SAVINGS BY THE NUMBERS

Akoya’s Category Workbench is a Software-as-a-Service (SaaS) application that provides visibility into where savings opportunities exist across large categories of parts and quickly identifies the specific actions to take to realize the opportunities. It also helps procurement management assess the competitiveness of each of their suppliers and monitor the cost savings performance of their organization. Through each of its commodity-specific modules, Category Workbench delivers critical cost management information on-demand to the desktop of the purchasing professionals and engineers who are tasked with cost management of purchased parts.

With Category Workbench, a cost analysis on a few hundred suppliers or a few thousand parts that previously took experts months to complete can now be done instantly. This is particularly powerful because Category Workbench is able to deliver tangible returns on investment to businesses in short timeframes. Applications of Category Workbench to date have identified over $100 million in savings.

Akoya has recently added supplier consolidated reporting to the Category Workbench product, which identifies competitive and non-competitive suppliers. This new capability gives purchasing professionals the ability to quickly respond to supplier requests, identify potential supplier exit or consolidation candidates, and improve risk management through early identification of potential at-risk suppliers.

Category Workbench Case Study. A Fortune 100 manufacturer recently used Category Workbench to evaluate $120 million of purchased cast parts. Akoya was able to extract detailed part information (dimensions, features, requirements, and specifications), confirm its accuracy, merge it with the spend information, and load it for modeling in a matter of days. Within the first few months of Category Workbench deployment, the manufacturer renegotiated supply contracts resulting in over $5 million in annual savings. These savings comprised a 13.5% yield on the first group of parts targeted through the initial implementation. The table below describes the first wave of results from the manufacturer’s implementation of Akoya Category Workbench:

Improvement Goals

Results

Reduce Direct Material Cost (4% target)

13.5% savings yield on parts targeted through the initial implementation

Improve accuracy of resource deployments on cost savings opportunities (30% target)

Average 72% realization of savings identified on parts deemed as opportunities by Category Workbench

Reduce time required to take action for cost management

7 - 15 week reduction in time to take action on opportunities for a single part family

Gain return on investment within calendar year

Estimated 8x return on investment in one year (based on savings already captured)

In addition to the benefits above that were measured by the manufacturer’s 6 Sigma process, they were also able to accomplish the following process improvements:

  • Construct sophisticated cost competitiveness profiles to better understand the competitiveness of the individual families of parts
  • Direct resources to focus on the critical information to proactively manage costs
  • Highlight the strengths and weaknesses of current suppliers based on their cost competitiveness profiles and alignment of cost drivers for the parts they make
  • Develop concurrent interaction and collaboration across engineering, procurement and financial functions, beginning with the design phase

Based on the results of the initial implementation, the manufacturer has expanded its use of the Akoya system to a majority of its cast parts and to other part categories.