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Optimizing inventory processes–flying toward high performance

Read how Accenture streamlined inventory workflows, boosted customer satisfaction and reduced inventory costs

Overview

The client is among the world’s top manufacturers of aircraft engines. It operates a global distribution network that provides spare parts critical for customers’ operational readiness.

Opportunity
The engine manufacturer struggled with parts inventory, which resulted in an unacceptably low order fill rate and turnaround of over 20 hours for high-priority orders. A lack of analytics capabilities hindered development of an effective strategy for inventory planning.

The engine manufacturer struggled with parts inventory, which resulted in an unacceptably low order fill rate and turnaround of over 20 hours for high-priority orders. A lack of analytics capabilities hindered development of an effective strategy for inventory planning.



SOLUTION



Root-cause analysis uncovered multiple reasons for subpar responsiveness. Using quantitative analysis, Accenture pinpointed supply-chain inefficiencies, including issues with suppliers, warehouses, stocking strategy, customer ordering and fulfillment processes.

Accenture configured and deployed a management tool that determined the most efficient stocking strategy by calculating optimal inventory levels, based on statistical modeling for parts at all geographical locations.

A performance dashboard provides visibility to relevant stakeholders, who monitor metrics such as first fill rate, parts availability, inventory value, turns and single shipment frequency.

Results
The Accenture solution demonstrated an immediate inventory reduction of $100,000 by rebalancing stock and identified excess inventory of more than $1 million. Turnaround for fulfilling high-priority orders has dropped from over 20 hours to less than 17 hours.

The stock replenishment process and tool enable the client to continuously monitor actual inventory against target levels. The Accenture solution shows that cost reduction, speed and service quality can be achieved with analytics aligned with high performance.