Resilience, Technology, Sustainability - shared.value.chain€¦ · Source: ‘Global Outsourcing &...


shared.value.chain is a think tank andmanagement advisory firm. We help companiesto embed sustainable value creation in theircore business (products and supply chains).

We believe that there is significant potential for globally operating corporations to bring together ecological, economic and societalvalue creation.

Sustainable products, flexible and resilientsupply chains as well as collaboration are thebackbone of companies‘ core business andsubsequently the platform for sustainablegrowth.

Michael D‘heurFounder & Managing

Directorshared.value.chainMunich, Germany

Advisor, Author, Architect

shared.value.chain: We are Advisors, Authors and Archit ects forSustainable Value Creation


Value Chain Realities Accelerators

Market Volatility

Natural Disasters

Key Questions

Source: Adapted from Sustainable Value Chain Management (D’heur et al., Springer, 2015)

The ‚new realities‘ of value creation, put the curr ent business models under pressure

Global Value Chains

ScarceResources

Profit versus Purpose

TechnicalInnovation

Man madecrises

x

What value do we want to

create?

How viable isthe current

model?

How do webuild the

capabilities tocope?


Volatility in the Market

Global Value Chains

Ecological Crisis (Storms, Draughts, ...)

Profit versus Purpose?

Constrained ResourcesFinancial Crisis(Lehmann, Euro, ...)

Technology

Supply Chain ‘Scandals’ & Trust Issues

“How shall we cope and create value in this environm ent ?”


Companies need to master customer and internal expe ctations to stay ahead of the competition

„I want it today“„We need to know

upfront“„Make it faster & cheaper, please“

• Superior serviceexperience

• Instantly availableoffering acrossmultiple channelsand customergroups

• Expectations of a growing global middle class

• Full value chainvisibility (fromsource to store)

• Anticipatechanges in demand

• Timely productfeedback /service

• Manage thesupply networkfor performance

• Effective andefficient setup

• Trimmed forincreasedperformance

• Continuous costreduction in product & supply chain

• Management ofComplexity


Challenges to master service, visibility and effici ency are coming from multiple areas

How do we protect, respond, recover?

How do we becomeproactive and

predictive?

How do we build a sustainable model?

SUPERIOR SERVICE

VALUE CHAIN VISIBILITY

EFFECTIVE & EFFICIENT

• Technical, weather and supplier disruptions

• Increasing product proliferation

• Fast changing demand patterns

• End-to-end value chain visibility

• New/disruptive business models

• Longer and more interdependent value chains (n-tier networks)

• Scalability of the operations

• Increasing cost


RESILIENT TECH SAVVY SUSTAINABLE

COLLABORATIVE

CAPABILITIES OF A FUTURE PROOF OPERATING MODEL

A new set of capabilities is required, to be able t o respond to the challenges

How do we protect, respond, recover?

How do we becomeproactive and

predictive?

How do we build a sustainable model?


Resilience is important to keep the momentum

The ability to absorb the impact of a business interruption, and continue to provide a minimum acceptable level of service. It requires a business culture that encourages resilience building as an ongoing practice, aimed to strengthen processes & plans

RESILIENT Definition


Source: Dobbs, Manika and Woetzel: No ordinary disruption; McKinsey Global Institute, May 2015

Our global economy is interconnected, like never be fore – and the pace is accelerating


Source: ‘Global Outsourcing & Supply Chain Risk’ Survey (Demand Chain Executive Magazine, 2014)

Companies are operating in a high risk and volatile environment

7%

6-9

3-5 27%

1-2

10+

4%

12%

39%

0

88% of companies surveyed experienced more than 1 disruption with material impact on the ability to operate since 2011

Number ofsupply chaindisruptions


Source: BCI Supply Chain Risk Report, November 2013 (n=519) / Other: Energy scarcity, Cyber attacks, Environmental incidents, Industrial disputes, healt & Safety, Civil unrest

IT/Telecom disruptions and adverse weather are the main disruptors across many industries

Unplanned IT / Telecom outage

Outsourced service failure

Adverse weather

Product Quality

Transport network disruption

Loss of talent / Skills

Financial Services 64% 38% 21% 20%

Professional Services

70% 68% 47% 43% 35%

Public Administration

50% 24% 36% 22% 28%

IT & Telecom 48% 25% 33% 25%

Manufacturing 35% 33% 42% 43%

Energy & Utility 44%

Retail & Wholesale 40% 71% 31% 39%

Health Care 43% 50% 43% 50%

Transport & Storage

44% 56% 67% 56%

Engineering & Construction

57% 57% 57% 43%


1. Understand the risks in your end-to-end value chain

2. Collaborate and engage with key partners to limit/share the risks

3. Develop business continuity plans, that are practical and enable you to predict, respond, recover

3 recommendations to build resilient capabilities

RESILIENT Recommendations


Being ‘Tech Savvy’ means to be clever in using the right technologies and data to compete

The ability to use emerging technologies, including big amounts of data to make the end-to-end value chain transparent and to understand/capture market opportunities

TECH SAVVY Definition


The world is changing at a rate at which the systems, structures and cultures built over the past century

can no longer keep up.


Mobile technologies, the Internet of Things and Big Data are already changing the game

Source: Dobbs, Manika and Woetzel: No ordinary disruption; McKinsey Global Institute, May 2015


Source: Supply Chain Insights, Big Data Study 2014/2015

Mobile technologies and big data will be key driver s for supply chain excellence in the years to come


3 recommendations to build tech savvy capabilities

1. Understand the opportunity that big dataoffers for your company (based on yourindustry needs and competitiveposition)

2. Use partnerships to share infrastructurecost

3. Don’t be a slave to the data – usecommon sense and manage the risks(privacy)

TECH SAVVY Recommendations


Being sustainable means to have a business model, t hat delivers economic, ecologic and societal benefits

The ability to structure all aspects of a companies core business (ie. products and supply chains) in ways that deliver economic, ecologic and societal value at the same time

SUSTAINABLE Definition


Source: United Nations Environment Program, Footprint Network

Mankind is already exceeding the limits of the plan et. Where do we get the all the Planets from, to survive in the fut ure?


Source: Ellen MacArthur Foundation, Circular Economy, 2012

Implementing the vision of a circular economy is al ready driving transformative change


3 recommendations to implement a sustainable value chain

1. Question the Status Quo of valuecreation in your company andcollaborate across productdevelopment, supply chain andcustomers to find more sustainablesolutions

2. Reduce the resource intensity of thevalue chain system (Actions mightinclude asset sharing, multi-modaltransports, Cradle-to-Cradle products,Closed-loop value chains)

3. Measure a balance set economic,ecologic and societal metrics

SUSTAINABLE Recommendations


The ability to collaborate across the boundaries of the value chain is the key to success

The ability to managing all internal and external stakeholders in a collaborative manner, to allow the organization to manage risks, change and to capture opportunities

COLLABORATIVE Definition


Many people drive important change

Action that is head & heart driven

More leadership, not just management

Partnership of hierarchy and network

Constant flow of information

Not a project: A “get-to” mindset,

not “have-to”

Collaborating in a Network Model, helps to adapt fa ster to changing needs than traditional models

Source: Adapted from John Kotter, Accelerating Change, 2014


3 recommendations to drive a culture of collaborati on

1. Use the experience of your team andexpand it with external experience ->overcome internal boundaries

2. Define internal and externalrelationships in a new way – you winand lose together

3. Test the network model as operatingmodel for accelerated change

COLLABORATIVE Recommendations


2nd tier Suppliers

1st tier Suppliers

1st tier Customers

2nd tier Customers

SOURCE MAKE DELIVER

PLAN

RETURN

Value Creation Strategy(Product, Value Chain, Communication)

Enterprise Architecture(Organisation, Reporting,

Systems)

Stakeholder Collaboration

Sustainable Business Planning

Supplier & Partner Networks

Sustainable Cost Reduction

© shared.value.chain

Cradle-to-CradleCo-Creation

Sustainable Operations

Sustainable Products

RESILIENT

TECH SAVVYSUSTAINABLE

COLLABORATIVE

The new platform for sustainable value creation is built on value chain and collaboration capabilities


Economic, ecological and societal value

Economic value

Ecological value

Societalvalue

Revenue growth

Reduced costs

Reduced use of primary materials

Improved societal value of the product

Reduced impact of products on the environment

Reduced negative social impact of value creation

• Reduced working capital• Fewer fixed assets• Improved use of capital• Reliable supplier base

• Sustainable innovation• Improved brand image• Premium prices via segmented

customer offerings

• New business models for solving social problems

• Improved localisation and income opportunities

• Avoidance of child labour• Alleviation of poverty

• Substitution and simplification of materials

• Reduced environmental impact and costs

• Closed material cycles• Internalisation of environmental

costs• Habitat regeneration• Preservation of biodiversity

Source: Sustainable Value Chain Management (D’heur et al., Springer, 2015)

Thriving for sustainable value creation, is deliver ing several economic, ecologic and societal benefits


Resilient

Tech savvy

Collaborative

Sustainable

“Are you ready for the race?”


Muito obrigado - Please join the conversation and dis cover how you can make your value chain more sustainable

@SharedxValue

[email protected]

https://www.facebook.com/sharedvaluechain

https://plus.google.com/+sharedvaluechain/

https://www.linkedin.com/company/shared-value-chain-management-consultants

CSR und Value Chain Management (Springer, 2013)

Corporate Social Responsibility(Springer, 2015)

Sustainable Value Chain Management (Springer, 2015)

Publications: https://sharedvaluechain.com/publications/

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