locker, alwin; council of supply ... - smart business events

Supply Chain Organisation as prerequisite for Supply Chain Innovations

Locker, Alwin; Council of Supply Chain Management Professionals - EuropeanConference 2006; Brüssel; 19.5.2006

Laboratory for Supply Chain Innovation

Supply Chain Organisation as Prerequisite forSupply Chain Innovations

SIG Combibloc International AG

Dr. Alwin Locker

SIG Combiblocpage 2

• Net sales 2005: EUR 1,097 million

Strong No. 2

R&DEquip-ment

Sales,Service

Packaging

• Net sales 2005: EUR 125 million

Focus: Value added bottling

Value Addedbottling

SIG HoldingNeuhausen, Rhine Falls/

Switzerland

SIG Combibloc SIG Beverages

SIG Group – todaySIG Combibloc generates approx. 90% of Group Turnover

SIG Combiblocpage 3 SIG Combibloc

Worldwide Locations & Company Figures

20042003

9391,058

20022001

854

1,075 1,097

200520042003

Net sales (mill. Euro)

9391,058

20022001

854

1,075

+ 28 %

1,097

2005 20042003

3,7313,923

20022001

3,380

4,061

2005

3,943

20042003

Employees

3,7313,923

20022001

3,380

4,061

2005

3,943

+ 17 %

20042003

10,67212,122

20022001

9,465

13,079

2005

14,673

20042003

Carton sales (mill. units)

10,67212,122

20022001

9,465

13,079

+ 55 %

2005

14,673

Headquarter: Neuhausen, Switzerland

Production: 7 sites

Sales, services: 44 offices

SIG Combiblocpage 4 SIG Combibloc

„Printing Cartridge Business“

ServiceFilling lines Packages Closures

No standstillsInstalled basic

systemsAmortisation filler /

sleeves salesDifferentiation

90% of sales volume10% of salesvolume

SIG Combiblocpage 5 Speed of Innovations has increased

No choice for companies to participate or not to participate

Source: Boutellier, ETH

SIG Combiblocpage 6

Productexcellence

Process excellence

today

tomorrow

Years ofadvantage

ProductTechnology

1 3 5

ProcessTechnology

BusinessProcesses

Competitiveadvantage

Process innovations guarantee competitiveadvantagesCompetitive Advantage = Product x Process Excellence

SIG Combiblocpage 7 SIG Combibloc – SCM Strategy & Objectives

Customer Value Orientation as first Priority

Return onInvested Capital(ROIC)

Revenues

Invested Capital

Change incapital structureand composition

Cost and Value Driver

TaxesEVA

Cost of capital

Pre-tax returnOn Invested Capital

Operating costs

CustomerSatisfaction

Survey

Lead times repeatingorders

Time-to-market newdesigns

Innovative processes

Inventory

On-time production

1

2

3

4

5

Cost- & Investment Efficiency(Priority 2)

Flexibility & Process Quality(Priority 1)

SIG Combiblocpage 8

Supply Chain Management Strategy• Scope / Segments• Vision / Objectives

SCMProcesses

ITTechnology

SCM - Innovation

BusinessRules

define enables

3 Pillars of Supply Chain Management (SCM)SCM Organisation as Basis

SCM Organisation

SIG Combiblocpage 9 Scope of Supply Chain Management at SIG

CombiblocSCM covers Supply Chain from Customers to Suppliers

Supply Chain Management

Sourcing Production Distribution

SIG Combibloc Customer RetailerConsumer

Suppliers

Customer SCMSupplier SCM Internal SCM

SCM Core Process 1: Forecasting und Planning

SCM Core Process 2: Order Fulfilment – new designs

SCM Core Process 3: Order Fulfilment – repeating business

SCM

SIG Combiblocpage 10

CBEE CBUK CBAS CBAMIT CBWE

CustomerSCM

SupplierSCM

InternalSCM

CBIN

SCM Teams in Regions

allCap

SCM Project Organisation 2002-2004Use the experience of the pilot in three SCM modules


Supply Chain Integration with Customers andSuppliersPosition of Value Offering- & Order Penetration Point

Order Penetration Point

PurchasingInventory /Distribution

Production/-Planning

OrderCenter

Sales/MaterialPlanning

Customers demand chain

OrderCenter

Inventory /Distribution

SIG supply chain

Value Offering Point


Purchasing


Supply Chain Integration with Customers andSuppliersPosition of Value Offering- & Order Penetration Point

Supplier supply chain

PurchasingInventory /Distribution


OrderCenter

Sales/MaterialPlanning

SIG demand chain

OrderCenter


Inventory /Distribution

Purchasing

Value Offering Point

Order Penetration Point

SIG Combiblocpage 13 Customer- and Supplier SCM

New Processes in the Supply Chain – can be tested easily

TRADITIONAL

Customer

OrderOrder

Ord

er

Pro

cess

Deliv

ery

Pro

cess

OrderOrder

SIG CBSupplier

Delivery

Delivery

Production

Production

Production

NEW

Ord

er

Pro

cess

Deliv

ery

Pro

cess

Material-planning

Material-planning

ProductionPlanning

ProductionPlanning

Capacity-planning

Capacity-planning

DeliveryPlanning

DeliveryPlanning

Capacity-planning

Capacity-planning

ProductionPlanning

ProductionPlanning

DeliveryPlanning

DeliveryPlanning

Delivery Delivery

Production Production

ProductionPlanning

ProductionPlanning

Production

Fore

cast

Pro

cess

SIG Combiblocpage 14 Business Rules

Pre-requisite for the Implementation of Customer- andSupplier SCM, especially for Roll-out

Production planning

Stock planning

Forecast Delivery

New print designs


BizTalk

Order Generation Module+ Database

Web-System

SIGCustomer

ERP

Customer SCM IT-ApplicationTwo Phases – MS Prototype & SAP Serial Product

Phase 1 –

MicrosoftPrototype

Phase 1 –

MicrosoftPrototype

SIG Combiblocpage 16 Customer SCM IT-Application

Two Phases – MS Prototype & SAP Serial Product

https

Mail

Extra-/Internet

Extra-/Internet

File

RFC

File

RFCInternet HTTPS

Format: XML/IDOC

E-Mail with Attachment

Format: Excel, ASC II, XML

X400 EDI

FTP FTP Server

Outlook

(with Add-on)

SAP Web

Application Server

X400Mailbox

EDIConverter

Form

at

Convert

er/

Mappin

g

SIG

-Sta

ndard

-Inte

rface

SA

P-S

tandard

-Work

flo

w

Phase 2 –

SAPSerial

Product

Phase 2 –

SAPSerial

Product

SIG Combiblocpage 17 SCM Process Organisation

SCM is responsible for complete Order Fulfillment Process

SCM

Sales, Service,Marketing

OrderCentre

Prod.Planning

MaterialMgt.

RM/SFstock

ProductionFG

stockShipping

PrePrint

Planning & Controlling

Sales & CRM

Forecasting

CRM = Customer Relationship ManagementRM = Raw MaterialFG = Finished GoodsSF = Semi-finished Goods

CustomerCustomer

SIG Combiblocpage 18 Development steps of SCM organisations

From Pilot Project to SCM Structure

• low invest• scarce resources• option

SCM Pilot SCM Project SCM Structure

• team• defined goal• resources

• line responsibility• strategy & objectives• ROI

Source: Boutellier, ETH

SIG Combiblocpage 19 Global SCM Organisation

Tasks of organisational layers – global, continental, local

RessourceMgt. Capacity

& Material

SCMInnovation/

Support

UK

Austria

SCMGlobal

Germany 2

Pre PrintCenter

OrderCenter

SCM Europe

SCMGermany 1

Global

Innovation &Synergy

Local

Efficiency &Speed

Continent

Customer-orientation &Complexity-management

SCM America SCM Asia

Master DataMgt.

SIG Combiblocpage 20 There is no one right organisation

Organisations have to fit certain Conditions at certain Times

TaskType

Complex

Routine

TaskCoordination

Centralisiation /Hierarchy

Decentralisation /Team

DailyBusiness /Innovation

Deployment

Crisis /Innovation

Development

„If the ship goes down,

the captain does not call a

meeting, the captain gives

an order“

P. F. Drucker

„We are what we

repeatedly do. Excellence,

then is not an act, but a

habit“

Aristotle

SIG Combiblocpage 21 Summary & Conclusions

• Concentration on core processes in supply chains enables SCMinnovations

• SCM innovations consists of three pillars• interface processes• business rules• IT

• SCM process organisation is a pre-requisite for the long-termimplementation of SCM innovations

An organising framework can never be right or wrong,

only helpful or unhelpful

John Kay, Foundations of corporate success

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