A leading commercial vehicle OEM, with a broad portfolio of build-to-order medium and heavy-duty vehicles, was not performing as needed to serve its commercial, municipal and military fleet markets. Production was down, supplier constraints were causing limitations, and costs for expedited materials were up. This translated to excessive lead time on orders, contractual risk, and a growing inventory of incomplete vehicles equating to lagging revenue and dissatisfied customers.
Patina delivered a Constraint Management Office (CMO) with Standard Operating Procedures and then “platooned resources” – to fix processes, define metrics, and initiate action plans. Internal deficiencies were addressed, including order slotting and scheduling, EDI generation, material flow processes and newly defined metrics to drive accountability. External communications were improved among 60 critical suppliers with the focus to accelerate progress.
Among the successful outcomes: a 2,600 truck-backlog was eliminated; there was a 48% improvement in order-to-ship lead time; an 11% reduction in transportation costs; 90% fewer external resources; a 50% reduction in premium freight; and knowledge was transitioned to the organization. This led to greater cash flow and a stronger bottom line, as product was delivered faster than before and extensive customer wait times were reduced or eliminated.