Customer Value Case · Utilities

Before the Truck Arrives

How a North American utility attacked MRO value in two passes: open transactions first, stocking parameters second, so the fastest value lands before the slower, structural fix.

Electric utility generating station and storeroom operations
Inventory Growth+~50%M&S inventory line, 3 years, own filings
Pass 1 ValueBefore ReceiptOpen POs cancelled or filled by transfer, cash never spent
Cover Threshold12 moOn-hand cover beyond which buying pauses
Recurring Benefit~1/3/yrOf the one-time release, every year
À propos du client

Caution applied uniformly, across an estate that never stopped growing

Industrie
Regulated electric & gas utility, North America
Champ d'application
~20,000 MRO SKUs, 40–50 sites and storerooms
Solution
MRO360
Équipe
Small team of inventory analysts
Regulatory Context
Rate-regulated, decisions must be evidenced
Approche
Two sequenced passes over the same estate

A major North American electric and natural-gas utility serving millions of customers, an estate of generating stations, service centres, and storm-response storerooms spread across its territory, roughly 20,000 active MRO SKUs, and a small team of inventory analysts responsible for keeping all of it right. Three forces shaped its inventory culture: restoration promises measured in hours, which reward holding stock just in case; a multi-billion-dollar grid and generation investment programme adding new assets every year; and a regulated environment in which every decision may one day need to be evidenced. The result was visible in the utility's own audited filings: the materials-and-supplies inventory line had grown by nearly half in three years, higher in every reported period while cost discipline was a stated priority.

Rather than a single monolithic programme, the engagement was structured as two sequenced passes over the same estate, so the fastest, most tangible value lands first and funds confidence in the second. The platform runs on extracts from the operator's existing ERP and writes approved values back, no integration programme required, live against real figures in weeks, with a bounded evaluation before any wider commitment.

All customer figures in this case study are expressed as ratios and design parameters to protect confidentiality. The base of the case is the materials-and-supplies inventory line in the operator's own audited filings, validated against its own extract of roughly 20,000 SKUs.

Le défi

20,000 SKUs, 40 to 50 storerooms, a handful of analysts

The estate wasn't undisciplined. Every individual decision was defensible; the sum was bloat.

  • Purchases arrived for material the network already held, while surplus of the same item sat at another site, sometimes an hour away, undetected.
  • Safety stock reflected caution, not calculation: levels were set high, reasonably, but uniformly, and never re-derived from actual lead times, demand variability, or criticality.
  • Cover was invisible. For thousands of SKUs, on-hand quantities already covered a year or more of forward demand, yet replenishment kept firing.
  • The analysts' week went to processing transactions, not questioning them, with no capacity to ask, PO by PO, whether the network still needed it.
Full Engagement Design

Get the complete two-pass breakdown

The download covers both passes module by module, why the sequence itself was the design decision, and how the case stayed defensible for a rate-regulated environment.

  • The seven modules behind the two passes, and exactly what changed in each one
  • Why cancelling a purchase order before receipt beats a working-capital release, and how that value showed up within weeks
  • How safety stock was re-derived per SKU while storm-response and restoration spares stayed explicitly shielded

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Résultats

What each pass delivered

Pass 1 produced value from decisions already in flight, before receipt. Pass 2 released capital structurally, and kept it from rebuilding.

Système métriqueRésultat
Structural release (Pass 2)Eight-figure, at a conservative ~10% of the nine-figure estate
Recurring benefit~1/3 of the one-time release, every year
Carrying-cost avoided (Pass 1)~22% a year on every cancelled purchase
Cover threshold12 months on-hand, beyond which buying pauses
Reduction target~10%, conservative against 15–40% published benchmarks
Analyst capacityRecovered without adding headcount

Criticality governs every recommendation: storm-response and restoration spares are explicitly shielded from reduction, so the estate gets leaner without getting riskier.

Ce que vous allez apprendre

Inside the two-pass engagement

  • How Search and Visibility surfaced the network-wide stock position that let one storeroom raise a purchase order while surplus of the same part sat an hour away, undetected.
  • How Cross-Enterprise Transfer Intelligence rerouted open purchase orders to inter-plant transfers wherever surplus existed, replacing purchase cost with freight cost before receipt.
  • Comment Évaluation du niveau de criticité replaced a single, uniform safety-stock setting with a criticality-based level for every SKU, while explicitly shielding storm-response and restoration spares.
  • How Stock Velocity Classification and Prévision de la demande rebuilt lead-time and demand inputs that had been set once, years earlier, and never revisited.
  • How Dynamic Reorder Point and Contrôle d'obsolescence turned invisible excess into an actioned release, and kept released capital from rebuilding over time.
  • Why the two-pass sequence itself was the design decision: Pass 1 earns the organisational patience for Pass 2, where the durable, recurring value lives.
À qui s'adresse ce document ?

Built for the teams who keep a regulated estate right, with a small team

VP Supply Chain & Inventory Operations

Accountable for ~20,000 SKUs across 40 to 50 sites, with a team that could never manually review all of it.

MRO & Procurement Leaders

Closing the gap between open purchase orders and network-wide stock visibility, before the truck arrives.

Finance & Regulatory Affairs Leaders

Needing every inventory decision to carry a derivation, defensible in front of a regulator.

Reliability & Storm-Response Leaders

Protecting restoration readiness while the estate gets leaner, not riskier.

Get a free spare parts maturity assessment, run on your own extract.

If your open purchase orders have never been reviewed against network-wide stock, or your safety levels were set in a different decade, the same two-pass case can be built on your own extract, in weeks.

Customer identity, territory, and absolute figures have been withheld or expressed as ratios and design parameters at the customer's request.
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