2017 General Motors Company - Supply Chain Team Project

COST ANALYSIS OF STEEL LOGISTIC NETWORK

The Challenge:
GM was eager to investigate their steel raw material supply chain and analyze the costs involved in steel logistics. The main goal of this project was to provide a steel logistics cost analysis model to examine freight rates for negotiating future supplier freight rates.

The Solution:
The Tauber team performed a cost analysis on current GM-controlled business and then leveraged that information to expand the analysis to the remaining supplier-controlled freight. The team characterized the logistics structure of the steel network and then replicated costs for freight, warehousing, material handling, and management to develop a comprehensive cost model to compare to the supplier freight rates. The model simulates the logistics setup of the supplier and provides a rate per metric ton to compare to the supplier’s rate per metric ton. The team also delivered a user interface of the model for future use to update data and view the new saving analysis.

Read the 2017 General Motors Company - Supply Chain Team Project Executive Summary in the 2017 SPOTLIGHT! book.

Student Team:
Bethany Daniel –EGL (BSE Mechanical Engineering & MSE Industrial and Operations Engineering)
Ruoxi Li–Master of Supply Chain Management

Project Sponsors:
Matt Naef–Global Commodity Manager, Body Commodities (Steel/Aluminum/Paint)
John Robertson–Shop Director, Supply Chain, Global Assembly Warehousing
Brian Watanabe–CT Lead for Non-Fab Aluminum Sheet

Faculty Advisors:
Mariel Lavieri –College of Engineering
Jim Price–Ross School of Business


About Tauber Team Projects:

The 2017 Tauber Team Projects resulted in $575 million in savings according to sponsoring company calculations, an average of $18.5 million per project over 3 years.

Each two to three person Tauber Team consists of graduate engineering, MBA, and/or MSCM students. Along with receiving high-level corporate support from the sponsoring company, each team is advised by a College of Engineering and a Ross School of Business faculty member and overseen by a Tauber Institute Co-Director. The projects begin on-site in May and continue for 14 weeks.  Students present the results of their projects and compete for over $40,000 in scholarships at the U-M Tauber Institute's annual Spotlight! event, held each September in Ann Arbor, Michigan.  Spotlight! provides outstanding opportunities for students and corporate partners to establish relationships while exploring innovations in operations and manufacturing.
 
Access Spotlight! book for project details.
2017 General Motors Company - Supply Chain Team
2017 General Motors Company - Supply Chain