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nVentic helped an automotive client identify 15% improvement at their leading facility

Context

Our client was a major OEM manufacturer in the automotive industry. Globally the company demonstrated average performance when benchmarked with its peers for DIO, but nVentic was invited to look at their flagship site, where they believed performance to be best in class. Having already been through several projects to improve inventory management, the client still struggled with inventory performance visibility and asked nVentic to run a proof of concept project.


Approach

nVentic immediately understood why inventory visibility was poor. The 6 million transactions per year were deleted from the ERP systems and warehoused on a frequent basis. We therefore had to deal with multiple instances of missing or conflicting data right from the start. Rather than wait until all data was available, we focused on what was immediately to hand (less than a year) and carried out our standard classification and evaluation on that basis.


Results

Despite the client’s expectation that we would find little or no improvement potential, nVentic identified an overall opportunity to reduce inventory by 15%, with around 5% in finished goods and 20% in raw materials. The client commented that the transparency we gave them in a week was something they had strived but failed to achieve for many years. We also made some key recommendations in master data management.
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