Demand Driven MRP – Results and Case Studies

The following companies’ results give some sense of the nature and scale of the improvement potential of DDMRP, Demand Driven MRP .

Oregon Freeze Dry

Oregon Freeze Dry is the world’s largest custom freeze dry company and is the world leader in commercial and industrial freeze drying science.

Click here to see a video about the implementation at Oregon Freeze Dry (##Note: It takes a minute or so for the video to load)

At their Mountain House Division:

  • Sales increased 20%
  • Customer Fill Rate increased from 79% to 99.6%
  • Inventory was reduced by 60%

At their Industrial Ingredient Division:

  • 60% reduction in make-to-order lead time
  • 100% on-time delivery
  • Inventory was reduced by 20%

Raw Material impact:

  • No out-of-stocks
  • Inventory was reduced by $2 MM


LeTourneau Technologies, Inc.

LeTourneau is a vertically integrated manufacturing company specializing in large scale and high load bearing equipment for a number of industrial applications including oil and gas, steel, mining and forestry products.

Watch this video about the implementation at LeTourneau Technologies, Inc. (##Note: It takes a minute or so for the video to load)

(Note: It takes a minute or so for the video to load)

There’s a very interesting comparison at LeTourneau.

2 sister facilities, Longview and Houston, are similar in size, making similar products, with similar capabilities, equally strong management, both using exactly the same ERP system.

Both plants experienced tremendous growth over a 4-year period (the company grew sales from $250 MM to $1.2 B).

Look at the difference between the inventory growth needed to support that revenue growth at the 2 plants; the difference? The Longview Facility was using Demand Driven MRP as part of their TOC implementation.

NOTE: The caption for the Longview plant mentions “ASR” … until 2011, this was the name (Actively Synchronized Replenishment) given to the technology known today as Demand Driven MRP.

Houston-facility

Longview-facility

Question: when the explosive growth fell back, and sales even dropped … which situation would you rather be in? Houston, with high inventory and falling sales, or Longview?

Not forgetting the bottom line … the Return on Adjusted Capital Employed (RACE) indicates that Profit kept pace with growth … which as you know, is a rarity.

profit-performance-440



Erickson Air-Crane

Erickson Air-Crane manufactures and operates the world’s largest fleet of Transport Category S-64 helicopters.

Watch this video about the implementation at Erickson Air-Crane. (##Note: It takes a minute or so for the video to load)

(Note: It takes a minute or so for the video to load)

With more than 17,000 parts to manage, Erickson saw the percentage of parts stocked-out with demand drop by 75% in 4 months.



Bonanza Press

Bonanza Press offers customized, exclusives and general release games.

Inventory Turns: Increased From 5 to 16 turns per year

Total Inventory: Grew to have 3 times the SKUs, with 30% less inventory

Lead Time: Reduced from 16 days to 3.2 days

Order Fulfillment: Elevated from 70% to 98%



Roseburg Forest Products

Roseburg Forest Products is one of the largest closely held forestry products companies in the United States. They are vertically integrated from their own forest lands through the production of plywood, dimensional lumber, particle board and Engineered Wood Products.

On Time Delivery from 45%to 95%
Increase in RACE of 14.5%
35+% reduction in inventory over 19 months



Corsa Performance

Corsa is a market leader in aftermarket automotive and marine exhaust systems.

Inventory Turns from 6 to 20
Inventory down 30% with 25% increase in sales
On Time Delivery at 96%



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