Ford exec team's visits to suppliers are paying off

David Sedgwick, Crain staff report (AN)

Detroit, Michigan -- Ford Motor Co.'s purchasing operation says special steps aimed at attracting cutting-edge technology from suppliers are getting results.

This year, a team of high-level Ford purchasing and engineering executives is visiting nine key suppliers for daylong reviews of their newest technology. A Ford team generally visits key suppliers every two or three years in an effort dubbed the Executive Business and Technology Review.

When the 2012 European Focus was in development, Continental AG displayed a lane-departure warning system that Ford adopted for the car. Various luxury cars have the feature, but Ford's system is of interest because it's inexpensive enough for compact cars.

A video camera mounted in front of the rearview mirror monitors road markings to ensure the vehicle stays in its lane. The system alerts the driver if the vehicle drifts into another lane by vibrating the steering wheel.

Tony Brown, Ford's group vice president of global purchasing, established the program five years ago to encourage suppliers to show Ford their best products. To speed decision-making, he paired key purchasing executives with their counterparts in Ford engineering.

One such purchasing executive is Birgit Behrendt, Ford's executive director of global programs. Behrendt's job is to ensure that Ford's purchasing operation coordinates with the company's product development unit.

"We were the last to be offered new technology because we struggled to get it out into the market," Behrendt said in an interview with Automotive News. "Suppliers don't make any money developing a product. They only get a return when we put it on a vehicle."

So Ford formed a team of engineers and purchasing executives to visit a different group of key suppliers every year. In addition to Behrendt, key team members include:

• Burt Jordan, executive director of global vehicle and powertrain purchasing
• Joe Bakaj, vice president of global powertrain engineering
• Paul Mascarenas, chief technical officer
• Barb Samardzich, vice president of global product programs
• Raj Nair, vice president of engineering for global product development

Ford's high-powered group "can make an on-the-spot decision" with suppliers, Behrendt said. "Either it's something we want to look at, and please talk to our engineers. Or we might say that frankly it's not for us, so that nobody wastes effort on things that won't be used by Ford."

Primary participants are 102 suppliers in Ford's Aligned Business Framework, a program that steers long-term contracts to key global suppliers.

Ford says its cultivation of suppliers is moving good technology into vehicles. "A lot of what you see on the Focus came from our technology reviews two or three years ago," Behrendt says.

But Ford still has a ways to go. According to the 2011 Henke report, which asks suppliers to rate the purchasing operations of six North American automakers, the suppliers are most willing to share new technology with Toyota and Honda.

On the other hand, Ford scored better than Nissan, General Motors and Chrysler on that survey item.

Although Ford remains midpack on suppliers' willingness to share new technology, Ford's effort to globalise its platforms gives it a powerful lure for suppliers.

High production volumes let Ford and its suppliers cut the cost of innovations. "We are looking at the democratisation of technology," Behrendt said. "We bring it to the volume market."

From Automotive News (A Crain publication)