ImplementationImplementation Workstream : Workstream :

Update to ECR Board Update to ECR Board 28 November 2003 28 November 2003

Implementation Workstream

Objectives - Champion roll-out of ECR practices - Drive implementation of global standards

Deliverables 1. Validate benefits of ECR engagement :

‘The Business Case for ECR’

2. Develop KPI’s and measure roll-out of ECR practices and global standards

3. Make recommendations to tackle non-implementation

Co-Chairs : Andre Tordjman, Auchan Ed Lonergan & Vicki Belcher, GilletteCo-ordinator : Marianne Dehousse, AIM

Key Messages for today

1. Proposed business benefits for practising ECR:- Accelerating growth- Reducing costs

2. Proposed measurement of benefits:- Levels and activities- KPI’s

3. Initial “Healthcheck”. Need to improve: - Co-ordination- Communication

4. Developing Solutions

Benefits and Measures

Level Benefit?

Europe Industry Health

By Country Industry Health

By Company Comp Advtge

“What do I get from ECR?”

Benefits and Measures

Level Benefit? 1.Engagement 2.Capability 3.Business Benefits

Cost Saving Growth

Europe Industry Health

By Country Industry Health

By Company Comp Advtge

Measures“What measures can we use?”

Benefits and Measures

Level Benefit? 1.Engagement 2.Capability 3.Business Benefits

Cost Saving Growth

Europe Industry Health Projects

By Country Industry Health Projects

By Company Comp Advtge Project with Partner

KPI’s

- No’s involved- Stage reached

- No’s involved- Stage reached

Measures“How can we measure?”

Benefits and Measures

Level Benefit? 1.Engagement 2.Capability 3.Business Benefits

Cost Saving Growth

Europe Industry Health Projects Scorecard

By Country Industry Health Projects Scorecard

By Company Comp Advtge Project with Partner Scorecard

Measures

KPI’s

- No’s involved- Stage reached

- No’s involved- Stage reached

- No. completed

- Scores achieved

- No. completed

- Scores achieved

- No. completed

“How can we measure?”

Benefits and Measures

Level Benefit? 1.Engagement 2.Capability 3.Business Benefits

Cost Saving Growth

Europe Industry Health Projects Scorecard %€ %€

By Country Industry Health Projects Scorecard %€ %€

By Company Comp Advtge Project with Partner Scorecard %€ %€

Measures

KPI’s

- No’s involved- Stage reached

- No’s involved- Stage reached

- No. completed

- Scores achieved

- No. completed

- Scores achieved

- No. completed

“How can we measure?”

Benefits and Measures Proposed Measurement of Business Benefits

Europe Top 5 ECR active participants, Retail Total Europe, Retail

Top 5 ECR active participants, Supplier Total Europe, FMCG

By Country Top 5 ECR active participants, Retail Total Country, Retail

Top 5 ECR active participants, Supplier Total Country, FMCG

Company Own results Appropriate Universe from above

Source of data : Published Company Results vs Industry averages (MVI, M&MPlanetRetail…)

Cost Saving : Operating Costs % variance, last 3 years

Turnover%

Growth : % Sales Growth (like-for-like) average, last 3 years

Sample Group vs Universe

Benefits and Measures

Level Benefit? 1.Engagement 2.Capability 3.Business Benefits

Cost Saving Growth

Europe Industry Health Projects Scorecard %€ %€

By Country Industry Health Projects Scorecard %€ %€

By Company Comp Advtge Project with Partner Scorecard %€ %€

Measures

KPI’s

- No’s involved- Stage reached

- No’s involved- Stage reached

- No. completed

- Scores achieved

- No. completed

- Scores achieved

- No. completed

ECR European Projects : Completed/ongoing

0

1

2

3

4

5

6

7

1996 1997 1998 1999 2000 2001 2002 2003

Supply Demand General

Steady support for EU Projects,

trend towards Supply side

ECR European Projects : Company Participation

14

3517

57 51

1837

100

14

41

17

87

18

42

137

74

0

20

40

6080

100

120

140

160

1996 1997 1998 1999 2000 2001 2002 2003

No of Companies involved No of people involved

185 companies have participated to date.

Some companies support multiple projects

Issues to address/2004 workplan :

- Process for deciding which topics are best tackled by an EU project?

- How many projects at any one time?

- “Recruitment” of companies to EU projects? Call for volunteers vs targeted recruitment

- Measuring roll-out : “Beyond the Blue Book”

ECR European Projects

Benefits and Measures

Level Benefit? 1.Engagement 2.Capability 3.Business Benefits

Cost Saving Growth

Europe Industry Health Projects Scorecard %€ %€

By Country Industry Health Projects Scorecard %€ %€

By Company Comp Advtge Project with Partner Scorecard %€ %€

Measures

KPI’s

- No’s involved- Stage reached

- No’s involved- Stage reached

- No. completed

- Scores achieved

- No. completed

- Scores achieved

- No. completed

ECR Nationals status on EU project areas

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14

Promotions

Product Introductions

CRM

POS

Traceability

Cat Man

Consumer Direct Logistic

3PL

Replenishment

CPFR

Transport Optimisation

Shrinkage

Data Synch

OSA

Finished Ongoing Considered

30%

30%

15%

15%

5%

65%

50%

40%

55%

40%

40%

30%

25%

10%

120 Project Teams across 20 countries

“Adoption rate” of European projects is 5 - 65%

Cost

Growth

• Enabling technologies (6) • ECR scorecard (6) • EDI (5) • Coupon Optimisation (3)• RFID (2)• Cross docking (1)• Packaging Damage (1)• Packaging items (1)• Pre-packaging merchandising Units (1)• Social Responsibility (1)• Fresh Food (1)• Textiles - terms & processes (1)

Further ECR National Projects

29 National Project Teams working on additional topics

Issues to address/2004 workplan :

Continue to improve dialogue/communication to:

- Avoid duplication of effort

- Co-ordinate projects to accelerate learning eg a “buddy system”

- Establish what we tackle at a European vs national level

- Roll out the “basics” as well as initiate more “advanced work”

Initial Report on Implementation : ECR Nationals Projects

EuropeNational

Benefits and Measures

Level Benefit? 1.Engagement 2.Capability 3.Business Benefits

Cost Saving Growth

Europe Industry Health Projects Scorecard %€ %€

By Country Industry Health Projects Scorecard %€ %€

By Company Comp Advtge Project with Partner Scorecard %€ %€

Measures

KPI’s

- No’s involved- Stage reached

- No’s involved- Stage reached

- No. completed

- Scores achieved

- No. completed

- Scores achieved

- No. completed

227

31

82

47

75

33

0

50

100

150

200

250

Worldwide Europe

2001 2002 2003

Scorecard completion : European companiesScorecard completion : European companies

ECR Scorecard : Capabilities GCI Compliance

205

29

249

129

186

98

0

50

100

150

200

250

300

Worldwide Europe

2001 2002 2003

European companies account for c50% of scorecard completion worldwide

Some companies complete multiple entries

Strategic Direction -Consumer ValueBusiness Models

ScoreGeneral Meaning

All plans and strategies derive from the principle that creating consumer value must be the primary driver for business decisions

and actions.

0 Nothing plannedThe current business model does not address

or measure how the business is creating value to the consumer.

1Plans agreed but

have not yet started implementation

General acceptance that the traditional business model may not be suff icient to deliver consumer value. Early plans to

challenge the model are in place.

2Pilot tests being

conductedParallel to the traditional model, new s w ays of

providing consumer value are being tested.

3Roll-out of

implementation started

Based on pilot-testing, alternative w ays of providing consumer value have been

identif ied and are evident by a signif icant increase in grow th rates.

4 Fully implemented

A portfolio of business models ensure that the organization exceeds consumer

expectations on value and delivers superior returns for the trading partners.

ECR Scorecard : Measuring implementationECR Scorecard : Measuring implementation

We can measure implementation rates via ECR scorecard

Strategic Direction -Consumer ValueBusiness Models

ScoreGeneral Meaning

All plans and strategies derive from the principle that creating consumer value must be the primary driver for business decisions

and actions.

0 Nothing plannedThe current business model does not address

or measure how the business is creating value to the consumer.

1Plans agreed but

have not yet started implementation

General acceptance that the traditional business model may not be suff icient to deliver consumer value. Early plans to

challenge the model are in place.

2Pilot tests being

conductedParallel to the traditional model, new s w ays of

providing consumer value are being tested.

3Roll-out of

implementation started

Based on pilot-testing, alternative w ays of providing consumer value have been

identif ied and are evident by a signif icant increase in grow th rates.

4 Fully implemented

A portfolio of business models ensure that the organization exceeds consumer

expectations on value and delivers superior returns for the trading partners.

ECR Scorecard : Measuring implementationECR Scorecard : Measuring implementation

4

37

30

29

0

•Average score = 2.32

•c40% of companies are at roll-out or full implementation

EU Companies 2003 score

We can measure implementation rates via ECR scorecard

Issues to address/2004 workplan :

- Global Standards/Compliance scorecard : Need to increase the pace

- Target setting for completion rates and scores achieved

- Understanding why companies don’t use Scorecards

ECR Capability : use of scorecards

Key Messages for today

1. Proposed business benefits for practising ECR:- Accelerating growth- Reducing costs

2. Proposed measurement of benefits:- Levels and activities- KPI’s

3. Initial “Healthcheck”. Need to improve: - Co-ordination- Communication

4. Developing Solutions

Improving visibility & communication

www.ecrnet.org lists all activity by country initiative

Tracking & measurement tools

Matrix highlights topic and status by country...

Improving visibility & communication

….or you can access by topic

Tracking & measurement tools

…with a simple “who to contact” list

Key Messages for today

1. Proposed business benefits for practising ECR:- Accelerating growth- Reducing costs

2. Proposed measurement of benefits:- Levels and activities- KPI’s

3. Initial “Healthcheck”. Need to improve: - Co-ordination- Communication

4. Developing Solutions