Faurecia Case Analysis

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- Positioning as a tier-1 supplier is advantageous as direct contact is maintained with the carmaker. But it means assuming the role of middle-man bridging communication between suppliers/carmaker to create the final product.

- Added challenges for Faurecia/employees “meant it not only had to acquire new skills (among which assembly techniques and dealing with a large number of suppliers), but also to adapt to new ways of interfacing with customers for shipping parts” (Bidault,2007).

Voice of the Customer Recommendations & Plan of Action

Recommended action includes early and ongoing integration of internal/external customer input in all stages of product design identified by Slack et al.,(2013):

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Collaboration among car makers, suppliers and the expertise of front-line staff in relation to product development, process improvement and innovation would prove highly beneficial. This can be achieved through the formation of quality improvement committees or focus groups that represent the interests of key stakeholders. “Understanding the user is a key issue in design” (Pirhonen & Murphy, 2008).

In fact, Faurecia’s pool of 60,000 employees spread throughout 28 countries is a significant untapped resource. Focus groups and employee surveys would promote engagement revealing potential trends and the barriers that impede the realization of Faurecia’s performance objectives. The company would attain real-time information related to improvement requirements which would highlight potential areas for R&D investment.

The reality is that “shifting market demands, the availability of new talent pools, and economic factors have already altered the R&D landscape, moving sources of innovation outside of traditional geographic areas” (Hensley, Inampudi, Kaas, & Newman, 2012). Faurecia needs to capitalize on its global advantage.

As noted, “for tier-1 suppliers, being the partner of choice for a particular component was a key competitive position. While this could be founded on identification of business opportunities and anticipation of customer needs at very early stages of vehicle design, it also increasingly required suppliers to have global engineering and R&D capabilities and global manufacturing facilities so as to be able to serve a large number of customers in as many countries as possible” (Bidault,2007). These recommendations will strengthen partnerships with internal and external customers and positively impact Faurecia’s overall operational performance objectives.

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References

Athabasca University. (2015). OPMT-505 Study Guide Section 2-5: Process Design. St. Albert: Athabasca University, Faculty of Business.

Bidault, F. (2007). Sitting pretty: Managing customer-driven innovation at Faurecia car seating. ESMT European School of Management and Technology, Berlin, Germany. Retrieved November 9th, 2015 from

Hensley, R., Inampudi, S., Kaas, H. & Newman, J. (2012). The future of the North American automotive supplier industry: evolution of component costs, penetration, and value creation potential through 2020. McKinsey & Company. Retrieved November 10, 2015 from

Pirhonen, A., & Murphy, E. (2008). Designing for the unexpected: the role of creative group work for emerging interaction design paradigms. Visual Communication, 7(3), 331-344. Retrieved October 31, 2015 fromhttp://0-vcj.sagepub.com.aupac.lib.athabascau.ca/content/7/3/331.full.pdf+html

QuickMBA.com. (2010). Vertical Integration. Internet Center for Management and Business Administration, Inc. Retrieved November 10, 2015 from http://www.quickmba.com/strategy/vertical-integration/

Slack, N., Brandon-Jones, A., & Johnston, R. (2013). Operations management (7th ed.). Essex, UK: Pearson Education.