fischer&partner scm-its not a back office story gfk imaging summit 2013
TRANSCRIPT
FISCHER & Partner Executive SolutionsRicky L. Stewart
„We are closing your business gaps“
SCM It´s not a back office story
Key Facts - about FISCHER & Partner
Enterprise for Consulting, Project & Interim Management
Founded 2009 in Hamburg
Offices in Hamburg und Munich
Powerful network with about 40 professionals and industry experts
Independency by bounding freelancer experts
More than 500 years of operational expertise from leading blue chip companies
Know-how in process optimization-, restructuring- and M&A, SCM, S&M
strategic – operational excellence – performance focused
Spectrum of Services
Marketing &Sales
Strategy & Management
Restructuring & Realignment
M&AOutsourcing
InterimManagement
Finance & Controlling
Processes & Organization
Supply Chain & Logistics
IT
Functional Competence
Industry Competence
Partnerships & Cooperations
Consumergoods& Trade
Pharma& Healthcare
CE, IT, Media& Telecommunication
Chemical Industry, Energy& Engineering
Interim Management
Providers
Strategic Investors
Private Equity-Fonds
Interim Management Partnerships
HR & Business Consultancies
Financial Auditors & Tax Consultancies
Private EquityBusiness Unit Leader
Unique combination of functional- and industry competences
ToolsIntegrated Process Optimization & Enterprise Mobility for Sales
Integrated Process Optimization
FISCHER & Partner
Enterprise Mobility Solutions,
Coop-Partner Heidelberg Mobil
Sustainable implementation of DDEM-method
Transparency, Efficiency, Flexibility Competetiveness
ToolsIntegrated Process Optimization & Enterprise Mobility for Sales
Implementation-LevelsIPO ensures the implementation on different levels
1. Process-LevelExposition of sales processes on mobile devices
2. Functional-LevelProviding Sales- & Marketing data, where they arise and being required
3. User-LevelConsolidation of IT-Applications by superior process layer and deduction of process-stages to pre-defined user groups.
Fusion of Customer Relationship Management, Enterprise RessourcePlanning and Intranet applications
4. Value-ChainEnsuring information exchanges on all functional departments, e.g.
automatic turnover- and production forecasts on order-, stock- and sales basis
What´s wrong in the CE market?
You ALL have high quality products with stunning features
You ALL have great product design and wonderful marketing programs
You ALL have the best sales force in all possible worlds
You ALL have customer service which is the benchmark for others
Yes, there is always room for improvement
Why do companies making a loss while others do record profit?
What makes a Lean Champion?
High Low
Low
High
Lean Champion
Service (OSA)
Efficiency in SCM &
Logistics processes
Effective planning
and control
Goal-oriented
cooperation
Control over key
figures
Organizational
alignment of the
integrated value
chain logistics costs
Ranges
process costs
Loss of revenue by OoS
Inventory and capital costs
ProfitLoss
We found a difference in the SCM process…
SCM is not a back office story
It is THE key process
Supply Chain Management is a key process
Lean Champions have one thing in common:
The entire organization is driven by the SCM process and it is also used as aManagement cockpit
Value Chain Optimization (VCO)
= costs-, turnover- and customer-orientated optimization of the value-chain
Definition of SCM….
Cu
stom
er/C
onsu
merSupply Chain Management Customer Management
optimization of supply-chainOptimization of
sales chain
Su
pp
lier
1. Target: Increaseavailability of goods
2. Target: Decrease
of logistic-costs
Integrated optimization of the value-chain
sustainable cost reduction process improvement and costumer loyalty
Demand&
SupplyPlanning
Operations
Inbound&
OutboundLogistics
CustomerService
Marketing& Sales
+
On Basis of Information Structure
SCM Basic Concept Provide the end consumer with the highest quality at best price, at the right time with the
shortest lead time- By partnering with channels, suppliers, 3PLs, and internally between Sales, Marketing, R&D, Procurement, Manufacturing, Distribution, Service, and Business Management - By continuing to innovate process, systems and organization, to improve long term profitability
Product PersonellProcess
Business
Produkt
Technology
People
Organization
Policy
Deve
lopm
ent
Pro
cure
ment
Pro
ductio
n
Mark
etin
g
Sale
s
Service
Logistics
Busin
ess
Managem
ent
Development
Management
Supply
ManagementCustomer
ManagementBusiness
Management
Decision Making Process
Supply Chain Process
Action Fields in Supply Chain Management ….require integrated and modular solutions
t 2 Our project-module SCM & Logistics for optimization of value-chains
Support & Interfaces
Operations
Structure
Strategy
Ac
tio
n F
ield
s f
or
Op
tim
iza
tio
n-P
roje
cts
SCM Vision
SCM Strategies
SCM Management/Organization
SCMProcesses
4
Sales
12
Marketing
13
Fi/Co
14
HR
15
SCM Planning
SCM Logistic / Network
SCM Controlling/KPI
6 7
Purchasing
8
IT
9
Customer Service
10
CRM
11
5
1 2 3
Yes….You all have SCM
But…
If your C-level Management is not pushing for improvement
If you SCM manager is complaining that no one is talking to him (sales)
If your SCM Manger is in a comfort zone of jargon and technical issues
If sales & marketing is not involved- no KPI
If you have monthly business reviews
If there is quite a gap between FC and result and everybody got used to it
YES? SCM is a back office story in your organization
Learn from other industries
Companies learn often from direct competitors
Non performers learn from non performers?
Champions look for improvement in different -but comparable-
industries and markets
A Food Business ExampleWhat do you think is the margin of Fresh Dough?
Consumer Sales Price (Gross) € 1,29
Consumer Sales Price (net) € 1,21
- Retail Margin (ca.35%) € 0,42
Net-Net € 0,79
- Transport & Warehousing € 0,28
- Packaging & Recycling € 0,23
- Ingredients & Manufacturing € 0,17
Delivered Margin € 0,11
- Marketing Spend
- Administration cost
Supply Chain drives Profit:
High impact of cost structure
Obsolescence is most value
destructing
Exemplary calculation:
Fresh DoughHow to crate a winning International Supply Chain for Fresh Dough?
Tough Challenges:
Short total product life (65 days)
30 days guaranteed shelf life to Trade
High variances in weekly sales
Traditional weekend-consumption
High seasonality
Demand highly influenced
- by weather
- Shopper impulses at POS
Long Supply Chain due to complexity:
- Origin of ingredients
- Unique Packaging components
Logistics Challenges:
- Temperature control a must
- more than 2500 km to transport
Key Success Factors:
Connected functions along SCM
One set of numbers
Match of Supply & Demand
Rolling forecast (weekly)
Monitor performance KPI
Align the functions in joint reviews
Benchmark
Improve Logistics efficiency
Look for maximum SC flexibility
Improve the SCM process
Match of supply and demand rolling FC weekly
Lean Champions plan and monitor business with rolling weekly forecasts
Lean Champions do it weekly
Monitor performance and KPIAlong the added value chain
Factory
Warehouse/Distribution Center
Sales & Marketing
FC accuracy – closest to the market
stock older 60/90 days
Everybody is responsible
Champions benchmark
Benchmarking is the practice of being humble enough to admit that someone else is better at something and being wise enough to learn how to match and even surpass them at it
External
Benchmark against Champions
SCM Benchmark not only in your industry or market
Internal
By division
By country by product group
By department
Benchmarking is a process for implementing best practice
1st Level:
Figures for the entire
supply chain
2nd Level:
Key figures per
function?
(examples)
3rd Level:
Detailed functional
indicators
(examples)
Management
Business Unit
Manager
Floor Mananger
WholeSupply Chain
Supplier
Performance
Service Level
tot. logistics
cost share
Supply Chain
planningforecast accuracycaused shelf gaps
Central logistics
utilization
Costs of central logistics
Branch
Logistics
total shelf availability
Store logistics costs
Supplier
Causes shelf gaps
Efficiency EDI messages
Promotion
Shelf availability
in the course of
action
remainder
Stock
Pick-cost
Truck utilization
Branch
shelf availability
Refill productivity
Subjekt AddresseesKey hierarchy
service levelshelf availabilitySupply chain coststotal stock
SCM - Management cockpit
Supply Chain- constantly improve the processDevelopment of content and importance over last decades
Lean Champions constantly improve
Integrated Business Planning and MonitoringKeep the functions connected & responsible
Everybody is involved
Champions monitor weekly
© Oliver Wight
Weekly
Factory
Sales & Marketing -push stock or demand?
EDI in the order and
invoice
Informal exchange of
individual indicators
Joint pilot projects in
logistics, planning
Measuring supplier
performance
Standard
Don’ts
Dos
o Joint Scorecards
o Intensive Master Data and Ratio exchange
o Joint packing optimization
o Expansion of EDI use (especially shipping)
o Active management of supplier performance
(Influence of supply chain performance on the
conditions negotiations, use of financial sanctions)
Intensive substantive cooperation with calculable
short-and medium-term efficiency potential
o Joint strategic long-term planning
o High investment in intensive relationships of trust and close personal contacts
o Too extensive CPFR and VMI projects without predictable return
o High number of pilot projects without clear objectives and sufficient Controlling
Cooperation for its own sake with high resources
and the risk of lack of focus
Dos and Don'ts in the cooperation between retail
and industry.
SCM as the most important processSCM Champions
Lower out of stock rate
Lower stock
Lower costs
Are using the SCM Cockpit and meeting as a management tool
Has joint plans together with retailers
And react faster on market changes
SCM as the most important process in the company is one of the
reasons why Champions perform in a impressive way
FISCHER & Partner Executive SolutionsAnalysis, strategy, design and implementation from one source
THANK YOU
Colonnaden 46 - 20354 Hamburg
Phone: +49 (0)40 34 10 770 – 10
Mail: [email protected]
Web: www.executive-solutions.de
Ricky L. Stewart