Chemical Benefits: Planning profitable business growth in the volatile chemical sector

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Chemical Benefits Planning profitable business growth in the volatile chemical sector

29

% of Fortune 500

manufacturing companies are our customers

IBP Delivers Growth Top Business Benefits Attributed to Integrated Business Planning (% respondents) Improved Asset Utilization

Increased Revenue

Improved Logistics Planning

Developing and Executing Demand Shaping Programs

19%

17%

52%

20% Capital Planning and Asset Management

21%

Improved translation of Demand into Procurement requirements/buy-side

31%

21%

Improved Forecast Accuracy

31%

27% 28%

31%

Improvements in the Perfect Order/Customer Service

Reduction of Inventory

Source: AMR Research, a Gartner organisation

Improved New Product Inventory

Better Supply Planning / Schedule Adherence

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Business Benefits Delivered Manufacturers Customer On Time In Full % (by line)

Cost and Service

Finished Goods (days)

>80 days

80 - 34 days

Stockturns Finished Goods

<34 days

90 94%

<90%

9 - 25 turns

>94%

>25 turns

<9 turns

Oliver Wight Clients

Disadvantage

Parity

Advantage

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>81%

IBP Metrics

Forecast Accuracy %

<72%

72 81%

Overall Supply Chain Metrics >84%

Total Supply Chain Cost % Sales

>10%

Perfect Order Probability %

10 - 7%

72 84% <72%

<7%

Oliver Wight Clients

Disadvantage

Parity

Advantage

Case Studies

Issues Demand doubled and they were struggling to keep up. This resulted in them paying for over-time and taking on temporary labour Service level performance dropped from 95% OTIF to sub-80% Inventory levels rose significantly Poor forecasting tools

Company:

Forecasting information was ‘non-existent’

Value Delivered Packaging Coatings Inks

Multinational company which creates paints and performance coatings for both industry and consumers worldwide.

Operating costs cut by €1 million Inventory reduced by €1 million Customer service levels improved dramatically Production volume doubled with no temporary labour or subcontracting Plan adherence and service levels raised to consistently over 95% Demand planning process implemented and eliminated forecast bias €400,000 more savings identified

The greatest benefit about this journey is being able to have your finger on the pulse daily, so you always know what’s going on. The results have come very quickly but the best thing about working with Oliver Wight is that the change is sustainable.

ANPG Inks Business Director

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Company:

Issues Costs increasing, sales were falling and margins squeezed Inventory had increased substantially

Global manufacturer of flavours, fragrances and cosmetic actives.

Largely operating informal processes from the 80s Constantly firefighting Workforce lowered by 30% which lowered morale

Value Delivered Inventory levels reduced by 60% Cost base improved by over ÂŁ1 million a year Inventory accuracy increased from 30% to 95% Customer service levels maintained over 95% whilst reducing inventory

The Oliver Wight approach of engaging and motivating business teams to understand and re-think business needs and processes, is a key pre-requisite to success.

General Manager of the Aroma Chemicals Division

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Company:

Issues No effective business processes, integrated IT systems, performance measures or management information Customer survey indicated that lead times and delivery performance was extremely poor Delivery speed at nine months

World’s largest manufacturer of high-pressure aluminium and composite gas cylinders.

OTIF in the low teens

Value Delivered £1 million saved in fixed costs OTIF risen to consistently over 90% Delivery speed reduced to two months or less Reduced costs & lead times Improved NPD processes resulting in £2 million in extra revenue

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Company:

Issues Disappointing return on investment from the implementation of a division-wide ERP system Misaligned business processes Missed customer shipments

Offers chemicals for applications in bioscience, biopharma, food, cosmetics and pharmaceutical laboratories.

High inventory Less-than-desired financial performance Delivery performance at 70%

Value Delivered Inventory reduced by 40% Delivery performance improved to >95% Avoided millions in costs during the recession Gained significant market share Built greater cooperation and teamwork

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Company:

Solutia Manufacturer of materials and specialty chemicals.Â

Issues After an airline crisis rocked the industry, there was no direction or idea of what was going to happen â&#x20AC;&#x201C; all the assumptions about what the market was going to do were gone

Value Delivered On time delivery increased to 100% Cut overtime by more than half Reduced worldwide finished goods inventory by more than half

Some of our chemical clientsâ&#x20AC;¦ AkzoNobel EMD Chemicals IFF Luxfer Group

For further information on how Integrated Business Planning can help transform your business performance please contact us on +44 (0) 1452 397200 or hello@oliverwight.com

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Imagine the possibilities, realize the potential.

When you talk to Oliver Wight about improving your business, we’ll assume you want results, not just better processes - things like increased revenues and margins and greater market share. If you have the ambition, it is possible to make improvements that truly transform the performance of your organisation and create more fulfilling roles for the people within it. We believe this can only be delivered by your own people. So, unlike other consultancy firms, we transfer our knowledge to you; knowledge that comes from 50 years of working with some of the world’s best-known companies.

Oliver Wight has a long-standing reputation for innovation and we continually challenge the industry status quo, so you always get the latest in new thinking. Your Oliver Wight partners will use their real-world experience to ensure your people, business processes and technology are fully aligned and integrated right across your organization. They will coach, guide and inspire your people to drive change throughout your organization, allowing you to create a culture of continuous improvement and innovation that simply becomes for you ‘the way we do things around here’. It’s a proven, sustainable approach that will deliver results straight to the bottom line.

Oliver Wight EAME LLP The Willows The Steadings Business Centre, Maisemore Gloucester GL2 8EY United Kingdom T: +44 (0)1452 397200 F: +44 (0)1452 397230 hello@oliverwight.com www.oliverwight.com

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