Frequent stockouts of critical parts
Our client had a complex manufacturing process with multiple products produced based on market demand. They had over 2000 child parts which made managing them a tough task. With so many materials to purchase, they often had to stop production due to unavailability of critical parts.
Low visibility of stores, production, and planning team
Each of the client’s department had their own process and their own way of reporting data related to materials. This gave rise to siloes within the organization acutely hampering the visibility of inventory across departments. This meant, without a proper synchronization with the production and the planning departments, the stores department was either ordering too many parts or too few parts. Apart from this, they were using excel macros which was not enough to capture all the varying parameters and predict accurate material mix for purchase.
High inventory holding costs
Once the client saw a trend in stockouts, they started ordering in more parts than necessary to mitigate the situation. As the inventory piled up, so did their holding costs putting a serious dent in their capital management.
Keeping suppliers in loop
With the high number of parts in use for their production, the client had multiple suppliers. They also had suppliers across the globe to control costs. This meant that the parts arrive at different times and from different places. Our clients faced difficulties in keeping the suppliers in loop to order the right amount of parts in the right time.