CLIENT CASE STUDY


Automotive supplier shrinks costs via parts classification, inventory optimization

A global automotive supplier collaborated with Accenture to reduce maintenance repair and operations costs by 15 percent of the baseline.

Overview

Using proprietary tools, Accenture collaborated with an automotive supplier on a global maintenance, repair and operations (MRO) parts classification and inventory optimization project, establishing:

  • A new global classification structure for MRO materials to identify existing duplicates and avoid the creation of duplicates in the future

  • Inventory optimization parameters and controls to improve availability rates, which it rolled out at three pilot sites

Opportunity
Like many others in the competitive automotive supplier industry, this company was under constant cost pressure. It identified its maintenance, repair and operations (MRO) area as an opportunity to reduce and avoid costs. The company’s Automotive Group managed more than three million MRO parts and more than 200,000 spare parts worldwide.

The MRO and spare parts were managed on a plant-by-plant basis, allowing little visibility into item data and inventory. As a result, many duplicate parts and obsolete stock remained on the system.

The company selected Accenture and its deep MRO parts life cycle management experience and proprietary tools and assets to gain greater insight and control over its parts.

 

Download the client case study. [PDF, 398 KB]

Solution

Drawing upon its deep MRO parts life cycle management capabilities and tools, Accenture helped to create a new global classification structure for MRO materials.

In addition, Accenture collaborated closely with the company to establish new inventory optimization parameters and controls, which were rolled out at three pilot sites.

Results
Thanks to new replenishment parameters, the company can achieve one-time savings of close to $2 million (15 percent of the baseline) across the three pilot plants.

The work can also help make recurring inventory savings due to reduced finance costs and storage needs. The new classification structure helps identify and eliminate existing obsolete parts and duplicates, as well as prevent the sourcing of duplicate items in the future.

With better stock replenishment parameters, the item availability rate has improved by at least five percent.

To further enhance performance, it plans to extend the pilot to incorporate the rest of its plants worldwide. The new framework also positions the company to improve its sourcing and procurement capabilities to make additional spend reductions.