Projecting Financial Impact of Service Strategy Design Options

MCA debuts Service Business Design solution for manufacturers

MCA debuts Service Business Design solution for manufacturers

Philadelphia — February 16, 2005 — Service planning and optimization specialist MCA Solutions has unveiled a new solution intended to help aerospace, defense, high-tech and capital equipment companies leverage their service supply chains as a key business driver.

Service Business Design, the newest product in MCA's Service Planning and Optimization (SPO) software suite, is intended to help companies determine the financial impact of service strategy design options. The solution makes recommendations based on risk avoidance and profit maximization, allowing planners to see how their decisions will impact the overall business, MCA said.

The new solution was designed to help companies build a responsive network for parts and service, as well as determine the cost and profitability impact of their service product offering portfolio, MCA said. With the solution, service managers can perform "what-if" simulation using a variety of standard or user-defined planning scenarios to compare cost, service and budget impact of longer-term business decisions.

Judging Impact of Supply Chain Configuration

Planners can use the solution to judge the impact of changes to the physical supply chain configuration; design and pricing of service support product offerings; determination of warranty and contract service-level terms; and assignment and realignment of customers to service contracts.

Other scenarios that can be evaluated include lead-time and cost trade-offs for new buy or repair strategies, budget analysis of bid and proposal scenarios, and product introduction and end-of-life/end-of-support.

The two other core modules in SPO 4.2 include Strategy, designed to help forecast parts demand and determine optimal stocking lists and stocking levels to achieve maximum levels of service at the lowest possible cost; and Tactics, which generates and prioritizes optimal new buy, repair, trans-shipment and allocation orders to meet service-level objectives at the lowest possible order cost.

Moving from "Tactical" Spare Parts Management

MCA said that SPO users can reduce inventory costs 20 to 50 percent and increase customer service levels. The provider believes that service excellence is increasingly determining market leadership.

"SPO helps companies move away from tactical 'spare parts management' — a focus that dominated this industry when customer support was seen as only a cost-center — to the implementation of competitive service strategies that contribute to the bottom line," MCA said in a statement announcing the new SPO module.

"This is what manufacturers are clamoring for," said Bob Salvucci, president and CEO of MCA Solutions. "It puts the customer relationship at the center, and positions vendors to extract substantial value from an often-overlooked segment of the supply chain."

The Boeing Company, Cisco Systems and Tellabs are among the companies using MCA Solutions' SPO suite. MCA said the SPO suite can be deployed and delivers benefits in as little as 8-10 weeks.

For more information on solutions for the service and support chain, see the articles "In the Field and All Grown Up," the Net Best Thing column in the June/July 2002 issue of iSource Business (now Supply & Demand Chain Executive), and "Time to Prove It," the Net Best Thing column in the April/May 2003 issue of the magazine.

For best practices in service parts management, see the article "Three Keys to Successful Service Parts Management."

More articles about MCA Solutions.