News & Research: Client Successes

Case Study: Inventory Write-off Assessment

ScottMadden helped a southeastern energy transmission cooperative to analyze the root causes for inventory write-offs and develop conclusions and recommendations for improvement.

• Inventory write-offs over the past several years were higher than expected. The situation attracted the concern of management, particularly as they looked forward to future anticipated levels of capital project activity
• Information to support management's initial conclusions as to the source of write-offs did not exist. As a result, the corporation was not able to develop successful solutions to decrease the frequency/value of inventory write-offs
• ScottMadden's role was to perform all data analysis, validate root-cause hypotheses, and develop an implementation plan to address gaps that led to inventory write-offs

• Analyzed the details of inventory write-offs over the previous two years
• Reviewed key processes and inventory metrics
• Performed root-cause analysis on significant issues and findings
• Developed conclusions and recommendations
• Created implementation plan to address gaps in business processes, organizations, policies, tools, and data

• Validated management's initial conclusions and provided a comprehensive report detailing findings, gaps, and recommendations for improvement
• Facilitated the creation of initiatives to improve materials requirements planning and minimize the creation of excess, unnecessary inventory