Success Story KraussMaffei

4flow designs a global spare parts network – from network design to implementation

Successful aftersales service is the key to long-term customer relationships and satisfaction, particularly when it comes to high-quality machinery and systems. Each delay in the provision of spare parts can quickly have significant effects. KraussMaffei, a leading machinery manufacturer in plastics processing, has optimized its spare parts logistics processes with a global spare parts hub concept together with 4flow. This has resulted in faster and more cost-efficient spare parts availability for all product lines.

KraussMaffei is a globally leading machinery and equipment manufacturer for the production and processing of plastics and rubber. The ChemChina subsidiary has more than 30 locations globally, 10 production facilities, about 570 trade and service partners, and employs over 5,500 people. Their DSS (Digital and Service Solutions) division is responsible for both digital service products and customer service for all the group's products and offers customers a reliable aftersales service with stable processes, high parts availability, quick response times and short delivery times.

Setting up a service and cost optimized IT landscape

The challenge was to create a concept for a service organization with a global end-to-end supply chain – where synergies could be applied in handling as well as in transportation and replenishment bundling processes. For this reason, a service and cost-optimized IT landscape with harmonized processes was set up for the newly designed location network to increase the service level and shorten delivery times. In order to take regional market aspects into account at the beginning of the project, a multinational project team consisting of KraussMaffei staff and 4flow consultants from across Europe, the Americas, and Asia-Pacific (APAC) was established.

Increasing service levels and shortening delivery times

During the network design, all relevant data from globally installed machines and service customer orders was collected, visualized and optimized using the standard software 4flow vista^® to build up the network. In addition to the spare parts warehouses in Europe, North and Middle America, the concept envisioned that a new regional hub in the APAC region would be one of the requirements for optimally fulfilling service levels.

Based on a detailed supply chain cost model, the project team developed various scenarios for site selection. Ultimately, a decision was made in favor of an intra-Asian spare parts warehouse with a specific type of warehouse that had a free trade zone in the greater area of Shanghai. In addition to quick access to the entire inventory, it also saved customs and import duties.

“The progress we have made in the global hub project has exceeded our expectations. With 4flow’s support, we can significantly improve the availability of spare parts globally while also increasing process quality,” said Karl-Michael Schlick, Head of Global Spare Parts Operations – Digital and Service Solutions at KraussMaffei.

Harmonizing and optimizing global spare parts processes

The project team developed a global hub concept to include the network design, processes, organization, and IT. The focus was on implementing the new APAC hub in Shanghai as an additional component of the global network. This enabled global supply chain processes to be harmonized, optimized, and integrated into the overall concept.

Integrating customer expectations and requirements

An important part of the analysis was to directly integrate all customer expectations and requirements into the global hub concept. Industry benchmarks and best practice solutions based on current KraussMaffei processes, technical discussions, and requirements were also included in the concept. In addition, 4flow developed a forecasting algorithm to map uncertain and fluctuating customer demands as well as possible.

Selecting the right service providers with a structured tendering process

98 percent of the materials are difficult to predict due to significant demand fluctuations. For this reason, the algorithm was designed holistically and, in addition to historical data on actual demand, also included parameters such as the value and criticality of the parts in recent years. 4flow also worked together with KraussMaffei in a structured tendering process to select the right service providers for the new warehouse location in Shanghai – and supported the entire process all the way to the successful implementation and operation of the global hub concept.