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Part Reuse & Vendor Rationalization
Exploiting PLM and ERP functionality to enable an ongoing rationalization of parts and vendors provides one of the largest justifications for PLM. Redundant parts create substantial operational overhead e.g., requisitions, vendor searches, vendor qualifications, incoming inspections, stock keeping, etc. Current studies show the average annual cost to maintain each instance of a part is $4408.00. Additionally, part redundancy by default equals vendor redundancy and that in turn reduces your buying power and your ability to drive vendor process, quality, delivery and serviceability to more and more demanding levels. Finally, the drain on engineering productivity cascades to have adverse affect on time to market, cost to market and the product or system quality at launch or commission. It is imperative to create a comprehensive part and vendor management process and application environment that forces an ongoing rationalization of parts and vendors beginning at the engineering desktop.
Key Business Value Findings
  1. Top performers reduced the annual cost of commodity spend by between 1.3% and 4.1% - vendor rationalization and improvement
  2. Top performers increased Engineering Staff productivity by between 3.9% and 9.6% annually
  3. Top performers increased Procurement Staff productivity by between12.7% and 21.9% annually
  4. Top performers increased Warehousing, Quality Inspection and Expediting Staff productivity by between 7.4% and 11.3% annually
Implications & Analysis
  1. Top Performers are 71% more likely to force classification of all parts in the early design stages
  2. Best in class enable Parametric search at the Engineering Desktop
  3. Best in Class propagate Approved Manufacturer/Supplier Data including Lead Time, Cost, Vendor Preference, and Mean Time Between Failure (MTBF) to PLM for exploitation by engineering communities
  4. Best in class enable automated component swapping in Engineering BoM's using selectable criteria including; lead time, cost, vendor preference, and mean time between failure (MTBF)
Our senior analysts are equipped to assist your organization to:
  1. Establish a parametric part classification schema to enable classification of all components and materials
  2. Establish part management workflows and configuration management rules that enforce classification and pull the engineering and procurement staffs through the part and vendor management processes
  3. Establish parametric part search capabilities
  4. Establish BoM generation capabilities to enable BoM create using selectable criteria as referenced above