SCL Antwerp - Patrick Dittli, Global Director Supply Chain, Metro Cash & Carry
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Transcript of SCL Antwerp - Patrick Dittli, Global Director Supply Chain, Metro Cash & Carry
CONNECTIVITY: BOOSTING CUSTOMERCENTRICITY INTO THE VALUE CHAIN
SCL ANTWERP EVENT 2015June 2015
Patrick DITTLIGlobal Director Supply Chain,Metro Cash & Carry
CONTENTS
METRO Cash & Carry
September 2014 | Member of METRO GROUP 1
01 SHORT INTRODUCTION
02 GAME HAS CHANGED – THE OPPORTUNITY!
03 CHALLENGES TO OVERCOME – DO NOT IGNORE
04 HOW CONNECTIVITY BRINGS CUSTOMER CENTRICITY
05 DIALOGUE
Cross-functional companies
METRO CASH & CARRY – A CORE BRAND OF METRO GROUP
METRO GROUP sales 9M 2013: €46.3 billion
Hypermarkets
Sales 9M 2013 (bn): €7.3
Countries**: Stores**:
3324
Status: 30 September 2013*Status: 31 August 2014
**Status: 30 June 2014
METRO Cash & Carry
September 2014 | Member of METRO GROUP 3
Wholesale
Sales 9M 2013 (bn): €22.6 Countries*:28….Stores*:
764
Department
storesSales 9M 2013 (bn): €2.1 Countries**: 2Stores**: 137
Consumer electronics stores
Sales 9M 2013 (bn): €14.4 Countries**: 15Stores**: 988
revolutionary … what a success!
METRO Cash & Carry
September 2014 | Member of METRO GROUP 4
• 50,000 articles,Food & Non-Food
• >15,000m2 net sales area
• Location in outskirts of city
• Huge parking lot
• Aggressive pricing
• Cardholders only (business owners)
• … a privilege!
HOW IT ALL STARTED
Our business is global – geographies are different!METRO GROUP 2014: 2,212 LOCATIONS IN 31 COUNTRIES
Netherlands METRO C&C Media-Saturn
1745
Pakistan METRO C&C 9
Poland MAKRO C&C Media-Saturn
4171
Portugal MAKRO C&C Media-Saturn
109
Romania METRO C&C Real
324
Russia METRO C&C Media-Saturn
7362
Serbia METRO C&C 10
SlovakiaMETRO C&C 6
France Spain
MAKRO C&C 37
Switzerland Media-Saturn 25
Status: 30 June 2014METRO Cash & Carry
September 2014 | Member of METRO GROUP 5
Germany METRO C&C
107
Media-Saturn 416Real 308Galeria Kaufhof 122
Austria METRO C&C
12
Media-Saturn 47
Belgium MAKRO C&C
13
Media-Saturn 23Galeria Kaufhof 15
Bulgaria METRO C&C
14
China METRO C&C
78
CroatiaMETRO C&C
7
Czech Republic MAKRO C&C
13
Denmark METRO C&C
5
METRO C&C
Greece
93
MAKRO C&C 9Media-Saturn 10
Hungary METRO C&C
13
Media-Saturn 21
India METRO C&C
16
ItalyMETRO C&C
49
Media-Saturn 116
Japan METRO C&C
9
KazakhstanMETRO C&C
8
Luxembourg Media-Saturn
2
Moldova METRO C&C
3
Media-Saturn
Sweden
72
Media-Saturn 28
Turkey METRO C&C
27
Media-Saturn 41Real 12
Ukraine METRO C&C
33
Vietnam METRO C&C
19
What got you here, will not get you there…
METRO Cash & Carry
September 2014 | Member of METRO GROUP 7
GAME HAS CHANGED – AMAZONFRESH.COM, WAITROSE.COM
PlanetRetailLebensmittelZeitung
GAME HAS CHANGED – ANALYSTS
METRO Cash & Carry
September 2014 | Member of METRO GROUP 8
„Revolution in Lebensmittelhandel“ (E&Y)
„Convenience and on-line change the game“ (Planet Retail)
„Digital consumer demand“ (SCM World)
PlanetRetail
WHERE DO WE (AND MANY RETAILERS) COME FROM?
brick & mortar …
METRO Cash & Carry
September 2014 | Member of METRO GROUP 10
… and therefore, delivering home…
• … „is not our business“
• … „cannibalizes our stores“
• … „is not as profitable“
• … „is not part of my bonus“
• … „needs different IT systems“
• … „we do not have capability“
• …
we had it all!
… WE ALMOST FORGOT WHAT WE ALSO HAD – AND HAVE!
METRO Cash & Carry
September 2014 | Member of METRO GROUP 11
… WE ALMOST FORGOT WHAT WE ALSO HAD – AND HAVE!
METRO Cash & Carry
September 2014 | Member of METRO GROUP 12
20 million customers (card holders) …
• Addresses, emails, business details
• Intimacy with our A- and B-customers
A massive, unrivaled opportunity to create value, provide targeted solutions!
Internal
• „Store is Core“
• Store vs. Headquarter
• Other channels are not just „incremental“
• Seamless shopping experience?
• Assortment & Solutions
• Sales Force
• Logistics Network (& stocking policies)
• IT & processes
AND IT WOULD BE WRONG TO CLAIM THAT WE HAVE IT ALL
METRO Cash & Carry
September 2014 | Member of METRO GROUP 13
HOW CONNECTIVITY BRINGS CUSTOMERCENTRICITY
METRO Cash & Carry
September 2014 | Member of METRO GROUP 14
THROUGH CROSS-FUNCTIONAL EXERCISE CONNECTIVITY INTENDS TO BREAK THE VERTICAL FUNCTIONAL PERSPECTIVE
Marketing
Master Data
Offer
Merchandise
Supply Chain
Operations
Supplier Customer
END-TO-END PROCESSES
END-TO-END CUSTOMER CENTRICITY
VALUE-CHAIN
HR
Finance
METRO Cash & Carry
September 2014 | Member of METRO GROUP 15
FOCUS ON CUSTOMER, OFFER AND SUPPLIER:TO BE MASSIVELY IMPROVED BY WELL CONNECTED PROCESS STEPS, GOODSYSTEM CONNECTIVTY AND CLARITY IN ROLES AND RESPONSIBILITY.
METRO Cash & Carry
September 2014 | Member of METRO GROUP 16
Three areas appear to be offering greatest opportunities
Order Management
Product Life Cycle
Management
Promotion Management
THROUGH CROSS FUNCTIONAL EXERCISE CONNECTIVITY INTENDS TO BREAK THE VERTICAL FUNCTIONAL PERSPECTIVE
(Central) Order
Management
Product Life Cycle
Master Data Mgmt
Logistics Flows
Deliveryconditions
Supplier performance
StockManagement
Considering the “ stone i n the w ater effect” , we agreed to focus first on Order Management
Ord
er M
ana
gem
ent
Pro
duc
t Li
fe C
ycle
M
anag
emen
t
Pro
mot
ion
Man
age
men
t
Three areas appear to be offering greatest opportunities
METRO Cash & Carry
September 2014 | Member of METRO GROUP 17
Wave 1Wave 2
Wave 3METRO Cash & Carry
Cluster 1
Cluster 2
Cluster 3
…
Remove duplicates and cluster pain points into key statements
Listing pain points
Cluster 1
Cluster 2
Cluster 3
Must-do
Postpone
Consider
Understandable and consistent description
Cluster pain points in problem situation
Process Mapping and pain point collection
Assign to customer / company value
Document pain points in list
1 2 3 4
Cluster Id Cluster Name (optional) Problem Situations Pain pointsID Painpoints related to that cluster
2 Order entry too late in the system17 We don't have the product in stock
Delivery too late 11 Our replenishment is too low frequent / high
volume19 We have to pay penalties due to too late deliveries13 We don't know what the customer wants to order in the next weeks8 No insight in phasing in / out of products (promo and NPD)3 Picking errors7 Stock differences between system and warehouseDelivery not 4 Promo products often are
sold outA Delivery is not on time or
complete
<situation 3>
in full
Pain Points
Prioritize clusters; where to put the
(initial) focusAbsolute impact
calculation5 6
Define solutions and (if solutions hard to find): root cause analysis.
Estimate which impact might be solved implementing the solution(s)
Finding solutions7
SCI: situation,
consequence, impact.
Decision Management Board
8
Proposal defined solutions to Board and get approval to start TO BE)
Closure AS-IS
CONNECTIVITY ES METHODOLOGY (AS –IS)
September 2014 | Member of METRO GROUP 18
Work out detailedProject plan per area
2 3 4
5
AS IS: Board approvalproject brief per solution
1
6
Impact on RACI or structure
Explain and train (pilot group)
Securing7
Board Discharge8
Work out the plan to implement the solutions
One A4 to get Board approval for the preferred solutions
Prepare for required changes
Pilot the solution(s)
Go live with the solution in part of the business to understand the effect
Adapt process / Work Instruction
Adapt tools &
systems
Learn, adapt and prepare for rollout
Adapt tools &
systems
Explain and train (involved employees)
METRO Cash & Carry
September 2014 | Member of METRO GROUP 19
Implementation
Go live with the solution(s) in the speed as agreed in the plan
Adherence and performance are monitored with periodical performance reviews
Adapt process / Work Instruction
CONNECTIVITY ES METHODOLOGY (TO-BE)
SITUATIONS: DELIVERY VS. ORDER MANAGEMENT
ORDER MANAGEMENTDELIVERY
MASTER DATA INCOMPLETE& INACCURATE
STOCK NOT UPDATED FOR ORDER RELEASE
OPL PARAMETRES NOT ACCURATE
DELIVERY CONDITIONS & FLOW TYPES
NOT ADAPTED TO STORE NEEDS
SYSTEMS NOT ALIGNED
WITH BUSINESS NEEDS
1.
2.
3.
4.
5.
MASTER DATA INCOMPLETE& INACCURATE
STOCK NOT UPDATED FOR ORDER RELEASE
DELIVERY CONDITIONS & FLOW TYPES
NOT ADAPTED TO STORE NEEDS
SYSTEMS NOT ALIGNED
WITH BUSINESS NEEDS
1.
2.
3.
5.
DELIVERY CONDITIONS & FLOW TYPES
NOT ADAPTED TO CUSTOMER NEEDS
4.
BE AWARE: BOTH STREAMS HAVE SAME SITUATIONS, BUT HAVE DIFFERENT CONSEQUENCES WITH DIFFERENT PROBLEMS!
METRO Cash & Carry
September 2014 | Member of METRO GROUP 29
ASSUMPTIONS FOR POTENTIAL IMPACT CALCULATIONS
METRO Cash & Carry
September 2014 | Member of METRO GROUP 22
Time expressed in Hours. (Possible evaluation in FTE / € as well)
Other Impact are expressed in €.
In case of possible different “magnitude”, the conservative approach prevails.
If the same impact appears twice or more, it has been divided by each
consequence proportionally
Period: either year 2013 or 1 rolling year.
Perimeter considered: Division: Dry Food, Non Food, Fresh. (Ultra fresh excluded) Store : All 37 ES stores
Goal of the potential impact calculations: measure the „As is“ situation (e.g. DILO) measure the undesired effects/consequences (e.g.
Assumptions)
Supply Chain
Operations Offer
METRO Cash & Carry
September 2014 | Member of METRO GROUP 23
DOT
Free up re-ordering time of store
Improve availability
Optimize stock
DARWIN
Better availability
Optimized stock
Flow types & delivery conditions adapted to store needs
PILLAR
Guarantee qualityMaster Data accuracy
ICARUS
Process adherence
Performance management
Continuous improvement
Guidance and stimulation of change
Maintain the Focus during ProjectsImplementation and Development.
To ensure Sustainability along the time and departments involved.
ICARUS
Customer Satisfaction improvement
Efficiency enabler
Working Capital
Focus
Improve service level Become preferred supplier for independent
HORECA customer
Ensure FSD development without interfering C&C development.
PERFECT
ORDER
PROFIT.GROWTH
Customer Satisfactionimprovement
Operational efficiency
BENEFITS
METRO Cash & Carry
September 2014 | Member of METRO GROUP 24
DO T Free up time in stores for customer addedvalue tasks
Increase Stock Availability for customers
PILL AR Increase efficiency for on-shelf availability by accurate information.
DARW
IN Appropriate stock levels and stock quality Develop flexible sourcing process as per
business development needing
Patrick DittliTel: +49.211.969.1317Mob: [email protected]
METRO AGMetro-Strasse 1
40235 Duesseldorf Germany
CONTACT
METRO Cash & Carry
September 2014 | Member of METRO GROUP 29