IN FOCUS
How Automation is Revolutionizing Automotive Supplier Sales:
12 Key Areas for Greater Efficiency and Error-Free Processes
"If you have "no budget" today, you have to digitize and automate your processes. Avoiding errors in price management is a side effect that often has an even greater impact than simply increasing efficiency."
Erik Reiter
25 years in automotive supplier management (sales -> CEO); sales consultant for strategy and processes; co-founder of Digital Automotive
(1) Importing changes or RfQ data from PLM systems
Technical changes or requirements can be imported directly from Product Lifecycle Management (PLM) systems. PLM systems often generate part numbers and bills of materials (BOMs) that can be automatically forwarded to the sales system. This saves valuable time and reduces the error rate.
(2) Current factors, surcharges and raw material indices from controlling and customer negotiations
Automation ensures that the latest factors and surcharges from Controlling are always integrated into the cost calculations. The same applies to pricing, which is often based on factors and surcharges negotiated with the customer. Here it must be ensured that these values correspond to the correct status at all times.
(3) Current exchange rates from the central bank
Current exchange rates are required for several use cases: for conversion in higher-level reports, for the calculation of currency escalation clauses or possible claim potentials. The integration of central bank data ensures that all calculations are based on current exchange rates. Alternatively, exchange rates specified by Controlling can also be integrated directly into the calculations.
(4) Volume data directly from Sales Planning - including ERP (SAP) actual volumes
Automatically imported volume actuals and forecasts from Sales Planning are incorporated into all calculations in change, claim and amortisation management, so that a precise and up-to-date evaluation is guaranteed with every adjustment. Examples of this are deviations between the contract and actual quantities, which lead to corresponding losses (claim potentials!). The same applies to underpayments from part price allocations (amortisation!).
(1) Automated cost and price calculations
All cost components are automatically imported and calculations are carried out based on the latest factors and surcharges. Whether it is an enquiry, a change or a claim, the calculations are always up to date and follow the internal process specifications (compliance!).
(2) Automated price list updates
As soon as a change, a claim, an amortisation or a quicksaving agreement is finally negotiated, the price lists are automatically updated. This saves time, prevents allocations from being forgotten or copying errors from occurring..
(3) Price reduction calculations (LTA/LTC)
Long-term contracts with price reduction clauses (LTA/LTC) often require special calculations, especially if, for example, mandated/ directed parts are to be excluded. Automated processes ensure absolute precision here and prevent costly errors.
(4) Cross-project raw material index changes
For automotive suppliers with price adjustment clauses, annual or intra-year price adjustments involve a great deal of effort. The prices must be adjusted accordingly across all projects. With an automated solution, these values are entered once (per customer) on the key date and thousands of part prices are recalculated.
(5) Profit calculations and warnings
Profit calculations are carried out automatically at every process - be it the RfQ phase, a change or a claim. This can be a time-consuming process of determining the correct basis for calculation, particularly in the case of calculations involving take rates. In a deeply integrated system, these values are simply determined automatically without any manual effort.
If margins fall below certain levels or other deviations occur, warnings can be issued so that countermeasures can be taken in good time.
(1) Automated quotation
Quotation documents are generated automatically and are based on the current prices to be submitted, including price or cost breakdowns (PBDs/CBDs).
(2) Approval workflows
Approvals run automatically through predefined workflows so that approvals are granted more quickly and delays are minimised. Automated approval workflows can ensure compliance with process specifications, particularly in the RfQ phase and in the change management process.
(3) Automated price transfers to SAP and Sales Planning
The final prices can be automatically transferred to the invoicing system (ERP (SAP)) and to the sales planning modules, eliminating the need for manual transfers here too.
(1) Claim Potential Report
Automated reports show damages resulting from contract deviations. This not only visualises the deviation from quantity, exchange rate or material price variances, but also calculates the amount of damage directly.
(2) Open Claims Report
You receive a clear overview of all claims currently being negotiated. Also which claims should be prioritised and where escalation is necessary. Filterable in all dimensions. Created fully automatically, of course.
(3) Open One-Time-Payments (Cash Flow Report)
Open one-time payments are visualized transparently so that you can always keep an eye on your cash flow.
(4) Purchase Order Reports
Automatic reports on purchase orders and open price items prevent price variances that lead to additional work in the accounting department.
(5) Amortization Tracker
This automated report shows which amortisations are still outstanding and how they are developing. The focus here is on overpayments and underpayments. Relevant for claiming outstanding payments or creating provisions.
(6) Acquisition calendars and RfQ overviews (Pipeline)
The acquisition calendar is automatically calculated backwards using the SOP information from the S&P Global Mobility data. Depending on the product, the RfQ start is 18-36 months before SOP. Once the RfQ data has been received, the current acquisition overview of all current requests is created automatically.
(7) Acquisition decision templates
Generated completely automatically, directly from the acquisition process that has already been processed. Automated decision templates not only save creation time, the associated standardisation also guarantees management that all key process steps have been adhered to:
(1) Order Intake Reports
Receive up-to-date reports on incoming orders at any time with customisable filters according to products, customers, regions or specific project attributes.
(2) Claim Performance Reports
Automated reports show the performance of your claims in detail - from the processing time to the success rate.
(3) Change Performance Reports
See in real time how changes affect your profitability and where there is still potential for improvement.
(1) S&P Global Mobility data for the planned volume figures
By integrating S&P Global Mobility Forecasts for vehicles and engines, you can base your planning on precise market data. Of course, a planner must be able to make his own assumptions if there is better market knowledge, e.g. through direct customer information.
(2) SAP (ERP) Actual quantities and call-offs
Current actual quantities from the ERP system are automatically incorporated into sales planning. They serve as the basis for reliable forecasts. The use of actual quantities for automated forecasts is an enormous labour saving, especially for products that have several variants with take rates.
(3) Prices directly from the Sales Management
The price lists from Sales Management are transferred directly to Sales Planning. This is the biggest source of error in Sales Planning. Prices for projects that are in the strategy, acquisition or development phase (not yet in SAP) are often incorrect or out of date and are entered carelessly into huge Excel files.
The price forecast for series business, which is influenced by agreed price reductions (LTA/LTC) or technical changes, is also rarely mapped correctly. The solution: the sales planners receive the current price list, including all future changes, automatically for their sales planning directly from the system. And always with the current status, and therefore in real time.
An enormous gain for efficiency and data quality.
(1) Market growth
Market growth reports based on S&P Global Mobility data can be generated automatically. This is the basis on which each user can then select their individual perspective on the automotive market. With user-friendly filters for regions, customers (OEMs), locations, vehicle classes, BEV, ICE etc.
(2) Portfolio development
A standard report that every automotive supplier wants to see: how the OEM or regional portfolio will develop over the next few years. Easily available for everyone without any effort.
(3) SOP-Countdowns
Which vehicles from which OEM will be launched in 3 years? Where else can I place my products? This is also a standard report that is available without any effort and provides inspiration for future growth.
(4) Market shares
Automated market share calculations are performed automatically on the basis of the booked and strategic projects and the S&P Global Mobility data. And the visualisation also works automatically.
(1) Target project proposals
Potential target vehicles or engines in which you can place your products are suggested directly. This is particularly helpful if too few target projects have been defined for certain SOP years and the plants are at risk of under-utilisation.
(2) Automatic repair of S&P Global Mobility project links
Sales planning experts who work intensively with S&P Global Mobility data know the problem: the built links break if, for example, the program code changes. The result: the S&P volume figures are no longer updated. In some systems, in others the turnover even disappears completely. The solution: A system that automatically repairs broken links. If this is not technically possible, the system should suggest replacements that the user can insert with a single click.
(1) Vehicle and engine volumes (project level):
Intelligent use of S&P Global Mobility data
The automated import of S&P Global Mobility data described above represents a real efficiency gain. It becomes perfect when the sales planner can decide project by project for which projects the updates should be used automatically and where not. If these are to be the basis for volume planning everywhere, the volume planning is already done. And with every update of the S&P figures, a new forecast is created fully automatically.
(2) Comparison of plan, actual, S&P, budget, contracted volumes
A volume planning system should take into account the different perspectives in order to recognize deviations and draw the right conclusions for planning. This includes the automated transfer of contractually agreed quantities from acquisition, the one-click definition of budget quantities and the comparison of your own planning with the S&P quantities.
(3) The part number level: Intelligent take-rate conversion
Sales planners who have to deal with take-rates are familiar with the problem: converting take-rates to part quantities and vice versa, including a derivation to the vehicle quantity using defined reference parts. The description alone shows the complexity that sales planners have to contend with here. A system that solves this problem means real time savings.
(4) Use of actual quantities for the forecast
For projects that are in series production, forecasting individual variants can involve a lot of effort. A system that automatically uses actual quantities for forecasting enables correct forecasts in real time without effort. The option to intervene manually in the event of unusual changes must of course always be possible.
(1) Scenario creation
10% less in China or 5% more volume at BMW globally. How do these assumptions affect our sales development? A simple system that adjusts all affected projects in a simulation with just a few inputs is a huge leap in efficiency when creating scenarios. Budgets (the special form of scenarios) can also be created with a single click.
(2) Scenario visualization with deviation analysis
Sales reports for scenarios can be created completely automatically. The visualization and comparison of different scenarios with each other or with the latest planning status is available at any time without the need for manual effort.
(1) Growth reports
How strongly is your own company growing? And how does the latest information on volumes, prices and orders won affect sales development? Reports that are available at any time in real time create the necessary transparency to make the right decisions. It's brilliant when these are created completely automatically and sales can be visualized in all dimensions (customer, region, product, business unit, plant, etc.) with just one click.
(2) Portfolio reports
Similar to the market analysis portfolios, you naturally want to have the development of the customer, product, region or location portfolio for your own company at the click of a mouse. Without any manual effort, of course.
(3) Plan/actual comparisons
The classic in business analysis: plan/actual comparisons. The budget values saved with one click are compared with the actual values in an automatically generated report.
The actual values are fed from the ERP (SAP) quantities, the current price information from Sales Management and the latest information from the orders won. This is all information that is already available from the respective processes. The trick is to link the data in a deeply integrated system in such a way that automated reports are generated from it.
CONCLUSION
The complete solution for automated and error-free sales processes: Digital Automotive
Automation is not just an option, but a necessity in order to survive in an increasingly complex and competitive market. The automation of sales management and sales planning creates the basis for error-free, efficient processes that enable companies to make optimum use of limited resources while reducing the error rate to a minimum.
However, all these requirements can only be met with the right solution. Digital Automotive offers the only comprehensive platform that combines seamless integrations, automated pricing processes, intelligent project proposals and fully automated performance reports in one solution. With Digital Automotive, manual work is eliminated and all relevant data flows automatically into the necessary processes - from quotation calculation to strategic planning reports.
Automotive suppliers that rely on Digital Automotive not only secure a technological advantage, but also the flexibility and agility needed to remain successful in a fast-moving market.
