MMOG/LE to ensure a strong and reliable supply chain

The Materials Management Operations Guideline/ Logistics Evaluation also called MMOG/LE is a tool used to assess the supply chain management expertise and capability of automotive manufacturing and logistics facilities worldwide.

It is aligned with the objectives of the global quality standard IATF 16949 and uses numbers and terminology consistent with this standard.

The MMOG/LE tool is the industry standard for assessing the supply chain management processes of OEMs and thousands of Tier 1 and Tier 2 suppliers against what is considered best practice, making it much easier to explain supply chain operations and demonstrate continuous improvement to both external customers and internal management.

It is a self-assessment and continuous improvement tool for your supply chain.

This tool will allow you to identify your weak points in order to implement different actions to make your supply chain strong and reliable

MMOG/LE standard : objectives

In an international context in full evolution, to align with the standards of the automotive industry requires a constant progression and evaluation of its logistic processes.

Indeed, today’s major car manufacturers (and Tier 1 suppliers) are more and more demanding when it comes to selecting their suppliers (Tier 1, 2, 3, etc.) and often favor those who respect global standards, especially in terms of supply chain, in order to benefit from good delivery times, for example.

Industry standards strongly encourage automotive suppliers to continuously improve their processes in order to meet the performance and excellence requirements of car manufacturers (and tier 1 suppliers).

Many suppliers therefore use MMOG/LE to evaluate their own supply chain processes, i.e. production, procurement, storage, delivery, … and whether they can meet the market requirements.

The Automotive Industry Action Group or AIAG, (represented by GALIA in France), is a North American automotive association, whose missions are to :

• Enable collaboration within the automotive and related industries
• Provide access to information, training and tools

The goal is for stakeholders to continually improve the environment in which they operate.

AIAG has partnered with its European counterpart, Odette, and both have introduced the MMOG/LE to enable automotive stakeholders to improve their global supply chain management.

Both institutions regularly update the MMOG/LE standard due to the constant evolution of the automotive sector. It is therefore important for suppliers to stay up to date in order to best adapt to market changes.

The MMOG/LE is a standard to meet various objectives such as:

• Determine the robustness of existing internal processes
• Compare supply chain operations
• Facilitate continuous improvement
• Increase customer satisfaction
• Mitigate risk at all levels of automotive suppliers

MMOG/LE allows to identify supply chain issues (such as delivery delays, capacity constraints, manufacturers’ requirements…), to define improvement areas and to support suppliers in improving their daily logistics processes.

The MMOG/LE allows to have a quality approach not only towards customers but also internally and thus to shine on a worldwide level as a reliable and solid supplier.

MMOG/LE : a complete set of specifications

MMOG/LE is available in 10 languages and encompasses two evaluation profiles:

• A full assessment: used by OEMs and higher-level suppliers whose primary business is automotive.
• A basic subset is used by suppliers at lower levels of the automotive supply chain.

Note that the basic subset includes the most important criteria of the full assessment and gives lower tier suppliers, who have ambitions to grow their automotive business, the opportunity to take the first steps towards world class status.

The MMOG/LE tool consists of:

• Six chapters that describe the components of the supply chain
• A gap analysis to document action plans
• Criteria to assess an organization’s supply chain processes and capabilities
• Automated rating and classification system with A, B and C categories for the full version and ZA, ZB and ZC in the basic version (A and ZA being the best classifications)
• Built-in tools for gap analysis, action plan development and progress tracking
• Diagrams to summarize and graphically communicate assessment results
• Background information and recommendations on how to use MMOG/LE

MMOG/LE internal & external benefits

Companies that adopt MMOG/LE practices report numerous financial and business improvements, such as:

• Up to 60% reduction in inventory holding costs
• Reduced premium freight costs by up to 85%
• Reduced obsolescence costs by an average of 80%
• Improved delivery or service rates by up to 15%
• Reduced employee training costs by up to 50%
• Acquisition of new business and therefore company growth

MMOG/LE also highlights areas where technology can help automate processes to eliminate error-prone manual processes.

Companies often achieve the best results with MMOG/LE when management actively participates in the assessment, in the same way as for any quality change within a company

It is fundamental that evaluation and continuous improvement are embedded in the corporate culture.

The ultimate goal is to improve your chances of being selected by a manufacturer or Tier 1 supplier by complying with their requirements to the maximum. MMOG/LE is therefore an indispensable tool for automotive suppliers today.

In addition, automotive companies, and more particularly OEMs, are facing unprecedented disruptions in their business due to component shortages (semiconductors, transportation cost increases, staff shortages, political changes…).

As a result, OEMs are realizing that Tier 1 sub-suppliers are just as important as their Tier 2 suppliers in supplying their factories and are looking for ways to improve the performance, security and visibility of their entire supply chain.

OEMs will increasingly ask their Tier 1 suppliers to deploy MMOG/LE including their own suppliers and so on down to the lower tiers, so it’s time to get trained in MMOG/LE

SNECI & the MMOG/LE standard training

SNECI provides training in the MMOG/LE standard.

This training is aimed at automotive suppliers wishing to assess their logistics capability and highlight weaknesses in their organization.

The Global MMOG/LE v5 standard is the ideal tool to continuously improve the supply chain while significantly reducing logistics costs and meeting customer expectations.

GLOBAL MMOG/LE v5 is a logistics assessment tool recommended by GALIA/ODETTE and proposed by SNECI.

During this training, the following points will be covered :

• Understanding of  of MMOG/LE
• Introduction to version V5: Key changes
• Achievement of “best logistics practice” developed by OEMs and leading Tier-1 suppliers
• Review, introduction and tracking of logistics KPIs that reflect logistics strategy and vision of the company
• Ability to work with MMOG/LE Excel file and MMOG.np
• Improvement of sub-supplier management both for series and new projects
• Improvement of internal and external communication (suppliers/customers)
• Problem prevention vs problem resolution approach
• Accentuation of criteria with added value for customers
• Knowledge of auditing and self-audit rules
• Understanding of customer requirements regarding MMOG/LE

The main objectives of this training are to :

• Identify weak points and continuously improve your
• Logistics standards
• Significantly reduce logistics costs
• Integrate logistics department and its staff members at the right place within the organization
• Fulfill requirements of OEM customers

Delivered by a Logistics Expert certified by GALIA to perform Global MMOG/LE audits, this training will give you all the keys to meet the expectations and requirements of car manufacturers.

We organize these sessions in face-to-face and/or remote sessions in order to adapt to your constraints and preferences.

To go even further, we also propose, in addition to this MMOG/LE training, an internal audit performed by our experts, with your teams. This audit can last from 1 to 3 days, depending on your needs.

SNECI also offers a wide range of training courses  from IATF 16 949 audit to the B2B portals of Stellantis & Renault, including Monozukuri, electric vehicle operation or autonomous vehicle technology via ADAS systems…

Do not hesitate to contact us for more information or to write to Laura who will answer you in less than 24 hours: laura@sneci.com.