MAHLE + Celonis

Automotive supplier MAHLE boosted transparency and agility in the supply chain using Celonis Process Intelligence. The result: a 20% inventory reduction group-wide.

MAHLE is one of the world's leading automotive suppliers and counts almost all major car manufacturers as customers. The group, with a revenue of €13B+, has its roots in the development of components for combustion engines. Today, MAHLE develops products and system solutions in three strategic areas: electrification, thermal management, and sustainable, highly-efficient combustion engines powered by hydrogen or other renewable fuels. Like many original equipment manufacturers (OEMs), MAHLE needs to master the mobility transition, fast. “The entire industry is undergoing radical change,” says Markus Lohrey, Head of MAHLE Group Logistics. And change comes with challenges too. For the automotive sector, the laundry list includes material shortages, rising raw material and energy prices, geopolitical tensions, and stricter CO2 regulations.

→ Read Lohrey’s blog on how the automotive industry will have to adapt in the future.

“We need more transparency in order to be able to react faster, work cost-efficiently, and optimize our inventory,” says Lohrey. That’s why MAHLE turned to Celonis Process Intelligence. The Celonis Process Intelligence platform gives MAHLE the long-needed transparency and agility to proactively manage its supply chain. The result: an inventory reduction of up to 20% across all locations. Here’s how.

The challenge: excess inventory, no supply chain transparency

Process mining delivered a living, moving digital twin of MAHLE’s supply chain processes. Think of it like an X-ray for businesses, showing how processes truly run. Combining this visibility with standardized process knowledge, AI, and automation, businesses can understand where added value is hidden in their processes and how to capture it. Initially MAHLE focused on optimizing its already somewhat standardized processes - Accounts Payable , Procurement, Order Management - until in 2022 the team turned their focus toward Inventory Management. Here, they pursued three goals:

• Harmonize system and process landscape
• Digitize and accelerate inventory analysis
• Optimize inventory levels for an agile and resilient supply chain

A single source of truth to reduce excess inventory

One of the driving forces behind the project is Daniel Claß. The Head of SAP Standards & Systems Europe and his project team of IT and business experts, have co-innovated the Inventory Control Center together with Celonis. With the Control Center, MAHLE has created a single source of truth that links all inventory-relevant factors, enabling teams to view and control inventory effects worldwide and in real time. For the first time, everyone in MAHLE’s Group Logistics can make a proactive contribution to reducing excess stock.

Proactive Inventory Management

And the team didn’t stop there. Together with Celonis, they have further developed the Control Center to flag and prevent future build up of stock.

The Inventory Projection App shows material planners how their most important material stocks will develop over the coming months, giving them the insights they need to tackle impending overstocks – a risk that’s easily overlooked in the daily flood of data.

How does it work? Celonis consolidates the data from all SAP instances in order to include all kinds of parameters. These include pre-booked orders, production requirements, goods receipts, but also plant-to-plant deliveries, consignment warehouse stocks or wage provisions.

Using intelligent automation (Celonis Action Flows), material planners get proactive alerts about impending overstocks and material shortages, enabling them to take prompt countermeasures and ensure delivery reliability while keeping stock levels low.

MAHLE’s central inventory team, headed by Timo Liebrich, is now able to take targeted, global, and cross-divisional optimization measures. Within a few months, the IT and logistics teams rolled out the Control Center globally to almost 150 plants.