The company is a reputed machine tool manufacturer and a pioneer in this industry. They have a strong reputation for technical excellence. Their machine tool solutions are used across multiple industry segments and they provide components for wind energy, power generation and infrastructure sectors. They are also a leading manufacturer of large and heavy duty CNC machines.
Their business carries an inherent high risk due to the high value of their end products coupled with high delivery lead times. Vendor support is most critical as bought outs are a major input. While customizations & change requests are part of the industry reality, delays apart from poor end product quality endangers receivables & repeat business.
- Due date performance < 40%
- High Assembly lead times: > 16-25 weeks
- Unreliable MIS and low visibility of status
- Capacity inadequate during crisis but unable to load at some other times
- Worried about managing capacity expansion profitably
- Suspects losing money on so-called strategic orders
- Cost & delivery time pressures from smaller players & imports
- Working capital pressures on vendor payments & inventory
- Due date performance: > 80%
- Reduced WIP/Inventory: ~ 20%
- A new working culture which brings all the functions together as a single team working to common priorities with focus on results
- Significant reduction in lead times leading to reduced cash to cash cycles
- With improved operational efficiencies, the operational capability became a market differentiator in this industry segment