AIAG: "they are bringing in European and Japanese automakers to broaden the initiative."
- "General Motors Corp"
- "mailed a comprehensive year 2000 self-assessment survey to 50,000 supply sites around the world"
- "The year 2000 issue is being underestimated in importance by many suppliers,"
- "response has been disappointing".
- "they are bringing in European and Japanese automakers to broaden the initiative. They hope that critical mass will force suppliers to respond,"
- "The pressure is going to get so great they're going to have to get moving on this,"
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Up and down the supply chain, year 2000 compliance is off to a dismal start.
By Kathleen Melymuka
All your year 2000 remediation is done and tested. Then January 2000 comes, and you're out of business. Why? Because your suppliers screwed up.
Your retail shelves will be empty; your assembly line will have nothing to assemble; your emergency room will lack lifesaving devices.
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The auto industry: On a collision course
No industry illustrates the domino effect of year 2000 better than the automotive industry, where suppliers and subsuppliers down the line are all interdependent and where there are many sole-source vendors. "It's all win/win or lose/lose," says James W. Lloyd, vice president for information and network resources at UT Automotive, Inc., a Dearborn, Mich., supplier of a broad range of auto parts.
The Big Three U.S. automakers - General Motors Corp., Ford Motor Co. and Chrysler Corp. - have banded together through the Automotive Industry Action Group (AIAG) to keep the supply chain from breaking. Late last summer, the trade association's Year 2000 Task Force mailed a comprehensive year 2000 self-assessment survey to 50,000 supply sites around the world over the signatures of the Big Three's purchasing executives.
Suppliers were asked to complete the assessment and use the format as a tool for their own suppliers. Completed assessments will be posted on confidential online databases accessible only to the Big Three. Suppliers can update their responses as their year 2000 compliance programs progress, keeping their customers up to date.
The effort gets high marks from suppliers for simplifying communications with their customers. "It's tremendously helpful to come up with just one set of answers," Lloyd says.
But evidently, that isn't enough. The AIAG, in Southfield, Mich., won't say how many assessments have been returned, but the response has been disappointing. "The year 2000 issue is being underestimated in importance by many suppliers," says Ferron, a lead consultant on the AIAG's year 2000 project.
Audits show that suppliers that have responded have vastly overestimated their own prepared-ness. "In every instance, there were potential serious, even business-threatening, surprises," Ferron says.
'None of the Big Three would say what they'll do if the effort fails to gain momentum in time. Instead, they are bringing in European and Japanese automakers to broaden the initiative. They hope that critical mass will force suppliers to respond, says Joe Bione, lead Deloitte Consulting partner on the AIAG initiative. "The pressure is going to get so great they're going to have to get moving on this," he says. '
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