Large Original Equipment Manufacturers Research Articles

NDT for qualification of space hardware made by additive manufacturing

X-Ray Computed Tomography (CT) has been established as the preferable NonDestructive Testing (NDT) method to detect inner defects in Metal Additive Manufactured (MAM) parts such as porosity, inclusions, lack of fusion, etc. Moreover, the usage of this manufacturing technology has grown in the aerospace sector due to the establishment of quality standards and the current maturity of the manufacturing systems, processing route and means of inspection. For instance, the European Cooperation for Space Standardization has developed a specific standard (coordinated by the European Space Agency – ESA) for AM quality assurance, processing, and requirements in space applications (ECSS-Q-ST-70-80C) indicating that CT inspections shall be carried out especially for critical structural and functional components. Similarly, large OEMs (Original Equipment Manufacturers) have developed their own standards considering CT as a mandatory NDT method in critical parts, but also other techniques such as Penetrant Testing (PT), Digital Radiography (DR) or visual inspection (VI) are also considered necessary to assure the quality of the components. This works presents diverse applications examples of different NDTs for hardware qualification: Titanium brackets for CHEOPS space missions; Aluminium helix antenna for PROBA3; Aluminium brackets for JUpiter ICy moons Explorer mission (JUICE), the last; or other aeronautic components like Aluminium fairings for the Clean Sky 2 IADP demonstrator, and structural Titanium flap fittings of the RACER helicopter. The aforementioned cases will be analysed not only from the execution of the inspection, but also from the application of different standards and requirements, specifically developed for AM or adapted to this novel manufacturing technology.

Start-up collaboration units as knowledge brokers in Corporate Innovation Ecosystems: A study in the automotive industry

Start-up collaboration units (SCUs) are organizational units specifically created by large companies to facilitate collaboration with start-ups within their corporate innovation ecosystems (CIEs). The purpose of this study is to analyze the role of SCUs with reference to the transfer of knowledge between start-ups and large companies in collaborative innovation projects. An embedded case study was undertaken with three large original equipment manufacturers (OEMs) in the automotive sector. Interviews were conducted with managers of the three OEMs, of the intermediaries they collaborate with, and of the start-ups involved. Data were systematically coded and analyzed. The main barriers to knowledge exchange in partnerships between large companies and start-ups were identified, i.e. mismatches in the interpretation of knowledge and mismatches in the expectations of the partners. In addition, strategies have been identified that can be used by SCUs to facilitate knowledge flows, namely building networks, integrating communication, knowledge elicitation, orchestrating dialog, thinking outside the box, and increasing agility. This study is one of the first to focus on SCUs. It contributes to understanding collaborative innovation processes involving start-ups by studying the knowledge-broker role played by SCUs in the complex network of actors (large companies, start-ups, innovation intermediaries, public institutions) that make up a CIE.

Boundary spanning in multiple supplier development initiatives: an exploratory study

PurposeBoundary spanners link their internal organization with its external environment. In the present research, the authors study supply managers who build a bridge between a large original equipment manufacturer (OEM) and its network of suppliers. The purpose of this paper is to explore how boundary spanners mediate between internal (buyer) and external (supplier) managers in supplier development (SD) initiatives.Design/methodology/approachThis paper adopts a qualitative case method to study an OEM pursuing multiple SD initiatives with multiple suppliers simultaneously. Data consist of interviews and non-participant observations conducted over a period of 14 months.FindingsThe findings of this paper highlight the mediation tasks that emerge at the organizational interface in advanced SD undertakings. Based on the analysis, this paper demonstrates how the nature of three core boundary-spanning activities, information mediation, reaching compromises and strategic communication, differ in four general SD conditions.Research limitations/implicationsThe present paper advances the understanding of individual-level buyer–supplier tensions in SD. It makes a theoretical contribution that sits in the intersection between boundary spanning and SD.Practical implicationsThis paper increases managers’ knowledge of a range of required SD mediation activities and provides an overview of where they unfold.Originality/valueThis paper breaks new ground by creating knowledge that extends beyond four dominant trends in SD research: SD as organizational-level behavior, SD as a generic set of activities, SD as a single performance improvement area and SD as a dyadic management task.

A Multiple Badge Architectures Open Source RFID Reader with Insight Regarding Room Occupants

The preferred architecture and the source company for radio frequency identification (RFID) badge access cards can vary over time within the same company, depending on what management may envision for the future of working. Additionally, the preferred badge architecture and the company that makes those badges can vary from company to company, and from original equipment manufacturer (OEM) to their supplier partners. These circumstances create some inefficiencies amongst the workforce. Within the same engineering campus of a large OEM, many employees may still have the old key ring style badge, but some of the new RFID device readers may no longer accept this outdated badge architecture, which means these employees may not have access to certain areas until they get their new smart badge ID card. This makes doing their job much more difficult, potentially forcing them to find new ways to access the room or area that they need. Additionally, due to differences in badge architecture, an OEM’s supplier partners do not have access to areas of the OEM’s testing site or offices, even ones in which the OEM would prefer that they have permission to access in order to increase work efficiency (including test tracks and special laboratories). This paper presents a new open sourced RFID card reader which is designed, tested and implemented to read both of the most popular badge architectures (key ring badges and smart cards). The new proposed system also includes a unique function which shows the employee more information about the occupants inside of the room that they are trying to access. After reflecting on the state-of-the-art, the main selling point of the proposed system is that it recognizes multiple different badge architectures, and it doesn’t require the end user to source their RFID devices from a certain company. It provides other benefits including allowing suppliers and OEMs to seamlessly share collaborative spaces, and ensuring older versions of badges don’t become obsolete.

The Eastern European Automotive Industry in a Post-Pandemic World: What Drives Performance?

The automotive industry is one of the key drivers of economic growth in countries in Central and South-Eastern Europe, with contributions of up to 15% of gross domestic product. At the same time, the automotive industry is at the heart of key transformations: new technologies on the horizon at the verge of the global “green deal”; supply chain uncertainties because of the effects of pandemics in Asia; and unpredictable demand side factors ranging from purchasing power to consumer preferences. These aspects, coupled with large, fixed investments and costly distribution channels, put the industry at the core of (radical) change initiatives. Ahead of these changes, our paper investigated the presence of firm, industry, and country effects on the profitability of firms in the automotive industry in Central, Eastern and South-Eastern European countries, considering different industry definitions and firm size. We found that firm effects are significant for profitability variation across companies, but differ in intensity based on the size of the company, which signals that firm size matters significantly as a driver of operational profitability, as it is converted into sustained competitive advantages. While industry effects bear very little significance for profitability variation in the automotive industry, our most surprising finding was that country effects are important for profitability and have more of an impact for smaller companies. This may be the consequence of “historical” factors that led to large Original Equipment Manufacturers setting up their manufacturing facilities in the region, but also of specific economic policies in the form of state aid addressed to the automotive industry.
 Keywords: automotive industry, profitability, Central and South-Eastern Europe, variance components, industry effects, country effects

Valuation and pricing of software licenses to support supplier–buyer negotiations: A case study in the automotive industry

Licensed standard software can be replicated millions of times at near zero cost for the supplier and poses immense challenges for purchasing and cost managers. A model is introduced to evaluate the appropriateness of software prices and thus to support the negotiation and decision process regarding suppliers. The model determines the “value to customer” of a software product using conjoint analysis and converts that value into a theoretical license price. In a case study coming from a large Original Equipment Manufacturer (OEM) it is shown that the developed conjoint model can successfully be used in practice and suggests realistic purchase prices.

A machine learning approach to estimate product costs in the early product design phase: a use case from the automotive industry

The management and controlling of product costs play an important role in the early stages of value creation, since 70 - 80 % final product costs are determined in product development and design processes. Traditionally, the focus in business practice is often on the organizational controlling unit that records the corresponding costs when they occur. In those, later phases of the product lifecycle, the possibilities of exerting influence are very limited. Consequently, an accurate estimation of costs in the early design phase is an important instrument to support strategic decisions in the product engineering process. An intelligent approach based on machine learning to support cost management in the early design stage is presented. In a real-world case study using wheel cost data from a large original equipment manufacturer (OEM) we investigate the performance of a cross-validated machine learning framework using a greedy sequential forward feature selection method for dimensionality reduction, as well as grid search hyperparameter tuning in order to compare six regression algorithms. The results of the study show that it is possible to predict the costs of product components in the early design phase with an R2 of 0.960 using only seven features coming from the product design and development department. By a cluster analysis and scatter plots of prediction accuracies it is shown where the deviations in cost estimation come from. The study supports the statement that machine learning models are a promising instrument for product managers and cost engineers.

Digital transformation of TSG from a B2B to a B2C company

Learning outcomes The main objective of this marketing strategy case is to understand why and how a firm should evaluate and rework its own business to stay competitive and aligned with external market forces. Case overview/synopsis Technical Solutions Group (TSG), was the India-based technical support division of Quatrro Global Services and focused on providing support to customers of large Original Equipment Manufacturers (OEMs) and software developers around the globe. Because of the increased competition and structural changes at the customer end, the business was facing flattened revenue growth and a drop in margins. TSG had to make strategic decisions on how to continue the business, either within the current paradigm of being a business to business business or transforming into a business to consumer business leveraging digital technology. Complexity academic level This case can be used in an undergraduate (upper level) or graduate-level course on marketing strategy, digital strategy or strategic management. Supplementary materials Teaching Notes are available for educators only. Subject code CSS 11: Strategy.

On a method to improve your service BOMs within spare parts management

For advanced capital goods with high system availability requirements, it is common that all customers have service contracts with the Original Equipment Manufacturer (OEM). These service contracts include service level agreements on spare parts supply. The OEM operates a service network to support these logistic contracts. To determine spare parts stock levels the OEM needs to forecast spare parts demand. An important input for this forecast is the service Bill Of Material (BOM) per installed machine in the field, which specifies the applicable spare parts for a machine, and is usually derived from the machine configuration. Because of a growing installed base, increasing machine complexity, and an increasing number of machine variants, companies face a challenge in defining and maintaining machine configurations, which is why the service BOM is not always in line with the actual installed machine. An incorrect service BOM results in either a too low or a too high forecast for spare parts demand, and will result in under- or overstock.In this paper we study the service BOMs at ASML, a large OEM in the semiconductor industry. We develop a method to generate alerts for possible errors. This method builds on multiple sources of machine information. Our method was tested in a pilot study, and found to be very effective. 95% of the generated alerts were correctly triggered and did result in actions that improved the service BOM. As a result, the method has been implemented by ASML. By this method, ASML reduced spare part non-availabilities by approximately 4–5 percent per year.

RFM customer analysis for product-oriented services and service business development: an interventionist case study of two machinery manufacturers

This study examines how original equipment manufacturers (OEMs) can segment their product-oriented services customers with the help of a recency, frequency, and monetary value (RFM) analysis of service consumption. The study is an interventionist case study that uses two large OEMs as case companies, both seeking profitable growth in the area of services. The originality of the paper is threefold. First, the research extends the RFM analysis using four product-support-service-specific variables, and it outlines the similarities and differences between the industrial service and consumer business contexts when using the RFM analysis. Second, by applying and modifying the RFM model to better suit the product-support-service context, the study contributes to the literature on the governance of product-oriented services in manufacturing. Third, the paper contributes to the literature on management accounting supporting service business development, by introducing a method that can use installed base and customer information to measure, analyze and govern the business potential of an industrial machinery “fleet”. In all, the paper is particularly helpful for service management and accounting academics and practitioners who wish to understand product-oriented service governance in environments in which there is a vast installed base of products at the customers, with remarkable potential for extending service business.

Organizing for servitization: examining front- and back-end design configurations

PurposeResearch suggests that to structure for servitization, organizations should separate their front- and back-end units by reference to high vs low contact activities. However, these prescriptions are overly simplistic and largely based on anecdotal evidence that fails to account for context. The purpose of this paper is to explore the design decisions taken by organizations in support of servitization.Design/methodology/approachA large-scale exploratory case study was conducted, consisting of embedded cases in three divisions of a UK-based, global manufacturing firm.FindingsEach division provided different combinations of offerings (i.e. product-, use- and result-oriented). The findings suggest that front-end/back-end configurations differ according to the offering and can exist concurrently within the same organization, challenging the assumption that different configurations within an organization are not possible. The findings show that underlying contextual factors, such as the complexity and temporality of the offering, as well as the power of the customer, have implications for the structuring of servitizing organizations.Research limitations/implicationsThis is a context-specific, qualitative case study conducted within a large original equipment manufacturer, yet the findings are analytically generalized.Originality/valueIn identifying the relevance of different design decisions in terms of customer contact, decoupling of activities and grouping of employees, the findings challenge the extant view that organizations simply split activities between the front- and back-end functions. The research identifies an additional design configuration – integrated project teams – involving a dominant customer dictating organizational interfaces. This research exposes the need for further investigation into how to organize for servitization in project-based contexts.

Critical success factors in ERP implementation in Indian manufacturing enterprises: an exploratory analysis

Enterprise resource planning (ERP) implementation projects involve complex processes which influence operations and performance of companies. It is essential to identify critical success factors (CSFs) of ERP implementation projects out of several contributing factors. In most large original equipment manufacturer (OEM) organisations, ERP systems have replaced legacy information systems with integrated and maintainable software. In an attempt to understand what the CSFs are, why they are critical, and to what extent they are relevant to such OEM organisations this paper explores the existing literature empirically to research the CSFs that lead to the success of ERP, which is our basic objective. We conducted exploratory factor analysis (EFA) in the context of ERP implementation in large manufacturing organisation. The findings of the results provide valuable insights for the researchers, practitioners and managers interested in adopting ERP systems in similar environments, which is also an objective of our research.

A fog computing-based framework for process monitoring and prognosis in cyber-manufacturing

Small- and medium-sized manufacturers, as well as large original equipment manufacturers (OEMs), have faced an increasing need for the development of intelligent manufacturing machines with affordable sensing technologies and data-driven intelligence. Existing monitoring systems and prognostics approaches are not capable of collecting the large volumes of real-time data or building large-scale predictive models that are essential to achieving significant advances in cyber-manufacturing. The objective of this paper is to introduce a new computational framework that enables remote real-time sensing, monitoring, and scalable high performance computing for diagnosis and prognosis. This framework utilizes wireless sensor networks, cloud computing, and machine learning. A proof-of-concept prototype is developed to demonstrate how the framework can enable manufacturers to monitor machine health conditions and generate predictive analytics. Experimental results are provided to demonstrate capabilities and utility of the framework such as how vibrations and energy consumption of pumps in a power plant and CNC machines in a factory floor can be monitored using a wireless sensor network. In addition, a machine learning algorithm, implemented on a public cloud, is used to predict tool wear in milling operations.

Should an OEM Retain Component Procurement when the CM Produces Competing Products?

We consider a large original equipment manufacturer (OEM) who relies on a contract manufacturer (CM) to produce her product. In addition to the OEM's product, the CM also produces for a smaller OEM. Both the larger OEM and the CM can purchase the component from the supplier, but their purchase prices may differ and remain unknown to each other. The main question we address is whether the larger OEM should retain component procurement by purchasing components from the supplier and reselling to the CM (buy–sell), or outsource component procurement by letting the CM purchase directly from the supplier (turnkey). We show that, under buy–sell, the larger OEM's optimal strategy is to resell components at the highest possible component purchase price of the CM (i.e., the street price). By comparing buy–sell and turnkey, we find that a CM with low component price is better off under turnkey, even though under buy–sell he receives more profits through the products sold to the smaller OEM. Furthermore, the larger OEM's preference between buy–sell and turnkey depends on her component price, the volatility of the CM's component price and substitutability between the two products.

A part total cost of ownership model for long life cycle electronic systems

Dedicated part selection and management groups within large original equipment manufacturers are responsible for various tasks involved with managing parts or components used in electronic systems. The tasks range from part adoption to obsolescence management and include numerous assembly and support activities that are performed on a regular basis. Long life cycle electronic systems typically utilise commercial ‘off-the shelf’ parts, which subject them to the same supply chain constraints imposed by a market that is oriented towards short-term, high-volume products. Relevant issues involve a high frequency of part procurement obsolescence, reliability concerns, and the risk of long-term supply-chain disruptions. Unfortunately, initial part selection decisions are often driven by procurement management processes with little or no insight into the total cost of ownership (TCO) of the part's adoption and use within the organisation. The part TCO model proposed in this article enables better informed part selection and management decisions. The article discusses and demonstrates the model's use in Lifetime Buy and Design Reuse case studies for an example surface-mount electronic part. Additionally, the model proposed in this article is well suited for addressing the impacts of part number reduction, retirement of parts from databases, organisational adoption of new parts, sourcing strategies and part-specific long-term supply chain disruptions by influencing initial component selection and providing guidance on what actions taken at the component management level provide the maximum payback (or maximum future cost avoidance).

Information Sharing in Global Supply Chain Alliances

ABSTRACT The post–WWII economic expansion of economies such as Japan, South Korea, Hong Kong, Taiwan, Singapore, and more recently China and India was enabled to a significant degree by the increasingly complex, global supply chain networks of large Original Equipment manufacturers (OEMs) in the United States, European Union, and Japan. By linking buyers and suppliers across countries and industries, supply chain management (SCM) practices have a large impact on the economic fortunes of companies and countries throughout the world. Nowhere has the effect of this mutual interdependence been felt more strongly than between the U.S. companies and the Asia-Pacific market. Although the benefits of SCM are well documented, some evidence suggests that the reality of SCM implementation can create additional pressures for suppliers. We identify key problem areas experienced by suppliers and their link to the type of information shared by buying firms. The problem area experienced by most suppliers relates to issues of dependence in the alliance. Mere information sharing is insufficient for a successful alliance, and more information can be associated with a number of problems. For example, lack of information sharing can be associated with a supplier's perception of the buyer expecting excessive support. However, greater information sharing can be associated with a supplier's perception of the buyer passing on an excessive burden. Sharing of financial information is perceived as intrusive and controlling. These apparent contradictions uncover the complexity of the supply chain alliance. The moderating factors appear to be open communication and joint sharing of problem solving procedures—factors identified by suppliers that define a world-class buyer.

Avoiding Over-Reliance on a Single Large Customer: The Impact of Technical Capability, Product Development and Alternative Key Customers

ABSTRACT This study examines three investments that component suppliers can make to circumvent their large customers' ability to achieve significant power advantages. A large scale survey of component suppliers was conducted approximately 12 to 24 months after Original Equipment Manufacturers (OEMs) began flexing their increased purchasing power to demand price reductions and costly design services. The results show that suppliers' technical capability, suppliers' efforts to develop segment-focused products, and supplier investments to build relationships with alternative key customers lessened their large customers'power advantage. The urgency of balancing relationships with large OEMs is illustrated with the finding that customers'power advantage has a strong negative influence on the suppliers'forecast ofc their own performance. In contrast, no relationship between forecasted performance and the level of interdependence between large OEMs and their suppliers was found. The rapid increase of customer power across a broad range of industries has placed many companies in situations similar to the component suppliers investigated in this study. Thus, the outcomes of these suppliers'investments should be of interest to a large audience of managers. The theory used to frame and examine this important managerial situation provides a vantage point that complements the work done by other researchers.