Global Chains and the modular design of autoparts: The case of M

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Global Chains and the modular design of
autoparts The case of México 

• Dr. Arturo A. Lara
• Universidad Autónoma Metropolitana X.
• México- D.F.

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This analysis focuses on the production plant
network of Lear Corporation in Mexico, and its
aim is to describe and analyze the technological
up-grading process, as well as the strategy of
intra-company coordination and cooperation (in
the North American market) developed by Lear
within the framework of modular production.
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I
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NUMERO DE PATENTES DE LAS PRINCIPALES EMPRESAS
PRODUCTORAS DE ASIENTOSAUTOMOTRICES (1976-2002)
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hypotheses Lear-México is an autoparts
company that is bringing together an increasingly
large amount of automobile interior sub-systems
and components, including seats. This process has
been made possible by a) the incorporation and
intra-firm application of the technological
capabilities it has developed on a global level,
b) the use of a modularization and
specialization strategy in a cohesive cluster of
technological sub-systems and c) productive and
technological coordination processes on an
intra-company level.
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How can we explain the evolution of Lears
technological capabilities, from the production
of seats to entire interior systems? In order
to answer these questions, it is necessary to
describe the interdependent nature of seat
design.
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Establishing the architecture.

• The steps are
• 1.- Crate a schematic of the product.
• 2.- Cluster a rough geometric layout.
• 3.- Identify the fundamental and incidental
  interactions.

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Integral architecture

• An integral architecture has the following
  properties
• Functional elements of the product are
  implemented using more than one components
  (chunks).(many-components-to-one function)
• A single component implements many functional
  elements. (one-component-to-many-functions)
• The interactions between components are ill
  defined and may be incidental to the primary
  functions of the products.

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Modular one-to.one function/component

• One architectural feature essential for many of
  the advantages associated with modular product
  designs requires a one-to-one relationship
  between function and component.

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Deviation from a one-to-one relationship.

• 1.- There can be a one-to-many relationship
  Multiples components contribute to a particular
  function (protection and comfort in automobiles).
• 2.- A function can be provided by a component
  that simultaneously provides also other functions
  (the automobiles body)

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Deviation from a one-to-one relationship.

• 3). There can be a many-to-many relationship
  between functions and components (the power unit
  of the computer).

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Fuente Fixson Sako (2001)
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Modularity and Outsourcing

• In theory, modularity captures the notion of a
  clear division of labor between the architect
  with architectural design knowledge and designers
  with knowledge of each module.
• The dichotomy between integral and modular
  architecture is conceptually powerful. But the
  reality is not pure.

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The broad ties and interconnection of interfaces
among the different modules that make up the
interior of a vehicle a process called
modularization have made it possible for Lear
to make a huge leap from being a supplier of a
segment as specific and specialized as seats, to
offering the whole interior system.
Modularity and Outsourcing
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Modularity and Outsourcing

• Acquired technological knowledge and the
  processes involved in the manufacture of these
  other modules have strengthened Lears
  competitive capacity to extend production to
  cover the whole interior system

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Lear Seating Corporation Plants In Mexico, (1995)
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Lear Corporation Plants In Mexico, 2000
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Interior system task structure Matrix
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Flujo de suministro y fabricación de asientos e
interiores en Lear Tláhuac
Fabricantes de autos
Competencia
Sentido de la cadena de suministro
Plantas de Lear
Planta de Lear proveedor exclusivo
Fuente Elaborado con información de entrevistas
a plantas de Lear Corporation.
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Contraste de los diseños integral y modular en
Lear Corporation
Diseño Modular
Diseño Integral
Nodos de fabricación Lear
Plantas Lear
Clientes
Clientes
Proveedores
Estados Unidos
México
Cd. Juárez
Tláhuac
Plantas de Lear
Plantas de la competencia
Clientes
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Conclusions1.- During the 1990s, Lear-México
underwent an impressive process of expansion.
This company opened numerous plants in different
parts of Mexico, increasing the number of people
it employed and diversifying its productive
processes. 2.- Lear offers a successful case of
a world class supplier that went from being a
specialist in the manufacture of seats to a
producer and assembler of different components
(upholstery, harnesses and interiors) which are
then distributed to the terminal industry.
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3.- This company has managed to orchestrate the
broadening of the range of products it offers
with a growth strategy, not only through
geographical expansion but also by improving its
technological capabilities and organizational
strategy.
Conclusions
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Conclusions4.- The case study of Mexico reveals
that the policy of expansion and the location of
Lears plants is part of the process of economic
and commercial integration of this country
resulting from the North American Free Trade
Agreement. Lears decisions with regard to
location are in response to the search for lower
salaries, the reduction of transport costs and
the needs of its main customers (Chrysler,
General Motors, Volkswagen, etc.).
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Conclusions 5.- A company that increases its
size, the number of plants it has, its
technological capabilities, its human resources
and the range of products it offers is facing up
to the challenge of dealing with complexity and
uncertainty. Lear has managed to overcome these
obstacles by acting on three basic levels 1)
intra-company coordination, 2) its strategy of
capability expansion, and 3) modular design.