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Mahindra & Mahindra Increases Revenues by 10% via Inventory Optimization
Technology Category
- Analytics & Modeling - Predictive Analytics
- Platform as a Service (PaaS) - Data Management Platforms
Applicable Industries
- Automotive
- Equipment & Machinery
Applicable Functions
- Logistics & Transportation
Use Cases
- Demand Planning & Forecasting
- Inventory Management
- Predictive Replenishment
Services
- Data Science Services
- System Integration
The Challenge
Mahindra & Mahindra Farm Equipment, part of the $20 billion Mahindra Group, is the world’s number-one tractor company by volume. Its Spares Business Unit (SBU) provides genuine vehicle and tractor spare parts via advanced capabilities in sourcing, assembling, warehousing and distribution. However, the SBU was losing sales revenues due to stockouts and tight working capital as a result of its high inventory investments. The business was relying on manual analysis and Excel spreadsheets to create demand and supply plans, but they were not adequate for the complexity and scale of the challenge. To gain greater responsiveness and ensure the availability of spares for different demand patterns, Mahindra sought Blue Yonder’s expertise and advanced technologies to optimize its parts inventories, spanning 100,000 SKUs and 21 distribution centers.
About The Customer
Mahindra & Mahindra Farm Equipment is part of the $20 billion Mahindra Group and is the world’s number-one tractor company by volume. Its automotive business competes in almost every segment of the industry. The Spares Business Unit (SBU) of the company provides genuine vehicle and tractor spare parts via advanced capabilities in sourcing, assembling, warehousing and distribution. The SBU was facing challenges with stockouts and tight working capital due to high inventory investments. The business was relying on manual analysis and Excel spreadsheets to create demand and supply plans, which were not adequate for the complexity and scale of the challenge.
The Solution
Mahindra implemented Blue Yonder’s Luminate Planning platform, leveraging the benefits of key demand forecasting, inventory management and replenishment planning capabilities. Scientific forecasting methods and multi-echelon inventory models have increased forecasting accuracy and optimized inventory levels, leading to higher customer service levels, reduced inventory investment and increased sales revenues. Labor-intensive processes, disconnected systems and Excel-based planning worksheets have been replaced with integrated, automated data exchanges between Blue Yonder’s planning platform and Mahindra’s execution systems. This enables the SBU to plan, execute and deliver goods in an organized and consistent manner. Post-implementation, the SBU has realized an overall improvement in forecast accuracy of 10%.
Operational Impact
Quantitative Benefit
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