Transcript Poster Presentation Service Logistics Summit

Reduction of Vehicle Spare Part Repair Throughput Times at RET
The performance of a spare part repair process as a function of cross-functional cooperation
A. Problem Description
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Repair
throughput
time (quality)
Relatively high stock levels
Unreliable repair throughput times
Internal and external repair suppliers
Oligopolistic supplier market
Unique vehicles
10
8
6
4
2
Inventory
investment
(cost)
Research Goals
1.
2.
3.
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Identify literature recommendations
Study the current repair process
Benchmark with other companies
Provide recommendations on how to reduce repair times
B. Research Methodology
Problem finding phase
February – April 2014
Problem diagnosis phase
April – May 2014
Current situation
Process study
Desired situation
C. Conclusions
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Intervention design phase
June 2014
Company
reference
visits
ERP data
analysis
Spare part
availability
(service)
Scale ranging from 0 (very undesirable) to 10 (highly desirable)
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Interviews with RET employees
Literature
review
0
Repair processes involve a diverse set of actors
(mechanics, logistics employees, repair shops, etc.)
There is no ‘one size fits all’ repair process, even
though some general principles apply
Specific
recomme
ndations
Management reflection and discussion
D.Recommendations
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Review repair process and decisions made
• I.e. Repair/replace, suppliers, warranties
Differentiate
• ‘Strategic’ parts with clear supplier
agreements and partnerships
• Non-strategic parts with repair ‘swap’
arrangements
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1. Measurement
(KPIs)
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SRUs unavailable
Poor failure descriptions
Wide repair deadlines / No KPIs
Incomplete repairs
Different priorities at repair shop
Transportation frequency
Modifications
3. Manage
exceptions
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Hardly any agreements regarding
repair times
Incomplete repairs due to poor
failure descriptions
Manufacturers not really suitable
for repair
Discussions regarding warranties
and modifications
Financial Implications of long repair times
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Current application of ideas ‘on the job’
Industry conditions (non-standardized parts,
oligopolistic vehicle suppliers) challenge potential
inventory reduction
Staged approach
2. Agreements
(SLAs)
External
Internal
E. Practical Applicability and Relevance
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As a result, repair throughput times at RET depend
on a wide variety of internal and external factors:
Inventory reduction potential ≈ €1 million (10%)
Minimum yearly inventory cost savings ≈ €75K
Additional cost savings due to reduced investment
Inventory value (in millions)
Total estimated yearly cost savings
€ 200K
4.
Professionalization
Current
Student
Renso Stolk, MSc in Supply Chain Management
Logistics Repair Coordinator
Rotterdamse Elektrische Tram N.V.
Thesis Coach
Prof. dr. Leo Kroon
Professor of Quantitative Logistics
Rotterdam School of Management (RSM)
Date
Thursday November 6, 2014
Company Supervisor
Ir. Maarten Rodenburg
Logistics Manager
Rotterdamse Elektrische Tram N.V.
Thesis Co-reader
Prof. dr. ir. Rommert Dekker
Professor of Econometrics
Erasmus School of Economics (ESE)
MSc Thesis Poster Presentation
Service Logistics Summit
November 2014
Savings potential