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Familiar?
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Alignment
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Creating Alignment
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The Challenge
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The Management Team
VP Supply Chain
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Supplier footprint
TFC
Netherlands
Miami NO8DO
Orange Mango
US Trio
Spain PET
Spain
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Assortment
Three flavors
Orange
Orange C-Power
Orange/Mango
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Shelf life
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Market
Three customers
Retailer Food & Groceries
500 stores
Supply chain leader
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The Fresh Connections
Supply Chain
Components
pallets
Finished product
pallets
SRM Mixing Bottling CRM
tankyard
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Contract index
Price setting
Example (sales)
Promise Contract index Basic price Sales price
Much 1.1 1.50 1.65
Little 0.9 1.50 1.35
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Performance evaluation
Costs
Operational costs
Improvement projects
highest
ROI
Revenue Investments
Price: Working capital
Customer satisfaction Equipment
Volume: Buildings
Portfolio
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Quick
Tour
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The Challenge
The Start
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Getting started
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Management team
meeting
Agenda
1. Service Level Agreements with Customers
2. Inventory Policy for Finished Products
3. Capacity Management
4. Inventory Policy for Raw Material
5. Supplier management
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Service Level
Agreements with
Customers
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SLA customers
Pro Con
Increase service
Revenue Increase
level promise to Risk of Penalties
(plus 62 K)
97.5%
Decrease service
Revenue decrease
level promise to Risk of Penalties
(minus 110 K)
92.5%
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Inventory Policy
Finished Products
Pro Con
Inventory finished
Longer production products (obsolescence)
Change over
interval (15 days)
Volatility in warehouse
Inventory finished
Shorter production products (obsolescence)
Change over
interval (5 days)
Volatility in warehouse
SCM Report : Product | SAL Report : Product | OPS Report : Mixing and Bottling 25
Capacity Management
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Bottling Line Capacity
Pro Con
Ops:
Overtime Fixed costs
From 2 to 3 shifts
Prod plan adherence (100 K)
(40 extra hours)
Ops:
Overtime Project costs
10% extra
Production plan adh (15 K)
capacity
OPS Report : Mixing and Bottling | SCM Report : Product | FINANCE statement 27
Inventory Policy for
Raw Materials
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Inventory policy raw
materials
Pro Con
Inventory Shipments
Decrease lotsizes
Overflow
to 1 week
Volatility warehouse Orders
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PET bottle supplier
Pro Con
Change to
Rejection rate
(nearby) certified
Break down Contractindex
supplier, FTL
Transportation costs
High quality
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Creating Alignment
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The best companies
are the best aligned
Strategy effectiveness
Org effect
Aligned
Best of intentions, Very best chance of
but incapable winning
How well aligned is
your strategy with
your longterm
Not aligned
purpose?
Boldly going
Not long for this world
nowhere
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Source: Trevor and Varcoe, A Simple Way to Test Your Companys Strategic Alignment, HBR, May 16, 2016
We need a bridge
We all mean
well, but we
get nowhere
A challenge for corporate leaders is how to make sense of strategic alignment at both the team / business unit
level (or division or department, however it is classified) and at the enterprise level.
We need to be educated and trained about alignment
Only 10% of what we know, weve
learned in class room setting
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But learning by doing has some weak
points
company strategy
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There are other ways to educate and create alignment
Cross functional
learning experiences
Around managing value
chains
To create a lasting
learning effect
To create alignment by tapping into the full learning
& development potential of your people:
Participation in teams
Class room learning (10%) Bridging the gap from
Learning from colleagues (20%)
Learning by doing (70%) strategy to execution
A learning experience up to 10 times as effective as Creating alignment
traditional programmes
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Last but not least: the forgetting curve
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Learning experience needs
to be configured
Workshop
(1 day)
Teambuilding
event
(0,5 day)
Training intensity
(# rounds, training between rounds)
Training modules
around TFC
Creating
alignment S&OP
- Basic
SC
- Advanced
Risk Mgt - Applied
Strategy into
CO2 Action Logistics
Footprint (level1,2,3) Footprint
KPIs External
- Selection
Strategy Colla-
- Targets
- Planning Segmen boration
-tation
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History
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Name-dropping
email: h.kremer@inchainge.com
Q&A
More info at:
www.thefreshconnection.biz
www.thecoolconnection.org
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