The document discusses true inventory optimization, highlighting the need for spare parts to be available at the right time, right place, and right price. It presents case studies of Metso Minerals and JLG Industries, detailing their challenges and solutions in improving inventory management and customer satisfaction. The results indicate significant improvements in inventory reduction and customer satisfaction metrics after implementing optimized service parts management strategies.

1. THREE KEYS
TO TRUE INVENTORY
OPTIMIZATION

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RIGHT TIME
RIGHT PART RIGHT PLACE
TRUE
INVENTORY
OPTIMIZATION
TRUE INVENTORY OPTIMIZATION
occurs when spare parts are
available when and where
needed at the right price for
the customer and company.

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Dynamic, global service
operations require a
complex service parts
management approach
to ensure the highest level
of equipment availability
with the least amount of
parts-related disruption.
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RIGHT PART

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METSO MINERALS OVERVIEW
CHALLENGES
• Global parts inventory
• Service locations function
separately
• Difficulty meeting SLAs
• High inventory costs
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RIGHT PART

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METSO MINERALS OVERVIEW
SOLUTIONS
• See supply chain as a whole
• Service locations function
interdependently
• Meet customer expectations
• Lean out and predict
inventory costs
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RIGHT PART

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Results
+3.4%
on-shelf
availability
32M
EUR inventory
reduction
+18%
inventory turns
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RIGHT PART
“We are constantly looking for ways
to improve how we connect to
our customers and their needs,
we’re looking forward to continuing
our service transformation.”
− Sebastien Bergé, Metso Minerals

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Accurate service parts
forecasting is challenging
when considering a mix of
fast and slow-moving parts
with sporadic demand.
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RIGHT TIME

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CHALLENGES
• Thousands of parts in inventory
• Customers purchasing non-OEM
parts due to price sensitivity
• Lack of visibility into competitive
pricing
• Part pricing mostly manual process
JLG INDUSTRIES
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RIGHT TIME

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JLG INDUSTRIES
SOLUTIONS
• Set optimized pricing echelons
• Customers seeing greater value
in OEM parts
• Auditable pricing platform
• Interpret data for lifecycle pricing
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RIGHT TIME

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JLG INDUSTRIES
BENEFITS
• Three-year cumulative value to
JLG would be 60% higher than
originally projected
• Automating the pricing of 80%
of spare part stock
• 100% ROI in 12 months
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RIGHT TIME

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Dedicated service parts
management solutions
enable demand forecasting
and ongoing optimization,
allowing you to meet your
customers’ service parts
needs by balancing the
unique complexities of the
global service supply chain.
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RIGHT PLACE

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SOLUTIONS
This was done by demonstrating
SPM v11 consolidation not only met,
but exceeded prior functionality
and quality of the separate MCA
v7 and SPM v9 solutions, and do so
at a lower internal cost.
PRATT & WHITNEY
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RIGHT PLACE

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CHALLENGE
The need to consolidate two
very successful, but different,
long-standing parts
management solutions.
PRATT & WHITNEY
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RIGHT PLACE

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Results
“We made a large investment into the
future of our customer service. Our
customer base relies on uptime, and
optimizing our services just makes
sense – for our customers and for the
long-term success of our business.”
− Robert Tomastik, Materials Center of
Excellence Manager, Pratt & Whitney
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10%
improvement
in fill rate
10%
reduction
in inventory
RIGHT PLACE

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RIGHT TIME
RIGHT PART RIGHT PLACE
TRUE
INVENTORY
OPTIMIZATION
5-25%
Increased Customer
Satisfaction
10-25%
Part Availability
Improvement
3-8%
Margin Increase
10-35%
Inventory Reduction
RESULTS OF
INVENTORY TRULY OPTIMIZED

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JLG Industries Metso Minerals
READ THE CASE STUDIES
Pratt & Whitney