Our programs are based on no less than 5 to 1 paybacks being realized in the first 6 to 18 months. This allows program costs to be recovered quickly with subsequent returns contributing to profits and cash on the balance sheet. We rarely see programs that do not support these results as only the best in class value chain operations supported by appropriate management directives can operate towards the zero working capital goal.
All of our value chain programs are centered on the Company’s commercialization spectrum which provides the basis for long term growth. We define 4 aspects of commercialization as represented by the top row of the graphic below.
Whether a Company is launching new products or servicing established products continual optimization of this commercial strategy and tactics is critical in providing competitive response to ever-changing marketplace dynamics.
The value chain applications to each aspect of commercialization are important to ensuring delivery is aligned to the market, it’s growth goals and diversity across consumer channels. Our advanced supply and demand models provide the means to define the value chain as it operates today and provide comparisons to an optimized future for each aspect of the commercialization spectrum. These models have been developed over years of diverse program applications so that financial benefits can be evaluated for cost and returns for most any industry and their markets.
Our models support a 3 step process of Assess, Transform and Sustain to improve value chain performance and the commercialization goals.
- Assess – Initial modeling supports an evaluation of the Company’s value chain as it applies to the Company’s commercialization growth strategy. This evaluation supports the assessment.
- Transform – The output of the assessment is a roadmap that defines activities required to realize performance improvements as identified in the model. The roadmap supports the transformation.
- Sustain – The output of the transformation is the processes and systems that support the execution of the improved value chain as it was modeled. At this point financial benefits are tangibly realized with new methods that support a sustained improvement process.
These three steps combine to provide performance by design, execution and sustained methods into the business and it’s long term growth goal of commercialization. By solidifying this type of market alignment with the value chain for product development, production and delivery a long term growth of market sales can be realized.
Rapid Opportunity Assessments are typically done in a 3 week time frame with focus on a specific value chain area including:
- Sourcing & Distribution Network Modeling
- Supplier & Procurement Management
- Supply Capacity Capability & Throughput
- Warehouse & Inventory Management
- Advance Planning Systems
- Order Fulfillment Systems
- Manufacturing & Operational Excellence
Technical Assessments are typically a longer term proposition where advanced modeling tools are used to determine the end to end performance of current value chain operations vs. a proposed architecture. Proposals can include system and process change as well as contracts with partners and suppliers, outsourcing, co-location and fulfillment distribution strategies.
All Assessment services will provide a roadmap of transformation activities with timelines and benefits that have been modeled with current Company data.
Transformation typically follows an Assessment which has provided the roadmap for change and targets benefits as goals for success. Transformation can be broken into scale categories as:
- Single Site, Single Functional Area focus for improvement within the Value Chain
- Single Site, Multiple Functions in an integrated approach to the Value Chain Improvement
- Multi-Site, Corporate Value Chain Improvement
All transformation programs are based on a 5 to 10 to one return on investment in the first year as the primary success criteria. Timeframes to make the transformation can vary depending on the scope and goals of the program.
Sustaining the transformation involves the execution systems and building upon the knowledge transfer that occurred in the transformation stage. Establishing these systems typically involves a certification strategy where specific quantifiable performance is the basis of certifying processes. Key areas typically involved in this stage are:
- Perfect Order Metrics
- Delivered Cost
- Cash Conversion Cycle
- Working Capital
- Supplier Scorecard Rating Program
- Service Partner Performance