Post on 01-Nov-2014
description
Supply ChainSupply ChainStrategyStrategy
20 NASSAU STREET, SUITE 244
PRINCETON, NEW JERSEY 08542
Keys to Increased Business Keys to Increased Business ProfitabilityProfitability
A Profile of REM Associates of Princeton, Inc. Resources and Capabilities
Copyright Copyright ®® REM AssociatesREM Associates Page 2
REM Associates ProfileREM Associates Profile
Business Supply Chain StrategyBusiness Supply Chain StrategyProfile of REM AssociatesProfile of REM AssociatesThe REM Associates NetworkThe REM Associates NetworkFunctional Areas of ConsultingFunctional Areas of ConsultingClient Industry ProfileClient Industry ProfilePartial Listing of ClientsPartial Listing of ClientsREM Associates Relevant ExperienceREM Associates Relevant ExperienceOur Approach to Clients:Our Approach to Clients:–– AssessmentAssessment–– Issues and ConcernsIssues and Concerns–– Path ForwardPath Forward
Overview of The Business Operations Strategic Planning Process.Overview of The Business Operations Strategic Planning Process.
Our business operations strategy profile includes . . . .
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Business Supply Chain StrategyBusiness Supply Chain Strategy
Intensified product, service, and market competitionIntensified product, service, and market competitionInnovative pricing strategiesInnovative pricing strategiesA constantly changing government regulatory environmentA constantly changing government regulatory environmentGreater emphasis on operational and working capital cost reductiGreater emphasis on operational and working capital cost reductionon
Today’s business management faces increasingly complex challenges from a variety of sources, including . . . .
In addition, increasing business pressures require management focus, decision making, and action plans directed at . . . .
Business technology issuesBusiness technology issuesPolitical, regulatory, and external controlsPolitical, regulatory, and external controlsSociological and cultural changeSociological and cultural changeInvestment community emphasis on Investment community emphasis on ““realreal”” earnings and growth.earnings and growth.
Increasing the need for managing a company with in-depth understanding, improved knowledge, and skills not previously required in business management.
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Business Supply Chain StrategyBusiness Supply Chain Strategy
Recent assignments found that inefficiencies in business operations waste as much as 25% of an organization’s operating costs. With profit margins of 3 to 4%, even a 5% reduction in waste can double a company’s profitability. Key drivers of this value creation include . . . .
By lowering costs and increasing asset utilization, business operations can free up cash.
Revenue Revenue -- capacity utilization, product speed to market, stockcapacity utilization, product speed to market, stock--outs, and outs, and service to customersservice to customersExpensesExpenses -- inventory carrying costs, production and distribution costs, inventory carrying costs, production and distribution costs, transportation costs, logistics productivity, outsourcing, and atransportation costs, logistics productivity, outsourcing, and asset utilizationsset utilizationCapital UtilizationCapital Utilization -- working capital (inventory turns, order cycle time) and working capital (inventory turns, order cycle time) and fixed assets (plants/DC locations, fleet utilization, strategic fixed assets (plants/DC locations, fleet utilization, strategic outsourcing)outsourcing)
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Business Supply Chain StrategyBusiness Supply Chain Strategy
Operations and process assessmentsOperations and process assessmentsData and information flows and linkagesData and information flows and linkagesPolicies, procedures, and practices completeness, consistency, aPolicies, procedures, and practices completeness, consistency, and nd effectivenesseffectivenessOrganization structure and responsibilities Organization structure and responsibilities –– ownership.ownership.
Supply Chain strategy deals with planning the intermediate and longer-term direction of the business, including . . . .
Supply Chain re-engineering is directed at assessing and improving policies, procedures, and practices to improve costs, customer service, and business effectiveness, including . . . .
Supply Chain missionSupply Chain missionKey strategic thrustsKey strategic thrustsSupply Chain goals and objectivesSupply Chain goals and objectivesAction plans aimed at strategy implementation.Action plans aimed at strategy implementation.
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Profile of REM AssociatesProfile of REM Associates
Advice and counsel in Advice and counsel in ““Business and Supply Chain OperationsBusiness and Supply Chain Operations””Consumer and industrial companies as well as governmental organiConsumer and industrial companies as well as governmental organizationszationsStrategic, tactical, and contingency planningStrategic, tactical, and contingency planning
Operations evaluations directed at improvements:Operations evaluations directed at improvements:–– Profit improvementProfit improvement
–– Facility operations analysis and planningFacility operations analysis and planning
–– Cost reduction and productivity improvementCost reduction and productivity improvement
–– ABC inventory costing and evaluationABC inventory costing and evaluation
–– Functional outsourcingFunctional outsourcing
–– Customer serviceCustomer service
–– Organization structure and performance.Organization structure and performance.
REM Associates, started in 1984, is now in its twenty-fourth year serving business clients . . . .
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Profile of REM AssociatesProfile of REM Associates
Senior experienced business personnelSenior experienced business personnel
Most with over 25 years of experienceMost with over 25 years of experience
Careers in both consulting and business operationsCareers in both consulting and business operations
Variety of business disciplines Variety of business disciplines
Broad range of industry backgroundsBroad range of industry backgrounds
Strong interStrong inter--personal skillspersonal skills
Commitment to positive resultsCommitment to positive results
Support from analysis through implementation.Support from analysis through implementation.
REM Associates represents a network of over sixty experienced professionals worldwide . . . .
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BrinmarAssociatesBrinmar
Associates
MiamiUniversity
of Ohio
The REM Associates NetworkThe REM Associates Network
REM Associates Network represents key business operations organizations and companies. A partial list includes . . . .
MiamiUniversity
of Ohio
Bernard J.La Londe &Ohio StateUniversity
Bernard J.La Londe &Ohio StateUniversity
JosephAndraski
Group
JosephAndraski
Group
Gross&
Associates
Gross&
Associates
CGRAssociates
CGRAssociates
PrincetonComputerConsulting
PrincetonComputerConsulting
UniversityOf
Pennsylvania
REM AssociatesNetwork
REM AssociatesNetwork
PrincetonUniversity
PrincetonUniversity
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The REM Associates NetworkThe REM Associates Network
REM Associates provides virtually turn-key management . . . .
Policies,Procedures,
and Practices
Policies,Procedures,
and Practices
ProjectManagement
ProjectManagement
SettingGoals and Objectives
SettingGoals and Objectives
OperationsAssessment
OperationsAssessment
InventoryStrategy
InventoryStrategy
ActivityBased
Costing
ActivityBased
Costing
OrganizationAnd
Staffing
OrganizationAnd
Staffing
DistributionNetworkDesign
DistributionNetworkDesign
StrategyPlanning Through
Implementation
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Functional Areas of ConsultingFunctional Areas of Consulting
REM Associates represents a broad range of supply chain and business operations skills and backgrounds . . . .
OperationsManagementOperations
Management
FinancialAnalysis andEvaluation
FinancialAnalysis andEvaluation
ResourceUtilizationResource
UtilizationOrganizational
StaffingOrganizational
Staffing
InformationSystems
InformationSystems
ForecastingAnd ProductMarketing
ForecastingAnd ProductMarketing
QualityAssuranceQuality
Assurance
Outsourcingand
Alliances
Outsourcingand
Alliances
Strategicand Tactical
Planning
Strategicand Tactical
Planning
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Functional Areas of ConsultingFunctional Areas of Consulting
Specifically, within supply chain operations and related functions, we are experienced in . . . .
Supply Chain Management
Sourcing and Purchasing
Customer Service and Order Processing and Related Systems
Transportation Operations and Management
Warehousing & Distribution Operations
Facilities and Network Design
Production and Inventory Management
Forecasting and Sales Planning
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Functional Areas of ConsultingFunctional Areas of Consulting
Assessment, evaluation, and planning of supply chain functionsAssessment, evaluation, and planning of supply chain functions
Evaluation of supply/demand chain functions, linkages, and strucEvaluation of supply/demand chain functions, linkages, and structureture
Assessment of forecasting, demand planning, and inventory manageAssessment of forecasting, demand planning, and inventory managementment
Development and positioning of organizational structures to suppDevelopment and positioning of organizational structures to support business ort business operations strategyoperations strategy
Diagnosis and evaluation of functions and personnelDiagnosis and evaluation of functions and personnel
Development and specifications of operating systems requirementsDevelopment and specifications of operating systems requirements
Development of effective performance measurements and benchmarkiDevelopment of effective performance measurements and benchmarkingng
Assistance in implementation of recommendations and changes in oAssistance in implementation of recommendations and changes in operations perations directed at cost effective improvements.directed at cost effective improvements.
We have worked for a number of manufacturers, distributors and distributor organizations. Our work has included . . . .
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Client Industry ProfileClient Industry Profile
REM Associates has worked with manufacturers, wholesalers, and distributors representing a wide variety of industries . . . .
ManufacturingService and
Industry Associations
ManufacturingService and
Industry Associations
Consumer ProductsConsumer Products
FoodFoodRetailingRetailingWholesalingWholesalingPharmaceuticalPharmaceuticalPaperPaperNewspaperNewspaperTobaccoTobaccoWines, Spirits, and Wines, Spirits, and BeveragesBeverages
Industrial ProductsIndustrial ProductsChemical ProductsChemical ProductsClay ProductsClay ProductsMining Mining Precious MetalsPrecious MetalsElectronicsElectronics
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Client Industry ProfileClient Industry Profile
The State of North CarolinaThe State of North CarolinaThe State of MichiganThe State of MichiganThe County of Los AngelesThe County of Los Angeles
In addition, our work and business relationships have been international in scope, including government clients and agencies such as . . . .
Our state, city, public, and local government work has included . . . .
IndonesiaIndonesiaRussiaRussiaChinaChinaTaiwanTaiwanPhilippinesPhilippines
United KingdomUnited KingdomIndiaIndiaPakistanPakistanSouth AfricaSouth AfricaMalaysiaMalaysia
MexicoMexicoArgentinaArgentinaPanamaPanamaCosta RicaCosta RicaEtc.Etc.
Our international exposure has included countries such as . . . .
The City of New YorkThe City of New YorkThe University of MissouriThe University of MissouriPrinceton University.Princeton University.
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A partial listing of our clients for whom we have worked in the past include . . . .
Partial Listing of ClientsPartial Listing of Clients
American Stores CorporationAmerican Stores CorporationAnheuserAnheuser--Busch companies, Inc.Busch companies, Inc.Avon Products CompanyAvon Products CompanyBankers Trust CompanyBankers Trust CompanyBecton Dickinson & CompanyBecton Dickinson & CompanyBen & JerryBen & Jerry’’ssBorden CompanyBorden CompanyBristolBristol--Myers Squibb CorporationMyers Squibb CorporationEngelhard CorporationEngelhard CorporationG A F CorporationG A F CorporationGeneral Electric CompanyGeneral Electric CompanyGeneral Mills CompanyGeneral Mills CompanyGlaxoSmithKline plcGlaxoSmithKline plcGulf & Western CorporationGulf & Western CorporationHermes of ParisHermes of ParisHewlettHewlett--Packard CompanyPackard CompanyHoechst Celanese CorporationHoechst Celanese CorporationHome Base CompaniesHome Base CompaniesJohn Hancock Life Insurance Co.John Hancock Life Insurance Co.
Honeywell CorporationHoneywell CorporationJohn Morrell and CompanyJohn Morrell and CompanyKimberlyKimberly--Clark CorporationClark CorporationKraft Foods CorporationKraft Foods CorporationLand OLand O’’ Lakes IncorporatedLakes IncorporatedLea & Perrins CompanyLea & Perrins CompanyLeiner Health ProductsLeiner Health ProductsMerrill Lynch & CompanyMerrill Lynch & CompanyMilton Hershey SchoolMilton Hershey SchoolNabisco Brands IncorporatedNabisco Brands IncorporatedPepsiPepsi--Cola IncorporatedCola IncorporatedPhilip Morris CompanyPhilip Morris CompanyPrinceton UniversityPrinceton UniversityR. C. Bigelow Tea CompanyR. C. Bigelow Tea CompanySears Roebuck & CompanySears Roebuck & CompanySouthland CorporationSouthland CorporationUSA TodayUSA TodayUniversity of MissouriUniversity of MissouriWarnerWarner--Lambert CompanyLambert CompanyW R Grace & CompanyW R Grace & Company
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REM Associates Relevant ExperienceREM Associates Relevant Experience
Assessment of existing functions, processes, facilities, and opeAssessment of existing functions, processes, facilities, and operations aimed at rations aimed at costs and productivity improvementscosts and productivity improvementsAnalysis and evaluation of functions, organization and structureAnalysis and evaluation of functions, organization and structure, linkages, and , linkages, and positioning of supply/demand chain activities to support businespositioning of supply/demand chain activities to support business goalss goalsAssessment and evaluation of forecasting , sales planning, and iAssessment and evaluation of forecasting , sales planning, and inventory nventory management to support distribution costs and required levels of management to support distribution costs and required levels of serviceserviceEvaluation of customer service functions and activities to deterEvaluation of customer service functions and activities to determine effective mine effective levels of service based on demand, cost, and business positioninlevels of service based on demand, cost, and business positioninggDevelopment of systems requirements and measures to monitor, conDevelopment of systems requirements and measures to monitor, control, and trol, and manage supply/demand chain activitiesmanage supply/demand chain activitiesManagement of implementation programs to meet timetables and milManagement of implementation programs to meet timetables and milestones estones directed at on time completion.directed at on time completion.
The scope of our engagements range from single to multiple functions beginning with assessment and planning through implementation . . . .
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REM Associates Relevant ExperienceREM Associates Relevant Experience
For a Major West Coast Pharmaceutical Manufacturer:For a Major West Coast Pharmaceutical Manufacturer:–– Assessed business operations to:Assessed business operations to:
»» Improve product and customer demand forecasting, including promoImprove product and customer demand forecasting, including promotional tional activityactivity
»» Reduce operational costs of functional activitiesReduce operational costs of functional activities»» Improve service to all customers, including retail, wholesale, aImprove service to all customers, including retail, wholesale, and militarynd military»» Reduce inventories and related business investments at all levelReduce inventories and related business investments at all levels, including s, including
raw materials, WIP, and finished goods.raw materials, WIP, and finished goods.–– Results of this work included:Results of this work included:
»» Inventory reduction of over 35%Inventory reduction of over 35%»» Improved customer service to over 96%Improved customer service to over 96%»» Increased major customer inIncreased major customer in--stock position to over 97%stock position to over 97%»» Reorganized key management functions and responsibilities which Reorganized key management functions and responsibilities which
significantly improved communications, decision making, and timesignificantly improved communications, decision making, and timeliness of liness of management actions.management actions.
A sampling of our client engagements includes . . . .
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REM Associates Relevant ExperienceREM Associates Relevant Experience
A Large Consumer Product CompanyA Large Consumer Product Company::–– Assessed and evaluated supply chain functions, linkages, tasks, Assessed and evaluated supply chain functions, linkages, tasks, and activitiesand activities–– Developed an integrated supply chain strategy directed at reduceDeveloped an integrated supply chain strategy directed at reduced costs and increased d costs and increased
customer service levelscustomer service levels–– Positioned sourcing, sales, manufacturing, and distribution to ePositioned sourcing, sales, manufacturing, and distribution to effectively support market and ffectively support market and
customer focuscustomer focus–– Evaluated deployment of inventories based on forecasted demand pEvaluated deployment of inventories based on forecasted demand pull to the marketplace in ull to the marketplace in
order to strengthen support services to customersorder to strengthen support services to customers–– Recommended and planned implementation for an integrated supply Recommended and planned implementation for an integrated supply chain strategy.chain strategy.
A Fortune 100 Pharmaceutical CompanyA Fortune 100 Pharmaceutical Company::–– Set up multiSet up multi--country (14) teams for implementing production and resource plancountry (14) teams for implementing production and resource planningning–– Worked with inWorked with in--country company teams to implement planned changescountry company teams to implement planned changes–– Evaluated and recommended operations improvements within countriEvaluated and recommended operations improvements within countrieses–– Monitored and directed progress toward program goals and objectiMonitored and directed progress toward program goals and objectivesves–– Conducted and managed program reviews to make sure timelines werConducted and managed program reviews to make sure timelines were mete met–– Completed almost two year program ahead of schedule.Completed almost two year program ahead of schedule.
In addition, a sampling of our client engagements includes . . . .
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Our Approach to Clients Our Approach to Clients –– 1. Assessment1. Assessment
Client operations size and basic structureClient operations size and basic structure
Classes of products, facilities, and customers servedClasses of products, facilities, and customers served
Key business strategic issues and concernsKey business strategic issues and concerns
Operations network including sales, distribution, customer serviOperations network including sales, distribution, customer service, and related ce, and related
functionsfunctions
Customer service goals and objectivesCustomer service goals and objectives
Operations goals and objectives.Operations goals and objectives.
Our initial approach to clients begins with an assessment. In order to form a solid base of understanding, we determine critical characteristics of our client’s business in terms of . . . .
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Our Approach to Clients Our Approach to Clients –– 2. Issues and Concerns2. Issues and Concerns
Present and planned business initiativesPresent and planned business initiatives
Specific operations issues:Specific operations issues:
–– Forecasting and sales demand planningForecasting and sales demand planning
–– Inventory managementInventory management
–– Warehousing and TransportationWarehousing and Transportation
–– Other operations related issuesOther operations related issues
Current key projects within operating functionsCurrent key projects within operating functions
Priority, sequence, and timing of implementation of near and lonPriority, sequence, and timing of implementation of near and longerger--term initiatives.term initiatives.
In order to focus our response and meet client specific needs, we need to understand company issues and concerns. For example . . . .
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Our Approach to Clients Our Approach to Clients –– 3. Path Forward3. Path Forward
Goals and objectives of REM Associates assistanceGoals and objectives of REM Associates assistance
Structure and content of a proposal to respond to your needsStructure and content of a proposal to respond to your needs
Requirement for site and/or functional visitsRequirement for site and/or functional visits
Data needed in order to understand and scope the detail of workData needed in order to understand and scope the detail of work
Point person for questions and clarificationPoint person for questions and clarification
Timetable for decision making and program completion.Timetable for decision making and program completion.
As a result of initial meetings, we form an understanding and plan a path forward in response to your needs, concerns, and plans . . . .
Overview of The Supply ChainOverview of The Supply ChainStrategic Planning ProcessStrategic Planning Process
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The logic of supply chain strategy relates directly to the flow of products, information, and costs through the business and to the customer . . . .
Overview of The Supply ChainOverview of The Supply ChainStrategic Planning ProcessStrategic Planning Process
Manufacturing Sales & Distribution Customer
Products
Information
Costs
Revenue
Flows:
Sourcing
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There are several levels of business logistics between the product source and the customer . . . .
Overview of The Supply ChainOverview of The Supply ChainStrategic Planning ProcessStrategic Planning Process
CustomerPlant
Primary
Distribution
Secondary
Distribution
Tertiary
Distribution
Direct Distribution Large
Chains
Small
Independents
Sourcing
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Strategic planning issues are generally of a broader scope than those of day-to-day operations issues . . . .
Business Mix
Market
Definition
Customer
Mix
Product
Mix
Operations
& Service
Mix
Fore
cast
Dem
and
by P
rodu
ct
Fore
cast
V
aria
tion
Serv
ice
by C
lass
of
Cus
tom
er
S K
Us
Prod
uct
Cha
ract
eris
tics
Faci
lity
Size
Faci
lity
Loc
atio
n
Faci
lity
Serv
ice
Are
a
Strategy
Operations
UniquenessType
Overview of The Supply ChainOverview of The Supply ChainStrategic Planning ProcessStrategic Planning Process
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The hierarchy of supply chain strategic planning begins with customers and service . . . .
Facilities
InvestmentFacilities
Investment
MIS Equipment Investment
Inventory Investment
Transportation Equipment Investment
MIS Equipment Investment
Human Resource
Investment
Customer Service
Goals and Objectives
Customer Service
Goals and Objectives
Inventory Goals
Deployment Strategies and
Programs
Warehousing Strategies and
Programs
Transportation Strategies and
Programs
Systems and Procedures
Strategies and Programs
Organization Strategies and
Programs
Order Processing
Strategies and Programs
Overview of The Supply ChainOverview of The Supply ChainStrategic Planning ProcessStrategic Planning Process
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A number of factors must be evaluated to determine the best cost and service mix in a strategic supply chain structure . . . .
Number of warehousesNumber of warehousesLocation of warehousesLocation of warehousesShipment modesShipment modesSize of shipmentsSize of shipmentsFrequency of shipmentsFrequency of shipmentsShipment consolidationShipment consolidationOperating methodsOperating methodsStorage requirementsStorage requirementsRegulatory requirementsRegulatory requirements
Order processing timesCustomer serviceOperationsTransportation
Inventory serviceStock vs. non-stockIn-stock position
Delivery reliabilityFreight consolidation holding timesInformation systems
Stock vs. non-stockIn-stock positionVariability of demand
Frequency of replenishmentTransit timesInventory carrying costs
COST: SERVICE:
INVENTORY:
Overview of The Supply ChainOverview of The Supply ChainStrategic Planning ProcessStrategic Planning Process
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An effective supply chain strategy requires the balancing of conflicting management objectives . . . .
High customer serviceHigh customer service
Low warehousing costsLow warehousing costs
Low transportation costsLow transportation costs
Reduced inventoriesReduced inventories
Fast deliveriesFast deliveries
Reduced labor costsReduced labor costs
Desired resultsDesired results
Logistics Objectives:
Impact of Objectives on:
Inventory:
Customer
Service: Costs:
Overview of The Supply ChainOverview of The Supply ChainStrategic Planning ProcessStrategic Planning Process
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The planning process must evaluate alternatives and recommend the most cost and service effective plan for total business logistics . . . .
Overview of The Supply ChainOverview of The Supply ChainStrategic Planning ProcessStrategic Planning Process
Product/
Market
Environment
Develop a Segmented Set of Strategic Success
Requirements
Define Business Operating
Mission
Identify Strategic
Deployment Alternatives
Develop Business
Operating Objectives
Identify Strategic
Operating Alternatives
Define Demand Chain Operating
Objectives
Define
Strategic
Objectives
Develop a Preferred
Operations Strategy and its Implementation
Execute
Implementation
Plan
ASSESS
PHASE I PHASE II PHASE III
Operating
Environment
SCREEN
SCREEN
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A S S O C I A T E SMANAGEMENT CONSULTANTS
20 NASSAU STREET, SUITE 244PO BOX 7345
PRINCETON, NEW JERSEY 08543-7345Phone: 609-275-4444
Fax: 609-924-9668E-Mail: REM.Murray@REMAssoc.com
web: http://www.remassoc.com