Overproducing is the tactic most manufacturers use, but it negatively impacts inventory turns and cash flow. Stressing operations to respond quickly is common for many tier one suppliers, but it also negatively impacts employee retention, overtime, and on-time delivery. Most embrace these negative consequences to prevent deductions on their scorecard. A poor scorecard can hurt chances of getting future business, and can destroy a company’s reputation.
Our client faced the challenges mentioned above in the Automotive, Heavy Duty Truck, and Aerospace industries for decades, but 2020 presented a set of new challenges. The global supply chain shrunk and then quickly expanded resulting in bottlenecks at ports and demand outperforming supply for logistic companies. This exacerbated the existing challenges of shrinking customer lead times and growing global supply chain. There had never been a more important time to implement a solution to improve their demand forecasting.