Case Studies

Improving Forecasting Accuracy

Project Summary:

  • Industry: Auto Manufacturing
  • Employees: 12,000
  • Outcome: Improved profit margins

Organizational Challenge:

The rising costs associated with the manufacturing and distribution of automotive component parts, coupled with shrinking profit margins, was threatening our client’s ability to execute on their strategy to be the most reliable, just-in-time, error-free component supplier to North American auto assembly plants.

To remain competitive, they sought to:

  • Validate the hypothesis that increased forecasting accuracy would reduce the need for overtime
  • Decrease the variance in sales forecasting accuracy (a gap of 30-50%+)
  • Reduce the significant overtime exhibited in ten of their twelve plants

Performance-Based Solution Components:

  • Role Excellence Profiles (REPs) for the Plant Manager and Account Manager
  • Performance Support Resources

Client Impact:
Improved profit margins due to:

  • Improved forecasting accuracy (within 7% of target)
  • Optimized workforce planning (reduced overtime by 40%)
  • Reduced variance in sales quota attainment
  • Reduced variance in unit costs across multiple plants
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