02 - Supplier Day EU - SC Strategy V3

ZODIAC AIRCRAFT SYSTEMS
Zodiac Aircraft Systems
Supply-Chain Strategy
G.Blandet, VP Purchasing Zodiac Aircraft Systems
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Here’s the bottom line
Here’s the bottom line :
85 % of Zodiac Aircraft Systems’ cost base
is in its supply chain.
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Key Figures of our Supply Chain (Direct Spend FY15 - July)
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Main Purchases Commodities (Direct Spend FY15 - July)
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Zodiac Aircraft Systems Purchasing Organization
CENTER LED GOVERNANCE
Zodiac Aircraft Systems Purchasing Committee
Commodity
strategies and
visibility of
our policy
with Suppliers
Flexibility of
execution
by our
operations
Collaboration
and value
creation with
Suppliers
Management
of Suppliers
Performances
Our organization is established to support the strategy
and optimize our supplier performances
Supported by a clearly defined governance and key enablers
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Gilles Debray
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Purchasing Organization Sep 2015
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Gregory Blandet
Supplier Contract
Lucie Le-Gloanec
Supplier Performance
Miryam Ennamir
Supply Chain Project
Sheyla Prado
Leadbuyers
SPM Experts
Commodity Leaders
Zodiac Fluid
Management
Zodiac Electrical
Systems
Zodiac Cabin & Cockpit
Systems
Zodiac Fuel&Control
Systems
Zodiac Water &
Waste Systems
Zodiac Data Systems
Zodiac Hydraulics
Cédric Pichery
Zodiac Actuation
Systems
Valery Dreano
Zodiac Oxygen
Systems EU
MC IIlunga
Zodiac Fuel & Inerting
Systems
Mathieu Jutigny
Zodiac Water &
Waste Aero Systems
Gil Lenhard
Zodiac On Board
& Testing
Eric Carcanague
Zodiac Fluid
Equipment
Nicolas Pouget
Zodiac Electrical Power
Systems
Valery Dreano
Zodiac Oxygen
Systems US
MB Harper
Zodiac Sensing &
System Management
Eric Mongenie
Zodiac Train Systems
Hans Wörmcke
Zodiac Communication
& Monitoring
Eric Carcanague
Zodiac Aero Duct
Systems
Stephane Meteyer
ZIPS
Eli Liebermann
Zodiac Cockpit &
Lighting Systems
Mathieu Richart
ZAA
John Stuart
Zodiac Cabin Controls
Oliver Schoëps
Zodiac Space
& Stations
Eric Carcanague
ENVIRO Systems
Daniel Wyatt
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Segment Missions
Zodiac Lighting
Solutions
Serena Wiliams
US Committee Members
PPP
Jean-Marc Lemaître
EU Committee Members
Zodiac Aerospace Customers Requirements
Aircraft manufacturers have changed their way of
business selection
•
•
•
•
•
•
•
Worldwide competition
Commitments about costs reduction programs
Criteria based on current industrial performances
Risk-sharing , Self-financing (NRC)
Innovation, technology differentiation
Offset participation
Time to Market effort…
Promises and business reputation are not enough
VOC makes the decision
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Zodiac Aerospace Customers Requirements
EMBRAER
BOEING
AIRBUS
BOMBARDIER
Cost Reduction
Continuous
Partner for
Success
RC Convergence
Scope+
SOFE
OTD
> 95%
>98%
> 99.5%
> 99%
Quality
< 500 ppm
<2000 ppm
50 ppm B787
< 3000 ppm
< 50 defects on
one rolling year
Requirements are increasing
Often targets are higher than those given by Zodiac Aerospace
to its suppliers AT THIS PRESENT TIME
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Zodiac Aerospace Customers Requirements
Aircraft manufacturer industrial organization have changed
• S&OP Management is key
• Manufacturing lead time reduction
• Equipments must to be delivered to FAL
(Final Assembly Line) “just in time”
• No more incoming inspection
• No buffer stocks
• Information flow standardization and forecasting ( Air Supply )
Any Quality or Delay issues are considered
as « crisis » by Customers
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Zodiac Aerospace Customers Requirements
Customers request immediate reactivity
when quality or delay problem occurs.
• Bombardier: Task force
• Airbus: QSR process
More and more involvement of our Customers
in solving quality issues : pressure at all levels
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Zodiac Aerospace Customers Requirements
Analysis made by our
customers showed that main
quality or delay issues
detected on FAL were due to
Tier-2 suppliers
Strong pressure from Customers to Tiers-1 to improve
their supply chain performances.
They charge us with penalties due to delinquent suppliers
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What happens now… Intrusion
Our customers are now requiring
detailed information about suppliers
responsible for poor performances (OTD,
NC, VLD…) and cost drivers also.
At this present time, Zodiac Aircraft Systems policy is to
NOT communicate
to Customers detailed information regarding our suppliers.
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Business position with suppliers regarding our VOC
To maintain the business position, Zodiac
Aerospace must prove to its customers that the
supply-chain process in place gives targeted
results.
Customer satisfaction is our main goal, must be
guaranteed
Suppliers selection is key to support the
business
Suppliers reaching targets and commitments are be more and more awarded
Others are placed in the Desourcing process at the Segment Level,
applicable for all BUs
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Suppliers collaboration with Zodiac Aircraft Systems
Purchasing policy of Zodiac Aircraft Systems
Sustainable and balanced relationship with suppliers. To be
selected, they must meet strict requirements in terms of ethics,
performance, know-how and technological innovations. At the
same time, ZAS supports them as part of an ongoing drive for
improvement and growth.
Suppliers are an integral part of resources and capacities.
ZAS measures the supplier's motivation to support the
development of its strategic activities, from a technological,
quality, logistics and business point of view.
Suppliers selection for competitiveness in terms of cost,
operational excellence and future contribution to our business.
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Suppliers Management and Purchasing Policy
5 levers for action
Suppliers Strategic Segmentation based on compliance with performance
objectives (VOC).
Disengagement of non-performing suppliers
Business Development and Long Term Agreements with the most efficient
suppliers
Introduction of new efficient suppliers, who are able to meet the requirements of
our markets (VOC).
Business ethics : based on honesty, integrity, fairness and protection. The code
is signed by all Group employees
Global management of suppliers at Zodiac Aircraft Systems level
Part of our “Operational Excellence” project started in 2012
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Formula of Supplier Performance is simple
Reduce Costs
Be on Time
Business Protection and
risk mitigation
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Deliver Quality
Keep best
relationship in good
and bad days
Value creation and
business growth consolidation
Performances in the supply chain
Zodiac Aircraft Systems is engaged about
meeting suppliers, explaining why we are
squeezing the supply chain.
Suppliers just can’t say “Hey, sorry we have
nothing to offer but we will get back to see
you soon”. That’s not the way it works.
Very good progress about industrial
performances, and cost reduction because of our
best suppliers are working with us on a partnering
for success basis.
Now, suppliers should take the opportunities
and join us in this path.
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About our Supplier Reduction Program
Reduction of Desourced Suppliers is key for our performances
• Contamination of our global performances
• Waste of time, cost and resources
• Not connected to our strategy
• Outside our Operational Excellence mindset
Between 2013-2014 : 639 suppliers have been Desourced
FY2015 : 654 Suppliers are classified to be Desourced
46% completed in July 2015
Desourcing means more business, growth and opportunities
for our Preferred Suppliers and newcomers
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Business Ethics
Compliance with law is expected, but
ethics goes beyond mere compliance.
The Ethics Code focuses specifically on
business ethics and the exemplary behavior
of employees throughout the Group, in terms
of transparency and loyalty.
Violations of ethics code are elevated to the corporate level for both ZA
and supplier employees and may result in termination of business.
http://www.zodiacaerospace.com/en/ethics-code
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Conclusion
Our operational performance automatically includes
our Suppliers’ performance
Our only choice is to improve – or to leave the door open
to our competitors and to your competitors
Aerospace market context is very favorable – but
also very demanding
It is in your interest to quickly improve your
performances to fully capitalize your current business
with us.
Be a KEY PLAYER in our Supply-Chain,
And not one of the dominos !
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