The case study was conducted for a spare parts department of a multinational industrial equipment manufacturer and service
provider. Following a previous study (Paakki andHuiskonen,2008), the company wanted to make further research on how to
effectively analyze the current distribution performance and performance gaps as there was pressure to in crease the company’s service performance. Due to the growth in the company, several distribution chain alignment projects were
being conducted in the company.This created a good environment for the
case study as some of the under taken projects were not fully implemented. The previous study concentrating on the categorization of the parts according to the demand aspects had revealed the impact of variabilities on the inventory management possibilities and provided some understanding of the root causes behind
the variabilitie . Although the company had adopted many actions to improve the inventory control parameter setting and
planning, it also understood that in stead of increasing the stocking levels,major improvements are possible only by proactive management of the actual causers of the variabilities.