Successful Restructuring of the Supply Chain for a Manufacturer of Wind Energy Plants

The Client

An international wind turbine manufacturer faced ongoing challenges with timely supply of crucial components for its production, causing frequent disruptions. Despite extensive internal efforts to address the issue, production delays and cost escalations occurred due to last-minute rescheduling and procurement. The lack of delivery reliability resulted in dissatisfied customers and contractual penalties, significantly impacting the company during economic difficulties.

The Challenge 

The management immediately recognized that this problem had to be dealt with as a top priority. However, due to the complexity of the situation with numerous internal and external factors that were not only changing rapidly but also influencing each other, it was not possible to objectively identify the main causes and the measures to be taken. To make matters worse, important relevant positions in the company were not filled.

Against this backdrop, an interim executive with experience in the industry was assigned to record, analyze and resolve the situation with the independent view of an external expert.

The Solution 

The following action plan was developed and implemented in close dialog with all stakeholders:

• The SCM organization was aligned along the value stream in the plant and a sequentially aligned "pearl chain management" was established
• Because of a missing parts issue, production control at the start of the chain was instructed to release orders without the missing components
• In close coordination with materials management, defaulting suppliers were immediately called upon to deliver backorders
• At the logistics center, employees underwent training using a qualification matrix to ensure they could be flexibly assigned
• The determination of process times in operational logistics led to an improved calculation of personnel requirements, which made it possible to avoid bottlenecks
• The selection of new managers and their participation in interdisciplinary workshops enhanced cooperation within and between teams to the point where production could be supplied proactively instead of reactively, as was previously the case
• Priority rules were implemented to address the issue of missing parts comprehensively, enabling the "missing parts team" to resolve the backlog effectively
   

The Results 

The Supply Chain Management (SCM) department now collaborates effectively across different locations and functions. The implementation of a sequence-based order planning methodology has brought stability to production control. This achievement is supported by the introduction of daily shop floor meetings, escalation meetings, intensive technical coaching for young team leaders, and the integration of On-Time In-Full (OTIF) key performance indicators at all stages.

Consequently, the focus has shifted from reactive troubleshooting to proactive root cause analysis and sustainable prevention. A pull system has been adopted in place of the previous push system. Key performance indicators have shown significant improvement, such as a 40% reduction in lead times for large components and an increase in On-Time Delivery (OTD) rates to over 98% for the logistics center and prefabricated components.

The project has been successfully concluded and transitioned to the manufacturer's employees. Extensive training and documentation efforts have been put in place to ensure that the positive outcomes are firmly embedded within the company.

Optimize your supply chain for efficiency and reliability. Connect with Thorsten Dörr to discuss cost-saving strategies and improved delivery performance.