While Ford is blaming its suppliers for its quality problems, preliminary results of a new study set to be released in about two weeks clearly show that Ford should look in the mirror when it comes to quality issues. The study found that Ford hinders suppliers’ ability to meet quality expectations more than any other major North American OEM.
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The annual OEM/Supplier Benchmark Study conducted by Planning Perspectives, Inc., in Birmingham, Mich., includes more than 225 suppliers in its survey. The study shows that while Ford is not willing to acknowledge any internal problems that may be contributing to its low quality, suppliers identified several areas where Ford is its own worst enemy.
Preliminary results indicate the following, according to the suppliers surveyed:
* Ford is the worst of the six major North American OEMs to deal with in terms of excessive and late engineering changes. These late changes hurt Ford’s ability to develop products on time and still meet quality targets.
* When selecting suppliers, Ford places more than three times as much emphasis on cost as on quality than do other OEMs, suggesting that piece price is far more important than quality to Ford Purchasing. Only one other OEM places more emphasis on cost than does Ford.
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By GlobalData* Suppliers also indicate that Ford simply doesn’t have its act together. Suppliers say they get conflicting objectives across functional areas (e.g., purchasing vs. engineering) and across purchased products (e.g., wheels vs. brakes), which makes achieving Ford’s sourcing objectives of cost and quality extremely difficult. While all OEMs have some conflicting objectives, none are as great as Ford’s, according to suppliers.
* Finally, Ford is the least effective OEM when it comes to internal efforts to improve quality.
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“While many automotive industry observers generalize about Ford’s contribution to their quality problems, these survey results specifically indicate, with a high degree of reliability, that the major portion of Ford’s quality problems are internal to Ford,” said John W. Henke, Jr., Ph.D., president of Planning Perspectives and professor of marketing at Oakland University.
“There is no question that no OEM can solve its cost and quality problems without the help of its supply base. However, that help is not going to be forthcoming to the degree that it must, if an OEM is not willing to face up to and address its internal issues, and stop publicly brow-beating its suppliers. Suppliers work with the OEMs everyday. They know what’s going on, but they are not always forthright with the OEM because they fear retaliation. This is true in Ford’s case. The survey enables suppliers to tell the truth confidentially and anonymously. Clearly, only Ford can control its future — suppliers can’t. Ford can either address its internal problems honestly, most of which could be solved relatively easily in a reasonably short time period, or Ford can continue to refuse to admit its problems and continue having problems. It’s really that simple.”
