About Thermo Fisher Scientific’s Material and structural Analysis Division (MSD)
Thermo Fisher Scientific Inc. is a world leader in serving science with over $40B turnover. MSD is a team of over 5000 colleagues within Thermo Fisher’s Analytical Instruments business. MSD is the industry leader in delivering innovative electron microscopy, spectroscopy, microanalysis, semiconductor, and imaging software solutions. It is headquartered in Hillsboro (Oregon, USA), with a global footprint. Its main factories are located in the Netherlands, Czech Republic, and USA.
The challenge
MSD faced challenges in inventory management. While business was growing significantly, ambitious inventory reduction targets resulted in pressure on all levels. High levels of excess and obsolete (E&O) stock hindered financial performance. Next to this, supplier performance issues led to critical part shortages, sometimes delaying customer orders and contributing to revenue risk.
Process-wise, the lack of visibility into the processes at sites, and the absence of a unified global inventory framework resulted in time-consuming decision-making and misalignment across corporate, divisional, and site leadership. In addition, undefined and unclear operational inventory control processes created inefficiencies, increasing manual workload, missed inventory reduction opportunities, errors, and employee frustration.
The project
To address these challenges, EyeOn implemented a structured project framework, overseeing six production sites and leading three key workstreams: E&O reduction, inventory right-sizing, and inventory best practices.
EyeOn introduced and refined key processes, including overall global E&O clean-up, E&O waivering, and specific E&O disposition options such as intercompany resell of purchased parts and dismantling manufactured parts to reuse their components.
For inventory right-sizing, the corporate inventory entitlement framework was adjusted to MSD’s needs, enhanced, tested, and deployed, ensuring alignment and user training. In addition, EyeOn supported the development of a comprehensive safety stock strategy and automated MRP attribute reviews to improve the efficiency of the sites’ inventory control leads.
Beyond process improvements, EyeOn played a vital role in defining and structuring the Inventory Control Lead (ICL) role. We created an inventory calendar and a detailed playbook with over 50 pages of standardized instructions for onboarding and reference. By mentoring ICLs, onboarding new sites into the global inventory program, and facilitating knowledge sharing, EyeOn built a strong, globally aligned inventory team.
Results
MSD’s global inventory team exceeded its yearly inventory mitigation target, by significantly reducing E&O stock within one year. Divisional and corporate leadership recognized the significant improvements in inventory management within the division, including EyeOn’s direct role in the inventory project.
The division implemented an improved version of the corporate inventory entitlement framework, which is being regularly used by ICLs and reported upon. The rollout of the safety stock strategy helped reduce backlog and improve operational resilience.
Standardized inventory management processes across sites enabled better knowledge sharing and leadership visibility. The automated MRP attribute reviews significantly reduced manual workload, enhancing efficiency and employee satisfaction. This set the team up for long-term success.
Ready to improve your inventory health?
Interested in how EyeOn can help you improve your inventory health and bring structure into your day-to-day processes? Learn more about our inventory expertise here or get in touch with our experts right away.