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Lean Assessment Tool: Savings through Inventory Reduction

By Thomas R. Cutler, President & CEO, TR Cutler Inc.

Ultriva Inc., a provider of software for lean manufacturing launched a free online tool that identifies potential savings that could be gained through inventory reduction. The Lean Assessment Tool helps material managers and supply chain replenishment and purchasing professionals to streamline operations, according to the company.

How a Lean Assessment Works:

Users upload parts histories (ideally six to twelve months of historical data), and then the software performs an inventory sizing analysis identifying specific parts that could be optimized through inventory reduction. Users can view graphs of their current replenishment patterns compared to potential opportunities and perform ‘what-if’ simulations by varying lot sizes, lead times and safety stocks.

“Even though the ‘lean philosophy’ can permeate the corporation in terms of process changes and improvements, one area where it has immediate impact is inventory management,” noted Narayan Laksham, CEO of Ultriva. “Having the right amount and correct mix of inventory is the key to achieving near-perfect, on-time delivery.”

The Lean Assessment Tool provides a fast assessment of where a company can optimize parts inventory and allows a company to realize the realities of just-in-time replenishment. Companies that used the tool during the three-month beta period identified potential cost savings of more than $10 million.

Laksham was pleased to report that, “Several of our current customers have been able to quickly identify parts that should go into a pilot study, additional suppliers they should bring online, or additional plants that should go live. On average, companies that use the Lean Assessment Tool identify cost savings of 30% to 50%, which implies a very good ROI for implementing a consumption-driven replenishment methodology.”

Strategic Alliances: Cincom and Ultriva

Recently worldwide software provider, Cincom Systems signed a partnership agreement with Ultriva. As part of the agreement, Cincom will offer to existing and new customers Lean manufacturing solutions that complement its Cincom CONTROL enterprise resource planning (ERP) and Cincom Acquire Sales and Product Configurator software.

This partnership provides manufacturers with complex engineer- or made-to-order products—a solution that features intelligent, role-based operations management combined with proven Lean execution. “We believe this combination will provide our customers with the operational efficiencies required to meet the unique challenges facing manufacturers today,” noted Jerry Miller, director of Cincom’s manufacturing business solutions division.

Laksham also commented about the new alliance, noting that, “Ultriva’s Electronic Kanban and other Lean manufacturing solutions have been working synergistically at Cincom customers over the years and that formalizing this business relationship, we can enhance the value to our customers with a pre-packaged, tightly integrated solution.”

Strategic Alliances: Gemba Consulting and Ultriva

Gemba Consulting is a global lean transformation consultancy specializing in implementation of the Toyota Production System and related methodologies in manufacturing, distribution and service. Gemba delivers rapid business results while building capability through leadership alignment and total workforce engagement.

Ultriva’s Laksham explained, “In the shift to a global, customer-centered economy, manufacturers must be more responsive in order to thrive. Manufacturers must quickly and efficiently change processes to meet changing demands. This partnership with Gemba Consulting is a great fit for addressing these new demands.”

Jon Miller, CEO of Gemba Research concurred saying that, “Lean Management is based on developing people who are problem solvers focused on serving customers and improving performance through waste elimination. We are delighted to work with Ultriva and find great synergies between our two organizations that will serve the best interest of our mutual customers.”

Ultriva’s Lean Execution Suite consists of modules like Customer Kanban, Supplier Kanban, Internal Kanban, SBR, Lean Production and OEE, which allow manufacturing companies to systemize, sustain, and scale lean disciplines across the organization. Ultriva's flagship product, Collaborative Electronic Kanban, eliminates stock-outs while reducing inventory levels up to 75%. Ultriva modules are in use in more than 130 plants worldwide, incorporating more than 5,000 suppliers, transacting over 1.5 billion dollars of inventory at industry leaders such as AGCO, CNH, Emerson, IR-Trane, McKesson, Rexnord, and ThermoFisher.

The free Lean Assessment Tool is a quick way to quantify the cost-savings, metrics, and be in the lean practice of continued process improvement.

Thomas R. Cutler is the President & CEO of Fort Lauderdale, Florida-based, TR Cutler, Inc, ( Cutler is the founder of the Manufacturing Media Consortium of three thousand five hundred journalists and editors writing about trends in manufacturing. Cutler is a member of the Society of Professional Journalists, Online News Association, American Society of Business Publication Editors, Committee of Concerned Journalists, as well as author of more than 300 feature articles annually regarding the manufacturing sector. Cutler is also the developer of lean technology C.E.O (Continuous Experiential Optimization). Cutler can be contacted at

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