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GPDS Lean Product Creation August 7, 2009,Process & Localization Template Overview,Agenda,What is GPDS? What are the key events in GPDS? What is the GPDS process for local parts? Where is there more GPDS information?,1. What is GPDS?,Program A,Global Product Development System Scope,Program Start,Annual Process,People Global Core Engineering,Process GPDS,Design,Engineering,Parts & Service,Purchasing,Manufacturing,Planning,Suppliers,Marketing,GPDS is a closed-loop Product Creation system. GPDS is a full enterprise effort,Technology C3PNG (CATIA v5),Program B,Program C,Mass Production 2,Mass Production 2,Mass Production 2,Program Start,Program Start,Key Concepts,Quality Process: Kano Model for Customer Satisfaction,Customer Satisfaction,Degree of technical achievement,x,Y,2. What are key events in GPDS?,Milestones & Gateways,Targets & Sourcing,FC5 Surface Hard Freeze,M1 Data Judgment,Final Data Judgment,Product Concept & Package,Program Start,Mass Production 2,Mass Production 1,Program Target Compatibility Checkpoint,Program Approval,Launch Readiness,Final Engineering Confirmation,Program Target Confirmation,FC3 Concept Decision,Program Strategic Confirmation,Logical Decision Making Process, Program Start,Targets & Sourcing,FC5 Surface Hard Freeze,M1 Data Judgment,Final Data Judgment,Product Concept & Package,Program Start,Mass Production 2,Mass Production 1,Program Strategic Confirmation,Program Target Compatibility Checkpoint,Program Approval,Launch Readiness,Final Engineering Confirmation,Program Target Confirmation,Main Objectives: Start the Program Team Bill of Material (BOM) and Targets & Sourcing processes Establish a robust prime Program strategy Foster a high level of part/architecture reuse and commonality Key Decisions: Key Platform and Powertrain system and Electrical architecture Program Mission Initial Marketing strategy Assembly Plant Alternatives,FC3 Concept Decision,Ford Confidential, Program Strategic Confirmation,Targets & Sourcing,FC5 Surface Hard Freeze,M1 Data Judgment,Final Data Judgment,Product Concept & Package,Program Start,Mass Production 2,Mass Production 1,Program Strategic Confirmation,Program Target Compatibility Checkpoint,Program Approval,Launch Readiness,Final Engineering Confirmation,Program Target Confirmation,Main Objectives: Program strategic targets / guidelines set Compatibility of Affordable Business Structure (ABS) with Marketing, Finance & Quality Functional targets, hardware selection and timing confirmed Workplan and resource availability to achieve successful delivery to are approved Key Decisions: Key Body, Chassis and Electrical systems,FC3 Concept Decision,Ford Confidential, Program Target Compatibility Checkpoint,Targets & Sourcing,FC5 Surface Hard Freeze,M1 Data Judgment,Final Data Judgment,Product Concept & Package,Program Start,Mass Production 2,Mass Production 1,Program Strategic Confirmation,Program Target Compatibility Checkpoint,Program Approval,Launch Readiness,Final Engineering Confirmation,Program Target Confirmation,Main Objectives: All Attribute targets including Quality, Cost, Weight & Function aligned and balanced Complete system selection completed to align targets and confirm Bill of Process (BOP) Supplier Agreement Letters on-track per Key Commodity Plan Supplier On-Board dates Ensure completion of Product Concept, Package, Targets & Sourcing Key Decisions: All remaining key commodity systems,FC3 Concept Decision,Ford Confidential, Program Target Confirmation,Targets & Sourcing,Final Data Judgment,Product Concept & Package,Program Start,Mass Production 2,Mass Production 1,Program Strategic Confirmation,Program Target Compatibility Checkpoint,Program Approval,Launch Readiness,Final Engineering Confirmation,Program Target Confirmation,Main Objectives: Program targets are set & ABS (Affordable Business Structure) updated Develop market equation Key Decisions: Commercial Program Agreements signed per Key Commodity Plan All Supplier Agreements signed Concurrent Gateways completed: Exterior & Interior Design and Surface Freeze (FC5) & M1 Prototype design readiness (M1DJ) Long Lead Funding for Manufacturing (as required),FC3 Concept Decision,FC5 Surface Hard Freeze,M1 Data Judgment,Ford Confidential, Program Approval,Targets & Sourcing,Product Concept & Package,Program Start,Mass Production 2,Mass Production 1,Program Strategic Confirmation,Program Target Compatibility Checkpoint,Program Approval,Launch Readiness,Final Engineering Confirmation,Program Target Confirmation,Main Objectives: Approve Program Quality, Cost, Weight and Function objectives Approve Funding Approve Market Equation Support completion Final Data Judgment & start of mass production preparation activities Key Decisions: Affordable Business Structure and Market Equation Product Quality, Cost, Weight and Functional performance Commercial Program Agreements (CPAs) are complete,FC3 Concept Decision,FC5 Surface Hard Freeze,M1 Data Judgment,Final Data Judgment,Ford Confidential, Final Engineering Confirmation,Targets & Sourcing,Final Data Judgment,Product Concept & Package,Program Start,Mass Production 2,Mass Production 1,Program Strategic Confirmation,Program Target Compatibility Checkpoint,Program Approval,Launch Readiness,Final Engineering Confirmation,Program Target Confirmation,Main Objectives: Complete and sign-off all design validation to requirements (except limited tunables). Key Decisions: Proceed to launch based on completion of Engineering Risk Assessment,FC3 Concept Decision,FC5 Surface Hard Freeze,M1 Data Judgment, Launch Readiness,Targets & Sourcing,Final Data Judgment,Vehicle Basic Design,Powertrain “Unit” Development,Program Start,Mass Production 2,Mass Production 1,Program Strategic Confirmation,Program Target Compatibility Checkpoint,Program Approval,Launch Readiness,Final Engineering Confirmation,Program Target Confirmation,Main Objectives: Manufacturing tools and equipment are ready for home-line production of vehicles Cross functional groups (engineering, suppliers, material control, confirm readiness to proceed to Tool Tryout build Key Decisions: Final decision to proceed to Tool Tryout (TT) Build,FC3 Concept Decision,FC5 Surface Hard Freeze,M1 Data Judgment, / Mass Production 1 & 2,Underbody Phase,Targets & Sourcing,Final Data Judgment,Product Concept & Package,Upperbody Phase,Program Start,Mass Production 2,Mass Production 1,Program Strategic Confirmation,Program Target Compatibility Checkpoint,Program Approval,Launch Readiness,Final Engineering Confirmation,Program Target Confirmation,Main Objectives: MP1 Produce first customer saleable unit without retrofit MP2 Begin acceleration to full production line rate Key Decisions: All homologation and certification documents are submitted and approved Product Quality exceeds customer expectations Suppliers, Manufacturing facilities and Assembly Plants have completed Production Validation and are capable to accelerate,FC3 Concept Decision,FC5 Surface Hard Freeze,M1 Data Judgment,APQP & Supplier Engagement,Sourcing,Team Evaluation #1,Team Evaluation #2,Team Evaluation #3,Team Evaluation #4,Failure Mode Avoidance Mfg./Capacity Planning Validation Planning,Testing & Validation Prototype Builds Tooling,Testing & Validation Tooling Verification Launch Quality / Capacity Verification,Launch Quality / Capacity Verification,% Complete,3. What is the GPDS process for local parts?,Localization Process Introduction,We had no template or standardized approach to developing & launching high local content new vehicle programs. Each program was “inventing” how best to work with Joint Venture partners There was no documentation: Explain expectations to Joint Venture partners Capture learnings Drive continuous improvement,Ford Confidential,Localization Process Development Goals,Fully concurrent GPDS development & launch capability High levels of part design commonality agreed up-front to optimize QCWFT. Key enabler is clarification of GPDS “gives & gets” for the Joint Ventures. Targets & Sourcing Engineering & DV Develop the Localization template using input from program teams (Transit, Mondeo, Focus, Fiesta, EcoSport & Ranger) Build on Lessons Learned Help present global teams deliver with less waste & re-invention Association program contractual agreements (Technical Licensing Agreements, Engineering Service Agreements, etc.) need to be standardized compatible with GPDS process logic,Localization Template “Is”,What it is - Process template(s) used to guide the development and launch of high local content new vehicle program at non-mainstream production facilities. The initial template is for production facilities that are not fully within the Ford Enterprise. A process to assure quality, cost, and speed is delivered to global emerging markets within GPDS logic. For example, to determine the who, what, how, and when for local part verification. A process proposal consistent with GPDS targets & sourcing process and the Global Concurrent launch effort for a Major All New Vehicle. The initial template proposal is for China Joint Ventures. Subsequently, templates for other localization situations will be developed (e.g. KD, minor markets, etc.).,Localization Template “Is Not”,What it is not - A process that would encourage reduced BOP or BOD commonality by making more visible the opportunity to have unique DV. A timing overlay that adds a stagger to the VPP based on regionally unique designs. Timing for all size product and manufacturing programs. All the detailed methods and tools required to execute the process. These methods and tools will have to be created by responsible functions. Totally finished. We expect to collect comments & concerns with the template during this visit. Approval is scheduled for October 2009 in support the next release of GPDS.,Key Assumptions,LEA is responsible for Engineering Sign-off. The Ford Regional PD Office is responsible to ensure: Local suppliers understand LEA design direction All issues are identified and resolved with the LEA Local JV has primary buying and manufacturing authority. Timing will vary for programs with smaller scalability. Shipping time (typically 6 wks) needs to be assessed based on National logistics. Design Transfer Agreements protecting Intellectual Property rights for Ford and for our suppliers consistent with Corporate guidelines are in place.,Key Challenges,Increasing global design commonality with optimized cost and minimum duplicate regional Design Verification & Validation (DV). Reinforce single central LEA authority over local content design direction, change control and resulting unique DV. Ensure the “right” information is used to make the “right” decisions. Clarity of roles & responsibilities and process/ methods/ tools for developing & verifying local content is needed. DV & quality implications of “B3” locally unique designs considered in the Key Commodity Plan decisions that are at the heart of the Targets and Sourcing process.,Key Challenges,Managing logistics to maximize concurrent development and launch. Logistics for local content DV to enable the LEA to Sign-Off the vehicle to be produced by the JV. Parts and/or vehicles Test and/or build count Die practices and logistics vary regionally and geographically. Sourcing PCF (Part Checking Fixture) disciplines and Buy-off Home Line Tryout,In-Process Issues,Present template status leads to JV launch 5 months after lead region (comparable to B515). VOME and SBU are engaged in improving concurrency. Value of building & testing VP prototypes with local content at the JV may vary from program. Best practice needs further evaluation. Present assumption follows EcoSport program plan Standard global PCF and tool buy-off processes are needed. Global Core process proposal for PCFs reflected Global SBU Core to be engaged to reduce durations,In-Process Issues,Need for unique Powertrain contracts for Association programs requires study. Presently assume covered in vehicle agreements Need for Long Distance drive of VP unit in JV market prior to . All alternative approaches need to be considered Sourcing for Minor (non-long lead) parts needs further discussion with JV. Key question is balance of design maturity and leadtime Applicability of localization template developed for China to India, South Africa and others needs study. To be studied before next GPDS release in December 2009,High-Level Localization Template Example for JV,(666 program),0,5.5,16.5,27,34,44,37,PS,PTCC,LR,PSC,3,GPDS v2.2 LEA Program,6,17.5,12,23.5,Month before ,PA,M-1,LS,19.5,FDJ,P-Rel,PTC,+4,+2,10,VP,8,FEC,PEC,J1,MP1,Key Process Points (thought starters): Ford China all local parts have DV/PV GPDS logic held without having to engage JV in core product development,Joint Venture (CFMA, JMA),Mfg, Purch. & Quality Input,Tooling,Minor Part Bid,Ford Confidential,Localization Template Walk-Thru,Pre- Strategic Alignment,Prelim Eng. Service Agreement (ESA) if required,Marketing Strategy / Positioning / Consumer Research for the proposed product,Product, Manufacturing and Sourcing Strategic Framework,Prelim Technology Licensing Contract (TLC),PS,MR,The Senior Leadership of the LEA, Region & the JV need to find alignment on the strategic intent of the program so that the global team efficiently work: Business Customer Product Architecture Market Positioning Manufacturing Sourcing / Supply Base,How Pre- works: Identify the key strategic questions, brainstorm the possible solutions for . After the Planning team studies the potential solutions, select the best approach to success and align for .,44 months before LEA Job#1,Quality History and High Hurts,Benchmarking,Baseline Top-Down Targets,Suggested Suppliers for Key Commodities,Pre- Strategic Alignment,6 months for Major Program,The Engineering, Finance, Purchasing & Manufacturing teams starts at to recommend program assumptions: System Cost Targets Manufacturing Issues & Quality Issues to be addressed Suggested local suppliers & segmentation for each Key Commodity per the Plan. Benchmarking for System Alternatives (Attachment C) Final Preparation for ,44 months before LEA Job#1,Global Sourcing Commodity Segmentation,Vision is maximum # of “D” or “B1” category commodities,TLC Framework and Principals Dev. And Negotiation,Product Planning Activity (Prime Alternative),ABS,Cost and Investment Estimate,ESA Framework and Principals Dev. And Negotiation,Program Planning -,PS,PSC,7 months for Major Program,Based on recommended assumptions, the LEA Chief Program Engineer and the Business, Planning & Marketing Teams decide the optimum global program direction: System Prime Alternative Product Positioning, Product Concept clinic & Market Equation Confirm Program Cost & Profitability Targets Consolidated Program Assumptions Business Agreements (as required),44 months before LEA Job#1,Manufacturing Requirements,CPE Target Sign-off Workshops,TLC Detailed Dev.,Sourcing Agreement Letters Signing,Secure Compatibility -,PSC,PTCC,Based on optimum global program direction, and Key Commodity Plan & Senior Management support of the Prime Alternative at start program implementation: Supplier Bid, Agreement Letter process per the Key Commodity Plan Gather Manufacturing Bill of Process facility & design requirements Sign-off compatible System & Supplier Targets Develop detailed TLC,37 months before LEA Job#1,B1, B2 & D Suppliers work with design source,B3 Part CAD Update,UP B3 Feasibility Commitment & Tooling Plan,PTCC,PTC,7 months for Major Program,Structure & Theme Design -,Develop detailed Underbody (UN) designs and secure Theme feasibility with suppliers: UN B3 Suppliers support UN design, complete virtual verification for all requirements and gain LEA approval. All B3 Suppliers provide CAD to LEA as required. UP B3 Suppliers commit to feasibility & gain LEA approval for tooling plan. Other Suppliers work with design source to ensure feasibility and cost efficiency.,34 months before LEA Job#1,Core Program Business -,PTCC,PTC,7 months for Major Program,Utilize latest engineering detail to confirm program direction and to secure critical agreements: Complete sourcing all suppliers with engineering responsibility UN Commercial Program Agreement signed using verified UN design data per schedule. Theme clinic & Feature Market survey to ensure optimum program direction & support Market Equation update. Update Investment, Cost & Program Agreements as required. Long Lead funding approval.,UN Commercial Program Agreements (CPA) Signed,27 months before LEA Job#1,Design Completion -,PTC,PA,Complete designs with LEA for & Final Data Judgment: UN B3 suppliers supply parts and analysis for M1 prototype as agreed with LEA. UP B3 Suppliers support UP design, complete virtual verification for all requirements and gain LEA approval. Other Suppliers work with design source to ensure feasibility and cost efficiency. Complete 1st Supplier Engagement Visit.,8 months for Major Program,UN B3 Suppliers support M1 testing as agreed with LEA,B3 Part CAD Update (cont.),B1, B2 & D Suppliers work with Design Source (cont.),27 months before LEA Job#1,1st Supplier Engagement Visit,PTC,PA,8 months for Major Program,Set Quality, Cost, Weight & Function Objectives and secure funding approval: Sign Supplier Commercial Agreements based on high confidence design maturity Conduct Market Acceptance Clinic and finalize Market Equation. Update Investment and Variable Cost and Finalize Affordable Business Structure Complete Final Program Agreements as required.,Set Objectives -,All Commercial Program Agreements (CPA) Signed,27 months befor

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