Supply Chain Risk Management & Warehousing Consolidation
(Energy Industry Sector)
about this project
Our client has been based in Aberdeen since the mid-1960s, when oil and gas exploration started in earnest and has played an instrumental role in driving the North Sea economic engine ever since. During this time, the Client and it’s extensive number of supply chain partners built a massive network of material storage facilities to service both on and offshore operations
The Client with the assistance of PBI embarked on a complete review of storage facilities, owned by both the Client and 3rd party
The project included a complete review of existing warehousing and material to baseline the current state. A complete reconciliation of SAP to ensure that the physical and systematic material counts matched
The ultimate aim of the project was to ensure that the Client had the correct material when they needed it in the right quantities
The key objectives of the engagement were:
- Desktop review of the material held
- Triage (Keep, Review, Dispose) of the physical material at 3rd party locations
- Inventory Management
- 5S of all physical and electronic locations
- Physical disposal of material
- Review of warehouse utilisation and optimisation of the Client’s own Warehouse facilities where possible
- Full visibility of material left on site and logged onto SAP
Key Project Summary "At a glance"
Project Scope
- Reduce the amount of inventory held at 3rd party Warehouse
- Temporary Storage removed as an “option”
- Material reviewed and kept based on future demand
- Consolidate material
- Reduce storage costs
- Market material identified for disposal if possible or dispose of unwanted / obsolete materials
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- Full visibility of all material on Company’s SAP
Improvement Strategy
- Workplace organisation using 5S
- Kaizen Events for rapid change
- Set up Reduction techniques
- Sustainability monthly metrics
- Visual Management
- Annual Audit checks
Benefits Delivered
- Reduced Storage Footprint by 40%
- Reduced number of items in storage
- Consolidate storage locations where/if appropriate by moving stock to Company’s own Warehouse
- 13 Storage Locations tackled
- 7 locations closed
- 1 partial closure (Specialist Preservation)
- Temp storage as an Option, removed
- $15.0M ($9.5M temp storage) made available on SAP to the business
- $ 1.4 M (Book value) Disposed
- Obsolete or Surplus Stock Removed
- $ 11.4M(GOI) Additional Inventory Disposed
- Non SAP Materials or Zero valued Inventory removed
