Chrysler Group Announces Evolution of Product Creation Process
Chrysler Group Announces Evolution of Product Creation Process
-- "Product Innovation Teams" To Build on Chrysler's Platform Team
Approach
-- Objective is to Create Optimum Balance Between Creativity and
Discipline
-- Positions Company for Improved Quality, Faster Development Times,
Lower Cost
-- Ensures Long-Term Success of the Company
-- Draws on Best Practices Across DaimlerChrysler AG; Provides Potential
to Leverage Links Throughout Entire Organization
AUBURN HILLS, Mich., July 12 The Chrysler Group
today announced a new product creation system intended to more
closely link the major disciplines of the entire organization, while
positioning the company to achieve reduced vehicle development times, improved
quality and sustained profitability.
The new process is based on the formation of Product Innovation Teams,
which tie Product Development (Design and Engineering), Manufacturing,
Procurement & Supply, and Marketing even more closely together at all levels
to create a more holistic vehicle development process.
The new system builds upon the successful platform team approach pioneered
by Chrysler in 1989. This new approach provides greater focus on the "up
front" part of the product creation process, which includes setting the vision
and purpose of every new vehicle. The main difference is that the
organization ensures all major areas are involved in product creation at every
stage, while spreading best practices throughout the entire system.
"This is our new blueprint to more quickly and efficiently develop and
market a complete portfolio of distinctive vehicles under the Chrysler,
Jeep(R) and Dodge brands," said Chrysler Group President and CEO Dieter
Zetsche. "It provides the potential for sustained profitability, while
allowing Chrysler Group to do what it does best: create innovative cars and
trucks that set us apart from the competition. This balanced approach is what
we call 'disciplined pizzazz.'"
The Product Innovation Teams consist of three major initiatives:
-- A Product Strategy Team, which is responsible for the "ideation and
discovery" phase of a new vehicle program. This team of senior-level
officers analyzes customer trends, new design ideas, technological
innovation, the macroeconomic environment and other key strategic
issues even before a business case is made to develop and build a new
vehicle line.
-- Product Teams, which will now be managed under the co-leadership of
Engineering, Manufacturing and Marketing. Evolved from the company's
platform team concept, these teams are renamed, but still divided into
five vehicle groups -- Small Vehicles, Premium Vehicles, Family
Vehicles, Activity Vehicles and Trucks - as well as a Powertrain team
that supports the product teams as before.
-- Component Teams, which assure consistent strategies for innovation,
design excellence and quality, while reducing complexity through more
sharing of components. Component teams ensure a single voice to the
supplier base. Together, they also draw on best practices across
DaimlerChrysler AG, including Mercedes-Benz, and create the potential
to leverage links throughout the entire organization as well as with
the company's alliance partner, Mitsubishi Motors Corp.
These teams all work in concert with the Chrysler Development System
(CDS) , which provides the process for vehicle creation from the vision of the
program all the way through production, using a system of "quality gates" to
assure predetermined objectives are met at every stage.
While the Product Strategy Team and parts of CDS are already in place and
have been supporting the recent new product launches of the 2002 Jeep Liberty
and Dodge Ram, other new elements of the Product Innovation Teams are now
being put in place. Products planned for public introduction as soon as the
2004 model year will realize the full benefit of the Product Innovation Team
initiative announced today.
"This new system becomes an important building block for the success of
the Chrysler Group over the long term, enabling us to better leverage the
synergies with our partners," Zetsche added. "It will help us more clearly
anticipate consumer needs and desires, and turn concepts into reality faster,
while providing a solid financial foundation."
Product Strategy Team Drives Vision, Ideation Phase
Under the realignment, the Product Strategy Team, a small group of top
executives across key areas of the company, will interact with the other teams
to set the definition and parameters of any potential new product. The team
is charged with analyzing a wide range of input, including new marketplace
trends, new design ideas, the latest and most relevant technological
innovations, the macroeconomic environment and other key strategic issues even
before a business case is made to develop a new vehicle.
"Setting the strategy will not be done by committee, but by the top
product people themselves that lead this company," said Zetsche. "This
provides strong creativity in the concept phase, and strong discipline in the
execution phase."
Product Teams Build On Platform Team Approach
While the new product teams are evolved from the platform team concept,
the vehicle groups are now led by a core team comprised of Product Development
(Engineering and Design), Manufacturing and Marketing. Under the previous
system, a senior-level officer was designated to oversee the platform as the
general manager. The new structure places one of the three core team members
as the core team leader.
"This realignment enables us to strike the right balance between market
pull and technology push, as well as balancing requirements between
development, manufacturing and marketing," said Zetsche. "We want to make sure
we nurture the creativity and risk-taking that the Chrysler Group people have
become known for, while driving quality up and costs down, thereby increasing
shareholder value."
Product teams will be divided into areas similar to the previous platform
team structure -- Small Vehicles, Premium Vehicles, Family Vehicles, Activity
Vehicles, Trucks and Powertrain.
"More clearly defining our vehicle lines by these segments provides us the
opportunity to broaden the potential for all of our brands," noted Zetsche.
"For example, Jeep, one of the most revered brands in the industry, could now
expand beyond its traditional scope while still preserving its core values."
Component Teams Balance Value and Innovation
A key element of the Product Innovation Team initiative is the creation of
component teams, charged with maximizing value through innovation and quality
for a specific vehicle area or subsystem, while reducing complexity across all
vehicle lines. Replacing the more informal 'Tech Clubs' used under the
platform team structure, component teams will be divided among the major areas
of a vehicle -- Body, Exterior, Interior, Electrical and Chassis -- and reside
within the product teams.
Each component team will also form an alliance with a designate from
Procurement & Supply, providing the capability to leverage the company's
know-how to achieve the best levels of quality, technology and design while
maximizing cost advantage. They also will facilitate more component sharing
across the vehicle groups where such synergies make sense, while preserving
the distinct character and emotional appeal of each brand through unique
exteriors and interiors.
Additionally, these teams will provide a single voice to suppliers for
increased efficiency and improved communication. In total, about 50 component
teams will be in place by the end of this year.
"The purpose of these teams is to increase our quality, innovation and
overall efficiency on several levels," said Zetsche. "While the platform
teams under the previous structure learned from each other and improved the
process with every successive new product launch, this approach really is much
more comprehensive and mandates best practices across the entire organization.
It enables us to drive down complexity by reducing the variety of parts or
subsystems used across our vehicle lines under the skin -- while maximizing
our opportunities and freeing up resources to concentrate on the distinct
personalities of the Chrysler, Jeep and Dodge brands."
Chrysler Development System (CDS)
Once the scope of a new vehicle vision is defined, the program will be
assigned to one of the five product teams and follow a comprehensive process
for the entire development cycle, from the earliest stages of the program
through design confirmation and ultimately, to production launch.
The Chrysler Development System (CDS) is already underway at Chrysler,
with this system serving as the blueprint for every new product program. The
CDS employs a series of phases, or "quality gates," similar to a system used
by Mercedes-Benz, to ensure all performance, quality and cost objectives are
met or even exceeded. Taken together, these 11 gates are designed to promote
earlier planning and accurately gauge customer needs, reduce cycle time and
waste, define and employ best practices across all product programs and
achieve 100% of all pre-established targets. Each product team will be
responsible for achieving objectives in accordance with the CDS.
"CDS will optimize the way we develop a new car or truck by using a system
of checks and balances at every stage of the process to keep every area on
target," said Zetsche.
"The goal of CDS is to preserve all the design excellence and innovation
that Chrysler has become known for, while successfully balancing often
opposing forces such as quality, cost and development times."
Visit DaimlerChrysler's Media Services Web Site at
http://www.media.daimlerchrysler.com for additional DaimlerChrysler news.
Chrysler Group
Product Creation Process
Platform Teams to Product Innovation Teams
Current Future
Platform Teams Product Innovation Teams
Strategic Considerations
Platform Teams focus on specific Product Teams focus on specific
products customer groups (Pull vs. Push)
Initial emphasis on design, brand Broader orientation for
applications later interaction of Product
Development & Design,
Manufacturing, and Sales &
Marketing
Focus on "all brand new" Focus on balancing cost
efficiency and innovation,
embracing commonality where not
relevant to the customer
Multiple vehicle platforms Reduction of vehicle platforms,
with increasing derivatives
One Plant/One Product Flexibility to build multiple
products at multiple plants
Operational / Process Considerations
Material Cost Management Teams focus Material Cost Management Teams
on turnaround targets incorporated into Component
Teams, with broader, strategic
focus
Segmented interaction with suppliers Joint Product Development &
Procurement interface with
suppliers ("one face/voice" to
suppliers)
Product Creation process managed by Product Creation process managed
periodic risk assessments by formal, disciplined Product
Executive Committee-level
Quality Gate reviews, with
corresponding action planning
Manufacturing and Marketing input to Upstream, concurrent involvement
Product Creation at later stages in Product Creation by
Manufacturing and Marketing
Organizational / People Considerations
Cross-functional participation Cross-functional participation
supported by an empowered
Product Core Team (Product
Development, Manufacturing, and
Sales & Marketing)
Platform Teams lead by Engineering Product Teams led by a
and supported by General Manager co-dependent Product Core Team
(Engineering, Manufacturing,
Marketing)
Tech Clubs Component Teams
Platforms independently define best Component Teams define best
practices practices, which are adapted,
if appropriate, across multiple
Product Teams
Product Team -- Core Function Representatives
Product Development Manufacturing Sales & Marketing
Small Vehicle Larry Lyons TBD Paul Wilbur
Premium Vehicle Eric Ridenour Frank Faga Steve Bartoli
Family Vehicle Gordon Rinschler TBD Ron Hein
Activity Vehicle Craig Love Rodney Peters Mike Kane
Truck Frank Klegon Jamie Bonini Darryl Jackson
Powertrain Floyd Allen Tom LaSorda TBD
Chrysler Group Product Strategy Team
Dieter Zetsche President and Chief Executive Officer
Wolfgang Bernhard Chief Operating Officer
Rich Schaum Executive Vice President, Product Development and
Quality
Jim Schroer Executive Vice President, Global Sales and Marketing
Trevor Creed Senior Vice President, Design
George Murphy Senior Vice President, Global Brand Marketing
Mike Evans Vice President, Product Planning