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5. THEORETICAL FRAMEWORK: PROTON SUPPLIER DEVELOPMENT MODEL In Proton, the component parts supplied by its primary suppliers are considered strategic products because the parts represent about 50 per cent in the total cost of end product and most of them are sourced from only one supplier (see Appendix 1), As Kraljic (1983) suggested, "Strategic products are generally obtained from one supplier, which the short- and long-term supply is not guaranteed and represent a high value in the cost price of the end product. The strategy is to strive for a partnership-like relationship with the suppliers in order to obtain significant improvements in quality, costs, delivery, product development and innovation." Before the establishment of Proton, the component parts manufactured locally were initially few and catered basically for the replacement market. However, with the introduction of specific localisation programme by Proton through its Vendor Development Programme (PVDP) for the industry in the mid of 1980's, more components were produced to cater for the original equipment and replacement parts market for domestic as well as export markets. As the President of Proton Vendors Association (PVA) said; "....many vendors were born, nurtured, and later developed and grew solely as a result of this VDP. There were only 17 vendors supplying 52 parts when Proton commenced operations in 1985, most of which were low-tech traditionally local parts like batteries, tyres and etc. To date there were 140 vendors supplying more than 4,000 parts to Proton." (From interviews with the President of Proton Vendors Association). In 1986, Proton has established the Procurement and Vendor Development Division (PVD) which an objective to develop its own group of suppliers in order to formulate and implement the local content programme for the national car. It was envisaged that with the implementation of this local content programme the automotive parts industry would expand. This expansion was much needed not only by Proton in its endeavor to build a strong industrial base to depend on, but also by the Government as a source of employment absorption and reduction of imports. The supplier development programme achieved quick results. In 1985, the local content of Proton car was only 18 percent in terms of value. By 1988, this ratio had climbed to 60 percent, touching 65 percent in 1991, and 70 percent in 1992. (see Appendix 2 and 3). The programme is illustrated in the theoretical framework as shown in Figure 2.
Annual Master Plan (AMP) Long Range Product Plan (LRPP) Engineering Cost Estimates Cost Estimates Review 4M Assessment (S.W.O.T). Harnessing available facilities Indigenous participation Single Sourcing No displacement of investment Designing & Specification Training & Development Productivity Improvement (QCD, 4M, TCA, etc.) Searching for technical assistance Matchmaking programme Trade/investment promotion Technology transfer Research centre Product development Testing and verification Technology "bridging " Equity participation Arranging Grant Scheme leme Banking arrangementt Purchasing arrangement nent Advertising & promotion tion Distribution Export programme After-sales services ' FIGURE 2 Proton's Supplier Development Model Identification & Selection Process Ongoing Assistance KEY FUNCTIONS/ACTIVITIES Selection of Parts: Identifying and selecting the parts to be produced locally in Malaysia by local component parts manufacturers (suppliers). 2. Selection of suppliers: Identifying and selecting the potential local suppliers based on the company's policies to produce the selected parts in Malaysia. 3. Matching: Shaping and fitting the products to Proton's requirements. This includes such activities as manufacturing, designing, specification, drawings, grading, assembly, packaging, agreement on price, order, delivery, risk taking and other terms of the offer. Contact: Searching out necessary input (technical assistance, capital and other resources) and initiate a match making programme between local suppliers and reputable overseas technical collaborators to expedite the transfer of technology. Research & Development: Gathering of information necessary for product planning, product development and modification. 6. Financing: Acquisition and dispersal of funds to cover the costs of producing and distributing the products. 7. Marketing: Market development and dissemination of persuasive communications about the products.
Page 1 and 2: PRODUKTIVm SUPPLIER DEVELOPMENT IN
Page 3 and 4: pRODUKnvm PENASIHAT Tuan Haji Ismai
Page 5 and 6: BIODATA OF RALIMOHD NOR Rali Mohd N
Page 7 and 8: The supplier development concept ha
Page 9: 4. SCOPE AND LIMITATIONS OF THE STU
Page 13 and 14: 6.2 SELECTION OF SUPPLIERS The supp
Page 15 and 16: Cases/ Company Company A Company B
Page 17 and 18: Proton inherited the automobile tec
Page 19 and 20: such as of technical know-how, supp
Page 21 and 22: A point worth noting in the Malaysi
Page 23 and 24: finished products. In short, the JI
Page 25 and 26: Car Assembly Production © Reverse
Page 27 and 28: Appendix 1: Cost Breakdown of Proto
Page 29 and 30: Departments Procurement & Vendor De
Page 31 and 32: Average ration of share parts Produ
Page 33 and 34: Sako, M, (1992), "Prices, Quality a
Page 35 and 36: JUST-IN-TIME (JIT) PRINCIPLES AND S
Page 37 and 38: UJ UJ Figure 1.1: Existing Layout o
Page 39 and 40: At the University of Bradford (UOB)
Page 41 and 42: Presently, tools for all the machin
Page 43 and 44: 2.3 Proposed Layout Improvement No.
Page 45 and 46: MC NO. Al A2 A4 A5 A6 47 A8 A9 A10
Page 47 and 48: Controller who plans the production
Page 49 and 50: Figure A4r i > \ 2 \l C c / ) 1.8 P
Page 51 and 52: Raw Mat. Store Tool Storage Area To
Page 53 and 54: above, the forklift is not required
Page 55 and 56: The remaining of the production los
Page 57 and 58: 4.10 Set-up Time Reduction Saving T
Page 59 and 60: TABLE 2.2 Standard Price List for P
Page 61 and 62:
5.3 Project Achievements The propos
Page 63 and 64:
REFERENCES 1. Alaya, S.E.B.H., Elim
Page 65 and 66:
27. Monden Y., Toyota Production Sy
Page 67 and 68:
BIODATA OF ALIAS RADAM Alias Radam
Page 69 and 70:
an investment-driven strategy towar
Page 71 and 72:
country's dependence on chemical im
Page 73 and 74:
distance ratio: OB/OF in order to m
Page 75 and 76:
productivity growth in the context
Page 77 and 78:
egistered the largest increase in m
Page 79 and 80:
Productivity Growth Measurement Two
Page 81 and 82:
CONCLUSION Chemical related industr
Page 83 and 84:
Chambers, R. (1988) Applied Product
Page 85 and 86:
Maisom, A. (1995) "Total Factor Pro
Page 87 and 88:
TABLE 1 TYend in Production, Employ
Page 89 and 90:
MIC Code 35111 35119 35120 35130 35
Page 91 and 92:
Year 1983 1984 1985 1986 1987 1988
Page 93 and 94:
TABLE 8 Malmquist Index, Technical
Page 95 and 96:
FIGURE 2 Malmquist Index and Produc
Page 97 and 98:
BIODATA OF DR. SHARIFUDDIN ZAINUDDI
Page 99 and 100:
However, the extremely few existing
Page 101 and 102:
SERVICE QUALITY MODEL According to
Page 103 and 104:
Word of Mouth Communications CONSUM
Page 105 and 106:
any point in the ZoT might be consi
Page 107 and 108:
who pay a nominal fee and received
Page 109 and 110:
RESEARCH FINDINGS Hypothesis la: Ac
Page 111 and 112:
TABLE 2 Manova and Paired Sample T-
Page 113 and 114:
It could be real that government fa
Page 115 and 116:
REFERENCES Adam, E.E. Jr., J.C. Her
Page 117 and 118:
McKinney, Jerome B., 1995. Understa
Page 119 and 120:
SYMBOLISM AND BUSINESS EDGAR J. RID
Page 121 and 122:
Once it is understood that we live
Page 123 and 124:
must be eliminated because racism n
Page 125 and 126:
which are people of color, out of t
Page 127 and 128:
The productivity problems of Americ
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