《L'Oreal供应链诊断.ppt》由会员分享，可在线阅读，更多相关《L'Oreal供应链诊断.ppt（72页珍藏版）》请在三一办公上搜索。
1、LOral Supply Chain Diagnostic,March 18,2004,1,Presentation Agenda,Project Scope and ActivitiesOverview of Our Supply Chain FindingsProcessesInventory ReviewMaturity ProfilesOrganization/People and Culture TechnologySupply Chain RoadmapDiscussion of Next Steps,2,Our Project Approach,Over the past thr
2、ee weeks,we have:Interviewed 5 Executives of LOral CanadaFacilitated two cross-functional process workshopsCollected and analyzed dataConducted a high level maturity assessmentCompared LOral process and performance to CPG best practiceIdentified key business issues and areas of improvementSummarized
3、 our findings in this presentation document,Project Kickoff,Data Collection,Interview with Executives,Process Workshops,Model Review&Validate Base Case,Review Metrics,Identify&Consolidate Issues&Opportunities,Opportunity Prioritization,Benefits Assessment,Findings/Recommendation Development,Present
4、Recommendations,Discuss Next Steps,3,Cross-Functional Participants,Senior Management-Supply Chain Laurent Venot(Project Sponsor)Jean ValoisPierre MassicotteValry Mayer,SalesDominique De Celles Isabelle Genest Anne-Marie NelsonDion Gemmity,Customer ServiceEli BengioPatricia Raposo,Logistics&Procureme
5、ntValrie LacerteYves DubNaity Jacel,Information technologyPierre Journel Marcelyne Craft,Finance Martin Deschnes,4,Presentation Agenda,Project Scope and ActivitiesOverview of Our Supply Chain FindingsProcessesInventory ReviewMaturity ProfilesOrganization/People and Culture TechnologySupply Chain Roa
6、dmapDiscussion of Next Steps,5,Processes,Demand Planning,Supply Planning,Order Fulfillment,Develop Sales ForecastMaintain Promotional PlanConsider inventory levels,backorder reports,safety stock levelsConsolidate and consider external data(POS,Nielsen,Customer data)Reconcile Demand Plan with BudgetN
7、ew Product Introductions,Net Inventory and Lead Times from the ForecastDistributed Requirement PlanningCapacity Requirement PlanningCustomer AllocationsCommunicate forecast to SuppliersReceive supplier commitment,Process Customer OrdersPlan and Manage Finished Goods InventoryPicking and PackingManag
8、e Outbound Product FlowManage shipping&transportationGenerate InvoiceCredit management and A/R,(*)Out of scope,6,Demand Planning Issues and Opportunities,Issues,Manual and Inconsistent ProcessesThe forecast process is mostly manual,inconsistent across brands and divisions(due to different levels of
9、maturity)as well as both time and resource consumingThere is no formal process for determining which products should be focused on during the forecasting meetingsNo one department“owns the forecast”There is no mechanism for automatically generating a baseline forecastToo much time is spent on manual
10、 processes,data clean-up and generating reports,leaving insufficient time to analyze data and manage exceptionsLOral Canadas brand forecasts are not all aggregated up into one forecast limiting visibility and data sharing LOral Canada does not have simulation or“what if”capabilitiesMany disparate to
11、ols are being used to facilitate forecasting-Excel,Valo,SAP and Outils Gestion.Interfaces have been built between the various tools and systems,but manual verification is required and the current technology still does not meet LOral s requirementsPOS,Nielsen,customer information,promotional and adve
12、rtising information are not all integrated in one central repository,Opportunity,Process RedesignSpend time forecasting products that give the highest return.Not all product lines benefit from increased attention.Focus on high margin,low volume,big ticket items,high profile items and items with comp
13、lements to maximize profitabilityCommunicate and reconcile forecast assumptions by conducting a formal review after each planning cycle with all stakeholders.Report forecast error and modify assumptions as appropriateForecasting Tool/BW Implementing a Forecasting tool will enable the automatic gener
14、ation of a baseline forecast based on sales history and additional variables.Most packages allow users to select a statistical model,enable the system to determine the model with the greatest fit or employ a composite model The forecasting tool selected should allow for the generation of alerts base
15、d on predefined tolerances,highlighting the products that require further consideration and manual interventionProducts should be reviewed to determine which ones are critical or high margin to plan in a Forecasting tool,while non-critical or stagnant products may be planned in SAP R/3 The forecasti
16、ng tool selected should provide“What If”simulation capabilities to demonstrate the impact of a variable change(e.g.price change)Coordinate data collection for all available sources and house it in a central repository such as SAP Business Warehouse,7,Demand Planning Issues and Opportunities,Issues,O
17、pportunity,PeopleEnsure the Planning Team is Cross-Functional and Cross-Trained:LOral will need to evaluate their resources skills and determine if additional resources are required to gain forecasting expertiseStatistical proficiency and system expertise should be balanced with industry,company and
18、 product knowledge Cross-training sharpens skills,broadens perspectives and improves communication Create incentives to improve the accuracy of forecasts:Establish forecast accuracy goalsEstablish compensation structureMonitor and review congruence of goals to rewardsThis will remove trade-offs betw
19、een forecast accuracy and performance against forecast,leverages key information and helps eliminate biasesLOral Canada has started to tie compensation to forecast accuracy.This practice will obtain greater acceptance among employees once a tool to support the process has been implemented,Department
20、s Involved have Different PrioritiesWhile the generation of the forecast is a collaborative effort between Sales,Marketing,Finance and Logistics,the involved parties do not share the same view of the forecasts importance nor appreciate the impact of their input(or lack thereof)on other departments a
21、bility to execute their functions downstreamSales is seen as too distant from the customer and therefore lacking pertinent data to input into the forecasting e.g.which store carries which SKUSales strategy to push products at the end of the month and year by decreasing prices,throws off the forecast
22、LOral Canada realizes that even if they implement a forecasting tool,without the proper processes or resources in place,forecast accuracy will not likely improve LOral Canada experiences a high turnover among sales and marketing people resulting in the loss of vital customer and product informationT
23、raining for Sales and Marketing resources is insufficient.Compensation re-evaluation has begun to align individual goals and metrics with organizational goals with respect to forecast accuracyAlthough LOral Canada has made great strides in improving their forecasting process,the accuracy has not imp
24、roved significantly leading to feelings of frustration among employees,8,Demand Planning Issues and Opportunities,Issues,Opportunity,Product Launches Although LOral Canada has access to other countries launches as well as to like products sales history,there is no tool or process in place to effecti
25、vely incorporate this data into their forecastsLOral Canada is unable to accurately assess the cannibalization effect of one product on anotherNo post-mortem analysis is conducted or captured on failed product launches as input to future launchesPromotionsThere is currently no means to accurately cl
26、eanse promotional uplifts from sales history Past promotional performance is not adequately measured,therefore making it difficult to predict the impact of future promotionsPromotions involving giftware can lead to imbalances in demand,making it difficult to predict true demand for these products“On
27、e Shot”promotions are difficult to planProduct AllocationProduct allocation has not been deployed effectively and has even led to undesirable forecasting behaviours,Product Lifecycle ManagementInvestigate APS functionality to handle:“Like Modeling”whereby sales history of a similar product is used t
28、o forecast a new productPhase In/Phase Out of products which entails weighting the forecast to reflect a products lifecycleThe separation of the promotional uplift from baseline forecast generationCannibalizationData CleansingSufficient time must be spent cleaning data such as SKU changes,data error
29、s,duplication,one-time events,stock-outs,promotions,outliers etc to enable forecasting models to separate business growth from seasonality and other deviationsProduct AllocationAllocation is a useful tool for ensure higher priority customersobtain increased service levels in cases of shortages.LOral
30、 should develop and implement formal policies for allocating products(e.g.based on customer forecasts)Allocation configuration should be modified to reflect the new policies in SAP R/3.In the long-term additional allocation functionality could be explored in an APS tool,9,Demand Planning Issues and
31、Opportunities,Issues,Opportunity,Customer Collaboration Cross-Share Forecasts with Key CustomersIncorporate customer forecasts which are deemed as reliable into baseline forecasts and challenge their numbers(manage by exception)Once forecasts are more accurate,LOral should provide a website to allow
32、 easy access for their Customers to enter their forecasts and to post LOrals confirmed quantities for customers to validate in a timely manner Aggregation/DisaggregationDetermine the appropriate level to forecast e.g.SKU/customer location for DSD,SKU/Customer DC for warehouse shipmentsAn APS solutio
33、n will facilitate the aggregation and disaggregation of the forecast,however,time should be spent determining the appropriate level for forecasting.Top-down approaches can mask trend shifts while bottom-up approaches may not consider effects shared across brandsMeasuring Forecast Inaccuracy Order da
34、te should be used as the point for establishing demand since it gives the most accurate information on when demand is initiated.Otherwise stock-outs,lost sales,opportunity costs and lost customers may be maskedEnsure the full aggregated costs of forecast error are measured:Insufficient inventory(sto
35、ck outs)Excess inventory(returns,spoiled,destroyed,obsolete,slow moving)Safety stockExpediting costsInventory carrying costsOvertime,Customer CollaborationAlthough some of LOral Canadas customers provide forecast and POS data,LOral does not possess the infrastructure or processes to effectively use
36、the dataLOral Canada must first focus on improving its own processes before extending their processes and data out to share with Customers and SuppliersForecast Accuracy While forecast accuracy is better at the Brand level,it varies greatly at the SKU level regardless of product classification(A,B,C
37、)Only 40%to 50%of items achieve the target of tolerance of 20%(BIC 75%of SKU achieve this target)SKU ranking has been erroneousImpacts of Forecast InaccuracyNumerous forecast modification requests to the factoriesCustomer Service levels(line fill rate in$)are at 92%despite target s of 98.5%(BIC is 9
38、9%)Inventory Write-offs are at 10.5%(BIC for CPG is 2%)Inventory Turns are 4(BIC for CPG is 17)Sales Returns are at 5.25%(BIC is 0.4%)NOTE:We are comparing LOral to CPG companies which is not a fair comparison in some cases.The comparison is meant as a guideline.,10,Supply Planning Issues and Opport
39、unities,Issues,InputThe unconstrained forecast is the main input for developing the purchasing plan.Given LOral Canadas poor forecast accuracy,the purchasing plan does not effectively meet customers demands as demonstrated by the numerous forecast modification orders sent to the plants and high inve
40、ntory levelsProducts lead times,safety stock levels,min/max levels are not reviewed on a regular basisFactory ConstraintsThe purchasing frozen horizons set by the plants seem excessively long and are not reviewed sufficiently.Therefore,LOral Canada must place orders far in advance,often before they
41、are able to assess trendsThe plants confirm back all ordered quantities since replenishment lead time is used.As a result,LOral does not obtain a real view of supply or capacity constraintsThe factories are Product focused rather than Sales/Customer focused.The result is a Push model rather than Pul
42、l.LOrals factories occasionally push excess stock to the DCs rather than trying to match customers requirementsNo global supply planning is engaged in at LOral.Each LOral Sales Company is prescribed where to buy each product and can only look to other factories in cases of shortage/capacity constrai
43、nts,Opportunity,Factory ConstraintsCollaborative Planning with the plants would involve LOral Canada posting their forecast on the Web and allowing the factories to confirm the quantities they can supply against the forecast in a timely mannerContinue to roll-out one of the newer LOral Canada proces
44、ses whereby products are stocked in the US and shipped directly to customers in Canada to reduce inventory levels and costsLong Term Once LOral Canada has improved their forecast accuracy,they will be in a better position to approach the factories to discuss:Shortening frozen horizons Communicating
45、issues Obtaining visibility to the plants production schedules to gain a better sense of supply plans and capacity constraints Receiving ASNs to give LOral Canada a true sense of their ATP to pass on to their customersDevelop new policies and education program across LOral companies to ensure custom
46、er service levels are the primary focus rather than factory throughput and costsAll LOral company forecasts should be rolled up to a central supply chain group for global supply planning purposes.This would enable global fulfillment to match supply with demand,11,Supply Planning Issues and Opportuni
47、ties,Issues,Opportunity,AllocationThe US Factories ought to be allocating stock in ratio to LOral Sales Companies forecasts.This would:Encourage the LOral Sales Companies to improve their forecast accuracyEnsure fair share allocation in shortage situations since each Sales Company would obtain stock
48、 in proportion to their forecastBeyond the forecasted amount stock could be allocated on a“first come,first serve”basis The US Factories should measure and be compensated based on their ability to service all of North America and not just the US VMIImplement an APS tool that includes VMI functionali
49、ty and choose a pilot customer to model with before extending the functionality out to other customersLeverage the VMI experience of LOral USA(e.g.Lancme)Product HarmonizationWhere possible,continue to roll out the process of manufacturing with Final Assembly,whereby products are produced and finish
50、ed to the point of localization steps,Factory Constraints(contd)Canada makes up only 3%of LOrals global sales,while the US which supplies Canada makes up 28%of LOrals global sales.Therefore,LOral Canadas requirements are only fulfilled once the USs needs have been satisfied.There is no formal proces
