Global Warehouse Materials Management Solution

A MANUFACTURING COMPANY IN THE AEROSPACE INDUSTRY WAS FACING EXCESSIVE INVENTORY ISSUES AND LONG COMPONENT TRANSFER TIMES BETWEEN LOCATIONS.

INTERTEC CREATED A GLOBAL WAREHOUSE MANAGEMENT SOLUTION WHICH DRAMATICALLY INCREASED EFFICIENCY AND ELIMINATED TASK DUPLICITY

Client's Challenge

The company, whose products include aircraft engines and systems, aerospace electronics, and landing gear components demanded a robust and reliable process to quickly move materials between plants.

The end goal had two equally important purposes: to minimize stock levels and significantly reduce inventory values, while at the same time enabling the fast transfer of materials between production plants to balance existing stock and meet manufacturing and repair process needs.

Our Solution

First, a formal Program and Project Management methodology was used based on Project Management Institute (PMI) principles and concepts. We then organized a cross-functional team composed of sales, finance, and materials and operations management in order to standardize all parts to facilitate cross-plant planning and transfers.

After standardization was completed, our team worked with the client to identify the existing barriers to moving materials. Some of these barriers included: material cost standards, multiple quality standards, part number variation for common parts, and organizational competition for materials between manufacturing, maintenance/repair, and sales orders.

Finally, we designed an ERP Solution within SAP to enable automatic plant-to-plant transfers based on MRP requirements.

Value Obtained

  • The development of an SAP materials management solution based on consistent cost models, quality standards, and allocation rules, resulted in seamless plant-to-plant transfers, as well as an inventory reduction of 25%.
  • Additionally, by implementing a common quality standard the company eliminated the need for material re-inspection and driving further cost savings.