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Research Thesis


Supply Chain Disruptions & A Case
Study of Automotive Assembler


Pallav Vikash Chatterjee
Executive Summary
Indian automotive industry is at an inflection point, with experts estimate it to
cross 10 million units annually and become world’s third largest automobile
producer. However with this growth risk management in supply chain context
is important consideration for the strategic planners for an automotive
industry player. With advancement of technologies, foreign OEMs entering the
country, cost, continuity & quality concerns force the OEMs globalize their
sourcing process and engages variety of services in their supply chain
functions. With increasing geographic diversities, complex information,
complex material flow & complex payment flow lines and critically important
and technologically critical components the risk has increased multi-folds.
Recent examples of labour strike disruptions with commodities suppliers
resulting to mounting losses for OEMs or the earthquake in Japan disrupting
the global operations of automotive majors exemplify the need of robust
Supply Chain Risk Management policies & practices to be adopted by
automotive players.

In this study it is proposed to discuss and gather feedback from industry
practitioners on current state of risk management practices, their perceptions
about continuity planning and the threats of risks that they perceive. Further
we propose to conduct a detailed review of research literature from journals
and publications on the subject of business continuity planning and supply
chain risk management. Further, we propose to study a context of risk
management issue of an automotive assembler and try to apply the learnings
from the rich sources of academic literature.
Table of Contents
Chapter / Section                                            Page No.
Acknowledgement                                                    2
Executive Summary                                                  3
Chapter 1. Indian Automotive Industry: Background                  7
      Industry                                                     7
      Growing global linkages                                      7
      Government Role                                              8
      Global scenario                                              9
      Supply chain structure                                       9
      Conclusion                                                   10
Chapter 2. Supply Chain Disruptions: Automobile Industry           12
Chapter 3. Exploratory Factors of Crisis in India                  14
      Generic Risks                                                14
      Pricing Risks                                                14
      Specification Risks                                          17
      Lead Time Risks                                              18
      Quality Risks                                                19
      Factors of risks                                             20
Chapter 4. Supply Chain Risk Management: Literature Review         23
Chapter 5. Risk Management Practices                               30
Chapter 6. Framework of Risk Analysis                              36
Chapter 7. Case Study – After-Market Spare Parts Business          37
      SAP-LAP synthesis                                            40
      Prevalent Situation                                          40
      Main Actors                                                  41
      Processes                                                    42
      Learning Issues                                              43
      Suggested Actions                                            44
      Expected Performance                                         45
      Self Interaction Matrices                                    46
      Assessment Matrices                                          49
      Cross Interaction Matrices                                   50
      SAP-LAP Interpretations                                      55
      Force-Field Analysis                                         58
      Strategic Options                                            59
Chapter 8. Conclusions                                             60
Bibliography   64

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Supply Chain Disruption Study In Automotive Context

  • 1. Research Thesis Supply Chain Disruptions & A Case Study of Automotive Assembler Pallav Vikash Chatterjee
  • 2. Executive Summary Indian automotive industry is at an inflection point, with experts estimate it to cross 10 million units annually and become world’s third largest automobile producer. However with this growth risk management in supply chain context is important consideration for the strategic planners for an automotive industry player. With advancement of technologies, foreign OEMs entering the country, cost, continuity & quality concerns force the OEMs globalize their sourcing process and engages variety of services in their supply chain functions. With increasing geographic diversities, complex information, complex material flow & complex payment flow lines and critically important and technologically critical components the risk has increased multi-folds. Recent examples of labour strike disruptions with commodities suppliers resulting to mounting losses for OEMs or the earthquake in Japan disrupting the global operations of automotive majors exemplify the need of robust Supply Chain Risk Management policies & practices to be adopted by automotive players. In this study it is proposed to discuss and gather feedback from industry practitioners on current state of risk management practices, their perceptions about continuity planning and the threats of risks that they perceive. Further we propose to conduct a detailed review of research literature from journals and publications on the subject of business continuity planning and supply chain risk management. Further, we propose to study a context of risk management issue of an automotive assembler and try to apply the learnings from the rich sources of academic literature.
  • 3. Table of Contents Chapter / Section Page No. Acknowledgement 2 Executive Summary 3 Chapter 1. Indian Automotive Industry: Background 7 Industry 7 Growing global linkages 7 Government Role 8 Global scenario 9 Supply chain structure 9 Conclusion 10 Chapter 2. Supply Chain Disruptions: Automobile Industry 12 Chapter 3. Exploratory Factors of Crisis in India 14 Generic Risks 14 Pricing Risks 14 Specification Risks 17 Lead Time Risks 18 Quality Risks 19 Factors of risks 20 Chapter 4. Supply Chain Risk Management: Literature Review 23 Chapter 5. Risk Management Practices 30 Chapter 6. Framework of Risk Analysis 36 Chapter 7. Case Study – After-Market Spare Parts Business 37 SAP-LAP synthesis 40 Prevalent Situation 40 Main Actors 41 Processes 42 Learning Issues 43 Suggested Actions 44 Expected Performance 45 Self Interaction Matrices 46 Assessment Matrices 49 Cross Interaction Matrices 50 SAP-LAP Interpretations 55 Force-Field Analysis 58 Strategic Options 59 Chapter 8. Conclusions 60