Context
A leading pharmaceutical company launched a working capital reduction program to optimize inventory management for direct materials, with a strong focus on packaging components. The goal was to balance inventory levels while maintaining production stability across its European production sites, ensuring operational efficiency and continuous product availability.
Ambition: balancing inventory reduction with production stability
The company aimed to reduce working capital tied up in inventory without compromising production stability in response to high product demand. Bridging the gap between senior leadership’s strategic objectives and operational execution on the shop floor was essential. Additionally, harmonizing inventory policies across multiple sites with varying processes and requirements was critical to achieving consistent and efficient inventory management.
How we helped
We helped the client design and implement a comprehensive inventory optimization program, integrating advanced analytical tools to assess and adjust inventory levels based on demand forecasts and production needs. We introduced a standardized inventory management philosophy and clear policies to ensure consistency across all production sites, enhancing supply chain visibility and resilience. To support successful adoption, we provided targeted training for planners and worked closely with stakeholders at all levels to align strategic objectives with day-to-day operations.
Results
The program achieved a considerable reduction in working capital for direct materials across European sites. The harmonized inventory management policy improved supply chain visibility and resilience, supporting consistent production without overstocking. Strong adoption by planners and alignment between leadership and shop floor teams created a sustainable and efficient inventory management system, empowering the company to effectively respond to future demand fluctuations.
Ready to drive efficiency and resilience in your inventory management process? Contact us today to learn how we can help you.
