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New Automotive Study Voices the Industry’s View on Quality and a Strategic Path Forward

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Automotive OEMs and suppliers estimate $3.5 billion in cost savings could be achieved if complexity and redundancy in Quality Management System (QMS) requirements were reduced, according to a new study and survey based on extensive interviews with the nation’s leading automakers.

The study reveals that while the current state of quality is the best it’s ever been, significant opportunities for improvement still exist within QMS — along with Problem Solving, Customer-Specific Requirements (CSRs), Product Development, and Loss of Experience — which the study identified as the top five issues challenging automakers in their efforts to achieve greater efficiencies in the industry’s quality systems, standards, and practices.

The survey and subsequent analysis is packaged into a just-released white paper titled Quality 2020, conducted by the Automotive Industry Action Group (AIAG) in collaboration with Deloitte Consulting LLP (Deloitte). AIAG is a not-for-profit, member-supported organization that works collaboratively with automotive manufacturing companies, suppliers, and service providers to help them develop common solutions to industry pain points.

Quality 2020 uses the survey data to identify needed improvements, with the goal of putting them in place by 2017 and then measuring the results of this industry-wide quality initiative by 2020. The comprehensive white paper based on the study — including exclusive interviews with the top quality executives from several automakers and Tier 1 suppliers — is available for free download at http://go.aiag.org/quality-2020-report.

“Quality 2020 is an illumination of where the industry needs to take action, improvements only possible if automotive companies are willing to put resources behind the plan, get engaged, and address the concerns,” says J. Scot Sharland, AIAG’s executive director. “With the release of the new standard ISO-9001:2015 expected in September, the timing and findings of the Quality 2020 study are even more important.”

Among the study’s key findings:

  • OEMs and suppliers both rank Problem Solving and Customer-Specific Requirements as the two most critical issues impacting quality.

  • Over one-third of respondents felt there is significant potential for improvement in Problem Solving.

  • Regarding CSRs, suppliers are concerned most with the ability to standardize business processes and systems, while OEMs are most concerned with managing customer expectations and relationships.

  • On average, respondents invest 116 workdays and over $100,000 annually to comply with QMS requirements. A savings of nearly $50,000 per site is projected if QMS complexity and redundancy are reduced.

  • Respondents identified the top two sources of complexity and risk to quality as unrealistic expectations and the concern that system validation sometimes doesn’t occur until product launch.

  • Automakers are concerned about the large number of Baby Boomer retirements in the next five to eight years, citing loss of know-how, teachers, and mentors.

The white paper provides introspection on these findings and others, and concludes with key takeaways and recommendations for a path forward.

“Our industry has made phenomenal progress in the quality and reliability of the vehicles we produce,” says Sharland. “But while the industry has deployed very robust processes and supplemented them with great tools, it needs to accelerate basic knowledge transfer throughout its global supply chain and make a renewed, focused, and industry-wide commitment to use the tools properly and follow the processes developed.”

“Collaboration, standardization, and pervasive deployment of quality knowledge and allied tools are the only ways we can successfully mitigate risks and deliver more predictable outcomes on a global basis,” he says.

Download the Report