For GSPM, the focus was not only on the end customers, but also on tens of thousands of service technicians worldwide. After all, they use the spare parts in their daily work and their performance can directly determines the quality of the service.
The technicians themselves are critical to spare parts management. If they have doubts about timely delivery, they often take the safe route and order for next-day delivery, even if it is unnecessary for the task at hand. If they are unsure about receiving the right part or are unable to clearly identify it, they typically order multiple variants as a precaution. This may be understandable but can be problematic for the overall performance and the carbon footprint of the spare parts delivery.
Therefore, one of the key role of an effective GSPM project was to gain the trust of the service technicians. What approach did specialists with Deloitte Germany take? In the first step, they gained comprehensive insights through maturity assessments, market surveys and interviews with service technicians in 15 national units, as well as an algorithm-based network analysis. This helped form the basis of the transformation strategy, which was implemented in the second step.
A challenge as complex as global spare parts management often requires a multidimensional approach. Of particular importance at the network level is the right location of parts distribution centers. Regional units have typically maintained their own inventories, but without a unified system. Smaller local stocks are now generally being consolidated into larger ones, closed, and consolidated into continental distribution centers (in Europe, North America and Asia Pacific) and in China consolidated into RDCs (Regional Distribution Centers). This can reduces redundant stock, fixed capital, and lead times, while at the same time providing expanded parts coverage, improved sustainability, and 24/7 operations. This new system has already been implemented at the European distribution center in Düren (North Rhine-Westphalia/Germany).
Another step in reducing complexity is to help harmonize order processes worldwide. A consistent, user-friendly approach with five service levels can provides clarity, transparency and increases efficiency. Smart service harmonization helps enables global standards for both the tracking and reporting of distribution performance. Innovative last-mile logistics concepts complete the GSPM, such as delivery directly to the trunk of service vehicles – or by completely dispensing with service vehicles altogether, which is currently being piloted in São Paulo (Brazil).
Such delivery concepts may not only help improve the service levels, but also may contribute to the sustainability goals demanded by customers by reducing transportation distances and thereby the carbon footprint. GSPM is also implementing a second aspect of sustainability: the circular spare parts economy (return, repair, reuse, remanufacture, recycle). To this end, dedicated repair centers are currently being set up and a new KPI model is being introduced.
The journey of Schindler and Deloitte also included several challenges. Some local concerns could only be overcome with intensive communication and rigorous proof of performance on site. Then there was the disruption caused by the COVID-19 pandemic. Although the focus was on improving service levels and sustainability, the project was also designed to identify potential savings.