire & Rubber Co. about supplying tires for the new Explorer." - Ford Moves Away From Firestone Reuters, September 28, 2000