IBM in supply chain project for DaimlerChrysler Aust/Pac

Stan Beer
Thursday, 29 September 2005 10:00

IT Industry - Deals

IBM Australia has won a contract with automotive company DaimlerChrysler Australia/Pacific to provide services, software and hardware in a supply chain transformation project.

The project will involve transforming the supply chain processes and spare-parts sales of DaimlerChrysler in Australia and to develop and host a national Web-based portal system to manage spare-parts ordering.

The improved business processes and IT systems will be designed to allow vehicle dealers to order replacement parts for DaimlerChrysler's smart, Mercedes-Benz, Chrysler, Jeep, Freightliner and Sterling vehicles faster, boosting customer service levels, spare-parts sales and delivering supply chain efficiencies.

"Our strategic review with IBM looked at a number of potential initiatives and helped us identify where we needed to enhance our operations. The business case for improving our spare-parts supply chain processes and systems was the strongest because it will enable us to transform our own internal processes and our relationships with our dealers, suppliers and the end-customer," said Ernst H. Lieb, president and CEO of DaimlerChrysler Australia/Pacific.

The review, launched in mid-2004, produced a strategy to improve a range of aftermarket business processes and has seen the company move to develop a national web portal to help dealers order parts for DaimlerChrysler vehicles more easily and transform the company's own internal supply chain processes.

Currently under development by IBM, the portal will be accessible by more than 180 DaimlerChrysler dealerships across Australia as well as DaimlerChrysler's parts distributors, vendors and suppliers. The portal will be hosted and managed by IBM Global Services and is being developed with IBM's WebSphere software on IBM hardware, including IBM eServer xSeries.

By providing a single point of access to multiple DaimlerChrysler spare-parts databases, the aim is for the web portal to simplify the process by which dealers order parts. This is expected to allow dealers to provide customers with the most accurate and up-to-date details about parts specifications and expected delivery dates.

The portal will also include an automated web-based warranty vetting process to speed warranty processing and the ordering of spare-parts. It will include user-friendly interfaces tailored to meet the specific requirements of dealers, suppliers and DaimlerChrysler staff.

"IBM understood our business and had the breadth of capability and size to deliver this strategic project. The portal will ensure that we improve support for our dealers, thereby enhancing our service to customers," said Lieb.

"The new processes will improve the efficiency of ordering parts and increase the competitiveness of approved DaimlerChrysler parts suppliers."

A team of IBM consulting and IT experts around the world are working with DaimlerChrysler's internal IT team to design and build the portal, which is expected to be rolled out in mid 2006.

"IBM's experience in the automotive sector gave us a lot of confidence that they knew our industry and the kind of pressures we face. They bought a truly global team to the table and it's already paid dividends," said Lieb.

Andrew Stevens, managing partner for IBM Business Consulting Services in Australia and New Zealand said: "IBM is assisting DaimlerChrysler with significant improvements to their dealer and supply chain processes. This project has a high level of executive support from both DaimlerChrysler and IBM allowing us to work as strategic partners on this important initiative. IBM is providing a full solution including: strategic consulting, solution design, implementation, software, hardware and application hosting."

Changes to DaimlerChrysler Australia/Pacific's parts supply chain will support spare-parts sales over $100 million per year for the company's smart, Mercedes-Benz, Chrysler and Jeep passenger and four-wheel-drive vehicles as well as a wide range of commercial vehicles, including Freightliner, Sterling and Mercedes-Benz heavy trucks, buses and light commercial vehicles.