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Sourcing evaluation and optimization brings quick wins to a top Finnish engineering and service company
Our client is one of the world leaders’ in elevators and escalator solutions. In the first quarter of 2017, the company decided to conduct a thorough review of its R&D sourcing procedures to optimize the process and find synergies among the different production sites.
Given ARC Consulting’s expertise in sourcing, particularly in the R&D sector, both in Europe and in Asia, the client contacted us directly to help evaluate its current R&D practices in its factories in both Asia and Europe.
Opportunity
The client currently has production facilities in Finland, China, USA, and India and thousands of R&D suppliers located in several countries globally. Given the breadth of the business, there is a significant potential for this entity to manage suppliers more effectively to realize cost savings.
The company currently lacks a consistent and systemic method for managing suppliers. Sourcing documentation and process are highly fragmented among the different entities. A standard sourcing process could be established to maximize the utilization of the resources, reduce costs, and improve process efficiencies.
Approach
The task was handled in 3 steps:
- Step 1: Data collection and analysis was conducted to better understand the current state of the R&D sourcing.
- Step 2: Identified and circulated a standard sourcing process that utilized the best practices and performance level of the factories. Conducted in-depth interviews with department managers in the European and Chinese production sites to identify opportunities for process improvement.
- Step 3: Formulated recommendations based on the inputs from the interviews and our professional experience.
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