BPR And Profit Analysis Of The Production Logistic Process Under The VMI Mode

The central position in the Harbin-Dalian Business Axis and its automobile industry have characterized Changchun in the Northeast Industrial Base. Changchun is the cradle of China automobile industry (AI for short)since the construction of FAW in1953. Fifty years afterwards, the developing trend of AI has presented scalization and the state of functioning in a chain. Whereas, the fast-developing market economy is challenging the traditional industrial situation with more and more internationally advanced executive theories. Not a small number of auto enterprises currently still adopt the traditional inventory management mode in the process of raw material purchases, which due to its historical limitation is exposing various malpractices, high inventory cost, low-level services, reduced competitiveness of the Integrated Supply Chain.This paper is basically launched through conceptual analysis, relevant theories elaboration, process reengineering, modeling&simulation and benefit analysis&allocation to prove it that VMI theory is the effective means of amending the problems as mentioned above caused by the traditional inventory management mode.The first thing demonstrated here is the importance of improving inventory management mode in some main auto part industry and chief demands in purchasing raw materials. A new inventory management mode is then accordingly put forward, namely VMI. Being the basis of propounding and developing this theory, the supply chain and inventory, the vital factor of logistics management, are introduced prior to VMI. VMI is compared with the traditional inventory management mode through conceptual analysis to present its advantages, with the feasibility of the former gaining adequate proof. In the third chapter, a concrete case is adopted to demonstrate the method of process reengineering in auto part industry, which consists of its significance, sorting out and points for attention; reengineering and then analysis of logistics management from the viewpoint of theoretical basis and present situations; a process reengineered as the final link of this part. The fourth chapter, a modeling framework is presented so that the feasibility of the target theory can be proved by the means of quantitative analysis. Petri modeling is chosen as it is to accurately, legitimately demonstrate every single link and effective parameter setting. After modeling, ExSpect is used for simulating to testify the working-hour saving advantages of VMI. On that basis, economic benefits from VMI are analyzed. The implement of any management mode, in traditional senses, brings bigger benefits to the downstream enterprises, and this will trigger a drop of the initiative of suppliers. This paper assumes a case in which one enterprise collaborates with three upstream suppliers, by using quantitative analysis to testify the result that the adaptation of VMI enables each partner on the supply chain wins mutually under certain conditions. The later demonstration is carried out through Shapley on how to divide the benefits produced by VMI under the mechanism of sharing risks and profits.This paper takes methods which combine the quantitative and qualitative analysis to comprehensively discuss the logistics management of auto part industry and give optimum solutions.