Applying Distribution

Transcription

1 Valkre Solutions, Inc. Applying Distribution Contents Executive Summary Internal DVP Interview Process Analysis Promise Management DVP Management

2 Executive Summary SCOPE North American Distribution operations serving Strategic Accounts Customers in scope: Manufacturing, Government and Services verticals Competition includes other national and regional distribution companies BUSINESS CONTEXT Growth has traditionally come from offering a broad product line and our capability in managing a complex supply chain. Small acquisitions helped us penetrate low served rural areas, we can now offer same-day delivery to 90% of our customers Best price no longer wins, customers want advisors who can help them improve their operations and compete better in the marketplace OBJECTIVES Establish a pragmatic and robust methodology to measure our impact and get customers feedback Identify new opportunities for future upsell input for program and product line expansion Develop long-term partnerships with strategic accounts IMMEDIATE OUTCOMES Increased share of wallet at DVP customers 30% within a six month period Based directly on DVP feedback, we redirected substantial investment dollars from improving our supply chain to innovating around our services portfolio Measured the impact generated for clients 2

3 Internal DVP Building an Internal DVP is a cross-functional effort to determine and align on what makes you different versus alternatives and how those differences impact your customer s income statement. The outcome is a practical, economically rigorous model that is easily communicated and updated internally. Uses: Deal Preparation, Sales Effectiveness, Organizational Clarity, Conducting Customer Interviews. Attributes: We believe our investments in Inventory Management, Customer Support and our Broad Product Line are the key points of differentiation Functions: At our customers, Operations and the Purchasing functions feel the impact. Drivers: Customers realize the impact largely through Working Capital efficiencies and reductions in Operating and Procurement Costs. We back up the charts and qualitative details with our financial claims. Here, we are anchoring our DVP on our ability to help improve our customer s Inventory Turns. In total, this DVP is thought to be differentially worth $49,600 for an typical customer a DVP% of 5%. 3

4 Interview Process A DVP Interview is a facilitated conversation with customers about your current DVP and potential improvement opportunities. Render generates interview materials and provides an organized interface to capture interview notes and insights. The results of each interview are structured in the DVP framework to create a dataset. Uses: Aggregate with other interviews to identify themes, create the basis for planning and accountability with customers, and provide rich customer stories to influence your organization. This one page Guide shows how the Internal DVP is used to facilitate the Customer Interview. Guides contain pages for qualitative stories and financial assumptions focused on: Are we helping you make more money today, and what are the opportunities to improve. Once completed, interview notes are shared with customers to ensure accuracy and buy-in. Render helps create Interview Notes that are detailed, but easily read and understood. Here, this customer thought the Current DVP% is worth more than half as much as the Internal DVP%, and Inventory Management and Sales Channel are the most important attributes. The Opportunity to improve the DVP% is significant at 2.5%, focused on continuing to invest in Inventory Management and a new investment in Partnership. 4

5 Analysis The primary Analysis activity aggregates DVP Interviews across customers to create two outcomes: Top 10 ways you create differential customer value today and determine your Top 10 Opportunities to improve DVP, all ranked by the value to the customer. Uses: Commercial Innovation, Sales Effectiveness, Deal Preparation, Segmentation, and input to decision making. The Top 10 Opportunities are the potential actions which have the greatest impact to the customer. The largest opportunity is Help Customers implement better Sustainable Initiatives, which is worth $114,000. Details can be seen under show comments. Improving some aspects of Customer Service is a Repair. You need to fix this to maintain (not grow) your DVP. Close to 90% of the total opportunity is contained in the Top 10. Segmenting the Opportunity dataset shows how Customers and Customer stakeholders differ in their opinion. Here, Government customers are much more focused on Customer Support than other segments. Summaries by functional segments are helpful to you and your customer to identify areas of competing priorities. 5

6 Promise Management The outputs of Analysis flow into tools designed to help you make and keep promises with customers. The keys are visibility and accountability. The Top 10 Opportunities are either converted into Initiatives or not. The resulting Initiatives are managed, quantified, and measured in order to communicate internally and with customers: Here is what you said, what we re doing about it, and the impact we jointly expect. Uses: Growth planning, closed loop communication, customer collaboration, result tracking, value selling, accountability Here, 3 opportunities have been Declined and 5 are being reviewed while 7 others are moving into action. New opportunities such as Offer inventory management services may require further time to evaluate. Those 7 Working On Initiatives flow into Execute mode. Initiative Management can be as simple as setting a Promise Date and getting it done. Offer Dedicated CSR Contacts is behind schedule, but three Initiatives have been completed. Other investments such as Inventory Management Offerings and increases to the product line portfolio will transform the relationship. 6

7 DVP Management There are dashboards to manage the system of DVP. They provide clarity on progress and dynamic understanding of DVP in real time. Uses: Accountability, Focus on Top Differentiators, Opportunities and Initiatives, organizational visibility, pace and speed management. The Current DVP is similar in Attributes to the Internal Perspective, but a bit lower suggesting overconfidence. The path forward is driven by Customer Support and Partnership not a broader product line. The plan to improve includes Partnership (Customer Sustainability Efforts), but the program has not been completed yet. The DVP% has only slightly improved from 3.0% to 4,1%. One path for growth will come by creating and approving Initiatives for the Opportunities currently Under Review. Once the Promise Keeping Bar is mostly Completed, you can expect the DVP% to rise sharply and provide the basis for increasing share, winning new customers, or raising price. 7

8 Valkre Solutions, Inc. Valkre builds tools to help Business-to-Business (B2B) companies unlock growth by creating differential customer value faster than competitors, year after year. These tools, tested over 10 years with leading corporations, change the conversation with customers, quantify a company s impact on customer profits, identify new opportunities to impact customer profits, and create organizational accountability to generate and communicate measurable business outcomes. With software, expert services, and training, Valkre s mission is to generate exponential returns for its customers by creating a scalable, sustainable capability for the entire organization. For more information on Valkre, please contact us: info@valkre.com