IAC Customizing QAD for a Unique Manufacturing Process

IAC Customizing QAD for a Unique Manufacturing Process Prashant Arya | Director IT

Agenda 1 IAC Overview 2 Carpet Manufacturing Model 3 Process Mapping 4 Outsourcing Model 5 Lessons Learned 2

IAC Global Profile 8 8 $4+ Billion Global Annual Sales Leading Supplier of Automotive Components & Systems 73 manufacturing facilities in 15 countries - 28, 000 Employees Process capabilities include 8 Compression 8 Injection and Blow molding technologies 8 Various trimming and finishing methods 3

IAC’s Core Market Leadership Segments Doors & Trim Systems Instrument Panels, Consoles & Cockpits Flooring & Acoustic Systems Headliner & Overhead Systems Other Interior & Exterior Components q q q q q q q q Interior Doors Panels Armrests Decorative appliqués Map pockets Switch bezels Speaker grills Safety components Instrument Panels Cockpits Center consoles Hard & soft panels Glove box assemblies Air distribution products q Air registers q Decorative appliqués q Cup holder Utility flooring Floor Carpets Floor mats Acoustic insulators Package trays Trunk trim Engine insulators Wheel arch liners Overhead systems Headliner substrates Grab handles Overhead consoles Visors Interior lighting Safety systems • Cargo • Management • Load floors • Seat panels • Pillars q Exterior • Bumpers • Reservoir • Systems • Rocker • Panels q Exterior trim 4

Customers are Key 5

Business & IT Challenges Non ERP friendly Roll Goods Functionality that Plans Product A and Builds Product B Identifying & Mobilizing resources to build the Roll Goods Functionality Keep new functionality within Global QAD Template Utilize the Governance model to drive the change Bring in specialized Change Management & Subject Matter Consultants to manage the change if required 6

Carpet Process (Rolled Goods) Overview 8 IAC manufactures two types of carpets 8 Woven Carpet – These are manufactured from Yarn 8 Non-Woven Carpet – Manufactured from Synthetic Fiber 8 Cutting and slitting rolls with traceability to original parent roll 8 Manufacturing order allocation of assigned and unassigned rolls 8 Inventory availability by quality of roll across plants and warehouses 8 Bill of material, recipe formula and dye lot management 8 Details of each carpet produced needs to maintain throughout the manufacturing process as well as post shipment for many years 7

Carpet Process Workflow(Woven) Preparing the Yarn Tufting Dyeing Latex Coating / Shearing 8 Yarn arrives at carpet manufacturer plant in form tubes or cones 8 These tubes or cones further wound to manufacture cones or Beam sets. These cones or Beam sets are transported to the Tufting machine 8 In tufting process carpet is manufactured on specialized multi-needle sewing machines. 8 Yarn is fed from the creel , one tube of yarn for each needle , and threaded through the needles. 8 A tufting machine can produce several hundred square yards of carpet per day. 8 In Dyeing process tufted carpet rolls are sew-in together to make a continuous roll, which is then fed under rods that color the carpet. 8 There are other methods to dye the carpet. 8 In Latex Coating process, a coating of latex is applied to both the tufted, dyed carpets primary backing and secondary backing 8 Shearing is process of removing all of the little loose ends and projecting fibers that might have been created during the tufting process. Inspection 8 Inspection is the final process where each carpet is carefully inspected for color uniformity and manufacturing defects before it is rolled, wrapped and shipped. 8

Woven Carpet Manufacturing Process Yarn Assign Yarn to Creel Issue Yarn to Creel Cones or tubes of Yarn purchased The Yarn Lot is assigned to Creel Location Yarn is transferred to a creel location Inspection Shipment Final production & reporting program were quality checks are done SEW-IN The WO(Dyed, Latex or Shearing) are scanned to create the inspection records. Greige Booking (Tufting) Production & Reporting of Tufted carpets WO Creation WO is created for each process after this like Dyed WO, Latex WO & Shearing WO 9

Non-Woven Carpet Manufacturing Process Fiber Issue Fiber Report Production Shipment Inspection 10

IAC Carpet Process - Challenges Critical Quality Requirement • Stringent quality checks at every manufacturing process of carpet • Quality checks based on complex set of rules • Quality checks based on governing laws of US specific to Automotive industry • Carpet specific quality parameters maintenance • Carpet specific Item master attributes Allocation of Inventory • Tufted carpet rolls needs to be allocated individually for a Work Order • Allocated Roll should not be available for another Work Order • QAD allocation based on logic of picking sequence i. e. date , location or expire date • Allocated inventory is reserved but can used by other Work orders. Production Booking • Functionality of quality checks before booking production • Consumption of components specific to Yarn lot and allow substitution of components • Receive & issue of multiple lots of Finished goods and components • QAD production report programs lack the functionality of quality checks and defect data entry. 11

Key Solution Architecture Challenges 8 Capturing of Detailed Information relevant to Quality and Production at every stage 8 High Degree of Complexity & varied processes in Inspection & Production Reporting 8 Approval Process for Lots & Dye Runs 8 Lack of Features in QAD to support Automobile Carpet Process 12

Masters – Process to QAD Mapping Masters • Carpet Data • Creel • Tufting Machine • Dyeing Machine • Quality Parameter Maintenance • Rules Group Maintenance • Operational Quality • Monthly Lab Audits • Machine Panel Set-up • Tufting Strength Standard • Wet Pickup Tolerance • Containment Customized Screen • Item Master Maintenance to Additional carpet data • Modify Work centre Maintenance of maintain carpet manufacturing machines such as Creeler, Tufting & Dyeing • Quality parameter maintenance were totally customized screens QAD Screen • 1. 4. 1 – Item master Maintenance • 14. 5 – Worker Centre Maintenance • 14. 13. 1 – Routing Maintenance 13

Yarn – Process to QAD Mapping Yarn Customized Screen • Assign Yarn to Creel • Issue Yarn to Creel • Warping • Location Transfer • RTI • Issue Edge Yarn • Depending upon the functionality front end validation screens were designed and data was captured then passed to QAD programs QAD Screen • 3. 12 – Receipts Backward Explode • 3. 4. 1 – Location Transfer • 3. 7 - Issues Unplanned • 3. 9 – Receipts Unplanned 14

Greige Booking - Process to QAD Mapping Greige Booking • Creation of Tufting/Dyed/Latex Coated Work Order • Release & Print of Tuft Work Order • Issue of Components • Receive Components • Inspection Customized Screen • Customized Work order Maintenance • Customized Multiple Work Order Release/ print QAD Screen • 16. 10 – Components Issue • 16. 11 – Receive Work Order • 17. 1 – Labor Feedback • 3. 7 – Issues Planned • 3. 9 – Receipts Unplanned • 3. 4. 4 – Batch Load Transfer • 16. 1 – Work Order Maintenance • 16. 7 - Multiple Work Order Release / Print 15

Inspection - Process to QAD Mapping Inspection • Creation of Tufting Work Order • Release & Print of Tuft Work Order • Issue of Components Customized Screen • Inspection was totally customized solution for data capture and validations. Then the QAD production booking programs were called. QAD Screen • 16. 10 – Components Issue • 16. 11 – Receive Work Order • 17. 1 – Labor Feedback • 3. 7 – Issues Planned • 3. 9 – Receipts Unplanned • Receive Components • Inspection 16

Quality - Process Mapping to QAD • Rules Group Maintenance • Operational Quality • Monthly Lab Audits • Machine Panel Set-up • Tufting Strength Standard • Wet Pickup Tolerance • Containment Quality Audits • Quality Stretch Audit • Quality Weight Audit Coater • FPI Audit • Dam Audit • Containment Quality Data 17

Implementation Approach Review Requirements / Mapping Systems Proposal Systems Analysis & Design Systems Development & launch 8 Understand system requirements with the support from IAC Business Team 8 Prepare system requirements of current applications and “to-be” 8 Submit the system requirements with high level mapping document. 8 Review findings and fine tune. 8 Review system requirements / mapping with Business Team. 8 Finalize and obtain concurrence on the Solution Design / mapping. 8 Vendor Submits fixed bid proposal for analysis, design, development of System based on approved mapping. 8 IAC IT and business team reviews and approves the proposal. 8 Project kick-off 8 Detailed Analysis, design, technical specification for Custom Developments, extensions and Reporting Solution. 8 Approval from IAC business and IT teams for development 8 Develop extension as per approved technical specifications 8 Acceptance Testing 8 Deployment 8 Prepare launch plan along with IAC business and IT team 2 Months - Plant 1 Month – India / US 1 Month 4 Months 10 Months Design Approval by IAC IT / Business Acceptance Testing by IAC IT / Business Team Business Analysis Participation from IAC Team Approval from IAC IT and Business Team Business / IT commitment for the project OFFSHORE ONSHORE MODEL 18

Development - Iterative Methodology An independent team working on developing the module using QAD as the base to fit carpet requirements Adopt Best Practices for software customizations Iterative development Enable business innovation through rapid ideation and prototyping Work closely with Business SMEs within the Team to ensure that the requirements are fully met FS & TS creation/Approval Code & Test On-Site Team creates the Iteration Backlog Requirements FS & TS creation/Approval Code & Test & Fix Defects ITERATION CODE FREEZE Iteration Backlog Requirements ITERATION ASSESSMENT Requirements Continuous Integration Up to 2 week Iteration 3 -8 weeks 19

Team Structure On-Site Team IT Project Manager Off-Shore Team Business Project Manager QAD Experts Development Team Program Coordinators Change Management Specialists Testing Team Process Analyst On-Site Team Off-Shore Team • Project coordinator to ensure coordination and consistent reporting across to stakeholders • Structure backed by a strong Governance Model to ensure timely resolution of risks and issues • Experts in the Business Process as well as the IT Solution • Quality Analyst to prepare Test data and ensure expected results 20

Lessons Learned Clearly Define the Scope, Expectations and Detailed Process Review/Documentation Prepare a Governance model and Schedule keeping in consideration resource constraints Adopt an iterative methodology for refining the mappings and process, allowing for repeatable and comparative testing. Manage/Control User-centric design & Change Orders Emphasis on Stricter Quality Norms & UAT Familiarizing User on QAD Functionality before Analysis 21