Supply Chain Transformation
Telefonica Europe
Paul Kelly
paul.kelly@telefonica.com
+44(0)7801 671 741
Monday, 8 July 13
A little about Telefonica...
2
Telefonica revenues totalled €14,141m;
51% from Latam
CapEx of €1,941m including €695m on
s...
Key industry challenges - 1
3
* breakdown: 29 per cent social networking, 19 per cent email and 19 per cent instant messag...
Key industry challenges - 2
4
R
e
v
e
n
u
e
T i m e
Monday, 8 July 13
Key industry challenges - 3
5
Devices
Suppliers
Telco
Operator
Internet Players
Monday, 8 July 13
Key industry challenges - 3
6
Traditional
Telecommunications
Telecommunications Channels, moving into
telecommunications
D...
This has driven our business strategy in 3 ways...
New BusinessCore Business
Broadband&
Connectivity
Voice
+SMS
• M2M
• eH...
...which in turn has impacted our supply chain
priorities...
Marketing
strategy
Corporate
Strategy
Sales and
Service
strat...
...with an increasing focus on supply chain Key
Performance Indicators
Transformation.... driven by a more global/regional...
Some key implementation challenges we
need(ed) to address
•Different suppliers and outsourcing strategies
•More homogenise...
What is culture?
•People form, and are formed, by culture
•“Culture” impacts Supply Chains:
•The way they work
•How they c...
How culture impacts Supply Chain Management
Examples:
•“Open Book”, Contracts, Partnerships
•Change Mgt, Planning, Program...
What kinds of culture?
•Countries
•Organisations
•Teams
Roles
Norms
Values
13
Monday, 8 July 13
What kinds of culture?
•Countries
•Organisations
•Teams
External
Environment
Leadership
Mission & Strategy
Organisational
...
Countries
“5D” Model - “Cultures and Organisations. Software of the
Mind” - Geert Hofstede
0
25.0
50.0
75.0
100.0
PDI IDV ...
Organisations
“Organisational Cultural Assessment Instrument” - Kim
Cameron & Robert Quinn
•Approach to collaboration
•App...
Teams
Force Field Analysis - ‘Field Theory in Social Science” - Kurt
Lewin
Today Vision
Forces
driving
change
Forces
resis...
Teams
Change Journey
Need for
Change
Diagnose
Problems
Design
Solution
Plan
ImplementationImplement
Review
•Understanding ...
What have we learnt
•We were right to consider “culture” as a key factor...
•...even so we under estimated its potential t...
Some final reflections....
•Never mistake motives and action
•Remember “English” is not the “Rosetta Stone”
•Consider cult...
21
THANK YOU
QUESTIONS
Monday, 8 July 13
22
Monday, 8 July 13
23
Monday, 8 July 13
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Paul Kelly, Head of Supply Chain Development & Strategy EMEA at Telefonica Europe - Supply chain transformation

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Paul Kelly, Head of Supply Chain Development & Strategy EMEA at Telefonica Europe spoke at the SCL Event July 2013

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Paul Kelly, Head of Supply Chain Development & Strategy EMEA at Telefonica Europe - Supply chain transformation

  1. 1. Supply Chain Transformation Telefonica Europe Paul Kelly paul.kelly@telefonica.com +44(0)7801 671 741 Monday, 8 July 13
  2. 2. A little about Telefonica... 2 Telefonica revenues totalled €14,141m; 51% from Latam CapEx of €1,941m including €695m on spectrum acquisition Network investment accounted for 82% of total investment Telefonica’s supply chain in Europe processed 3m+ dispatches to a distribution network of over 4000 stores per year 15m mobile devices brought to market per year Telefonica is present in 24 countries and an average of 130,250 professionals More than 315,7 million customer at March 2013 More than 247.31 million mobile phones accesses; 40 million fixed telephony accesses More than 19.40 million Internet and data accesses and 3.3 million pay TV accesses = Monday, 8 July 13
  3. 3. Key industry challenges - 1 3 * breakdown: 29 per cent social networking, 19 per cent email and 19 per cent instant messaging ** According to ComScore, it is 14% Hours spent communicating weekly 16-24 year old - UK Source: Ofcom Monday, 8 July 13
  4. 4. Key industry challenges - 2 4 R e v e n u e T i m e Monday, 8 July 13
  5. 5. Key industry challenges - 3 5 Devices Suppliers Telco Operator Internet Players Monday, 8 July 13
  6. 6. Key industry challenges - 3 6 Traditional Telecommunications Telecommunications Channels, moving into telecommunications Device Manufacturers & Operating Systems Money & Payment Over-the-top Other New Business Services Monday, 8 July 13
  7. 7. This has driven our business strategy in 3 ways... New BusinessCore Business Broadband& Connectivity Voice +SMS • M2M • eHealth • Big Data • Financial Services • Mobile Advertising • Security From To Transactional relations Emotional relationsCustomer Focus Embracing Digital Efficiency & Simplification Multiple suppliers, systems and processes Leverage scope and scale 7 Monday, 8 July 13
  8. 8. ...which in turn has impacted our supply chain priorities... Marketing strategy Corporate Strategy Sales and Service strategy Business Unit Strategy Devices strategy Supply Chain strategy 8 Monday, 8 July 13
  9. 9. ...with an increasing focus on supply chain Key Performance Indicators Transformation.... driven by a more global/regional approach Products available when, where and how the customer wants Monitor in-life device performance Support the best whole life customer experience Minimise capital invested in stock and drive operational efficiencies “Closing the loop” 9 Monday, 8 July 13
  10. 10. Some key implementation challenges we need(ed) to address •Different suppliers and outsourcing strategies •More homogenised markets but different market positions •Different distribution strategies •Legacy process and IT •Cultural differences 10 Monday, 8 July 13
  11. 11. What is culture? •People form, and are formed, by culture •“Culture” impacts Supply Chains: •The way they work •How they change “Oh, yes. I make my rounds. I’m in every department most every day” “Who Killed Change?” - Ken Blanchard Roles Norms Values 11 Monday, 8 July 13
  12. 12. How culture impacts Supply Chain Management Examples: •“Open Book”, Contracts, Partnerships •Change Mgt, Planning, Programme mgt, Process mgt •Organisation, hierarchy •Supplier management •Decision making, meeting etiquette •etc... Culture can impact all aspects of supply chain management 12 Monday, 8 July 13
  13. 13. What kinds of culture? •Countries •Organisations •Teams Roles Norms Values 13 Monday, 8 July 13
  14. 14. What kinds of culture? •Countries •Organisations •Teams External Environment Leadership Mission & Strategy Organisational Culture Management Practices Structure Systems, Policies Procedures Work unit climate Motivation Tasks and individual roles Individual needs and values Individual and organisational performance 14 Monday, 8 July 13
  15. 15. Countries “5D” Model - “Cultures and Organisations. Software of the Mind” - Geert Hofstede 0 25.0 50.0 75.0 100.0 PDI IDV MAS UAI LTO country 1 country 2 Helps with ....The Theory •Understanding organisations; manager <> team relationships •Meeting & workshop expectations •Attitude to risk and risk management •Attitude to work and organisation •Approach to change and change management 15 Monday, 8 July 13
  16. 16. Organisations “Organisational Cultural Assessment Instrument” - Kim Cameron & Robert Quinn •Approach to collaboration •Approach to decision making •Understanding motivations and performance management •Approach to risk and risk management •Recognition of expertise •Values Helps with ....The Theory 16 Monday, 8 July 13
  17. 17. Teams Force Field Analysis - ‘Field Theory in Social Science” - Kurt Lewin Today Vision Forces driving change Forces resisting change •Team concerns •Motivations •Rationale •Who is helping/hindering and why Helps with ....The Theory 17 Monday, 8 July 13
  18. 18. Teams Change Journey Need for Change Diagnose Problems Design Solution Plan ImplementationImplement Review •Understanding problems •Current feelings about change •Where are they on the change jouney •“Language” to share concerns Helps with ....The Theory 18 Monday, 8 July 13
  19. 19. What have we learnt •We were right to consider “culture” as a key factor... •...even so we under estimated its potential to impact the programme •Using tools and frameworks in a “light touch” way has helped us (the change team) and the wider business to talk more openly about the challenges •We did not recognise early enough the need to address governance •Our suppliers (existing and potential) have been less “sensitive” to these kinds of issues •3rd party support (Consultants) has helped at key times... “If you decide you divide” 19 Monday, 8 July 13
  20. 20. Some final reflections.... •Never mistake motives and action •Remember “English” is not the “Rosetta Stone” •Consider culture as the silent but influential person in corner •More research required! Its not about changing cultures but recognising them. Ignore at your peril! 20 Roles Norms Values Supply Chain Management Monday, 8 July 13
  21. 21. 21 THANK YOU QUESTIONS Monday, 8 July 13
  22. 22. 22 Monday, 8 July 13
  23. 23. 23 Monday, 8 July 13

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