Supply Chain Strategy & Design

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Asset Acquisition Strategy (Spares List Determination)

Our client is responsible for managing and providing engineering and supply chain sustainment support for an aviation system. An operating system had been introduced into service and due to regular demands for spares that could not be fulfilled (as they were not on the original spares acquisition list) was at risk of not achieving Full Operating Capability. GRA assisted the client to develop a spares buy list. Our client made use of GRA’s suggested spares buy list and recommended inventory management settings to make a one off acquisition buy to address the ‘nil stock’ issue. Once the spares acquired came into stock, the demanded spares fulfilment rate to the operator dramatically improved and the system achieved Full Operating Capability on schedule.

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Asset Acquisition Strategy (Test Equipment Options Development)

Our client is responsible for managing and providing engineering and supply chain sustainment support for an aviation system. A major component of the Support and Test Equipment (S&TE) system was due to become obsolete, with a limited window to make an acquisition decision for the number of replacement (upgraded model) units and associated test program sets. GRA assisted the client in making a timely acquisition decision with in depth analysis and modelling of future state scenario options. Our support to the client and recommendations enabled them to make a well informed decision within the limited time window, to satisfy the procurement lead time requirement and mitigate a high risk with significant consequences.

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Asset Acquisition Strategy (Logistics Support Concept Review)

Our client is responsible for managing and providing engineering and supply chain sustainment support for an aviation system. Following a series of acquisition decisions and challenges a comprehensive review of the sustainment support strategy was undertaken by GRA. We identified 30 components that may be impacted or warranted a review; assessed each component prioritising findings for a ‘deep dive’ analysis based on impact to the system and support costs; conducted a detail analysis of nine support strategy components; and recommended options with an assessment of trade-offs and impact on cost and system outcomes under each option.

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Supply Chain Network Optimisation (Llamasoft)

Our client is a publicly listed company that sources and manufactures bathroom and kitchen products nationally to trade and consumer channels across Australia. They were undertaking significant business transformation, which included changing their business model from being a primarily locally manufactured organisation to an internationally sourced one, and needed help to compare sourcing & distribution network options that could be deployed to improve service level performance whilst reducing working capital and costs. GRA were asked to build a model to assess the viability of a number of sourcing & distribution operating scenarios. The team used Llamasoft Supply Chain Network Optimisation Software and Tools to create a model that demonstrated that a segmented service offering could deliver enhanced overall service performance (from 80% to 95% line fill rate) with further enhancement of priority products (to 99%  line fill rate). The results of the modelling efforts were used to inform executive level business strategy planning which has subsequently resulted in the business halting a declining market share, increasing EBIT, Margin % and TSR compared to benchmark organisations.

 

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Strategic Sourcing & Supply Chain Strategy 2

Our client, a multi-billion-dollar investment holding company had acquired several large Australian retailers with a network of more than 300 stores across the country, and was in the process of defining their future integration plans and capability requirements. With stability of product range, store expansion and e-commerce being key drivers for the business, the company engaged GRA to develop a strategy to deliver cost reduction, improved service levels and greater utilisation of company-owned assets. Key to this engagement was a strong emphasis placed by the client on ensuring supply chain expertise was incorporated into the development of the strategy to ensure a sustainable outcome was delivered. The resulting business case developed by GRA provided opportunities to reduce costs, improve margins and drive greater utilisation of company owned assets. It also delivered a strategy to establish a common infrastructure and enable future acquisitions to be integrated into a common supply chain.

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Strategic Sourcing & Supply Chain Strategy 1

GRA assisted one of Australia’s largest office supplies retailers to develop a global sourcing and supply chain strategy with identified benefits of over $8m. A strategic initiative to improve gross margin by implementing global sourcing resulted in significant cost improvements to the company’s bottom line. The company sought GRA’s expertise to unify their global sourcing and supply chain strategies into an integrated strategy, including identification of optimal locations for supply chain activities within the consolidated logistics network. GRA identified $8m in operational savings through more efficient management of import channels to handle the increase in globally sourced product. This was in addition to the expected margin benefits of sourcing more product from overseas.

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Procurement IT Evaluation and Selection

Our client, Australia’s leading rail freight operator and a top 50 ASX company, had undertaken a large scale transformation journey from a government owned enterprise to an ASX listed company, with considerable success in improving the commerciality of the business. As part of the transformation and in pursuit of further savings opportunities the company initiated a project to transform the efficiency and effectiveness of the procurement function. The procurement transformation project identified a number of improvement opportunities, including the need for a procurement IT solution. GRA provided a detailed analysis of potential business benefits from improving core procurement processes through IT-enablement revealing a compelling business case for implementation of a leading procurement IT solution. 

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Procurement Transformation

Our client is Australia’s leading rail freight operator and a top 50 ASX company. Over the previous five years the company had embarked on a large scale transformation journey from a government owned enterprise to an ASX listed company. As the opportunities for savings through restructuring had largely been captured, the company was looking for further savings opportunities, including looking to Procurement to find ways to significantly reduce external spend. GRA was engaged to design and lead a company-wide Procurement Transformation program. Our approach was to be highly collaborative in order to engage a recently restructured Procurement department and re-establish stakeholder relationships with the business. Initiatives delivered include identified total procurement savings opportunity of $120m with implemented initiatives delivering $75m in the first 12 months.

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Testimonials

"GRA are consummate professionals and have been instrumental in delivering real value from our supply chain."

– Scott Coulter, Chief Operating Officer, Comvita

Typical results

  • 20-40% inventory investment reduction
  • increased service levels ranging up to 99.9%
  • 10%-15% reduction in supply chain operating costs
  • 5%-20% spend management savings
  • the ability to fund business initiatives from operating cash flow (OCF) improvements
  • improved return on capital employed (ROCE)
  • a minimum 3:1 ROI (10:1 to 30:1 typical)