Driving Collaboration to Create Win-Win

Partnerships Between Customers & Suppliers

October 23-24, Detroit

Day One
Tuesday, October 23, 2018

Day Two
Wednesday, October 24, 2018

Chair’s Opening Remarks

Optimizing the Relationship Between Customers & Suppliers to Achieve the Lowest Cost Structure


  • Outlining the flaws in current costing methodologies, such as how givebacks and long term agreements artificially increase costs
  • Exploring the potential of collaborative cost reduction such as design-to-cost, target costing and value engineering
  • Foreseeing how the industry might be able to build more trustful relationships between each tier of the supply chain to identify cost saving opportunities

Breakout Part One: Tiers to Discuss Challenges & Desires


Attendees will be split based on their company type, with OEMs, Tier 1s and lower tier suppliers each holding their own working groups. Each group will note down their grievances with the existing costing methodology and propose actions that they would like to see their customers or suppliers take.

AI for Predictive Costing


  • Navigating a changing environment and new technologies requires that allows us to look at product costing in a new way
  • Assessing the relevancy of Artificial Intelligence: does it fulfill requirements and overcome barriers?
  • Efficiently accomplishing existing tasks and discovering innovative solutions which were previously unfeasible or even unthinkable

Speed Networking & Morning Refreshments

Breakout Part Two: Sharing Perspectives on Industry Relationships


A representative from each working group will report back to the conference, summarizing
findings from Part One earlier. Conference attendees will discuss and vote on whether each
proposed action is desirable and achievable.

Establishing Software Development Costs for Commercial Vehicle Parts

  • Marcus Malinosky Cost Engineering Manager, Chassis and Mechatronics, Daimler Trucks North America


  • Examining the increasing inclusion of software and electronics in vehicles to outline why cost estimating needs to include software
  • Exploring the process development of software cost estimating: from comparing historical quotes to a cost model
  • Reviewing best practice case studies in establishing software development costs: has optimal practice been achieved?

Reviewing NAFTA, Trade & Commodity Trends & Determining the Cost Impact for the Automotive Industry


  • Outlining major updates in international trade for automotive components and materials, including U.S. trade policy and the effects of Brexit
  • Considering the impact of trends on material and component prices for the automotive industry
  • Assessing the global demand and supply for vehicles to consider which commodities may be at risk of price increases

Networking Lunch

13:30 Benchmarking Purchasing Strategies & Industry Best Practices to Maximize Cost Savings

  • Reviewing the pros and cons of the true cost approach traditionally used by purchasing
  • Considering whether productivity or givebacks YOY genuinely reduce total costs
  • Improving collaboration with suppliers to develop win-win situations and genuinely reduce real costs

Balaji Ramanujakannan, Strategic Sourcing Cost Analyst – Global Purchasing, Bendix

14:10 Hearing How Target Costs Are Set & Leveraged in Purchasing

  • Exploring the methods used by customers to set targets: are they realistic, or expecting to fail?
  • Understanding how cost engineers work with purchasing to ensure targets are utilized effectively
  • Determining how target setting may change in the future as a result of industry trends

Tim Welbaum, Senior Product Cost Estimator, Hella Corporate Center USA
Kyle Boes, Buyer, Program Purchasing, Hella Corporate Center USA

14:50 Reality Check: Identifying Common Cost Traps & Causes for Inaccurate Targets & Quotes

  • Considering the realities of how people and shifts work, and how this impacts labor rates
  • Reviewing the actual efficiencies and operations of equipment to ensure all costs are accurate
  • Developing a company mindset and process to check the reality of every quote or target

Subbarao Kankatala, Manager – Purchasing, Nissan

13:30 Optimizing the Product Design Process to Strategically Reduce Cost

  • Developing a process that enables cost to be continuously considered at each stage of product development
  • Considering the value of Lean & Six Sigma to methodically reduce waste
  • Leveraging technology to better visualize design options and drive out unnecessary costs

Joseph LaRussa, Director – Seat Engineering, Brose North America

14:10 Improving Internal Collaboration to Provide Designers with Quicker Feedback on Cost

  • Benchmarking how quickly engineering receive cost feedback compared to how long it realistically takes
  • Exploring the potential of technology to connect departments and provide instant feedback
  • Integrating cost engineers with engineering to improve shared understanding and expectations

Rob Stevens, VP of Engineering, Roush

Jim Corbeil, VP of Supply Chain Management, Roush

Ed Pretzel, President, Collaborative Supply Chains

14:50 How to Approach Cost Estimating & Quoting with Barely Any Design Details

  • Setting expectations for what level of accuracy cost engineers can realistically achieve when provided with limited design details
  • Leveraging data from past projects to fill in gaps in the design where possible
  • Quantifying the risks so that appropriate contingencies can be included in quotes

Eric Gierahn, Engineering Group Manager: Electrical, General Motors

Afternoon Refreshments

aPriori Presentation: Details TBC


aPriori is a software company located in Concord, Massachusetts that develops and markets product cost management software. aPriori software and services generate hard-dollar product cost savings for discrete manufacturing organizations. Using aPriori’s real-time product cost assessments, employees in sourcing, manufacturing and design engineering make moreinformed decisions that drive costs out of products pre- and post-production.

Exploring the Potential for Standardization of Cost Structures & Methods to Align Expectations Between Customers & Suppliers


  • Identifying easy wins: what could we all agree on today, if anything, that should be standardized?
  • Exploring ways in which companies can work together to standardize as part of long-term relationships, even if this cannot be applied across the industry
  • Brainstorming a method by which the industry might progress toward standardization: what are the steps that need to be followed?

Chair’s Remarks

Networking Reception – hosted by FACTON