Moving the Needle (and making it stick) Supply Chain Metrics that Drive Financial & Operational Improvement

Transcription

1 Moving the Needle (and making it stick) Supply Chain Metrics that Drive Financial & Operational Improvement Dave Brooks, Sr. Director, Software AG Jim Waites, Managing Director, IDS Scheer June 23, 2010

2 The Opportunity: Converting Real-time to Real-Value Business event Data captured Value Process Intelligence Intelligence delivered Action taken Engaged with customer Truck at loading dock Opportunity Customer has left the store Truck has left the dock Missed Opportunity Time Reference: Richard Hackathorn The BI Watch: Real Time to Real Value

3 You have to measure to improve, but what do you measure?

4 Supply Chain Key Performance Indicators

5 Computers From Publically Available Data SCOR METRICS

6 Retail Grocery From Publically Available Data SCOR METRICS

7 Telecom From Publically Available Data SCOR METRICS

8 Make the Needle Stick As Documented processes As Implemented processes As Executed processes

9 Perfect Design with Imperfect Execution - or Imperfect Design with Perfect Execution - Design done once, execution ongoing - Easier to design change than to execute change - Superior execution indicates organizational agility Process Innovation Differentiation Target Process Execution Differentiation Execution Sustainment Value Design/Implement Effort Implement Point Execution Precision Time

10 Three Initiatives Why wait for the cause to address the root? P2P Online Ordering European Retail Industry Performance Ready

11 Are New Capabilities Getting Traction? Monitoring the launch of a New Channel LAUNCH OF ONLINE ORDERING 6/29/2010 Sales Kickoff

12 How Do New Capabilities Change Customer Behavior? Online channel brings visibility across the product portfolio LAUNCH OF ONLINE ORDERING 6/29/2010 Sales Kickoff

13 How Do You Gain Insight Into Customer Behavior? Visualize buying behavior MONITOR THE CUSTOMER S BUYING CADENCE 6/29/2010 Sales Kickoff

14 PMG Initiative SCOR Level 1 Metric Benchmark Visibility

15 European Retail POS Initiative

16 ARIS PPM Store Monitoring - Risk sequences Conspicuity on a receipt Returns with a large sum of money (e.g. > ) Cancellation of cash receipt immediately or shortly after a cash sale Price changes/price reduction (e.g. > 10,00 ) Employee discounts with a large percentage (e.g. > 20%) Behavior at the POS Frequent deficiency with reference to certain cashiers ( shorts ) Repeated opening of the cash drawer without reference to a selling process Frequent reprinting of cash receipts Price instruments and means of payment handling Gift cards - Frequent usage of gift cards with a large amount of money Coupons - Frequent redeeming of coupons with a large amount of money Loyalty cards Frequent usage of the same store card Credit cards - Repeated usage of the same credit card for returns 16

17 ARIS PPM Store Monitoring - Performance indicators Quantitative Performance Monitoring and analysis of scanning times, cashier times, idle times and breaks. Number of employees, based on hourly output per employee. Number of employees, based on sales frequencies. Number scanned articles, manually registered articles Duration of the POS process per cash receipt Number of transactions higher than expected duration Qualitative Performance Number and duration of tendering and loyalty card handling Number and value regarding VISA payments, Cash payments, Debit Card payment Number of price inquiries and other call back to qualified personnel in the store. Number of times a cashier has to reweight articles at the point of sale. Failed registrations at the terminal Process optimization and potential for improvement through comparison of AS-IS-Processes 17

18 Process Mining within ARIS PPM Process Mining makes it is possible to detect cases of fraud and weak points within processes ***** BU R/F ***** ** Sport Discount ** * Phone:0681/ * every POS transaction corresponds to one process in ARIS PPM Process Mining automatically identifies conspicuous variability in key indicators (article price, quantity, discount value) - by dimensions (cashiers, POS terminals, stores, regions, article groups etc.) Non-specific Process Mining can be executed on the entire set of data or a defined key indicator and dimension Asics Gel Tactic Adidas Predator *Employee Discount* 20% PN: ,99 Subtotal EUR TOTAL EUR Cash No.Articles 2 Tax-Gross Sales % Tax NETTOUMSATZ Your Cashier: Mr. Kraemer **** Thank You **** RCPT TIME DATE : Article is scanned Article was scanned Employee discount is granted 1x Adidas Predator Price: 199,00 Euro Discount: 20 %

19 ARIS PPM Store Monitoring Dashboard 19

20 *integrated Management Views *

21 ARIS PPM Store Monitoring Reports Number of transactions, where cashier name is equal to loyalty card holder name Number of shorts and over (+/-) of all stores (01 to 20)

22 ARIS PPM Store Monitoring Reports Department sales per cashier of store 04 (by department) Discount value per cashier in store 04

23 ARIS PPM Store Monitoring Reports The tender time / ring time* ratio of store 04 (per cashier) Number of taken means of payment in store 04 (per cashier) Number of sales transactions of store 04 (by time) Number of sales transactions of store 04 (by hour, by cashier) Top cashiers according to turnover of region North Process cycletime (sales process) with predefined limits * ring time = scanning time

24 As Executed Process Comparison Cashier 1 Complex structure Cashier 4 Simple Structure

25 Retail Initiative Improve by focusing on: Process Intelligence Logic with POS process step detail Identify conspicuous transactions By region, store, department, clerk Identify best practice processing By region, store, department, clerk The Target Reduction of theft Driving operational standards for improved efficiency Increased customer satisfaction

26 Post Go Live Monitoring Sustaining P2P Improve SAP Go Live Sustainability During process design there are known key process steps Currently manual efforts put in place to monitor Usually short term focus support Eliminate chance of falling back to old ways Pinpoint attention areas

27 Post Go Live Monitoring Sustaining P2P Process Execution Metric Good Receipt (GR) Timeliness Planned versus actual date GR done without reference to Purchase Order Order quantity accuracy FI Invoices generated Inventory adjustment made Percent Manual PO versus mrp generated Vendor invoices with terms that don t match PO Improve by focusing on: Policy and Procedure enforcement Support Continuous Improvement Design Validation Root level Analysis Driven Analyze by Dimensions Drive Training needs Identify good and bad management practices

28 Make it Stick Excel by focusing on: Quicker time to Implement Execution Precision Execution Sustainment Process Innovation Differentiation Target Process Execution Differentiation Execution Sustainment Value Design/Implement Effort Implement Point Execution Precision Time

29 Thank You Questions? Dave Brooks Sr. Director Software AG Jim Waites Managing Director IDS Scheer