BMW's reputation tarnished by continued delays

Ongoing issues with BMW's new supply management software has an impact on company's reputation.

BMW's reputation tarnished by continued delays
BMW's reputation tarnished by continued delays

By < href="">Rebecca Byfield | August 23, 2013

As the world’s biggest maker of luxury cars, BMW has a reputation of excellence to uphold - a reputation that has been tarnished these last two months by ongoing issues with its new supply management system.

But in June 2013, BMW Australia
swapped over to the Advanced parTs Logistics in After Sales (ATLAS) system, which
the company
had been planning and developing on a global basis
for a number of years.

The change over in Australia required a shutdown of order processing to migrate the data from the old system to the new. While the migration only took a week to complete, BMW did not foresee the backlog it would create.

"In the lead up to the change over, all markets were prepared with the additional stocking of the 40 intermediate storage sites around the world," says Melbourne-based BMW Product Communications Manager Scott Croaker.

"Despite this preparation, there was a substantial increase in back order parts lodged with the central distribution centre at Dingolfing in Germany, comprising mostly special order parts that couldn’t be planned for," Croaker says.

Reports coming out of Europe say delays caused by the ATLAS system
implementation have
around 10 percent of parts unavailable, which has
significantly impacted BMW
dealers and customers across the world.

says some of the parts on back order that usually took between one to two weeks to arrive
have been
delayed by up to six weeks.

Meanwhile in Europe, Weller Gruppe, one of Germany’s biggest BMW dealers reported up to 20 percent of customers had been affected.

"We have to disappoint about 180 customers per month," Weller Gruppe owner Burkhard Weller says, adding that it is impossible to appease a customer who can’t use his or her

"I can’t tell the customer he will get his car back within one week. I have to say ‘I don’t know’. This is very unsatisfactory because, normally, we have a client satisfaction rate of 92 percent," Weller says.

Not all dealers have noticed an issue though. Hobart Autohaus Parts and Accessories Manager Robert Pike has got through relatively unscathed by the disruptions.

"BMW Australia has done an excellent job keeping us up-to-date on the issues," Pike says.

"So far, we haven’t had any issues getting parts but that’s because most of the parts we ordered were already in stock in Australia."

However Pike
concedes things may have been different had they needed to order specialty parts.

According to Croaker, BMW Australia has done a lot to stem the impact to customers by making additional service cars available to those waiting on parts.

The factory in Germany has also hired additional staff and has been working around the clock to process the backlog.

As a result, Croaker believes the backlog of ordered parts has been substantially reduced and expects everything to return to normal levels by the end of Q3 2013.

ATLAS logistics project was started in Dingolfing
in 2009, with a target to complete the new system within three years, according to a joint press release at the time from International Business Machines Corp and SAP AG.

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