Improving Working Capital Through Centralizing Inventory Management

Study Overview:

Many companies are comprised of diverse business units, each having their own P&L. In such cases, inefficiencies occur in the management of balance sheet items like inventories, where individual business units fail to optimize between demand/service levels and finished goods inventories. This 42-slide presentation provides insights into the value gained by centrally managing inventories in diverse corporations.

Key Topics:

• Supply Chain Organizational Models
• Inventory Management Metrics
• Centralization Transformation Process
• Best Practices and Lessons Learned

• Percent that centralize part of inventory management system
• Inventory Management Metrics
• Centralization Transformation Process

• While inventory days-on-hand and inventory turns were the most frequently measured inventory management metrics in the benchmark class, fill rate was rated the most effective metric by those using it.
• Among the benchmarking partners that have undergone a transition from a decentralized to a centralized or hybrid inventory management system, 80% indicated that the transition took fewer than three years.
• Benchmarking partners that have undergone a transition from a decentralized to a centralized or hybrid inventory management system most frequently rolled out the change top-down and bottom-up simultaneously.

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Industries Profiled:
Manufacturing; Chemical; Pharmaceutical; Financial Services; Consumer Products; Health Care; Service; Medical Device


Companies Profiled:
Eaton Corp; ASI Technologies; Inc.; W.R. Grace; Cabot Microelectronics Corp.; DuPont; Capital Safety; USA; Alfa Laval; Contract Packaging; Whirlpool; Cooper Power Systems; KimberlyClark; Corus Group; John Deere & Company; Crown; Ltd.; Draeger Medical; Glasstech; Leviton Manufacturing Co.; Marshall Boya (Akzo Nobel subsidiary); Northland Aluminum Products; Orica Mining Services; Outsourcing Services Group; PING; Prolec; Quickset International; Sasol; Speedline Technologies; Sudarshan Chemical Industries; Tata Steel; TTE Technologies; Valvoline Co.; Wacker Corp.

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