Process Improvement –  A Strategic Implementation
Focus of the Day <ul><li>Today we will look at how to address the main sources of stress (‘pressure points’) in organisati...
A Key Question for You <ul><li>What are the main challenges you face in running your business? </li></ul>
Session 1
The clash between the nature of external markets and the nature of internal resources BT3 Market Requirements are…. Dynami...
Link Strategy With Operations Give an Operations Advantage  Externally supportive Adopt best Practice Correct the Worst Pr...
The 3 key attributes  of operations Operations Contribution Implementing Supporting Driving be Dependable Operationalise s...
Operations can kick-start two virtuous cycles Understanding of the processes Competencies embedded in the operation Capabi...
Competitiveness Speed Flexibility Cost Dependability Quality The operations function can provide a competitive advantage t...
Competitiveness How is each performance  objective  being viewed? Quality The onset of “Total Quality Disillusionment” ISO...
Competitive Objectives are prioritized by CUSTOMERS and COMPETITORS Competitiveness Quality Speed Dependability Flexibilit...
Operations Strategy Decision Areas Determine Resource Deployment Operations Policies are shaped by COMPETENCIES and CONSTR...
Cost Competitive Objectives are prioritized by CUSTOMERS and COMPETITORS Market Competitiveness Quality Speed Dependabilit...
Cost Competitive Objectives are prioritized by CUSTOMERS and COMPETITORS Market Competitiveness Quality Speed Dependabilit...
Trade-offs “ Do you want it good, or do you want it Tuesday?” “ No such thing as a free lunch.” “ You can’t have an aircra...
Strategic Performance  - Responsiveness of Your Operation Failure Point Stress Point Performance ‘ Force’  Response curve ...
Some Current Pressure Points in Supply Chain <ul><li>Lean is good! </li></ul><ul><li>Agile is Better </li></ul><ul><li>6 σ...
The Causes of Supply Chain and Operations Stress <ul><li>Congruence </li></ul><ul><ul><li>Alignment to customer needs, pot...
Gaining Insights into Your Business Operation <ul><li>The SSRU at Warwick launched a major international benchmarking stud...
To AUDIT your Business <ul><li>Logon to  http://www.supply-chain.org.uk </li></ul><ul><li>Click on the SPA Methodology lin...
Congruence in Your Strategic Priorities
Not all aspects of our  performance have the same impact: Competitive Benefit Achieved performance qualifying level ORDER-...
Low High Negative Positive Neutral Achieved Performance Competitive Benefit Time Delights become Order winners and Order w...
Delights Order Winners Qualifiers Today Tomorrow Where will you be in the Future? ACTIVITY
Prioritizing Objectives Priorities should be determined by ...... The IMPORTANCE of each competitive objective Your PERFOR...
A method for identifying our ‘strategic’ operations priorities <ul><li>Identify what is important to customers </li></ul><...
For this product group does this performance objective ...... 9 Point Importance Scale 1 -  Provide a crucial advantage wi...
PRICE SERVQUAL (DISN.) SERVQUAL (ORDER TAKE) ENQUIRY LEAD-TIME DROP QUOTE WINDOW QUOTE DELIVERY PERFORMANCE DELIVERY FLEXI...
For this product group is achieved performance ........ 9 Point Performance Scale 1 -  Consistently considerably better th...
COST SERVQUAL (DISN.) SERVQUAL (ORDER TAKE) ENQUIRY LEAD-TIME DROP QUOTE WINDOW QUOTE DELIVERY PERFORMANCE DELIVERY FLEXIB...
better than same as worse than less important qualifying order winning 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 Volume Flex X D...
Brainstorming <ul><li>Identify and list 10-15 performance imperatives </li></ul><ul><li>Identify what information you have...
CUSTOMERS better than same as worse than less important qualifying order winning 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 IMPOR...
Why is the Importance/Performance Analysis Relevant? <ul><li>Maximises the impact of efforts </li></ul><ul><li>Minimises w...
Summary: The Importance / Performance Matrix <ul><li>A Valuable, high level tool to help focus your efforts: </li></ul><ul...
Process Improvement A Guide to Some Valuable Tools, Techniques and Methods  Session 2
<ul><li>“In order to control, you must measure” </li></ul><ul><ul><ul><li>Lord Kelvin </li></ul></ul></ul>
Today’s Message! <ul><li>No measurement without recording </li></ul><ul><li>No recording without analysis </li></ul><ul><l...
Operations Improvement <ul><li>Today’s Key Questions </li></ul><ul><ul><li>Can we do it OK? (Capability) </li></ul></ul><u...
Measuring Process Performance <ul><li>What do you do with your performance data? </li></ul><ul><ul><li>Report them? </li><...
Time Some measure of operations performance Process control charting Some aspect of the performance of a process is often ...
Time Some measure of operations performance Process control charting Our tendency is to intervene in the operation of proc...
How do you Intervene? <ul><li>Add more resource </li></ul><ul><li>Change behaviour </li></ul><ul><li>Alter some variable <...
100 90 80 70 60 50 X Now Percentage of deliveries on-time Delivery *  performance is 87%  Is this good, bad, or indifferen...
100 90 80 70 60 50 X Customer expectation = 98% Now Percentage of deliveries on-time Performance against customer expectat...
100 90 80 70 60 50 Customer expectation = 98% Now Percentage of deliveries on-time Performance against customer expectatio...
100 90 80 70 60 50 X X X X X Customer expectation = 98% Target performance = 95% Now Percentage of deliveries on-time Perf...
100 90 80 70 60 50 X X X X X X Customer expectation = 98% Target performance = 95% Competitor performance = 81% Now Percen...
Time Elapsed time of call Process control charting E.G  “The last point plotted on this chart seems to be unusually low.” ...
The Normal Distribution - a simple example The natural variation in processes  can be described by a normal distribution 2...
What defines the shape of the Normal Distribution? <ul><li>Just Two Variables: </li></ul><ul><ul><li>The Mean (or average)...
Process control charting The Basics 40   Mean = 100   160 elapsed time of call (secs) Frequency The “standard deviation” i...
Process control charting The Basics 40   100   160 elapsed time of call (secs) Frequency The chances of measurement points...
Using the Normal Distribution to Manage Processes <ul><li>So, we can apply the normal distribution to our observed data ch...
Time Elapsed time of call Process control charting The normal distribution  describes random variation when the process is...
<ul><li>We can be more sophisticated in terms of using the control charts </li></ul><ul><li>Thanks to the help of Statisti...
Process control charting UCL C/L LCL Alternating and erratic behaviour - Investigate Suspiciously average behaviour - Inve...
We can use the Normal Distribution when asking  “Is my process Six-sigma capable?” <ul><li>First, Identify the tolerance o...
So, what’s this Six-Sigma all about? <ul><li>To achieve  6   (or 6  ), a process must produce no more that 3.4 errors pe...
Test Your Understanding: Is the process capable? 1: If the SLA range is A? 2: If the SLA. range is B? The Basics Frequency...
How do I achieve Six Sigma <ul><li>You could renegotiate your service level agreement! (it’s a perfectly valid way…) </li>...
Building Process Knowledge  Stage  Term  Knowledge Typical form of knowledge 1    Complete ignorance    None     Nowhere 2...
Building Process Knowledge Knowledge at Stage... 1 2   3   4   5 6 7 8 Nature of production  Expertise based  Procedure ba...
But: How can we drive process improvement?
Traditional Western Perceptions of Job Functions Top Management Middle Management Supervisors Workers Innovation Maintenan...
Japanese Perceptions of Job Functions Top Management Middle Management Supervisors Workers Improvement Maintenance Imai 1986
Japanese Perceptions of Job Functions (2) Top Management Middle Management Supervisors Workers KAIZEN Maintenance Imai 198...
Innovation...   ...Kaizen Short-term, dramatic Large steps  Intermittent  Abrupt, volatile  Few champions Individual ideas...
Actual performance improvement with  continuous improvement Time Performance “ Continuous” improvement Standardize and mai...
Intended performance improvement with breakthrough improvement Time Performance Breakthrough improvements
Actual performance improvement with breakthrough improvement Time Performance Actual improvement
Session 3
Congruence in Supply Chains
Prisoner’s Dilemma Mr White gets 10 years Mr Orange goes free Mr White Mr Orange Confess Confess Don’t  Confess Don’t Conf...
Prisoner’s Dilemma Mr White gets 10 years Mr Orange goes free Mr White Mr Orange Confess Confess Don’t  Confess Don’t Conf...
Prisoner’s Dilemma Mr White gets 10 years Mr Orange goes free Mr White Mr Orange Confess Confess Don’t  Confess Don’t Conf...
Sotheby’s and Christie’s - the Classic Prisoner’s Dilemma in Practice 20 Years of  price fixing over commissions,  charges...
Sotheby’s and Christie’s - the Classic Prisoner’s Dilemma in Practice Alfred Taubmann - $7.5 m fine, + 1 Yr Europe - £13m ...
Prisoner’s Dilemma Sotheby’s fined £13m,  Directors resign  & CEO imprisoned Christie’s go scot free Sotheby’s Christie’s ...
A’s  perception  of its own  performance B’s  perception  of A’s performance B’s  perception  of its own performance C’s  ...
The Impact of Strategic Supply Chain Relationships <ul><li>Nokia experienced rapid growth in mid-late 1990s </li></ul><ul>...
Controlling the supply chain
Supply Strategy - The Benetton Video Case
1 . What are the strategic imperatives for: Benetton’s retail shops? Benetton’s Distribution? Benetton’s Manufacturing ope...
Benetton’s supply network spun wool & cotton producers cotton & sheep  farmers retail stores suppliers of cotton jeans, ve...
Distribution Operations Operational & Strategic Imperatives Across Benetton’s Supply Network: Retail <ul><li>reliable Qual...
Target markets Marketing Logistics Manufacturing FUNCTIONAL elements of Benetton’s strategy : A Dual System Involving: 1.’...
Elements of Benetton’s dual manufacturing strategy for woollen garments : Strategy element proportion of total sales cost ...
Why Does Benetton’s Supply Chain Strategy Work? <ul><li>Recognises the impact of Demand variation </li></ul><ul><li>Ignore...
Matching Supply Chains with Products - Marshall Fisher’s Framework
Matching Supply Chains with Products - Marshall Fisher’s Framework
Performance Implication of Supply Chain Alignment
Consequences of lack of Clarity Across Supply Chains
Supply Chain Stock Movements 1  2  3  4  5  6  7  8  9  10  11 12 13 14 15  16 17 18 19 20
Supply Chain Stock Movements 1  2  3  4  5  6  7  8  9  10  11 12 13 14 15  16 17 18 19 20
Supply Chain Stock Movements 1  2  3  4  5  6  7  8  9  10  11 12 13 14 15  16 17 18 19 20
Supply Chain Dynamics - ‘The Bullwhip Effect’ T Market Tier 1 Tier 2 Tier 3 Increasing variation in pattern t1 t1 t1 t1 Q4...
Some definitions <ul><li>‘E-Business’ - the conduct of business transactions, business planning and control, communication...
Why focus on Supply Chains? <ul><li>Because the Internet is an Inter-Organisational Communication Channel </li></ul><ul><l...
Three Main areas of E-Business Activity  Marketplaces - for trading Knowledge sharing e.g. product development, customer s...
Starting with the Customer’s Requirement select requisition approve status receive <ul><li>The objective is to automate th...
 
Hottest Segment of B-to-B eCommerce? Indirect 36% Direct 28% Taxes 13% HR 17% Profit 6% CEO View <ul><li>Over 1/3 of cost ...
Translate Costs into Profits ! <ul><li>3% reduction in indirect cost equals 50% increase in Profit </li></ul>Indirect 33% ...
Indirect Cost Reduction Targets Source: National Association of Purchasing Managers . What You Pay for Goods & Services Di...
5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
Supply Chain  e Business models <ul><li>EDI </li></ul><ul><li>High speed complex data transmission to core customers & sup...
5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
<ul><li>Seller-side or buyer-side system connects with existing transaction systems </li></ul><ul><li>Sales Order Systems ...
<ul><li>Public Web </li></ul><ul><li>Each Seller offers products at list price </li></ul><ul><li>Exchange </li></ul><ul><l...
How E-Business Can Impact on your Demand
Demand Profiles? Cyclical Stable Volatile
A major phenomenon: electronic auctions <ul><li>Streamlines strategic  and off—contract buying </li></ul><ul><li>Leverages...
5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
<ul><li>E-Procurement system integrates with enterprise control systems </li></ul><ul><li>CRM system integrating across th...
5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
<ul><li>Extended enterprise  solution - integrating marketplaces, portals and auctions </li></ul><ul><li>Procurement and S...
Emerging industry portals = many examples Global Supply Chain worth $178000bn Auto Industry Example  Covisint $200bn
5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
<ul><li>Integrated CAD/CAM/CSCM </li></ul><ul><li>Tracking, Global Positioning as integral part of E-Fulfilment systems </...
5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
E-Business project Critical Success Factors <ul><li>If you can’t support the business case, then start again </li></ul><ul...
E-Business project Critical Success Factors - 2 <ul><li>What have customers said about CRM and E-Business? </li></ul><ul><...
E-Business project Critical Success Factors - 3 <ul><li>Integration with operations and logistics </li></ul><ul><li>Logist...
Technology Policy & Processes People Program Manage- ment Critical Elements of E-Business Strategies
It’s not about technology...
… .but new ways of doing business
Remember To AUDIT your Business! <ul><li>Logon to  http://www.supply-chain.org.uk </li></ul><ul><li>Click on the SPA Metho...
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  1. 1. Process Improvement – A Strategic Implementation
  2. 2. Focus of the Day <ul><li>Today we will look at how to address the main sources of stress (‘pressure points’) in organisations and their supply chains. </li></ul>
  3. 3. A Key Question for You <ul><li>What are the main challenges you face in running your business? </li></ul>
  4. 4. Session 1
  5. 5. The clash between the nature of external markets and the nature of internal resources BT3 Market Requirements are…. Dynamic Heterogeneous Ambiguous Operations Resources are…. Difficult to change Technically constrained Complex Principle
  6. 6. Link Strategy With Operations Give an Operations Advantage Externally supportive Adopt best Practice Correct the Worst Problems Increasing contribution of operations Internally supportive Externally neutral Internally neutral The strategic role of operations can be defined by its aspirations (after Hayes and Wheelwright) STAGE 1 STAGE 2 STAGE 3 STAGE 4 The ability to Implement The ability to support Strategy The ability to Drive strategy Stop holding the organisation back Be as good as competitors Be clearly the best in the industry Redefine the industry’s expectations Principle
  7. 7. The 3 key attributes of operations Operations Contribution Implementing Supporting Driving be Dependable Operationalise strategy explain Practicalities be Appropriate Understand strategy Contribute to decisions be Innovative provide Foundation of strategy Develop long-term Capabilities The Strategic Role of the Operations Functions
  8. 8. Operations can kick-start two virtuous cycles Understanding of the processes Competencies embedded in the operation Capabilities enhance innovation and improvement World Class Operations Competitiveness Strong marketing High margin Investment Developing the resources which let the operation’s performance stay ahead of the competition Developing customers’ competitors’ and stockholders; perceptions and expectations Internal and External Principle
  9. 9. Competitiveness Speed Flexibility Cost Dependability Quality The operations function can provide a competitive advantage through its performance at the five competitive objectives Being RIGHT Being FAST Being ON TIME Being ABLE TO CHANGE Being PRODUCTIVE
  10. 10. Competitiveness How is each performance objective being viewed? Quality The onset of “Total Quality Disillusionment” ISO 9000 sweeps the world (except Japan!) Dependability Being monitored by customers Flexibility Long term technology flexibility proving difficult to achieve More closely defined - “rigid flexibility” Cost Increasing cost pressures Overcoming the volume and variety effects New ways of looking at costs Speed Value added methodology increasingly powerful Major benefit of BPR Return of the JEDI
  11. 11. Competitive Objectives are prioritized by CUSTOMERS and COMPETITORS Competitiveness Quality Speed Dependability Flexibility Cost The first task of an Operations Strategy is to clarify the relative priorities of the competitive objectives
  12. 12. Operations Strategy Decision Areas Determine Resource Deployment Operations Policies are shaped by COMPETENCIES and CONSTRAINTS Resource Deployment Capacity Structure Process Technology Supply Network Development and Organisation ISSUES - <ul><li>CAPACITY </li></ul><ul><li>LOCATION </li></ul><ul><li>FOCUS & SEGMENTATION </li></ul><ul><li>L/T FORECASTS </li></ul>ISSUES - ISSUES - ISSUES - <ul><li>DEVELOPMENT RATE </li></ul><ul><li>AUTOMATION </li></ul><ul><li>SIZE </li></ul><ul><li>INTEGRATION </li></ul><ul><li>IN OR OUT-HOUSE DEVELOPMENT </li></ul><ul><li>VERTICAL INTEGRATION </li></ul><ul><li>SUPPLIER DEVELOPMENT </li></ul><ul><li>DEVELOPMENT CHAINS </li></ul><ul><li>STRATEGIC VALUE FACILITATION </li></ul><ul><li>RESPONSIBILITY RELATIONSHIPS </li></ul><ul><li>IMPROVEMENT STRATEGIES </li></ul><ul><li>PERFORMANCE & CONTROL </li></ul>
  13. 13. Cost Competitive Objectives are prioritized by CUSTOMERS and COMPETITORS Market Competitiveness Quality Speed Dependability Flexibility Operations strategy is defined by the intersections of performance objectives and substrategies Operations Policies are shaped by COMPETENCIES and CONSTRAINTS Resource Deployment Development and Organization Supply Network Process Technology Capacity Structure Operations Strategy Principle
  14. 14. Cost Competitive Objectives are prioritized by CUSTOMERS and COMPETITORS Market Competitiveness Quality Speed Dependability Flexibility Operations strategy is defined by the intersections of performance objectives and substrategies Operations Policies are shaped by COMPETENCIES and CONSTRAINTS Resource Deployment Capacity Structure Process Technology Supply Network Development and Organization key key key key
  15. 15. Trade-offs “ Do you want it good, or do you want it Tuesday?” “ No such thing as a free lunch.” “ You can’t have an aircraft which flies at the speed of sound, carries 400 passengers and lands on an aircraft carrier. Operations are just the same.” (Skinner) “ Trade-offs in operations are the way we are willing to sacrifice one performance objective to achieve excellence in another.”
  16. 16. Strategic Performance - Responsiveness of Your Operation Failure Point Stress Point Performance ‘ Force’ Response curve Desired Capability Operating Capability STRESS KEY To ZONES
  17. 17. Some Current Pressure Points in Supply Chain <ul><li>Lean is good! </li></ul><ul><li>Agile is Better </li></ul><ul><li>6 σ </li></ul><ul><li>More customisation </li></ul><ul><li>More products </li></ul><ul><li>Use E-Commerce </li></ul><ul><li>CRM </li></ul><ul><li>ERP </li></ul><ul><li>Collaborative Planning, Forecasting & Replenishment </li></ul><ul><li>Direct Deliveries </li></ul><ul><li>………………………………………………………………… .. </li></ul>
  18. 18. The Causes of Supply Chain and Operations Stress <ul><li>Congruence </li></ul><ul><ul><li>Alignment to customer needs, potential degradation of delights </li></ul></ul><ul><ul><li>Mismatched relationships with customers and suppliers </li></ul></ul><ul><ul><li>Confusion over needs </li></ul></ul><ul><li>Capabilities </li></ul><ul><ul><li>Processes are not able to meet the performance targets </li></ul></ul><ul><ul><li>Service levels are inappropriate </li></ul></ul><ul><ul><li>Capability Not Measured </li></ul></ul><ul><ul><li>No laid down process maps or procedures </li></ul></ul><ul><li>Capacity </li></ul><ul><ul><li>Poor utilisation, slow response to demand, too many set ups, high or increasing variety </li></ul></ul><ul><ul><li>Low Value Adding content </li></ul></ul><ul><ul><li>Low T/E (throughput efficiency) </li></ul></ul><ul><li>Control </li></ul><ul><ul><li>High Forecasting Errors </li></ul></ul><ul><ul><li>‘ Bullwhip’ across the chain (Forrester Effect) </li></ul></ul><ul><ul><li>Resource Scheduling and Inventory inaccuracies </li></ul></ul>
  19. 19. Gaining Insights into Your Business Operation <ul><li>The SSRU at Warwick launched a major international benchmarking study. </li></ul><ul><li>You can contribute to better understanding of innovation and improvement by participating </li></ul><ul><li>The study aims to include over 200 Australian, US, and European participants by August 2003. </li></ul>
  20. 20. To AUDIT your Business <ul><li>Logon to http://www.supply-chain.org.uk </li></ul><ul><li>Click on the SPA Methodology link </li></ul><ul><li>Login to the ht2 site using: </li></ul><ul><ul><li>Username spa** </li></ul></ul><ul><ul><li>Password spa** (Same as your username) </li></ul></ul><ul><li>I will allocate your number </li></ul><ul><li>Complete the survey </li></ul><ul><li>Your results will be emailed to you in early April as a benchmark report </li></ul>ACTIVITY
  21. 21. Congruence in Your Strategic Priorities
  22. 22. Not all aspects of our performance have the same impact: Competitive Benefit Achieved performance qualifying level ORDER-WINNING OBJECTIVES QUALIFYING OBJECTIVES LESS IMPORTANT OBJECTIVES +ve neutral -ve Low High Competitive Benefit Achieved performance +ve neutral -ve Low High Competitive Benefit Achieved performance +ve neutral -ve Low High The Basics
  23. 23. Low High Negative Positive Neutral Achieved Performance Competitive Benefit Time Delights become Order winners and Order winners become Qualifiers Delights Adding Delights Order Winners Order Winners gain more business the better you are Qualifiers Qualifiers are the “givens” of doing business Principle
  24. 24. Delights Order Winners Qualifiers Today Tomorrow Where will you be in the Future? ACTIVITY
  25. 25. Prioritizing Objectives Priorities should be determined by ...... The IMPORTANCE of each competitive objective Your PERFORMANCE in each of the competitive objectives IMPROVEMENT PRIORITIES
  26. 26. A method for identifying our ‘strategic’ operations priorities <ul><li>Identify what is important to customers </li></ul><ul><li>Assess how well we perform </li></ul><ul><li>Relate our performance to customer’s or market requirements </li></ul>
  27. 27. For this product group does this performance objective ...... 9 Point Importance Scale 1 - Provide a crucial advantage with customers 2 - Provide an important advantage with most customers 3 - Provide a useful advantage with most customers ORDER WINNING OBJECTIVES 4 - Need to be up to good industry standard 5 - Need to be around median industry standard 6 - Need to be within close range of the rest of the industry QUALIFYING OBJECTIVES 7 - Not usually important but could become more so in future 8 - Very rarely rate as being important 9 - Never come into consideration LESS IMPORTANT OBJECTIVES
  28. 28. PRICE SERVQUAL (DISN.) SERVQUAL (ORDER TAKE) ENQUIRY LEAD-TIME DROP QUOTE WINDOW QUOTE DELIVERY PERFORMANCE DELIVERY FLEXIBILITY VOLUME FLEXIBILITY 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 X X X X X X X X X IMPORTANCE to Customers DOC. SERVICE X Temperature controlled - Overnight service Example
  29. 29. For this product group is achieved performance ........ 9 Point Performance Scale 1 - Consistently considerably better than our nearest competitor 2 - Consistently clearly better than our nearest competitor 3 - Consistently marginally better than our nearest competitor BETTER THAN COMPETITORS 4 - Often marginally better than most competitors 5 - About the same as most competitors 6 - Often close to main competitors SAME AS COMPETITORS 7 - Usually marginally worse than main competitors 8 - Usually worse than most competitors 9 - Consistently worse than most competitors WORSE THAN COMPETITORS
  30. 30. COST SERVQUAL (DISN.) SERVQUAL (ORDER TAKE) ENQUIRY LEAD-TIME DROP QUOTE WINDOW QUOTE DELIVERY PERFORMANCE DELIVERY FLEXIBILITY VOLUME FLEXIBILITY 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 X X X X X X X X X PERFORMANCE against Competitors DOC. SERVICE X Temperature controlled - Overnight service * * Estimated Example
  31. 31. better than same as worse than less important qualifying order winning 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 Volume Flex X Drop Quote X Delivery X Window Quote X Servqual (DISN) X Doc Service X X Price/Cost Delivery Flex X X Servqual (Order Take) X Enquiry Lead-Time IMPORTANCE FOR CUSTOMERS LOW HIGH Example PERFORMANCE AGAINST COMPETITORS GOOD BAD
  32. 32. Brainstorming <ul><li>Identify and list 10-15 performance imperatives </li></ul><ul><li>Identify what information you have about customer requirements against each of these imperatives </li></ul><ul><li>Identify what information you now need to gather about customer requirements against each of these imperatives </li></ul><ul><li>Identify what information you have about your performance against each of these imperatives </li></ul><ul><li>Identify what information you need to gather about your performance against each of these imperatives </li></ul>ACTIVITY
  33. 33. CUSTOMERS better than same as worse than less important qualifying order winning 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 IMPORTANCE FOR LOW HIGH PERFORMANCE AGAINST COMPETITORS GOOD BAD URGENT ACTION IMPROVE APPROPRIATE EXCESS ?
  34. 34. Why is the Importance/Performance Analysis Relevant? <ul><li>Maximises the impact of efforts </li></ul><ul><li>Minimises wasted efforts </li></ul><ul><li>Directs strategic improvements </li></ul><ul><li>Recognises the underlying dynamic nature of process performance…………... </li></ul>
  35. 35. Summary: The Importance / Performance Matrix <ul><li>A Valuable, high level tool to help focus your efforts: </li></ul><ul><li>The process of constructing the Matrix is a critical element of the approach </li></ul><ul><li>Try to keep it specific </li></ul><ul><li>Use it to: </li></ul><ul><ul><li>To get consensus </li></ul></ul><ul><ul><li>or, to identify disputed criteria </li></ul></ul><ul><li>Revisit regularly (e.g every year; every time a new process, service or product is introduced) </li></ul>
  36. 36. Process Improvement A Guide to Some Valuable Tools, Techniques and Methods Session 2
  37. 37. <ul><li>“In order to control, you must measure” </li></ul><ul><ul><ul><li>Lord Kelvin </li></ul></ul></ul>
  38. 38. Today’s Message! <ul><li>No measurement without recording </li></ul><ul><li>No recording without analysis </li></ul><ul><li>No analysis without action </li></ul><ul><li>No action without learning </li></ul>
  39. 39. Operations Improvement <ul><li>Today’s Key Questions </li></ul><ul><ul><li>Can we do it OK? (Capability) </li></ul></ul><ul><ul><li>Are we doing it OK? (Control) </li></ul></ul><ul><ul><li>Have we done it OK? (Assurance) </li></ul></ul><ul><ul><li>Could we do it better? (Improvement) </li></ul></ul>
  40. 40. Measuring Process Performance <ul><li>What do you do with your performance data? </li></ul><ul><ul><li>Report them? </li></ul></ul><ul><ul><li>Graph them? </li></ul></ul><ul><ul><li>Post them up? </li></ul></ul><ul><ul><li>File them? </li></ul></ul><ul><ul><li>Nothing? </li></ul></ul>ACTIVITY
  41. 41. Time Some measure of operations performance Process control charting Some aspect of the performance of a process is often measured over time Questions Is this OK? - Should I do something? The Basics
  42. 42. Time Some measure of operations performance Process control charting Our tendency is to intervene in the operation of process Question “ How do we know if the variation in process performance is “Natural” in terms of being a result of random causes, or is indicative of some “Assignable” causes in the process?” The Basics
  43. 43. How do you Intervene? <ul><li>Add more resource </li></ul><ul><li>Change behaviour </li></ul><ul><li>Alter some variable </li></ul><ul><li>Introduce an incentive </li></ul><ul><li>Panic! </li></ul>ACTIVITY
  44. 44. 100 90 80 70 60 50 X Now Percentage of deliveries on-time Delivery * performance is 87% Is this good, bad, or indifferent ? * Could be any aspect of performance The Basics
  45. 45. 100 90 80 70 60 50 X Customer expectation = 98% Now Percentage of deliveries on-time Performance against customer expectations is POOR Delivery performance is 87% Is this good, bad, or indifferent ?
  46. 46. 100 90 80 70 60 50 Customer expectation = 98% Now Percentage of deliveries on-time Performance against customer expectations is POOR Historical performance is GOOD Delivery performance is 87% Is this good, bad, or indifferent ? X X X X X X
  47. 47. 100 90 80 70 60 50 X X X X X Customer expectation = 98% Target performance = 95% Now Percentage of deliveries on-time Performance against customer expectations is POOR Historical performance is GOOD Performance against target is POOR Delivery performance is 87% Is this good, bad, or indifferent ? X
  48. 48. 100 90 80 70 60 50 X X X X X X Customer expectation = 98% Target performance = 95% Competitor performance = 81% Now Percentage of deliveries on-time Performance against customer expectations is POOR Historical performance is GOOD Performance against target is POOR Performance against competitors is GOOD Delivery performance is 87% Is this good, bad, or indifferent ?
  49. 49. Time Elapsed time of call Process control charting E.G “The last point plotted on this chart seems to be unusually low.” Is this just random variation - or is it the result of some change in the process which we should investigate? Some kind of “Guide lines” or “Control limits” would be useful The Basics
  50. 50. The Normal Distribution - a simple example The natural variation in processes can be described by a normal distribution 200 206 212 Weight of rice in box (grms) Frequency 200 206 212 Weight of rice in box (grms) Frequency 200 206 212 Weight of rice in box (grms) Frequency 200 206 212 Weight of rice in box (grms) Frequency 200 206 212 Weight of rice in box (grms) Frequency The Basics 200 206 212 Weight of rice in box (grms) Frequency
  51. 51. What defines the shape of the Normal Distribution? <ul><li>Just Two Variables: </li></ul><ul><ul><li>The Mean (or average) - X (‘Xbar’) </li></ul></ul><ul><ul><li>And the Variation of points from the Mean, known as the ‘standard deviation’ (∑ - sigma) </li></ul></ul>_
  52. 52. Process control charting The Basics 40 Mean = 100 160 elapsed time of call (secs) Frequency The “standard deviation” is a measure of the “Spread” or Variation” of a distribution standard deviation = 20 -1 standards deviation -2 standards deviation -3 standards deviation +1 standards deviation +2 standards deviation +3 standards deviation ∑ The Basics X -
  53. 53. Process control charting The Basics 40 100 160 elapsed time of call (secs) Frequency The chances of measurement points deviating from the average is predictable in a normal distribution A standard deviation -1 standards deviation -2 standards deviation -3 standards deviation +1 standards deviation +2 standards deviation +3 standards deviation 68% of points 95.4% of points 99.7% of points +3  -3  ∑ The Basics X -
  54. 54. Using the Normal Distribution to Manage Processes <ul><li>So, we can apply the normal distribution to our observed data chart - but how?: </li></ul><ul><ul><li>1. Collect historical data for an aspect of process performance for, say, the previous six months </li></ul></ul><ul><ul><li>2. Feed it into an MS Excel Spreadsheet </li></ul></ul><ul><ul><li>3. Press the function keys to calculate the standard deviation (STDDEV) </li></ul></ul><ul><ul><li>4. Use it to calculate upper and lower Control Limits </li></ul></ul>
  55. 55. Time Elapsed time of call Process control charting The normal distribution describes random variation when the process is operating normally - we can use the normal distribution to set the Upper and Lower control limits In this case the final point is very likely to be caused by an assignable cause, ie. the process is likely to be out of control (Only 3/1000 observations lie outside of the UCL and LCL) LCL UCL The Basics X -
  56. 56. <ul><li>We can be more sophisticated in terms of using the control charts </li></ul><ul><li>Thanks to the help of Statisticians we can use ‘science-based’ rules……. </li></ul><ul><li>So, in addition to points falling outside the control limits other unlikely sequences of points should be investigated ( i.e we should only intervene when the rules tell us to ) </li></ul>
  57. 57. Process control charting UCL C/L LCL Alternating and erratic behaviour - Investigate Suspiciously average behaviour - Investigate UCL C/L LCL Apparent trend in one direction - investigate UCL C/L LCL UCL C/L LCL Sudden change in level - Investigate The Basics Two points near control limit - Investigate UCL C/L LCL Five points one side of centre line - Investigate LCL C/L UCL
  58. 58. We can use the Normal Distribution when asking “Is my process Six-sigma capable?” <ul><li>First, Identify the tolerance or Service Level Agreement for the process </li></ul><ul><li>Next, using actual data relating to the process variable calculate the +/- 6  range (or 12 standard deviations) </li></ul><ul><li>Use this ratio to calculate your ‘process capability’ </li></ul><ul><li>If this is greater than 1 - process is ‘Six-sigma capable’ </li></ul><ul><li>Less than 1 - process is not ‘Six-sigma capable’ </li></ul>Upper Tolerance - Lower Tolerance 12  (+/- 6  )
  59. 59. So, what’s this Six-Sigma all about? <ul><li>To achieve 6  (or 6  ), a process must produce no more that 3.4 errors per MILLION. </li></ul><ul><ul><li>(In Manufacturing this is described as a ppm (parts per million) error rate.) </li></ul></ul><ul><li>An error means - ‘not to specification’ </li></ul>
  60. 60. Test Your Understanding: Is the process capable? 1: If the SLA range is A? 2: If the SLA. range is B? The Basics Frequency +6  -6  SLA Ranges A B The Basics
  61. 61. How do I achieve Six Sigma <ul><li>You could renegotiate your service level agreement! (it’s a perfectly valid way…) </li></ul><ul><li>You could try to improve the performance of your process </li></ul>ACTIVITY
  62. 62. Building Process Knowledge Stage Term Knowledge Typical form of knowledge 1 Complete ignorance None Nowhere 2 Awareness Vague ideas but not written 3 Measurement Important aspects written 4 Control of mean Documented 5 Process capability Documented with relationships 6 Process characterisation Full cause-effect equations 7 Know why Scientific models 8 Complete knowledge Full
  63. 63. Building Process Knowledge Knowledge at Stage... 1 2 3 4 5 6 7 8 Nature of production Expertise based Procedure based Role of workers Everything Problem solving Learning and improving Location of Knowledge Workers heads Written and oral Databases and software Nature of learning Artistic Natural experiments Controlled experiments Problem solving Trial and error Scientific method Look it up Training Learning by doing Learning before doing Automation Can’t Suitable Ease of transfer Can’t High and simulations
  64. 64. But: How can we drive process improvement?
  65. 65. Traditional Western Perceptions of Job Functions Top Management Middle Management Supervisors Workers Innovation Maintenance Imai 1986
  66. 66. Japanese Perceptions of Job Functions Top Management Middle Management Supervisors Workers Improvement Maintenance Imai 1986
  67. 67. Japanese Perceptions of Job Functions (2) Top Management Middle Management Supervisors Workers KAIZEN Maintenance Imai 1986 Innovation
  68. 68. Innovation... ...Kaizen Short-term, dramatic Large steps Intermittent Abrupt, volatile Few champions Individual ideas & effort Scrap and rebuild New inventions/theories Large investment Low effort Technology Profit Effect Pace Timeframe Change Involvement Approach Mode Spark Capex Maintenance Focus Evaluation Long-term, undramatic Small steps Continuous, incremental Gradual and consistent Everyone Group efforts, systematic Protect and improve Established know-how Low investment Large maintenance effort People Process
  69. 69. Actual performance improvement with continuous improvement Time Performance “ Continuous” improvement Standardize and maintain Improvement
  70. 70. Intended performance improvement with breakthrough improvement Time Performance Breakthrough improvements
  71. 71. Actual performance improvement with breakthrough improvement Time Performance Actual improvement
  72. 72. Session 3
  73. 73. Congruence in Supply Chains
  74. 74. Prisoner’s Dilemma Mr White gets 10 years Mr Orange goes free Mr White Mr Orange Confess Confess Don’t Confess Don’t Confess Mr White gets 3 years Mr Orange gets 3 years Mr White goes free Mr Orange gets 10 years Mr White gets 5 years Mr Orange gets 5 years
  75. 75. Prisoner’s Dilemma Mr White gets 10 years Mr Orange goes free Mr White Mr Orange Confess Confess Don’t Confess Don’t Confess Mr White gets 3 years Mr Orange gets 3 years Mr White goes free Mr Orange gets 10 years Mr White gets 5 years Mr Orange gets 5 years
  76. 76. Prisoner’s Dilemma Mr White gets 10 years Mr Orange goes free Mr White Mr Orange Confess Confess Don’t Confess Don’t Confess Mr White gets 3 years Mr Orange gets 3 years Mr White goes free Mr Orange gets 10 years Mr White gets 5 years Mr Orange gets 5 years
  77. 77. Sotheby’s and Christie’s - the Classic Prisoner’s Dilemma in Practice 20 Years of price fixing over commissions, charges & fees
  78. 78. Sotheby’s and Christie’s - the Classic Prisoner’s Dilemma in Practice Alfred Taubmann - $7.5 m fine, + 1 Yr Europe - £13m fine Christie’s - ‘whistleblowers
  79. 79. Prisoner’s Dilemma Sotheby’s fined £13m, Directors resign & CEO imprisoned Christie’s go scot free Sotheby’s Christie’s Confess Confess Don’t Confess Don’t Confess
  80. 80. A’s perception of its own performance B’s perception of A’s performance B’s perception of its own performance C’s perception of B’s performance A’s perception of B’s requirements B’s perception its own requirements B’s perception of C’s requirements C’s perception of its own requirements Operation A Operation C Market requirements Operations performance Gap? Gap? Gap? Gap? Gap? Gap? Gap? Gap? BT8 Supplier selection strategy Supplier development strategy Operation B
  81. 81. The Impact of Strategic Supply Chain Relationships <ul><li>Nokia experienced rapid growth in mid-late 1990s </li></ul><ul><li>Problems of product obsolescence and innovation </li></ul><ul><li>Recognised the need for a total supply chain solution. </li></ul>
  82. 82. Controlling the supply chain
  83. 83. Supply Strategy - The Benetton Video Case
  84. 84. 1 . What are the strategic imperatives for: Benetton’s retail shops? Benetton’s Distribution? Benetton’s Manufacturing operations? Benetton’s contractor & sub-contractors? 2 . How do these discrete elements of the network complement each other? 3 . What are the differences between a network perspective and a Business Unit perspective? Benetton - Some questions:
  85. 85. Benetton’s supply network spun wool & cotton producers cotton & sheep farmers retail stores suppliers of cotton jeans, velvet etc. Contractors Contractors PONZANO VENETO MONZAMBANO REGGIO EMILIA RESANA CASTRETTE VILLORBA Sub-contractors Agents Agents Agents
  86. 86. Distribution Operations Operational & Strategic Imperatives Across Benetton’s Supply Network: Retail <ul><li>reliable Quality of products </li></ul><ul><li>Timely selection </li></ul><ul><li>high stock turn </li></ul><ul><li>low stock levels </li></ul><ul><li>Attractive shops </li></ul><ul><li>Welcoming Service </li></ul><ul><li>Convenient location </li></ul><ul><li>fast response during season </li></ul><ul><li>efficient logistics </li></ul><ul><li>Dependable timings </li></ul><ul><li>Dependable order pick </li></ul><ul><li>Low cost operation </li></ul><ul><li>stable schedules </li></ul><ul><li>Consistent quality </li></ul><ul><li>Dependable delivery </li></ul><ul><li>Reliable contractors </li></ul><ul><li>Flexible contractor & sub-contractors </li></ul><ul><li>Dye in grey </li></ul><ul><li>Low cost supply </li></ul>
  87. 87. Target markets Marketing Logistics Manufacturing FUNCTIONAL elements of Benetton’s strategy : A Dual System Involving: 1.’ Speculation’ Base plan locked in far in advance Use of Subcontractors Known Schedules Low Cost 2. ‘Postponement’ Dyeing to order Premium transport Fast Response High Cost Central Control over Quality Manager’s ownership of subcontractor firms Dual system of distribution: 1. Conventional approach to the base order 2. Fast response and assured availability for reorder Complex, costly supply logistics, including: Multiple handling Subcontractors High transport costs Channel: controlled channel Small stores Low-inventory, high-inventory turn-over in stores Timely assortment Low margin Liberal trade terms Emphasis on ‘self-service’ Product: good design colourful good value Promotion: Directed to ‘actives’ Store location important Young Adults Fashion conscious Limited budget Active Interested in casual wear
  88. 88. Elements of Benetton’s dual manufacturing strategy for woollen garments : Strategy element proportion of total sales cost lead times basic purpose of strategy manufacturing control quality control ‘ SPECULATION’ ‘ POSTPONEMENT’ 90% 10% LOW (85% OF COMPETITION) HIGH (10% MORE LABOUR & OVERHEAD) ABOUT 6 MONTHS FIVE WEEKS LOW COST, ALLOW FOR USE OF SUBCONTRACTORS AND ASSEMBLY OF COMPLETE ORDERS GOOD SERVICE, FASTER OVERALL INVENTORY TURNOVER BY SUBCONTRACTORS BY BENETTON PLANT MANAGEMENT AT BENETTON WAREHOUSE AT BENETTON WAREHOUSEAND FACTORY
  89. 89. Why Does Benetton’s Supply Chain Strategy Work? <ul><li>Recognises the impact of Demand variation </li></ul><ul><li>Ignores Forecasting Error! </li></ul><ul><li>Minimises inventory risk </li></ul><ul><li>Spreads risk & reward across the network </li></ul><ul><ul><ul><ul><li>But WHY does it work???? </li></ul></ul></ul></ul>
  90. 90. Matching Supply Chains with Products - Marshall Fisher’s Framework
  91. 91. Matching Supply Chains with Products - Marshall Fisher’s Framework
  92. 92. Performance Implication of Supply Chain Alignment
  93. 93. Consequences of lack of Clarity Across Supply Chains
  94. 94. Supply Chain Stock Movements 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
  95. 95. Supply Chain Stock Movements 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
  96. 96. Supply Chain Stock Movements 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
  97. 97. Supply Chain Dynamics - ‘The Bullwhip Effect’ T Market Tier 1 Tier 2 Tier 3 Increasing variation in pattern t1 t1 t1 t1 Q4 Q1 Q2 Q3 T N T
  98. 98. Some definitions <ul><li>‘E-Business’ - the conduct of business transactions, business planning and control, communications and information sharing over a common I.S. platform such as the web. </li></ul><ul><li>‘E-Commerce’ The conduct of business transactions and trading over a common I.S. platform such as the web. </li></ul>
  99. 99. Why focus on Supply Chains? <ul><li>Because the Internet is an Inter-Organisational Communication Channel </li></ul><ul><li>Because E-Business systems are both intra- and inter-organisational </li></ul><ul><li>Because organisations are adopting E-Business to manage within and across supply chains </li></ul>
  100. 100. Three Main areas of E-Business Activity Marketplaces - for trading Knowledge sharing e.g. product development, customer strategies Supply Chain Collaboration/ synchronisation
  101. 101. Starting with the Customer’s Requirement select requisition approve status receive <ul><li>The objective is to automate the ENTIRE supply chain from product and service selection through receipt. </li></ul><ul><li>Using solutions that offer real-time interactivity with trading partners and customers worldwide </li></ul>
  102. 103. Hottest Segment of B-to-B eCommerce? Indirect 36% Direct 28% Taxes 13% HR 17% Profit 6% CEO View <ul><li>Over 1/3 of cost to business </li></ul><ul><li>60% for service business </li></ul><ul><li>Clear Target! </li></ul>Source: CAPS (Center for Advanced Purchasing Studies) Tempe, AZ, USA Division of Corporate Dollar Typical Manufacturer
  103. 104. Translate Costs into Profits ! <ul><li>3% reduction in indirect cost equals 50% increase in Profit </li></ul>Indirect 33% Direct 28% Taxes 13% HR 17% Profit 9% Typical Manufacturer Source: CAPS (Center for Advanced Purchasing Studies) Tempe, AZ, USA CEO View Division of Corporate Dollars
  104. 105. Indirect Cost Reduction Targets Source: National Association of Purchasing Managers . What You Pay for Goods & Services Division of Corporate Pounds Cost of Goods Processing Employee Touch Inventory Inter-Business Communication & Document Exchange Carrying Costs Internal procedures
  105. 106. 5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
  106. 107. Supply Chain e Business models <ul><li>EDI </li></ul><ul><li>High speed complex data transmission to core customers & suppliers </li></ul><ul><li>Static publishing, email </li></ul><ul><li>Catalogues & information to users </li></ul>1998-2001 Wave 1 - Emphasis on Promoting to Customers
  107. 108. 5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
  108. 109. <ul><li>Seller-side or buyer-side system connects with existing transaction systems </li></ul><ul><li>Sales Order Systems - Web-based order taking </li></ul><ul><li>Electronic Funds Transfer via BACS system </li></ul>2000-3 Wave 2 - Emphasis on Transaction Systems Supply Chain e Business models
  109. 110. <ul><li>Public Web </li></ul><ul><li>Each Seller offers products at list price </li></ul><ul><li>Exchange </li></ul><ul><li>Commodity Trading Venue (Auction) </li></ul><ul><li>Market Place </li></ul><ul><li>Independent Org provides access to many suppliers </li></ul><ul><li>Company Hub </li></ul><ul><li>Individual Companies manage multiple supplier Contracts </li></ul>Ad hoc Negotiated Buyer Buyer Buyer Buyer Supplier Buyer Exchange Venue Commodity Market Suppliers <ul><li>Seller Extranet </li></ul><ul><li>Seller access to pre-neg products and services </li></ul>Supplier Suppliers How transactions may be executed
  110. 111. How E-Business Can Impact on your Demand
  111. 112. Demand Profiles? Cyclical Stable Volatile
  112. 113. A major phenomenon: electronic auctions <ul><li>Streamlines strategic and off—contract buying </li></ul><ul><li>Leverages dynamic, Internet-based pricing </li></ul><ul><li>Dramatically lowers Cost of Goods </li></ul><ul><li>A large channel to new buyers </li></ul><ul><li>Cost effective method to liquidate inventory </li></ul><ul><li>More revenue from existing customers </li></ul>Reverse Auctions for Buyers Auctions for Suppliers Auctions May Benefit Buyers and Suppliers
  113. 114. 5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
  114. 115. <ul><li>E-Procurement system integrates with enterprise control systems </li></ul><ul><li>CRM system integrating across the organisation </li></ul><ul><li>ERP system implementation </li></ul>2002/5 Wave 3 - Emphasis on Interfacing with Supply Chain Supply Chain e Business models
  115. 116. 5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
  116. 117. <ul><li>Extended enterprise solution - integrating marketplaces, portals and auctions </li></ul><ul><li>Procurement and Sales via an E-Portfolio </li></ul><ul><li>‘ Middleware’ adoption to integrate legacy systems </li></ul>2003/12 Wave 4 - Emphasis on Coordination across the Supply Chain Supply Chain e Business models
  117. 118. Emerging industry portals = many examples Global Supply Chain worth $178000bn Auto Industry Example Covisint $200bn
  118. 119. 5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
  119. 120. <ul><li>Integrated CAD/CAM/CSCM </li></ul><ul><li>Tracking, Global Positioning as integral part of E-Fulfilment systems </li></ul><ul><li>Supply chain positioning a key strategic issue </li></ul>2002/10 Wave 5 - Emphasis on Integrating the Supply Chain Supply Chain e Business models
  120. 121. 5 1 2 3 4 E-Business In the Supply Chain - Five Phases of Evolution
  121. 122. E-Business project Critical Success Factors <ul><li>If you can’t support the business case, then start again </li></ul><ul><li>E-strategy must be seen as Cross-functional </li></ul><ul><li>Based on Business first, ‘e’ second </li></ul><ul><li>Clear E-Strategy project structure </li></ul><ul><li>Technology experts in a key project role </li></ul><ul><li>E-strategies identify new channels to customers - do you want them? </li></ul>
  122. 123. E-Business project Critical Success Factors - 2 <ul><li>What have customers said about CRM and E-Business? </li></ul><ul><li>What are the implications of CRM for existing processes, strategies and organisation? </li></ul><ul><li>What are the skills needed? </li></ul><ul><li>Where are the development needs? </li></ul><ul><li>Be prepared to spend 75% of time presenting internally to CRM teams,sales and others. </li></ul>
  123. 124. E-Business project Critical Success Factors - 3 <ul><li>Integration with operations and logistics </li></ul><ul><li>Logistics channel design MUST be an integral element of CRM strategy implementation </li></ul><ul><li>Understand the impact of E-Business on demand profiles </li></ul><ul><li>What are the implications for relationships with existing channels. </li></ul><ul><li>Identify the portfolio: Which products/services/customers via which channel? </li></ul>
  124. 125. Technology Policy & Processes People Program Manage- ment Critical Elements of E-Business Strategies
  125. 126. It’s not about technology...
  126. 127. … .but new ways of doing business
  127. 128. Remember To AUDIT your Business! <ul><li>Logon to http://www.supply-chain.org.uk </li></ul><ul><li>Click on the SPA Methodology link </li></ul><ul><li>Login to the ht2 site using: </li></ul><ul><ul><li>Username spa** </li></ul></ul><ul><ul><li>Password spa** (Same as your username) </li></ul></ul><ul><li>I will allocate your number </li></ul><ul><li>Complete the survey </li></ul><ul><li>Your results will be emailed to you in early April as a benchmark report </li></ul><ul><li>My email: Simon.croom@wbs.ac.uk </li></ul>
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