CIMdata PLM Industry Summary Online Archive
23 January 2007
Implementation Investments
Caterpillar Chooses aPriori Enterprise Cost Management Platform
aPriori announced that Caterpillar, Inc., the world's largest maker of construction and mining equipment, diesel and natural gas engines, and industrial gas turbines, has made a significant purchase of aPriori's Enterprise Cost Management Software PlatformT to be used in their North American operations. Caterpillar's decision to purchase aPriori was based on a highly successful initial project proving that the rich and timely cost information from aPriori could be used to reduce their product costs and minimize their product redesign costs.
The aPriori Enterprise Cost Management Software Platform provides real-time, predictive cost assessments throughout the entire product development, manufacturing, sourcing and delivery process. The investment in aPriori enables hundreds of users at Caterpillar to generate real-time costs for new product introductions and engineering changes within minutes rather than weeks. Caterpillar design personnel now have the opportunity to confidently understand the cost impact of their decisions through instant feedback, directly within their MCAD environment. Additionally, other functions at Caterpillar, from manufacturing engineers and planners, to purchasing and sourcing professionals and program managers, have full visibility to product costs through aPriori. This enables them to identify quantifiable savings in material, tooling, labor and overhead cost while evaluating alternative designs, manufacturing processes, and vendor sources, ultimately driving a reduction in their Cost of Goods Sold (COGS).
As part of an initiative to increase profitability by minimizing their product redesign costs as well as their overall product costs, Caterpillar needed more timely and accurate product cost information than their current systems could provide. aPriori proved it could provide predictive product "should-cost" information from the earliest stages of product development continuously through production delivery. aPriori also demonstrated its ability to provide accurate, real-time cost direction at all stages of the design and production development process. Caterpillar's results verified that aPriori's cost information enabled easier cost/design trade off analysis and it provided manufacturing routing and cost information that would be used by manufacturing engineering, planning and purchasing departments. Based on the results of this project, Caterpillar will be rolling out aPriori for use by its design engineers, manufacturing engineers and purchasing personnel.
"We are excited that a leading Fortune 100 company and one of the most successful manufacturing companies in the world has made such a significant investment in our technology," said Frank V. Azzolino, President and CEO of aPriori. "The ability to determine product cost early and confidently manage towards established cost targets is critical for a manufacturing company in today's competitive markets. Even a small reduction in Cost of Goods Sold results in a significant increase in operating margins and profitability."
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