Our client had many different processes for each category, location and supplier, with no consistency and lack of visibility of costs and amounts of stock in each area of allocation. Invariably stock was ‘pulled’ by the end user or supplier without any science behind stock allocation. Forecasting was done from historic usage and suffered from feast and famine stock levels.
MNH identified significant areas of working inventory overstock around the network, 3rd parties with ‘buffer stocks‘ hidden within their physical stock allocation and inflated ongoing consumption rates. MNH’s ongoing proposal was to standardize all processes and working stock reporting via ROTIX®, then take accountability for the allocation process across all areas; driving out inefficiencies and then maintaining the system at optimum performance.
ROTIX® analyses consumption and usage ensuring the optimum inventory is forecast, ordered and called off. This reduces costs in the form of waste, over consumption and excess stock holdings.
- Improved control and regular reporting on all working stocks = reduction in waste and costs.
- 20% reduction in stock holding.
- Sustained consumption reduced by +11% across all high volume high cost rotable lines.
- Managed category service levels with early issue identification going forward, removing feast and famine stock cycles.
- 15% reduction in ongoing inventory allocation levels.
- Robust standardised processes for optimum performance and stock control going forward.
"MNH’s independent status as Performance Managers means United Airlines receive a professionally-managed service, best-in-class network operators and significant cost savings."
Beth Mohr, Sr. Category Manager, Procurement, United
For more information read our United Airlines Inventory Allocation; ROTIX® Case Study.
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