MRO optimization with major business impact

Client Challenge

A European market leader in the paper industry with more than 15 production sites across mainland Europe and the UK faced rising stock levels and a non-centralized approach to MRO spend. This indicated significant potential for improvement in managing the MRO category more strategically.

The H&Z Approach

Within a focused strategic sourcing initiative, H&Z consultants developed and implemented a tailored approach over six months. By enriching existing MRO parts data and processing over 45,000 line items with an KI based system partner, H&Z was able to structure market baskets for competitive bidding.
Additionally, existing service providers were segmented, and in close coordination with production sites, potential preferred partners were pre-selected. A three-stage RfP and negotiation process, driven by cross-functional collaboration, resulted in the selection of a significantly optimized supplier base. This enabled procurement and business functions to fully capitalize on the improved supply structure.

 

The Results

The company achieved savings of more than 8% on the total MRO spend. Moreover, the supplier base was streamlined from over 1,000 to fewer than 100, significantly reducing process costs and complexity.