Global Warehouse Materials Management Solution

Introduction

This international aerospace corporation, whose products include aircraft engines and systems, aerospace electronics, and landing gear components, demanded a robust, reliable process to quickly move materials between plants in order to balance existing stock, meet manufacturing and repair process needs, minimize inventory levels, and reduce costs. Intertec developed an SAP-based solution that allowed for seamless plant-to-plant transfers, reducing inventory levels by 25%, eliminating the need for material re-inspection, and insuring additional cost savings.

Business Challenge

  • Minimize stock levels and significantly reduce inventory values.
  • Enable to the fast transfer of materials between plants to balance existing stock and meet manufacturing and repair process needs.

Solution

  • Intertec worked with the company to identify the existing barriers to moving materials including: material cost standards, multiple quality standards, part number variation for common parts, and organizational competition for materials between manufacturing, maintenance/repair, and sales orders
  • Intertec organized a cross-functional team composed of sales, finance, materials management, and operations to develop a set of standards for all parts to facilitate cross-plant planning and transfers. A formal Program and Project Management methodology was used based on Program and Project Management Institute (PMI) principles and concepts.
  • Intertec designed an ERP Solution within SAP to enable automatic plant-to-plant transfers based on MRP requirements

Results

  • Intertec led the development of an SAP materials management solution based on consistent cost models, quality standards, and allocation rules, resulting in seamless plant-to-plant transfers and a 25% inventory reduction.
  • By implementing a common quality standard, the company benefitted from additional cost savings by eliminating the need for material re-inspection.