To manage costs and deliver quality, CarCo needed to fundamentally rethink its operations model.
While conducting a major strategy review for CarCo, a large automobile manufacturer, Bain uncovered a major operational issue: the company needed to fundamentally change its production model.
- CarCo's costly supply-push production model caused the company to sell vehicles at a discount relative to those competitors who used demand-pull production.
- The company wanted to reduce complexity and improve its manufacturing and purchasing. Because the supply-push approach was completely integrated into every aspect of the business, however, major transformations of processes and associated operations improvements were needed at every step of the value chain.
A tactical approach to operations improvement could have delivered short-term benefits. Instead, Bain supported the client in developing and implementing a completely new operations strategy. To optimize its business, CarCo needed long-term, integrated solutions that crossed functional and value chain borders.