Integrated Business Planning Benefits: Why be good, when you can be great?

Imagine the possibilities, realize the potential.

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Why be good, when you can be great?

Delivering sustainable growth with Integrated Business Planning

Imagine the possibilities, realize the potential.

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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IBP Business Benefits Delivered Level 1 Metrics – Cost and Service Customer OTIF % (by line)

Finished Goods (days)

<90%

90 94%

>80 days

80 - 34 days

>94%

Stockturns Finished Goods

<34 days

Disadvantage email@oliverwight-eame.com

9 - 25 turns

>25 turns

<9 turns

Parity

Advantage

Oliver Wight Clients

IBP Business Benefits Delivered Continued IBP Metrics Forecast Accuracy %

<72%

72 81%

>81%

Overall Supply Chain Metrics Total Supply Chain Cost % Sales

>10%

Perfect Order Probability %

10 - 7%

<72%

72 84%

>84%

<7%

Disadvantage

Parity

Advantage

Oliver Wight Clients

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Case Studies Issues Facing lots of volatility in key business areas impacting forecast accuracy, supply chain performance and customer service leading to poor customer experience Company:

Retailers demanding even greater levels of customer service with daily deliveries and zero inventory Lack of integration across the business and timely decision making Lack of management of integration of NPD

Value Delivered World class performance in less than 15 months Heinz achieved a 24-month horizon for its NPD strategy with between 20 and 30 high-end NPDS in progress every year 99% customer service performance Demand and Supply accuracy only 5% and 2% volatility respectively Safety stocks of key products significantly reduced Financial accuracy with only +/-2% Business working from one set of numbers

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Company:

Issues Highly complex and competitive category challenging business performance and goals High levels of inventory and deteriorating service

Value Delivered Inventory reduced by 50% SLOB rates dropped from 35% to 15% Raised stock turns from 1.6 to 3.5 Service levels up to 98.5% Forecast errors halved OTIF improved from 40% to 95% SKUs reduced from 7,500 to 810

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Company:

Water and heating technology

Issues Serious problems with communication and supply chain efficiency between Italian and other European BU’s Low supplier management and performance

Value Delivered OTIF improved from 68% to 95% Improved team culture, open & honest communication

IBP is the way we will manage the global business… Enjoy the benefits that transparency will bring.

CEO

Working off one set of numbers Inventory days reduced from 85 to 59 €300,000 production savings Stock reduction of €4 million Company-wide strategy implemented

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Company:

Issues Making a loss and fighting for survival

Packaging Company

Losing customers and price cutting in an attempt to retain them OTIF just 50% Huge stock wastage by ordering in bulk to try and cut costs

Value Delivered Transformed from loss maker to highly profitable business Operating costs significantly reduced with no loss in sales Increased percentage revenue coming from innovation to 18% Dramatically improved visibility over a 12-18 month horizon Productivity doubled Lead times reduced by two thirds Working capital and headcount reduced by 50%

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Company:

Issues Close to bankruptcy with very serious cash flow problems

Fuel Pump Manufacturers

Suppliers were loosing confidence and cutting ties due to their payments being overdue Management unable to communicate credible or reliable figures Lack of transparency and absence of cross-organisational cohesion Operational SILOs and discouraging communication between departments Hasty expansions resulting in poorly-run subsidiaries with increasing costs and no real profitable returns

Because of IBP, we now have the capital from our current operations to further invest into new growth projects and prepare for the future.

CEO SUNTEC

Value Delivered Net sales of â&#x201A;Ź25.1 million in one year Increased profit margin of 10-15% Working from one set of numbers and teams communicating Cultural behaviours transformed Projections for future years are positive New investors

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Company:

Global Pharmaceutical Company

Issues Whilst being financially stable the company was operating in daily crisis Poor customer service levels (operating at 22%) Excess inventory Operating in functional/regional SILOs Strong year end culture with limited focus on strategy deployment

Value Delivered Business savings >200 million dollars with a 20 fold ROI Reduced global inventory by 30% Customer service dramatically improved from 22% to >95% High performing leadership team environment created Clear roadmap, tracked monthly, to deliver the business strategy

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Company:

Global Infant Formula Company

Issues Lack of financial integration inhibiting the dynamic financial decision making required in the business.

Competing in a volatile and dynamic industry S&OP process was established to enable demand/supply balancing but business recognized the need to enhance the process to one that helped focus on delivery of the business strategy (Integrated Business Planning).

Establish ownership of the IBP process at leadership level

Value Delivered A more transparent financial outlook allowing the business to identify future risks and opportunities and gap close accordingly Able to handle the business with more confidence, working from one set of figures to assess the entire business situation.

Global consistency in process Improved decision making led to optimized financial performance Significantly improved customer service levels Timely investment decisions made to exploit future demand

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Company:

Multinational Medical Equipment Manufacturer

Issues Disparate global organisation with no alignment to, or visibility of, the business strategy Decisions on investment and new product introduction driven by â&#x20AC;&#x2DC;who shouts loudestâ&#x20AC;&#x2122; Lack of financial integration with operational and sales planning Underperforming and unmotivated culture New product development being delayed and missing launch dates

Value Delivered Manufacturing capacity increased by 20% Average order size up 60% in some markets Greater visibility with a clear 24-month picture of demand One set of financial numbers Improved inventory levels and SKUs reduced by 50%

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Company:

Issues About to enter aggressive growth phase requiring significant investment Lots of debt

PACKAGING

Packaging Company

Sales forecast accuracy at SKU level 30% Forecast accuracy at SKU level 40% Manufacturing accuracy 30%

Value Delivered 30% revenue growth Inventory days reduced by 32.5% (from 40 to 27) Customer service increased from 96% to 99% Forecast accuracy at SKU level increased to 80% 20% saving in handling, warehousing and freight Manufacturing accuracy up to 80% EBITDA improved by 20% Markets biggest volume growth Tonnes per hour ratio improved significantly Sales forecast accuracy at SKU level increased to 50% Number one in French market for volume growth Market leader in key market with 50% market share within six months After 12 months only 20% debt left to repay oliverwight.com

Company:

Issues Inventories were swelling Significant portfolio complexity - 120,000 different SKU codes Lack of communication and integration across the business Each site working in SILOs

Value Delivered Increased net sales to â&#x201A;Ź1.1 billion 30% improvement in OTIF 50% reduction in inventories Increased visibility of medium to long term opportunities and risks Each site working collaboratively leading to integrated decision making

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Company:

Global Construction Materials Company

Issues Poor customer service levels High inventories Weak supply chain performance when compared to benchmark set Sub optimal cost to serve

Value Delivered 3-fold profit increase 5-fold ROI increase SKUs reduced from 3000+ to 996 External storage costs reduced by 50% OEE increased from 15% to 40%

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Some of our Integrated Business Planning Clientsâ&#x20AC;Ś Bunge SUNTEC Wrigley Novartis Consumer Health AkzoNobel Packaging Coatings Nampak Flexible Molnlycke Health Care AB Aircelle Maroc US Army

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

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 nearly 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 email@oliverwight-eame.com www.oliverwight.com

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