The automotive supplier roadmap that increased inventory accuracy by 63%

Company snapshot

Profile

• Industry: Automotive

• Size: 600+ employees

• Headquarters: Luxembourg, Belgium

Overview

Tier one automotive supplier bringing transmission and powertrain components to the largest OEM assembly lines.

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Providing some of the world’s largest automotive manufacturers with parts is a massive operation. But coming out of the COVID-19 pandemic, which caused disruptions across overseas suppliers, a tier one automotive supplier was struggling. A growing list of projects and limited resources made it increasingly difficult for the company to manage its transmission and powertrain components inventory. These challenges also slowed deliveries to the original equipment manufacturers (OEMs) that needed them.

Additionally, the supplier lacked real-time visibility across operations. Their current Enterprise Resource Planning (ERP) system couldn’t provide the material status visibility they needed, causing inaccuracies across multiple warehouses and departments. The supplier lacked a clear picture of what inventory they had, where it was, and when OEMs needed their shipments, slowing operations and delivery times and leaving customers in the dark.

As a result, the supplier faced a backlog of 2.5 million units, while maintaining an on-hand inventory value of $71 million. Their inventory was also impacted off-site, with only a 32% warehouse inventory accuracy rate. These issues further strained their shipping department, which had a throughput of 56,500 units, over 2.4 million less than their inventory backlog.

While the company had the capability and tools to address these issues, its team lacked the capacity. By partnering with Uber Freight’s Consulting team, the company could better understand its data, inventory, and material status to gain visibility and control over its projects and improve operations.

The main objective for the six-month partnership was to develop and execute a continuous improvement roadmap that would rework the company’s inventory and shipping operations, driving visibility and control, and optimizing their facilities.

To begin, Uber Freight’s Consulting team created a vision, mission, and operating principles to align leadership and guide the transformation. The team also engaged key stakeholders to develop a consolidated project list, encompassing 60 active projects from five different departments. By organizing and prioritizing projects through PICK—priority, impact, cost, and knowledge—principles, Uber Freight helped the supplier improve project management and execution, enabling the company to focus on higher value work that meets business objectives.

Through Uber Freight’s guidance, the company has seen significant improvements in inventory and materials management, as well as shipment operations, including:

These improvements have also led the company to reinstate its in-house continuous improvement team and execute the remaining items in the roadmap, ensuring stronger and more sustainable operations.