niklas blomqvist - sfkvolvo management system niklas blomqvist 2016-01-21 issuer:58400 niklas...

Volvo management system

Niklas Blomqvist2016-01-21

2016-01-22Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary 1

Volvo management system- journeyQuality Transformation - background

Volvo Management System1. - The offer2. - Problem statement3. - Program/Project approach4. - Phase 1 Key Deliveries5. - Visualisation through a new IT-application6. - Change Management7. - Traceability between Results & Enablers8. - Program Status


Quality transformation


Fulfilling our objectives requires excellence in customer satisfaction

To reach the 2020 objectives

Customer Satisfaction is an

absolute prerequisite

Everything designed around people

New aspired culture

Passion for customers and

cars

Move fast, aim high

Real challenge and respect

The Customer Satisfaction

improvement

will indicate if we have

successfully transformed to the

new company culture

2016-01-22Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary

In 2020 Volvo Cars will …

• … provide cars people want

• … be a lean nimble company

• … have a top tier premium auto brand perception

• … be the employer of choice

Which will lead to:

• … sell over 800,000 vehicles globally

• … top car industry ROIC

4

Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary 5

Business system, Effectiveness and completenessgap assessment and roadmap

Business manage-ment, maturity levels

Volvo Cars level

III

III

Single stable processes

IntegratedBusiness system

• Management system is covering all functions

• Targets, KPIs and strategies are defined holistically

• Vital value flows aredefined and managed

• All employees can see and understand their contribution

Excellence in operationsIV

• Little transparency

• No standardized processes

• Reactive management

• Continuous improvement established in all functions and value flows.

• Consistent implemen-tation of capable and manageable processes

• Sustainable and outstanding operational performance

• Customers and stakeholders expectations are fully met.

• Good isolated solutions in some functional areas exist

• Focus on value flows only in some areas

• Fragmented approach to continuous improvements

Value flow structure

Org. & governance

Strategy & KPIs

Mindset & capabilities

Ad-hoc fire-fighting

VCC2016III

2016-01-22

VCCmid 2014

We have started quality transformation

Quality transformation is the biggest quality-improvement program in the history of Volvo Cars

It is a company wide initiative to raise the quality of the company’s cars and services, both internally and

externally

18 high-priority workstreams encompass everything from product planning to the aftermarket


quality TransformationProgram phase I

example of results since 2011

- improved built quality with 55%- reduced leadtime for problem solving with 65%- reduced warranty spend/unit with 20%- reduced repair/1000 cars with 30%- improved First Time Through in factories with 25-35%- improved satisfaction of vehicle with 10%- reduced Problems Per Hundred cars with 15%- quality certified supplier sites 158


Volvo car group transformation journey

’Quality transformation is the starting point for VMS’


Quality manage-ment maturity levels

III

III

• Customer Knowledge is anchored in all functions

• Customer Satisfaction targets and KPIs are defined holistically

• Increased and definite customer awareness contributes significantly to business performance

IV

• Little transparency

• No standardized processes

• Reactive quality management

• Continuous improvement of Customer Satisfaction established in all processes

• Consistent implementation of capable and manageable quality processes

• Customer Satisfaction and corporate processes are considered as a connected, joint theme

• Customer Satisfaction is rooted in decision making processes

• Good isolated solutions in some functional areas exist

• Focus of quality processes is on technical departments (R&D, Manufacturing, Purchasing)

• Focus on warranty and goodwill costs

Ad-hoc fire fighting

Single stable Quality- processes

The Customer is integrated in our organisation

Excellence inCustomer Satisfaction

Relevance of VMS+-

8


Volvo management system –

The Offer

Volvo Management System

VMS


VMS Value proposition

Volvo Cars value proposition towards its customer is already done in the corporate strategy and the product cycle plan, in defined products and services the coming years.

VMS is positioning its value proposition towards optimising all the efforts and initiatives within Volvo cars towards decided strategies and plans. It means optimise value for customers , employees, owners, CEO and other stakeholders.

This will be done by making the organisation more connected between strategies , processes, results and continuous improvement so that the right decisions will be taken and implemented more efficiently than today. It will also mean a higher degree of transparency as part of a cultural change than today.

It will also give all employees the opportunity to understand their contribution towards Volvo Cars targets, the employee value proposition, through the proposed User Interface.

VMS value proposition is optimising the relationship of value, where Value = Benefits - Cost (cost includes economic risk).[

This means a Volvo Cars with significantly higher profit margin than today.


2016-01-22

“Mind” Alignment

The organizational structure andsystems where people fits,

where performance goals and strategies are clear

“Heart” Alignment

The emotional attachmentof people of all levels to the vision, mission,purpose and values

of the company

The building blocks of VMS

Systematic

Way of Working

The practical way to work to reach the company's

goals and fulfill the objectives

Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary

An interface on the intranet that delivers a human centric system

“Designed around you”

”I understand””I know”

”I recognize”

”I want to””I like it””I agree”

12

EFQM mofel for excellence, reference


“Mind” Alignment

Systematic

Way of Working

“Heart”

Alignment

Definition – Purpose VMS


What Is the Definition of Volvo Management System ?

A management system is a proven framework for managing and continually improving an organization's strategies, processes and results.

What Purpose Does the Volvo Management System Serve ?

� Optimized Profitability, Competitiveness, Globalization, Speed of change, Adaptability, Growth, Technology.

� Helps an organization to achieve goals through a number of strategies, including process optimization, management focus and disciplined management thinking.

� Sets standards for employees & organizations.� Continuously improves the Management system efficiency, thereby the

performance & health in our operations. � Helps direct the culture and Mindset.



Problem statement

Problem statement


Volvo Cars does not have a management system that aligns and supports the organization in managing and controlling the improvements needed to reach the strategic targets and create a healthy organization.

There are no governance structures or procedures in place to prioritize the right business improvement initiatives cross functionally and the KPIs/targets are not always aligned with the overall strategy.

Moreover, the IT tool that is currently used does not fulfill the needs of finding the information that is required to secure that all the units and individuals do what is expected to reach the targets.

16

Business Planning without Real Deployment

Financial Planning

Top Management’s

Vision, Mission &

Overall Goals

Financial Business

Planning

Unit Goals & Planning

Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary 172016-01-22

Diagnostic analysis of Volvo Cars Management System (RADAR-approach, 2011)

0

20

40

60

80

100

Internal operations customer defined

1 Customers expectation known

2

Link approaches and results

3

Own performance measurement

4

Supporting strategy5

Integrity of data6

Process/procedures/ instructions defined

7

Interfacing processes defined

8

Requirements known9

Roles and competencies known

10

Records listed

11

Accountability appointed

1213

Managing of interfaces

14Training on procedures/ instructions

15Applying of standards/ requirements

16Exchanging way of working

17Value add analysis

18Internal KPIs defined and measured

19

Efficiency of improvement

20Prioritization of improvement

21Standardization of improvement

22Learning from audit and KPIs

Results

ApproachDeployment

Assessment

Refinement

Key strengths

• Description of procedures and instruction

• Examples of holistic mgmt and improvement, e.g., VIDA

• Examples of good thinking, e.g., process roles in R&D, delivery perspective

• Some benefits realised e.g., P2P1

• Framework implemented in different units although partially

• Weak internal customer perspective• Low competence about KPI setting • Inconsistency of framework used for

process quality within operations, e.g., PDS & Process Control Guideline is not mandatory today

• Mixed awareness of procedures/instructions and how this will support Continuous Improvement

Improvement areas

Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary 2016-01-22 18



Program/project approach

VMS project approach


Structure development Implementation and content

• Values, Principles & Terminology• Value flows and processes• Goal deployment process• Continuous Improvement approach• OD framework • Methods & Tools• User interaction and Intranet

Decided structureImplementation planCost and resources

Decided structureImplementation planCost and resources

Strategies

Main objectives

High level processes

Concept dev

KeyInfo

MgmtDoc

StructureProposal

Operational processes

Areas to improve / integrate:

20142013Key Info Mgmt Doc

How we plan to build VMS


Passion for customers and cars

Move fast,aim high

Real challenge and respect

DeploymentGoals & SolutionsRequirementsProblem & Need analysis

Desired Properties(gross list):• "Designed around you"• Right from me• Continuous Improvements• Adding value for customers• Teamwork with involvement• Business, Geographical , Legal requirements• Demand driven flow• Stability through Standardization• Smart & Nimble• Managing with agility• Harnessing creativity & innovation• Creating a sustainable future• Developing organizational capability• Sustaining outstanding results• Succeeding through the talent of people• Leading with Vision, Inspiration & Integrity

Traceability between Results & Enablers

Policy Deployment

Agreed Process Landscape, 3 levels

Holistic prioritization of business improvements

Governance structure

Methods & tools

Capability Assessment

Visualization tool/ User Interface

Failure Modes / Waste

Business Case overall

Management review

Common Vocabulary

VMS Key Blocks:• Objectives & Strategies• Volvo Cars Value Chain • Customer orientation• Improvement work• Assessments• Results• Leadership• Performance Review• Common vocabulary• User Interface

VMS

21

Volvo Management System Program goals

� Create a clear traceability between Results & Enablers

� Create a Policy Deployment process where performance gaps are formulated into actions

� Formulate an agreed corporate Process Landscape with the appropriate number of levels

� Organize Capability Assessment methodology across the developed process landscape� Create a process for Holistic prioritization of business improvements� Create a Governance structure for process orientations and continuous improvements� Adapt efficient Methods & tools for the Management system and its components� Organize Management review on appropriate levels� Assure a Common Vocabulary for the organization� Create a Visualization tool/User Interface that is Designed Around You


VMS Program assignment structure


VMS

Value Chain/ Process orientation

Business Direction & Governance

Knowledge & Education

Methods & ToolsCommunication & Visualization

1a) Corporate Management and Control

7) Develop and Manage Customer Satisfaction

14) Policy & Target Deployment

18a) Implementation & Communication Education VMS

19) Methods & Tools for Process Development & Visualisation

22) IT Communication & Visualisation

P&M Finance

1b) Develop and Manage Business Capabilities

8) Develop and Manage Financial Resources

15) Business Plan / Business-Managament review

18b) Common Vocabulary

20) Guidelines/ Methods for Continouos improvement

Pre-inception VMS IT pre-study

MSS HR

2) Business StrategyValue chain/ Process

9) Develop and Manage Human Capital

16) Business Improvement Priority Model/Governance

21a) Business Process Assessment

Inception Business AnalysisAnalysis of Requriments

Design Legal

3) Product CreationValue chain/ Process

10) Develop and Manage Supplier Relationships

17) Volvo Car Group Decision process and structure

21b) Methods & Tools for Assessments and Audits

Elaboration System Architecture Accessibility

PSVLM China Op

4) Sales to OrderValue chain/ Process

11) Develop and Manage Socity Relationships

Construction Document ManagementUser Views Application Functionality

Q&CS IT

5) Order to DeliveryValue chain/ Process

12) Develop and Manage Information Technology

Transition I Pre launch (pilot testing)

R&D Corporate Com

6) Delivery to RepurchaseValue chain/ process

13) Develop and Manage Enterprise Risk and Corporate Compliance

Transition II Migration from BMSLaunchDecommission BMS

Launch & Deployment

Management System structure

Our task




Phase 1 key deliveries


VMS establishment– step by step, cornerstones

VMS Step 3

Corporate Policy Deployment and follow up routines

Routines for continuous business improvement work(incl Methods & Tools)

Audits & Assessments directive

Communication & Visualization, step 3 (including User Interface and VCC Intranet integration and BMSa phase out)

VMS Step 2

Business Improvement Governance Structure

Business Improvement PrioritizationRoutine

Communication & Visualization, step 2 (including User Interface and VCC Intranet integration and BMSa phase out)

VMS Step 1

Corporate management system structure

BPA established

Communication & Visualization, step 1 (including User Interface and VCC Intranet integration)

BMS / BMSa + Quick Fixes..........June 2013

BMS

BMSa

BMS

BMSa

Note: Steps missing solutions for Vocabulary and Management Review(all in all 10 solutions, 8 listed in the 3 steps)

2016-01-22 26

2016-01-22 27Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary

Corporate ProcessesSVP Product Strategy & Vehicle Line

SVP Quality and Customer Satisfaction

SVP Purchasing & Manufacturing

SVP Marketing, Sales & Customer Service

SVP Quality & Customer Satisfaction

SVP Human Resources

SVP Corporate Communications

VP Car Production

VP Group IT

SVP Purchasing & Manufacturing

SVP Finance

SVP Research & Development

SVP Marketing, Sales & Customer Service

SVP Product Strategy & Vehicle Line

Starts t the audit year 2015

Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary2016-01-22

Reference to Project 8 delivery to repurchase

Strategic

tactical

Operational

Volvo management systemmega processes and sub-levelsIllustrative


1. Mega

2. Main

3. Operations

Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes

Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes x Fishes

MP1 MP2 MP3 MP4 MP5 MP6

Toolbox

- EFQM

- 6Sigma

- BPA

- Templates

MP=Measurement Point

29

Label

Order to Delivery process illustrates VMS depth- Overview

New plants, suppliers and dealers will be incorporated into current Order to Delivery process

Production process

MarketRequirement

Planning

Program & Capacity planning

OrderScheduling

Material ordering

In-house manufacturing

Ordering

Final assembly

Internal supplier manufacturing

External supplier manufacturing

Material distribution

Forecasting process

Final deliveryProduct

distribution

Customization

OTD Process Development

OTD Process Governance

Car delivered to customerOrder

Delivery promise

VC

CD

VC

T

VC

G

Ordering process Distribution process

Material supply chain process


Operation

Main

Mega

30

Quality transformation


vms has started the journey…

3 projects have started under the VMS umbrella

1/ VMS IT-solutions step 1

2/ Methods for Process Development

3/ Establish EFQM education package

VMS

31

The Process Excellence maturity model


Business Capabilities

Bu

sin

ess

Val

ue

Mapping

Current processes defined and broken down to relevant levels.

L1

Customer Needs

Establish process specifications covering both input from suppliers and output to customers. Requirements identified and handshaked.

L2

Measure

Key performance indicators are identified and established.Target limits are set.

L3

Improvement

Improvement potentials are identified, prioritized and executed.

L4

Control

Continuously steer /optimize the process towards targets fulfilment and benchmark best practice.

L5

33Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary 2016-01-22

Result- and performance metrics tobe deployed in the enabler structure

Provide Clear deployment of kpi’s and strategies



Visualisation through a new it-application


Vms project, from - to

EFQM model

From-To

Based on

INTERVIEW FINDINGS

PURPOSE OUTDATED INFO STRUCTURE

SEARCHTECHNOLOGY2016-01-22Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary 36

VMS – Designed Around YouTailored to your positionIntuitive navigationPush alerts


sdsfsdf

This is THE NEW BMS

Improving the business management system – Graduate Program – May 2012

VMS


Designed around you @ work

MY JOB Guided tourTRAINING

Search this site…

Advanced

StartStartStartStart

News feeds

Feb 10 Newsletter from Dir

Feb 5 Vision and Mission

Jan 31 New VMS roled out

Support

Faq

Recent documents

TSU – investments

Job description

Product cost process

2

Add/removeAdd/remove

Atcheba, Louiza (L..)

Here you add and remove boxes

Corporate documents

What we do

Corporate documents


10/1/2015 41VMS Town Hall Meeting 16w03 ; B Kéden/ao; Security class; Proprietary

Process

Process

Process

Process

Process Process

Process

Process Process Process

Supplier Input Process Output Customer

xxxx

xxxx

xxxx

xxxx

xxxx

Process zz

Strategic / Tactical

xxxx

xxxx

Process xy

Role xy

Role zz

Function

xxx

High level Process Maps – visualization ideaThe Visual Process Factory

ProcessStrategy / Tactical

Strategy / Tactical

SIPOCOwnershipAuthority'sOwnershipAuthority's

R&R&RPerformance

/KPI’sPerformance

/KPI’sValue flow

Quality Assurance

Quality Assurance

Lead TimeImprovements

RqRequirements info in inputs / outputsxxxx Navigation logic in and out



chANGE MANAGEMENT


VMS is…

..affecting everyone in the company

..facilitating everybody's daily work

..a framework for managing and continually improving our organization's policies, procedures and processes

..making it possible for me to understand how I contribute to the company objectives

VMS is not…

..an IT-application

..an archive for instructions and role descriptions

..a system handled by “someone else”

The VMS JOURNEY has already started…

From To

Functional Cross functional

Happenings Continuous improvement

Isolated decisions Strategic alignment

Short term Long term

Product Customer & Product

Line organization Process

Reactive Proactive


HR PerformanceManagement

People StrategyHR

Transformation


Dependencies to change management programs - to be coordinated and controlled

VCMS

”P&M 2020”

PD202020

VCC Intranet3.0

The Volvo Way

Smart & Nimble

OrganisationalHealth Team

QualityTransformation

VCCS Lean

Designed Around You

IT Strategy

One Finance

VMSOrganisation & Governance

45

CMQFas II



TRACEABILITY BETWEEN RESULTS & ENABLERS

Efqm reference model for excellence


What are the Key Enablers to reach PD202020 target?

???

???

???

What are the key strategies that drive us in the

correct direction

The ability of an organisationto align, execute and renewitself to sustain exceptional

performance over time

???

Performance

What an enterprise delivers to stakeholders in financial and

operational terms

Ex.20 Months Lead time

Health

Input to Top level KPI mapping to EFQM model “5X list”

People ResultPerceptions-Overall Employee Engagement-Internal Employee Attractiveness-Diversity Index-Overall Leadership Index-Career Development

Business Result

Customer Results

Scociety Results

Results

2016-01-22

Performance Indicators-Lost Time Case Rate-Health Presence-Attrition rate per Year-High Potential Retention

Perceptions-Vehicle Satisfaction-Service Satisfaction -Sales Satisfaction -Intended Loyalty

Performance Indicators-Total Attribute Fulfilment-Delivery Precision

Perceptions-Brand Opinion Rank-Customer of Choice-Total Awareness Ration-Relevance as Brand -Luxury Attractor Index-External Perception

Performance Indicators-Strategic Partners

Business Outcomes-Volume per Nameplate-Volumes Cars (retail deliv)-Market Share-VCC Served Segm Share-Contribution Margin-Operating Cash Flow-EBIT (% of net revenue)-Operating EBIT (MSEK)-Turnover Cust. Service-Gross Marg Per -Nameplate-Breakeven Volume-P&A Operating EBIT-Operating EBIT (% of Re-invest)

Business Perf Indicators-Opinion/Consideration-Productivity Improvement-Material Cost Reduction-FTT (VCT/VCG)-Pricing Net Discounts-Price Deviation-Number of Innovation Projects-Invested Capital (BSEK) -Labour and Overhead-Labour and Overhead Effic-Total Headcount--Pricing Total Fixed Cost-Share of portf with Major LC -Share of portf at 7 years LC-Footprint Utilization (Mfg)-Warranty Cost per Unit


Provide Cars people want…

… sell over 800,000 vehicles globally

… deliver a top car industry Return on Invested Capital

… have a top tier luxury auto brand perception

… be the employer of choice

48



PROGRAM STATUS

2016-01-22 Issuer:58400 Niklas Blomqvist,nblomqvi Security Class: Proprietary 50

process Landscape

Process Process Owner Process Operating Manager

1) Strategy and Target Deployment Magnus Hellsten Christer Nord

2) Business Capabilities Magnus Hellsten Åke Ljungdahl

3) Product Development Peter Mertens Ekkehart Schwarz

4) Sales To Order Björn Annwall

5) Order To Delivery Lars Wrebo Cecilia Carlsson

6) Delivery To Repurchase Björn Annwall Christopher Dauerer

7) Customer Satisfaction Magnus Hellsten Åke Ljungdahl

8) Financial Performance Hans Oscarsson Anna-Kerstin Gustafsson

9) People, Organisation and Facilities Paul Welander Christer Kylén

10) Procurement Lars Wrebo Andreas Olsson

11) Communications Jonathan Goodman Anna Vilhelmsson

12) Information Technology Klas Bendrik Bo Lindberg

13) Environmental Performance Lars Wrebo Sammy Tanhua

Process Governance


Executive Summary - Summary Dash Board


Weeks 50 9 20 23 25 27 34 36 38 40 43 45 47 49 51

Resp G4 R G TBD FTT

Summary RED 2 2 6 6 5 6 6 7 8 5 4 3 5 4 3

Summary GREEN 2 3 15 17 18 16 17 15 14 16 17 18 17 18 19

Summary TBD 0 0 1 1 1 2 2 2 2 2 1 1 0 0 0

A0 Process Coordination J Öster G G G G G G G G G G G G G 0 13 0 100%

A1 Strategy and Target deployment C Nord G G G G G G G G 0 8 0 100%

A1 Corporate Strategy R R R G G na na na na na na na na

A2 Management and Control R R R G G na na na na na na na na

A3 Business Capabilities Å Ljungdahl G G G G G G G G G G G G G 0 13 0 100%

A4 Product Development J Edman G G G G G R R R G G G G G 3 10 0 77%

A5 Marketing, Sales to Order Pim de Ruigh G G G R R R R R R R R R R 10 3 0 23%

A6 Order to Delivery C Carlsson R R R G G G G G G G G G G 3 10 0 77%

A7 Delivery to Repurchase Jerry Nilsson G G G G G G G G G G G G G 0 13 0 100%

A8 Customer Satisfaction AM Sameus G G G G G G G R R R R R R 6 7 0 54%

A9 Financial Resources P Elfvelin G G G G G G G G G G G G G 0 13 0 100%

A10 People, Org. and facilities U Bokinge G G G G G R R G G G G G G 2 11 0 85%

A11 Procurement K Ek Blohm G G G G G G G G G G G G G 0 13 0 100%

A12 Comunications A Wilhemsson G G G R R R R R R R R R G 9 4 0 31%

A13 Information Technology Bo Lindberg R R R R R R R G G G G G G 7 6 0 46%

A14 Environmental Performance S Boyagi G G G R R R G G G G G G G 3 10 0 77%

B1 Strategy and Target deployment C Nord G R R G G G G G G G G G G G 2 12 0 86%

B2 Financial steering model M Liljeqvist G G G G G G G G G G G G G 0 13 0 100%

B3 Bus Improv. Model R R TBD TBD TBD TBD TBD na na na na na

B4 Decision process and structure tbd TBD TBD TBD TBD TBD TBD TBD TBD TBD R G G 1 2 9 67%

C0 Program Change Management H Bou Naaman R G R G G G R R R 5 4 0 44%

Old - Knowledge G G G G G R R G R na na na na na na 3 6 0 67%

D1 Improvement Methodologies A Ortmon G G G G G G G G G G G G G G G 0 15 0 100%

D2 Assessments and Audits J Lidman G G G G G G G G G G G G G 0 13 0 100%

D3 Process Dev. & Visualisation B Kedén R R tbd G G G G R G R R G G G G 5 9 1 64%

E1 VITS - VMS IT Solution P Dungården R R R G G R G G R G G G G G G 5 10 0 67%

72 222 15 76%

D. Methods & Tools

E. VITS - VMS IT Solution

A.Value Chain/ Process orientation

B. Business Direction & Governance

Projects

C. Knowledge & Education

Volvo Management SystemVMS Program Process Excellence Dashboard


niklas blomqvist - sfkvolvo management system niklas blomqvist 2016-01-21 issuer:58400 niklas...

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