"It is amazing what you can accomplish if you do not care who gets credit."
Our approach is a result of several years of experience in working with some of the best supply chains around the world. Our three-step approach is designed to achieve outstanding results in the shortest period of time. Initial analysis is short, incisive and focused. Solutions are well thought through, with viability being the primary concern. Finally, during implementation, a sound program management approach ensures the results are delivered as promised.
– Harry S. Truman, Ex US President (1884 – 1972)
We quickly and accurately identify points of high leverage in supply chains:
Points of high leverage are those areas of supply chain where even small improvements will create outstanding benefits for the overall organisation.
To demonstrate outstanding benefits available to the organisation from supply chain improvement in the shortest period of time, and to conserve effort, it is essential to identify and focus on points of high leverage in supply chains.
We are able to identify points of high leverage using our rigorous, data-driven approach to hypothesis-based problem solving. Equally useful is our experience as global supply chain consultants to a number of large corporate clients and a very strong team.
1. Examples of points of high leverage identified in recent projects:
- Sub-optimal supply chain network: In one company in North America, the supply chain network was a result of series of acquisitions over a period of 20 years. Some distribution points were too close to each other, resulting in redundancy, while in some areas customers faced unacceptable lead times due to sparse coverage. A rebalancing of supply chain network resulting in net savings of around $2.3 Million per year (nearly 12% increase in EBIT)
- Redundant capacity: Another company had more than 9 manufacturing plants around the world – a legacy for the era when global supply chains were difficult to put together, and impossible to sustain. Overall capacity was more than 40% underutilised. A global manufacturing and supply chain model resulted in planned capacity rationalisation in a phased manner over 3 years and a net EBIT impact of 9%
- Linear Optimisation: With nearly 20 potential sources of products and about 250 large customers, this company was always trying to find the right source for each customer. A linear optimisation model built and implemented for this purpose saved the company between $2-5 Million per year
- Other areas of high leverage identified
- Mode change from trucks to train (approx. 45% cost savings on the leg)
- Inventory reduction through centralised inventory planning (17% reduction in inventory)
- Strategic purchase of shipping (anticipated savings: 10-30%)
2. We work out high value, pragmatic, concrete solutions:
- High value
Create maximum impact, focusing on points of high leverage
Capable of being implemented, taking into consideration all the uncertainties and vagaries of the real world
Fully substantiated, data-driven, well thought through, not merely speculative or based on gut feelings
Sustainable, not creating other problems, aligning supply chain strategy with the organisational strategy and business environment
3. We implement the solutions to realise benefits:
Even the best solutions are worthless, unless they actually deliver bottom line benefits. We work closely with the client teams to:
- Engage stakeholders at all levels appropriately
- Work out proper communications plans
- Build in the right incentives
- Design the team, management and steering group structure for implementation
- Design the right measures of progress, report on an ongoing basis, build in an issue escalation resolution process
- Objectively verify and communicate the bottom line benefits delivered