With the advent of summer, I started my internship at Panasonic Automotive Systems of North America at Peachtree City, GA as an Operations and Supply Chain Management Intern. My internship lasted for 18 weeks and offered me vivid challenges and experiences in the field of Supply Chain, Operations Management and Process Improvement. I worked with the Purchasing department which is responsible for planning, scheduling and procurement of more than 6000 active parts for manufacturing units in Mexico and China. These parts are procured from over 170 Vendors which are located across the world. This complex procurement for two major manufacturing units involves a great deal of planning, analysis and coordination.
Before I dwell into the details of my experiences and recommendations, I personally thank Board of Directors who created this position and offered me the opportunity to work in this great company with such talented people.
During the internship, I worked closely with the Purchasing Manager and Chief Procurement Officer to solve many problems and streamline and standardized many processes. These problems challenged my abilities and skills learned at the Business School and provided me with an excellent platform to implement my learning and utilize my past work experiences to find out the solutions to these problems.
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I started with an Inventory Management project which involved identifying critical parts and calculating safety stocks for these parts. The identification of critical parts were based on not only on the constraints such as demand of these parts or availability of parts but also on subjective criteria such as whether alternate supplier exists or restriction of supply of parts from the supplier or how difficult it is to procure the part from a different supplier if needed. This complex evaluation is applied to identify critical parts out of more than 6000 active parts. Inputs are taken from the buyers which involve in procuring the parts in terms of their experiences. Once parts are identified safety stocks levels are calculated while taking into consideration the current safety lead times present in the system. I designed templates to monitor the inventory levels of these critical parts to have a better control and to prevent stock-outs.
In order to reduce the cost of procurement and the amount of work-load of the buyers, I initiated an analysis of the Order policy and Delivery policy of some of parts which have low cost and volume. After the analysis, I proposed to change the Order policy of some of the parts which used to be ordered every week into monthly orders. The demand is accumulated for the month and the parts are ordered once a month rather than weekly. As most of these parts are of low cost such as screws, solder paste etc, ordering every month does not increase the holding cost. However, it reduces the ordering cost by 25% and also reduces the amount of work for the buyers as now they need to place PO ever month rather than every week.
After understanding the processes, I involved myself in many process improvement projects which involved root cause analysis of the problems and then investigating various solutions to reduce these problems. One of these projects was Part Price Variance which in simple terms was about discrepancy of PO price with the Invoice price. These cases were getting reported in large numbers and because of this discrepancy payments are freezed to the supplier which restricts the next shipment. I consulted the various parties involved and explored various reasons to the problem. After investigating the root cause I discussed a new process flow with the Purchasing Manager to reduce the number of these Price Variances. It also helped us to reduce the rework and waiting at different levels.
I designed many new report templates for the higher management to have a better control and reporting system at place. I tried to automate most of these reports so that they do not take a lot of time and effort to populate the information in these reports. I extensively used Excel Macros and other tools to carry out the automation.
One of the major process improvement projects I undertook was enhancing the current Shipping Expediting Database. I and another team-mate explored various features that can be incorporated in the current system. After finalizing the features, I incorporated the required changes and introduced many new reports which can be generated from the database. Various security features are also added to restrict unauthorized access and updations. I documented the new changes and provided knowledge transfer to various departments.
In addition, I worked with Advance Purchasing department for some time with alumni of our Business School to recreate the Supplier Evaluation Criteria. The Suppliers are rated on various standards and a final score is calculated depending upon which the higher management decided whether to continue with the Suppliers or find an alternate Supplier. Panasonic also rewards the top 20 suppliers every year following this rating.
Apart from the great experience working at Panasonic, I enjoyed living in Peachtree City. It is a unique town with its lush green neighbourhoods and 80 miles of golf paths or “multi-use” paths which connects every neighbourhood and encompasses many ponds and serene lakes.
Panasonic Corporation being one of the largest electronic appliances manufacturing company with more than 640 companies in its umbrella provided a unique internship experience. However, the current economic crisis has proved to be difficult times for Panasonic Automotive Systems Company. With massive reorganization and lay-off the company is under tough constraints. But now with the improving economic environment, it is again picking up and future prospects are looking good. The latter section of the paper describes in details about Panasonic Corporation and Panasonic Automotive Systems Company and briefly describes the current environment.
Panasonic Corporation is one of the largest electronic products manufacturing group in the world. Founded in 1918 by Mr. Konosuke Matsushita as Matsushita Electric Devices Manufacturing Works, the company expanded many-folds. Started with a work force of 3 people (Mr. Matsushita, his wife and brother-in law), Panasonic now comprises of a diverse workforce of 384,586 employees around the world. It is a conglomerate of over 680 companies which are involved in vast business processes such as home appliances, environmental systems, automotive systems, networks systems, mobile communications and semiconductors.
Panasonic Automotive Systems Company
Headquartered at Kanagawa, Japan, the Automotive Systems Company develops, manufactures and sells car navigation, car Audio/Video equipments and systems. The company is founded in Jan, 2003 and currently employees 10,035 employees across the globe. The company was formulated to integrate a number of business units to have a better control over these units and offer consumers new products by utilizing the synergies of the individual business units. The automotive electronics business promotion center and corporate automotive electronics marketing division are combined with the automotive systems business, automotive multimedia company, and car navigation systems business to unify the development, production and sales of car navigation and audio-visual systems.
With changing consumer demands, the company focused on providing better products for in-vehicle entertainment and on the same time find solutions to environmental and safety concerns. The company included the American operations in order to cater the huge American car industry.
Panasonic Automotive Systems of North America
Matsushita was already a major player in the car radio market when it decided to open the first production facility at Peachtree City, GA in 1987. Two years later, another manufacturing facility was opened at Southfield, MI. This led to the birth of Panasonic Automotive Systems of North America which catered to the North America automotive industry. With a focus on R & D and a strong engineering and design team, the company came up with many revolutionary products and introduced American consumer to an innovative product line of in-vehicle entertainment and navigation system. In 1997, the company introduced world’s first DVD car navigation system. With the turn of the millennium, many innovative products were launched which included an Internet-ready portable car navigation system, the world’s first car audio with built-in SD player, and a car navigation system equipped with high-resolution, wide VGA monitor. Panasonic pioneered in the rear-seat car entertainment systems and introduced the car-mounted on-vehicle emergency call system (HELPNET) and the car-mounted electronic toll collection unit.
With the early success of Panasonic in the car entertainment industry, many major car manufacturers such as GM, Chrysler, Toyota, Nissan and Honda became its valuable customers. Panasonic worked closely with GM and supplied factory-installed equipments to almost all the car models of GM. JD Power and Associates rated Panasonic as number one on customer satisfaction for the increasingly popular vehicle option of rear-seat entertainment systems.
Panasonic Automotive Systems Company not only insured the quality of their products but also concerned about environment. The company pledges in their environmental statement that it insures a “prudent, sustainable use of the earth’s resources and the protection of the natural environment.”  It promotes the use of “Green Products” which are designated products with reduced environmental impacts. The processes in the manufacturing units are specifically designed to make the factories clean that coexist with the local communities and environment. The Peachtree City manufacturing unit was considered as one of the most environmentally conscious business in the Atlanta area. The company emphasise on reducing VOCs (Volatile Organic Compounds) and recycling of the manufacturing waste such as solder material, metal and plastics.
Peachtree City, GA Unit
Peachtree City, being ranked as the 8th best  place to live with lush green landscapes and carefully planned and controlled neighbourhoods, it is difficult to imagine a large manufacturing facility in this town. However, the philosophy of the founder of our company, Konosuke Matsushita, that “a company is a public institution. Hence, it exists for the society, is supported by the society and has to walk hand in hand with the society”, helped us sustain this manufacturing facility in harmony with the environment.
However, the current economic crisis proved to be quite devastating for the Peachtree City unit. With the downturn of the American automobile industry which led to drastic fall of major manufacturer like GM and Chrysler the demand for products of Panasonic Automotive Systems crashed heavily. The high cost of labor and overall production in United States could not be sustained with this decreased demand. Management was forced to take some drastic measures to sustain the company. The whole manufacturing was moved from Peachtree City to Reynosa, Mexico in lie of high cost of production. This led to huge lay-offs at Peachtree City unit. The work force was cut to one third and even employees who have served the company for more than 15-20 years were laid off.
Currently, Peachtree City houses the Engineering, Accounting, Purchasing and Quality departments which are supported by IT and Human resource departments. The Engineering department takes care of designing and new product development. It supports the manufacturing processes primarily at Reynosa, Mexico and Daliyan, China and other manufacturing units across the world.
Now, with the economy on the road to recovery and increasing consumer spending, the automobile industry is picking up again. This has increased the demand for Panasonic Automotive Systems products and many new projects from all major car manufacturing players are coming to Peachtree City. The company has started hiring the people it laid off before and steadily the sales are increasing. We are quite optimistic about the future of Panasonic Automotive Systems of North America and with the influx of new projects from GM, Chrysler, Honda, Toyota etc; the company will soon regain its lost glory.
 Panasonic Automotive Systems Company, Tuning in. (n.d). In Manufacturer. Retrieved 18th Aug 2010 from http://www.themanufacturer.com/us/detail.html?contents_id=2939
The internship provided me with a platform to utilize my business skills and learning’s at the business school. As it was a Supply Chain & Operations Management internship, it challenged a variety of skill sets and offered an opportunity to acquire new skills.
The Inventory management project offered me the opportunity to apply the learning of Operations Management course. It extensively utilized basic Supply Chain Management skills of identifying the critical parts by doing an ABC Classification. In order to have a leaner inventory and reduce stock-outs, concepts of safety stocks are applied.
Analysis of Material Resource Planning (MRP) which directly dealt with Order policy and Delivery policy utilized the learning from Operations Management course. I prepared numerous test cases to find out the best combination of Order policy and delivery policy to have a leaner inventory level.
Supplier rating criteria project which dealt with enhancing the criteria used to rate the suppliers, challenged my analytical skills. The statistical concepts and tools learned in Data Analysis course such as normal distribution, concepts of standard deviation and variance were applied in this project.
New supplier selection process involved analysis of financial statements and company profile of these suppliers. The new supplier’s financials are also compared with the current supplier’s financials which supply the related parts. This used to be an extensive analysis to insure that the new supplier is financial stable. I analyzed many suppliers’ financial statements, calculating various financial ratios, most of which is learned in Financial Accounting course.
I enhanced and added new features to the current Shipment Expediting Database. The database was based on MS Access and I added numerous reports and did functional level changes in the forms. It involved rigorous VBA programming and utilized many concepts I have learned in Information Systems course.
As explained earlier, I undertook many report automation projects which involved Excel Macros and other tools I learned in the Data Analysis course.
The procurement of parts from strategically selected Vendors, depending upon location, quality, price and availability, this dynamics is clearly understood with the concepts learned in Global Strategic Management course. Corporate level Strategic alliances with global Vendors to insure better control of prices and quality of the parts is part of the Corporate Strategy employed by Panasonic Corporation.
The management of manufacturing units across different locations in the world which transcends the need to establish factories in low cost manufacturing countries with abundant low-cost labor and to solve the problems in managing these units employed core concepts learned in International Management course. I understood the friction between different cultures and the need for the manager to adapt to the norms of different culture and how people work in different locations is key to managing many problems.
At Panasonic, we have a diverse work-force with many Japanese employees who work differently than their American counterparts. Japanese business issue course helped me to understand the cultural aspect of working habits of Japanese people.
To summarize, the internship was completely aligned with my future aspirations and goals. It helped me to foster new skills and gave me the opportunity to work in a diverse environment.
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