A Global Professional Equipment Manufacturer

A Global Professional Equipment Manufacturer Making it easier for customers to do business at reduced supply chain cost For a global leader in professional equipment, PA redesigned the complete order management and supply chain processes and organizations, and provided the client with simulation tools to shape decisions for more profit. Addressing the business challenge The business had grown rapidly through strategic acquisitions, which had led to a complex global supply chain with significant issues that included a lack of organizational clarity, non optimal processes, less than adequate business information and an unconstrained product catalogue. This complexity and inconsistency impacted the customer experience of dealing with the business and drove high supply chain costs. Consequently the client decided to manage its supply chain globally, looking to deliver improved predictability and reduced costs by harmonizing and simplifying processes, organization, and systems across markets and business lines. Creating a new supply chain operating model Together with client experts, PA designed and supported a supply chain transformation through two parallel initiatives: • Designing and implementing a new supply chain Strategy and Operating Model • Developing and deploying supply chain Visibility and Modeling tools. Building on a cross-company investigation of key challenges and opportunities, PA helped the business agree on a new supply chain vision and a one page 1 Key stages in developing the Commercial Operations programme have been: Issues analysis Future Blueprint Organisational Implementation Development PA supported a company PA supported client in PA developed SC visibility wide assessment of key developing a future blueprint for PA worked with client to tools and SC modelling tools issues and opportunities for the Commercial Operations develop the new Commercial PA supported implementation the Commercial Operations process Operations and Business of the Business Centre process Center organisation PA supported client in analysing business case for change 2008 2009 2010 Figure 1: Key stages in developing the Commercial Operations programme strategy. The strategy was detailed into a new supply chain blueprint and business case to: “ The program has • Implement regional shared service centers for supply chain, covering order management, logistics, quote support and planning made significant • Set up a commercial operations organization across the whole client progress towards organization to support the order to cash process driving • Simplify the process and systems for configuring the product specification fundamental and catalogue changes within • Implement Sales and operations planning processes and improve demand our organization, forecasting focusing on • Improve visibility and reporting across the end to end supply chain and process provide better strategic decision support tools standardization • Improve project management and installation practices. and simplification. A 40 people strong project organization was formed to implement the strategy, A direct result of and PA went on to support client workstream leaders in detailing the plans for those efforts was each initiative. PA then worked with senior client staff to design the the formation of a organizational structure and operating models for the new business centers and centralized the global supply chain organization, thus providing the foundation for effective Commercial implementation of the new supply chain strategy across the company. As a Operations result of the organization redesign, all units that needed to focus on being organization operationally excellent were clustered in three Business Centers. This enabled which will focus the country organizations to focus on customer intimacy, rather than operations. on simplified, standardized and Within this blueprint, the client Project Managers were established as the "voice consolidated of the customer" in the Supply Chain Organization. A design function was business established in each business center to ensure optimal planning of installation functions - with layouts, and dedicated installation teams were trained to work to benchmark the primary goal standards. Seamless communication of key information and milestone dates of making it between the Project Managers and back office functions was enabled through easier for our the implementation a project management toolset. customers to do business with us.” To enable effective execution and robust decision-making, PA constructed three new visibility and modeling tools. The supply chain visibility tool consolidates CEO information across different ERP and business systems and gives planners 2 visibility of the complete order flow. The red-flags tool helps order managers identify and address critical issues. The supply chain simulation model provides an environment for strategic decision makers to investigate effects of new policies, structural network changes, or market changes. Figure 2: Improved decision-making. Simulates the physical supply chain flow and key elements of the Commercial Operations process to assess impacts of changes and shape decisions for more profit Quote Order mgmt Order mgmt Customer Manufacturing Distribution Installation Cash and Sell (inbound) (outbound) Acceptance Purchased Purchased material material Subcomponent Component System production production production Purchased Component material production Delivering real value via the Supply Chain The client supply chain has been redesigned and relaunched to improve the customer experience and is on course to deliver substantial annual savings. Within just six months the establishment of a main business center had: • Streamlined the order management process through the development of tailored reports flagging orders not progressed according to plan “ PA delivered • Improved the quality of order data through identification of issues such as inconsistent order data between factories and the global sales organization great value and inconsistent interpretation and use of data fields between key markets because of the • Increased the quality of the supply base optimization decision-making unique through simulation-based analysis combination of • Created a management focus on the cost saving potential in outbound expertise in the transport areas of supply • Improved the understanding of the product portfolio in a supply chain context chain through the creation of a simplified catalogue structure transformation, • Met previously unachievable turnaround time targets for installation layouts organization • Simplified and harmonized the communications between the Country Organizations' Project Managers and equipment providers. design and dynamic From the client perspective, the supply chain transformation programme is seen modeling.” as integral to improving profitability for the business and quality for customers.