Pt. Megasari Makumur (Godrej Indonesia, part of Godrej Consumer Products Limited, India) has embarked on a journey to transform its business of manufacturing and distribution of various household products like air fresheners, wet tissues, baby care products, etc. through the platform of 'Theory of Constraints'. They have partnered with Vector Consulting Group since December 2013. Since then they have reaped the following benefits.
- Overall inventory days has been reduced by 28%.
- Inventory turns improved by 37% (from 6.38 to 8.75).
- Approx. 14% (8200 sq.m) of the warehouse space has got released.
- ROCE increased from 47% to 65%.
- Availability at the central warehouse and depots/branches has increased from 92% to 98%.
- Service levels from branches/depots to customers has improved from 95% to 97%.
- The TOC sales pilot conducted with the company’s largest modern trade partner, Indomart, resulted in a dramatic (41%) reduction in the retailers’ inventory while improving availability to a consistant 98-100%."
The following are the results experienced so far –