4 The Supply Chain of the Audi A8 V8 4.0l Diesel Engine – A Case Study of Audi AG (p. 96-97)
This chapter presents an analysis of the supply chain of the Audi A8 V8 4.0l diesel engine with two main goals:
• First, gathering information to quantify the bullwhip effect contained in this simple supply chain and
• second, providing the basis for evaluation of the cooperation scenarios identified in Section
3.1.2 to determine if they could be implemented in this engine supply chain and what advantages could be gained.
For this purpose, this dissertation uses an empirical approach in form of a qualitative case study (Benbasat et al., 1987, Lee, 1989, Yin, 2002, Dubé &, Paré, 2003). The reasons for using a qualitative approach in this evaluation include the assumption that the relevant variables of the problems of cooperation are context driven and that the internal dynamics, implementation, and quality need to be understood as well (Creswell, 1994, Patton, 1987). Since this dissertation follows the interpretive approach rather than the positive approach, this case study is not intended to provide repeatability, but to gain a deeper understanding of the phenomenon cooperation in supply chains of the European automotive industry (Darke et al., 1998, p. 277). The author acknowledges the subjectivity of this process since this research attempts to "understand phenomena through accessing the meanings that participants assign to them" (Orlikowski &, Baroudi, 1991, p. 5). Nevertheless, some quantitative methods are also involved in this case study (see Sections 4.2.2, 4.2.3, and 4.3.1) and some positive analysis (Darke et al., 1998, p. 276) is realized by the examination of product orders, deliveries, and inventories throughout this supply chain.
This chapter first presents all involved companies briefly. The supply chain of the Audi A8 V8 4.0l diesel engine is described in detail in Section 4.2. Section 4.3 attempts to determine the bullwhip effect by considering the data gathered in the case study (Section 4.3.1). This section provides also an evaluation of the benefits involved with the implementation of cooperation scenarios that were identified in Chapter 3 in this particular supply chain (Section 4.3.2). Further, Section 4.3.3 discusses the potential benefits of the implementation of a monitoring system for this particular supply chain. The chapter ends with the summary of the findings of the case study (Section 4.4).
4.1 Exposés of Companies in the Supply Chain of the V8
4.0l Diesel Engine
In this section, some general information on Audi is presented, more specifically on the company’s history and its financial situation. Thereafter, a rough sketch of Audi’s up- and downstream supply chain will be provided. Exposés of the companies involved in the case study are also included.
4.1.1 Audi AG
126.96.36.199 General Overview of Audi AG
Audi is an internationally renowned manufacturer of high-quality cars and is incorporated in Germany. The company is the result of two mergers. The first merger occurred in 1932 when the four automobile manufacturers Audi, DKW, Horch, and Wanderer merged to form Auto Union AG. To symbolize this union, the company adopted a logo that is made up of four intertwined rings – this sign is still used today to represent Audi AG (Audi AG, n.d. a). In 1969, the second merger was completed, when Auto Union AG and NSU joint forces to form Audi NSU Auto Union AG which was renamed Audi AG in 1985 (Audi AG, n.d. b). Since 1964, the company is a fully owned subsidiary of Volkswagenwerk AG, today known as Volkswagen AG (Audi AG, n.d. b). About 99 percent of Audi’s share capital is held by Volkswagen AG (Audi AG, 2005).