5 Strategies for Making Manufacturing Pay: How GKN Aerospace Cut $25 million in six months
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Transcript of 5 Strategies for Making Manufacturing Pay: How GKN Aerospace Cut $25 million in six months
Five Strategies for Making Manufacturing Pay
Louis Columbus Cincom Systems
Speed Is New The Platform
Are passionate about improving the accuracy and speed of Demand Management
Managing variability in their supply chains for competitive advantage
Reducing manufacturing costs by coordinating Demand Management and Quality
Increasing profitability by knowing which deals to take
Drive down cycle times by continually improving the Sales & Operations Planning Process (S&OP)
Are passionate about improving the accuracy and speed of Demand Management
Strong Focus On Analytics And An Effort To Continually Improve Permeate Highest Performing Companies
Dashboards: Less is more (6 metrics total, all measuring collaboration)
Managing variability in their supply chains using Demand Planning
Reducing manufacturing costs by coordinating Demand Management and Quality
Obsessed with Quality
Energized with the vision of seeing their products last decades longer than anyone predicted
Credit: NASA/JPL-Caltech)
GKN AerospaceResults Achieved:
• 50 percent reduction in Total Cost of Ownership (TCO) of enterprise system
• $25-million reduction in inventory investment in the first six months
• 42 percent increase in inventory turns
• 38 percent reduction in cycle time, improved electronic collaboration with key customers and more.
Increasing profitability by knowing which deals to take
Increasing profits by knowing which deals to take
Manual, fragmented processes driving suboptimal decisions leading to lost opportunities
Lack of knowledge transfer from engineering to project management & Sales slows bids, estimates and contracts to a crawl
Lost profitability
due to lack of accuracy on quotes, bids and pricing
Lack of project selection and prioritization
based on profitability
Input:RFPs,
Contracts Orders
MarginsOutput: Products and Services
Finding Competitive Advantage
Massive Overcommitments lead to lost sales and customers Lack of agility
and flexibility in responding to change orders and ECNs in a
timely manner
Inconsistent & conflicting SLA performance &
compliance
Massive time drains due to
chaotic bidding, estimating and contract mgmt.
llifecycle
Input:RFPs,
Contracts Orders
MarginsOutput: Products and Services
Funding Competitive Advantage
Higher Customer
Satisfaction Levels
leading to greater profits
50%+ increase in
project completion rate, under budget and
on schedule
67% reduction in quoting and order
rework
4X reduction in ECNs;
consolidation of product changes
34% increase in quoting &
pricing accuracy
54% increase in perfect order performance
34% increase in SLA
performance and 25%
reduction in compliance
costs
2X increase in contract closure
rates; 58% increase in
profitability from better clause management
Increasing profits by knowing which deals to take
Drive down cycle times by continually improving the Sales & Operations Planning Process (S&OP)
Best Practice: Making Sales & Operations Planning (S&OP) and Demand Planning Strategic with a 3 to 5 yr. horizon
The S&OP Process At Boeing
Sources: WSJ, Purchasing.com, AMR Research
Launch Sequence Making Manufacturing Pay Are passionate about improving the accuracy and speed of Demand Management
Managing variability in their supply chains for competitive advantage
Reducing manufacturing costs by coordinating Demand Management and Quality
Increasing profitability by knowing which deals to take
Drive down cycle times by continually improving the Sales & Operations Planning Process (S&OP)
Thank You
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