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transformation sweeps
across six continents
A large global manufacturer redeployed its resources
Consulting worldwide to become more flexible, move closer to its markets,
Manufacturing be more responsive to its customers, and control its costs.
September 2014 Clients challenge
A large global manufacturer of engineered equipment with four major product groups
and operations at 40 sites on six continents was facing significant operational challenges.
A lack of production flexibility made it hard to respond to market cycles and fluctuations
in demand; long lead times from orders to deliveries were causing a loss in market share;
and high costs were eating into the companys profitability.
Working collaboratively with key stakeholders from the company, we began to design
future-state scenarios that would address the companys needs to become more flexible,
shorten its product lead times, and reduce costs. Our ideas spanned the macrowhere in
the world plants should be locatedto the microwhich individual products should be
produced where.
Our four-year manufacturing footprint strategy and plan for a structural market and
footprint realignment addressed deficiencies and would improve profitability. A core
element of the proposed strategy was to move from single-product assembly facilities to
multi-product assembly operations closer to key markets, a setup tailored to customer
and market needs that would strengthen the companys ability to capture market demand
and to incorporate customer feedback into product design.
PwC was able to bring our experience across industries and clients, our expertise in
supply chain transformation, and our broad service portfolioincluding global Tax
advisory servicesto bring the project to fruition. Our worldwide presence was critical to
an effort that stretched to every corner of the globe.
We have forecasted that the companys order fulfilment cycle time will ultimately be
reduced from 275 to less than 80 days, and it will likely improve its on-time delivery by 27
percentage points. We also expect to see a five to seven percentage points jump in profit
as a direct result of newly efficient and lower-cost manufacturing. The company is
projecting a three-to-four-year return on its investment in transformation as it strives
toward its goal of becoming a global leader and number one or two in the markets it
serves, and it will continue to work with us on future ERP projects to improve its results
even more.
Or contact
Hans Kuehn
Partner
+49 151 46123227 hans.kuehn@de.pwc.com
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