Manufacturing Capacity

In recent years, the increase in worldwide construction has resulted in insignificant improvement in the profitability of this engine manufacturer. This increase in worldwide demand has created a need for Cummins to invest in it’s manufacturing capacity. The concern from their top management was did they have the proper infrastructure to support exponential growth in their capital spending.

TPCG was engaged to help the new formed Capital Strategy & Management group develop a clear understanding of their effectiveness in deploying capital investments and to aid in the re-engineering of the capital development, approval, tracking and post investment validation process. At the same time, TPCG was enlisted to help determine the worldwide demand/capacity balance and to help determine what the capital needs were to support increase demands in all part of the world. The solution was to create capital and capacity models to help evaluate the effectiveness of investments.

This process re-engineering exercise along with gaining a clearer understanding of requirements to meet the customer demands, will position Cummins to be more predictable in the deployment of capital funds as well as increasing the probability the they will achieve the returns that were expected at the time of investment.

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