Sales & Operations Planning Amsterdam 2012

1. S&OPprocess in practice
19 October2012, Supply Chain

2. 2 S&OP at Sky Germany 19 October
Agenda
1 General information on Sky Deutschland
2 Sky Supply Chain
3 Receiver Procurement
4 S&OP Process at Sky
5 Case Study – Avoidance of stock out
6 Lessons learned

3. 3 S&OP at Sky Germany 19 October
Agenda
1 General information on Sky Deutschland
2 Sky Supply Chain
3 Receiver Procurement
4 S&OP Process at Sky
5 Case Study – Avoidance of stock out
6 Lessons learned

4. 4 S&OP at Sky Germany 19 October
Sky Germany is the Pay TV leader in Germany & Austria
• 3,132m subscribers (Q2 2012)
• Exclusive broadcasting rights: live football, live sports, films and
the best entertainment
• More than 70 channels
• Market-leading HDoffering with 58 HDchannels, expanding to
more than 60 in 2012
• Differentiation through innovation: Sky+, Sky Go, Sky Anytime,
Sky Guide, Sky 3D
• Sky content available via satellite, cable, internet and mobile
devices with access to almost every household in Germany and
Austria
1

5. 5 S&OP at Sky Germany 19 October
Sky is constantly growing with a 1st
positive Ebitda in Q2 20121
294,0 303,6
282,2
Q2 2012
299,7
Q2 2009 Q2 2011Q2 2010
-47,4
Q2 2011Q2 2010
23,0
-23,4
Q2 2009
-63,4
Q2 2012
Q2 2012
326,7
Q2 2011
276,3
Q2 2010
235,8
Q2 2009
230,6
Revenues in
€m
Costs in €m
Ebitda in €m

6. 6 S&OP at Sky Germany 19 October
Sky customer base is constantly increasing based on accelerating
Sky+ levels and decreasing churn rates from 21 % to currently 10 %1
40
0
5
10
15
20600
500
400
300
200
100
0
Q2 12
584
Q2 11
116
Q2 10
5
Q2 09
19
109
16
21
0
5
10
15
20
2525
20
15
10
5
0
Q2 12
12
Q2 11
12
Q2 10
20
Q2 09
22
Sky+ Customerin kSky+ penetration in %
Churn rate in kChurn rate in %
Customer
base in k
Q2 12
3.132
Q2 11
2.759
Q2 10
2.476
Q2 09
2.364

7. 7 S&OP at Sky Germany 19 October
Agenda
1 General information on Sky Deutschland
2 Sky Supply Chain
3 Receiver Procurement
4 S&OP Process at Sky
5 Case Study – Avoidance of stock out
6 Lessons learned

8. 8 S&OP at Sky Germany 19 October
The Sky Supply Chain responsibilities are built on the SCOR process
Text
PLAN &
CONTROL
SOURCE MAKE DELIVER
RETURN &
REPAIRENABLE &
MONITOR
SERVICE
Process & IT unit
focusing on all
hardware related
processes
2

9. 9 S&OP at Sky Germany 19 October
Supply Chain Organization with strong focus on SCOR process
Supply Chain
Supply Chain
Management
Supply Chain
Services
Field Service
Strategic
Sourcing
Supply & Demand
Management
3rd
Party
Management
Performance
Management
S & OP
Budget & Cost
Management
Material
Planning
Material
Planning
2
S & OP
Budget & Cost
Management

10. 10 S&OP at Sky Germany 19 October
Agenda
1 General information on Sky Deutschland
2 Sky Supply Chain
3 ReceiverProcurement
4 S&OP Process at Sky
5 Case Study – Avoidance of stock out
6 Lessons learned

11. 11 S&OP at Sky Germany 19 October
Sky is currently buying three different hardware types
HD Standard
Zapper Box
External hard drive for
Premium Sky+ Product
HD Zapper Box with
internal hard drive for
Premium Sky+ Product
3

12. 12 S&OP at Sky Germany 19 October
Sky provides two different product types
HD standard
product
Premium Sky+ Product
3

13. 13 S&OP at Sky Germany 19 October
Sky is buying standard receiver on dual sourcing strategy, but premium
Sky+ product on single sourcing
separated into
external HDD &
receiver with internal
in ‘000
3
Standard Zapper 398
228
391
Total devices
PremiumSky+
789
424196
822 391 1.213
Supplier1 Supplier2

14. 14 S&OP at Sky Germany 19 October
Sky is buying all his hardware from 2 supplier in Asia with a 28 weeks
leadtime
3
Supplier 2
Supplier 1

15. 15 S&OP at Sky Germany 19 October
Agenda
1 General information on Sky Deutschland
2 Sky Supply Chain
3 Receiver Procurement
4 S&OPProcess at Sky
5 Case Study – Avoidance of stock out
6 Lessons learned

16. 16 S&OP at Sky Germany 19 October
Sky shipped in 2011 more than 1.2 million receiver to customers.
Nearly 50% of receiver shipments in 2011 are related to existing
customers
2
255345
666Sales
CRM
176490
600
Total Needs 1.266835 431
Standard Zapper Sky+
‘000

17. 17 S&OP at Sky Germany 19 October
Sky is buying more than 1.3m receivers. More than 10% of our needs
are provided by repair process (customer returns)2
131 21
Deliveries 1.225801 424
Total Inbound
OK Receiver
1.377932 445
Repair 152
Standard Zapper Sky+
‘000

18. 18 S&OP at Sky Germany 19 October
Operational Planning @Sky happens daily on a weekly basis with input
of internal & external partners2
Input Sales
•Daily adjustments
•Weekly periods
Input CRM
•Daily adjustments
•Weekly periods
12 month RFC
Reach
planning
Input Supplier
•Delivery issues
•Airfreight/ Sea freight
Input Finance
• Cash phasing
• Capex/ Opex FC
Input Supply Chain
•Swaps/ Returns
•Warehouse capacity
Input Technology
• Software Updates
• Defect reasons

19. 19 S&OP at Sky Germany 19 October
Logistics Jour
Fixe
Operational
S&OP
Tactical S&OP
Strategic S&OP
The monthly S&OP process @ Sky includes every management level & plann
horizon
Planning horizon
Focus on
Org level
Timeline
1 – 10 weeks 3 – 8 months 3 – 8 months 3 – 18 months
Short-termplanning Mid-termalignment
- Review of mid-termplans
- Cash & STBinbound
plans
- Purchasing req.
- Product roadmap
- Strategic initiatives
- Cash & STBinbound
plans
- Purchasing plans
Operational Head of /Director Director/VP SVP/Board
1st CW/monthBi-weekly 2nd CW/month 3rd CW/month
Information – Guidance – Decisions
Current Plans – Information Requests – Decision Proposals
Participants
- Sales D/AT
- CRM
- Technology
- Controlling /Accounting
- Supply Chain
- Sales D/AT
- CRM
- Controlling /Accounting
- Supply Chain
- Sales D/AT
- CRM
- Controlling
- Business Planning (tbd)
- Supply Chain
- CFO
- CEO(as needed)
- CustomerGroup
- Products & Operations
- Controlling /Treasury
- Technology
- Supply Chain
2

20. 20 S&OP at Sky Germany 19 October
Actual
vs.
Budget
Absolute
volumes
(in k STB)
Delta
volumes
(in k STB)
Delta
percentage
Year to Date as of Dec
2011
Comment:
• Reduction of HD-
Share due to the
change of Promotions
starting Q3 (main
focus on Sky+)
Actual
vs.
Forecast
2
Absolute
volumes
(in k STB)
Delta
volumes
(in k STB)
Delta
percentage
Year to Date as of Dec
2011
Comment:
•…
40
30
20
10
34.5
19.119.7
16.7
11.9
15.0
29.7
18.219.2
33.6
14.6
17.117.8
16.1
7.1
12.7
9.6
14.0
21.4
17.8
20.9
18.619.7
21.1
36.1
19.7
18.9
11.9
10.8
29.7
19.919.2
37.2
14.6
17.2
40
30
20
10
34.5
17.817.8
7.17.1
9.69.6
21.421.420.920.919.719.7
226.1 +3%
(+6.0)
+3%
(+6.0)
Actual/RFCBudget
220.0
-7% 13% 20% -32% -44% 10% -15% -43% 64% -21% 18% 80%
15
10
5
0
-5
-10
Dec
15.4
Nov
3.0
Oct
-3.1
11.6
Aug
-14.4
Jul
-2.5
Jun
1.7
May
-5.6
Apr
-4.5
Mar
3.5
Feb
2.3
Jan
-1.4
Sep
0% 0% 0% 0% 0% 0% -15% -48% 49% 10% 5% -4%
5
0
-5
-10
-15
Dec
-1.6
Nov
0.8
Oct
1.1
SepAug
-18.0
Jul
-2.6
Jun
0.0
May
0.0
Apr
0.0
Mar
0.0
Feb
0.0
Jan
0.0
9.8
226.1 -4%
(-10.3)
Actual/RFCFC2
236.4
Legend:
Actual shipments (Jan-Dec 2011)
Budget as of CW 01-2011
Forecast 2 as of CW 26-2011
Supply chain provides detailed accuracy analysis to Sales & CRM
2

21. 21 S&OP at Sky Germany 19 October
Agenda
1 General information on Sky Deutschland
2 Sky Supply Chain
3 Receiver Procurement
4 S&OP Process at Sky
5 Case Study – Avoidance of stockout
6 Lessons learned

22. 22 S&OP at Sky Germany 19 October
The stock forecast of the Sky+ product mid of 2011 shows an uncritical
situation with regard on the half year leadtime5
200
150
100
50
0
-50
-100
65
7683
92
106115
130
160154
123
134134137
Jul-12Jan-12Jul-11
Security
Buffer
‘000

23. 23 S&OP at Sky Germany 19 October
The stock forecast of the Sky+ product beginning of 2012 shows fire
fighting has to be started
200
150
100
50
0
-50
-100
65
7683
92
106115
130
160154
123
134134137
5
Security
Buffer
106
125
137
200
150
100
50
0
-50
-100
-98
-52
-19
-1
32
43
51
154
130
111
Jan-12 Jul-12Jul-11
Security
Buffer
‘000

24. 24 S&OP at Sky Germany 19 October
S&OP provides no guarantee for a better forecast accuracy
20
25
15
10
5
0
Jul
12
Jan
12
Jul
11
Actual
Forecast July 2011
+162.000
(+84%)
354.000
192.000
10
5
0
Jul
12
20
15
25
Jan
12
Jul
11
Actual
Forecast
155.000
+55.000
(+35%)
Actual
210.000
Forecast
5
CRM Forecast vs. Actual in
‘000
Sales Forecast vs. Actual in
‘000
Σ
+217.000
+62%
‘000

25. 25 S&OP at Sky Germany 19 October
Production stop at Western Digital, the main supplier of our supplier5

26. 26 S&OP at Sky Germany 19 October
Stock out could be avoided without big impacts on Sky business
41
31
42
73
Jun-12
0
20
40
60
80
100
120
140
160
Jan-12
5154
154
130
111
106
125
Jul-11
139
5
‘000
Security
Buffer

27. 27 S&OP at Sky Germany 19 October
S&OP measures covered Sky demand in 1st
HY 20125
Internal measures

Safety stock end of 2011 gave us time to
set up a dedicated team to evaluate several
options to act

Postpone CRM campaigns

No discount campaigns from sales for 1st HY Set up of task force with Sky Technology &

Daily stock & deviation analysis
External measures

Direct contact with all HDD suppliers to get
complete overview of the current and future
supply situation

Daily status updates from suppliers

Continuous screening current market
situation and Thai Flood Impact
Direct relationship to HDD sub suppliers made it
possible to get drives available
in short term
Moderate Sales & CRM adjustments
saved the business plan & stock
No stock out

28. 28 S&OP at Sky Germany 19 October
Agenda
1 General information on Sky Deutschland
2 Sky Supply Chain
3 Receiver Procurement
4 S&OP Process at Sky
5 Case Study – Avoidance of stock out
6 Lessons learned

29. 29 S&OP at Sky Germany 19 October
Lessons learned
• Start of dual sourcing strategy for external hard drives end of
2011
- Awareness of dual sourcing strategy mid of 2011
- First 100k EHDD from 2nd
Supplier ordered
• Implementation of CPFR process with receiver supplier
- bi-weekly conference calls/ meetings
- Video conferences with Humax
- Providing 12 month forecasts to all supplier
- more delivery flexibility for confirmed orders
- quarterly business revues
• Further improvement of S&OP process
- Providing better deviation analysis S&OP participants
- Providing deliver transparency to Sales & CRM
- Stronger engagement of board members
- Not only budget, but common sense
• Better understanding our suppliers Supply Chain
- Tear down process
- Know the subcontractors and their lead times
• Implementation S&OP Software planned
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30. Any Questions ?