Case Study: Metro-North Railroad achieves 98.7% service level and reduces inventory with Smart Software’s SmartForecasts

SmartForecasts Helps Metro-North Railroad Keep the Trains Running On-Time

Metro North Railroad, part of the MTA and the second-largest U.S. commuter railroad serving about 300,000 riders daily, faced major inventory planning challenges in its Material Management division, which stocks 37,500 parts valued at $107 million—more than 80% with intermittent, hard-to-forecast demand. Excess expensive inventory and a 95.8% service level in 2008, combined with long lead times and multi-year planning horizons for long-lived assets, prompted Metro North Railroad to evaluate forecasting solutions and select Smart Software’s SmartForecasts.

Smart Software implemented SmartForecasts to model intermittent demand, optimize safety stock and reorder decisions, and identify overstock and stockout risks. The solution paid back within nine months, helped cancel or hold pending orders to improve cash flow, and supported operational changes that lowered parts inventory by 8% (from $128M since 2007), raised service levels to a record 98.7% in 2014 despite fleet growth, cut projected new-equipment inventory growth from 10% to 6%, and identified $1.6M of inactive inventory for disposal. Smart Software’s SmartForecasts delivered measurable inventory and service improvements while protecting on-time operations.

Metro North Railroad

Rich Price

Chief Material Officer