It is imperative for Delphi's supply management organization to accurately and thoroughly calculate the total cost of ownership (TCO) for the variety of parts it buys from suppliers around the world. Delphi, based in Troy, Michigan, is a global supplier of electronics and technologies for automotive, commercial vehicle and other market segments.

Keeping in mind its vision to "buy where you consume and manufacture where you sell," the Cost Management group at Delphi designed an easy-to-use, sophisticated tool to measure TCO, focusing on global logistics costs. The Total Cost Model (TCM) provides decision support for Delphi's sourcing professionals so they can select suppliers and sources that provide the largest opportunity for total value.

The TCM is a desktop tool with built-in intelligence that accounts for numerous factors using minimum inputs. It has reduced the time to estimate the total cost of buying a part from five days to a matter of minutes.

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