GCL GROUP Logistics Consulting www.gclgroup.com Traceability Reac tivity Control Effec tiveness Knowledge Globalisation
GCL GROUP Logistics Consulting• Traceability • Reactivity • Control • Effectiveness • Knowledge • Globalisation • Trends CONTROL The nature of competition differs in all sectors. Direct competition between businesses leaves room for research on how to best manage infor- Overview of mation fluctuations all along the supply chain. The increasing refinement of supply chain soft- important trends ware technologies offers the possibility of improving integration and productivity. The more integration, the higher the client satisfaction, the shorter the total duration of the cycle, and Economic borders are crumbling, trade is skyrocketing, information is being transferred at the the less errors. In many cases it also allows us to speed of light, everywhere you look things are changing drastically. To stay ahead of the game, many realize savings whilst maintaining absolute con- organizations are reviewing and revamping their entire Supply Chain. It is no longer enough to trol over commercial activities and logistics. make a quality product and sell it at a competitive price. Today, you have to go beyond what cus- tomers expect. You have to do more with less. And faster than ever before. EFFECTIVENESS Market globalization and the advent of e-com- Many new demands are being made with regards to rationalization and productivity, custom merce have transformed the nature and struc- manufacturing and the production of smaller lots, just-in-time delivery, improved customer service ture of logistics functions. The best distribution combined with lower costs, etc. system wins the game. Given the speed at which technology is changing, businesses must period- From raw materials to finished products, the problem is almost always the same: how to opti- ically renew their equipment and software in mize the movement of products and reduce processing time to meet customer demands more effi- order to remain competitive. They absolutely ciently. must remain on the cutting edge of technology to be able to consolidate the various supply Creating shareholder value through increased net profits and better capital cost allocation is chain components and accelerate the flow of part of our daily challenges as we provide our clients with solutions to improve efficiency, reduce information. order management costs or improve asset utilisation. GCL Group’s sophisticated analysis and man- agement techniques can help your company eliminate processes throughout your supply chain KNOWLEDGE which have no added value for your customers. Logistics sector contributors and suppliers of logistics services must have a vast knowledge of TRACEABILITY transportation, warehousing and international Real time information becomes imperative for businesses concerned with improving efficiency goods transportation regulations with which while optimizing customer service levels. Today’s consumer demands a wider range of products, they must comply. Governments modify their requiring complete traceability on delivered goods. Integrating partners in the development and regulation and compliance procedures and these manufacture of the products requires operational precision indicating the origin, the transforma- changes influence logistics activities. tion, the component assembly and subset composition. The information and its availability on Logisticians must therefore adapt rapidly to new shared technological platforms becomes essential in following products along the supply chain. environments. Transport services deregulation Information standardization and the introduction of electronic microchips containing information and technological progress have brought on an unique to the product will grant businesses absolute control and security while pursuing optimum improvement in logistical systems and growth in profitability. productivity. REACTIVITY GLOBALIZATION The technological revolution and the Internet are changing the structure of baseline sales Logisticians must know and understand interna- costs, purchasing, the supply chain and distribution channels. The classic obstacles of time and tional systems of trade and logistics as well as infrastructure that once closed this sector to certain businesses hold less and less importance. What overseas regulation systems and ethical codes. counts today is speed of execution rather than size. The Internet allows numerous enterprises to They must also possess linguistic competencies integrate within virtual collaboration networks linking manufacturers, clients, brokers, agents, dis- and cultural awareness in order to successfully tributors, suppliers and wholesalers, for the ultimate advantage of the end user. The networks make deal with worldwide partners within the supply it possible to raise customer service levels, productivity and financial profitability while reducing the chain. Similarly, they must be expert users of total length of the cycle, repairs and returns. technology and be capable of formulating strategies that allow them to draw a competitive advantage from technology.
GCL GROUP Logistics Consulting• Traceability • Reactivity • Control • Effectiveness • Knowledge • Globalisation • Supply Chain Presentation of a real-life corporate case: Optimal Integration Spare parts of the Supply Chain - Aeronautics Our client is a world leader in the design, provision and manufacture of innovative aeronautic products and services destined for the regional and commercial In a global market, it is crucial to distinguish oneself from the competition; more and more, aircraft markets. The company has a global customers are basing their choices on customer service over cost and quality. Supply chain presence and is renowned for the quality of management provides them with this tool for competitiveness. Company directors with foresight have realized that supply chain management affords them an overview of their business affairs its products and its constant devotion to which guides them in strategic decisions and helps them to identify client-related problems. The developing aircraft on the cutting edge of supply chain is the backbone of the business. It consists of a process that links all physical activities technology. Today, its active fleet includes from purchasing and manufacture to distribution and customer service. several thousand aircraft and thus requires a first-rate post-sales support infrastructure. All these elements must be managed in concert. Good practices involve balancing and Over the years, the expansion of the distri- managing compromises. Cost reduction in one sector can increase costs in another. Reducing the bution centre network across the world was number of warehouses for example, can lead to a rise in transportation costs and have an impact on customer service if not adequately managed. Satisfying client demands can only be achieved thanks conducted in a decentralized manner, a to a structured cost management process. Today’s shareholders exert constant pressure on method no longer valid to meet today’s businesses to reduce operation costs while offering better service levels. challenges. SUPPLY CHAIN OPTIMIZATION IS GOVERNED BY THE FOLLOWING PRINCIPLES: In the framework of a project centring on the continuous improvement of our Chain-wide performance measures: Implementing channel-spanning performance indicators. client’s logistics operations, GCL Group was Measuring order fulfilment and customer profitability between partners; involved in a strategic analysis of the Customized logistics network: Implementation of a logistics network to serve specific customer distribution network in place to serve segments, requirements and geographical regions. Client segmentation and analysis of individual existing and future clients. GCL Group profitability, adaptation of a strategy to balance service with profitability; carried out a strategic study targeting a complete reconfiguration of the spare parts Activity-based costing: Precise process mapping of logistics operations. Identification of cost distribution network across the world. From and resource drivers. Business modelling, benchmarking of model. Development of decision models to perform product costing, client costing and sensitivity analysis; the customer service process to the review of business partnerships, the project team Collaborative forecast planning: Integration of planning processes through the entire supply strategically revised its methods and chain. Sharing of sales and forecasting information through initiatives like Vendor Managed practices in order to improve the Inventory. Challenging the current manufacturing and transformation locations to reduce the availability of its spare parts and demand variation sensitivity. Postponement of the ultimate transformation point in the supply consequently better its customer service chain; performance. To do this, we evaluated Strategic sourcing: Performing ‘make or buy’ analysis of non-core activities. Development of service levels and delivery times, performed partnerships with principal suppliers. Supply models, analysis of purchasing policies, algorithms, analysis of activity-based costing (ABC forecasting and demand methods; Costing), and completely modelled the spare parts distribution network backed by an Purchasing practices: Analysis of demand pattern and suppliers’ practices to minimize product analysis of client segmentation. We used handling. Implementation of drop-shipment practices and ordering quantity re-evaluation. simulation tools to support our Implementation of total cost practices to incorporate warehousing costs into volume deals. recommendations. Finally, our recommenda- Establishment of supplier performance program; tions led to the outsourcing of operations Integrated technology: Recognizing that information required to enhance the supply chain and the strategic deployment of inventory in resides outside the company. Facilitating data exchange through e-commerce. the service centres in order to optimize global coverage and amortize the company’s assets.
GCL GROUP Logistics Consulting• Tr a c e a b i l i t y • R e a c t i v i t y • C o n t r o l • E f f e c t i v e n e s s • Transportation and NetworkPresentation of a real-life corporate case: Public utility High-performance - Electricity Strategic Configuration of Our client is an important producer, carrier and distributor of electricity in North the Distribution Network America, building infrastructures for elec- tricity production and transportation, and Effective Organization exploring other sources of energy. Created in 1944 by the Quebec government, its sole and Execution of Transportation shareholder, the company supplies electrici- ty to more than 3.5 million customers in Quebec. It also contributes its expertise for The impact of new regulations, the rise in operational costs and the pressure of financial per- the benefit of its clients all over the world formance lead companies to re-evaluate their distribution methods. From the supply of raw mate- and, backed by a team of seasoned experts, rials to the delivery of the finished product, organizations’ transportation and distribution networks are more and more being considered an important part of the total logistics cost. The control and offers a broad variety of services in the ener- optimization of transportation and distribution operations allow companies to remain competitive. gy sector. Visionary leaders have realized that optimal configuration of their logistics network enables them to remain highly reactive, which guides them in their strategic decision-making process, and assists with identifying problems or responding to customer issues. The configuration of the distribution Within the framework of a project network, along with the optimization of the transportation process, is indisputably the most impor- focusing on Continued Improvement of tant factor influencing the logistics performance of an organization. Logistics Operations, GCL Group was All these elements must be integrated and managed skilfully. Good practices require proper involved in a series of projects to complete- balancing and managing tradeoffs. The reduction in costs in one sector of activity can increase costs ly revise the company’s distribution network. in another. The reduction in transit times, for example, can lead to the increase of transportation Using GCL Group’s extremely powerful mod- costs and have an impact on customer service if not managed adequately. eling tools; we began by modeling the com- THE FOLLOWING PRINCIPLES GOVERN THE OPTIMIZATION OF THE DISTRIBUTION AND TRANSPORTATION NETWORK: pany’s network and then used the model to Strategic Assessment of Distribution Networks: Optimization of manufacturing centre formulate various scenarios for network positioning, optimization of distribution centre roles and positioning. Assessment and effect of optimization. We thus studied concepts of transportation methods, simulation of distribution networks. Selection of optimal algorithms to site specialization, variation in delivery fre- reduce operational costs while optimizing the level of customer service; quencies, modification of storage policies Network Inventory Deployment: Analysis of inventory control practices, review of performance and others factors in order to define an opti- and inventory coverage, segmentation and specialization of distribution centres, simulation of mal solution. The network model, backed by service levels. Recommendation to improve responsiveness to customer’s requirements and reduce logistics costs; a detailed economic analysis, allowed us to recommend consolidation of the network Assessment of Transportation Strategies: Organize transportation (roles and responsibilities), into two principal sites, specialization of assessment of optimization tools, transportation procedure deployment, transportation capacity optimization, minimizing empty loads. Development of reverse logistics optimization strategies, stores, development of a concept of satellite establishing performance indicators and follow-up of transportation operations; warehouses of various sizes and optimiza- tion pole yards. The recommended scenario Optimization of Private Delivery Fleet: Optimization of delivery routes using simulation software. Selection of optimal algorithms to reduce travelling, costs and working hours while is currently in the process of being imple- minimizing the number of routes; mented and should generate substantial savings for the company. Assessment of Transportation Practices: Analysis of transportation practices (carrier selection, rate, and frequency). Recommendations to improve responsiveness to customers’ requirements and reduce transportation costs.
GCL GROUP Logistics Consulting• Tr a c e a b i l i t y • R e a c t i v i t y • C o n t r o l • E f f e c t i v e n e s s • K n o w l e d g e • G l o b a l i s a t i o n • Logistics Precise and Effective Logistics Execution The importance and strategic role of the logistics function, is a source Customer Service: Analysis of customer service organization and its role of constant concern for world class organizations. This forces companies to within the company. Evaluation of procedures, recommendations, and constantly re-evaluate their productivity level, their use of assets and their implementation of key performance indicators; level of understanding regarding their overall operations. The optimization of logistics operations combined with performance re-evaluation allows Inventory Diagnosis and Strategy: Diagnosis of inventory practices, logisticians to remain competitive. Visionary company directors have real- systems and control mechanisms. Analysis of inventory levels, rotation, ized that keeping their logistics activities on the cutting edge of technolo- excess and obsolete stock. Analysis of storage strategies and product gy enables them to remain highly reactive and integrated, guides them in positioning related to overall inventory velocity. Analysis of inventory control their strategic decision-making process and helps them to identify prob- practices. Recommendation on control systems to reduce discrepancies, lems and respond to customer needs. Logistics efficiency gives companies a variations and inventory losses. Development of procedures to ensure leading edge and position from which they can better meet increasing cus- proper inventory control. Audit of operations to ensure application of tomer demands. It consists of a combination of activities that revolve inventory control procedures; around the distribution centre including inventory management, labour efficiency, financial performance and operational flexibility. Facility Design and Optimization: Analysis of current operations, capaci- ty, stock levels, transactions, working procedures and productivity. All these activities must be integrated and organized in order to offer a Definition of design parameters. Development of applicable technologies reactive, secure, complete service while minimizing operational expenses. and operational constraints scenarios. Recommendation of an optimal solu- Good practices equal proper balance and management of compromises. tion based on cost/benefits analysis. Optimization of operations based on Cost reduction in one sector can cause an increase in another. Inventory available locations, storage and material handling equipment. Utilization of level reduction, for example, can ultimately lead to deterioration in cus- state-of-the-art technologies to support industry trends. Optimization of tomer service, if not managed adequately. In the same way, an inefficient product positioning to reduce travelling and increase productivity; operation can have a negative impact on a company’s commercial efforts. Development of operational standards: Detailed analysis of working THE FOLLOWING PRINCIPLES GOVERN THE OPTIMIZATION OF LOGISTICS OPERATIONS: methods and processes. Development of time standards for each specific activity based on engineering methods. Benchmarking of standards with Organizational Analysis: Assessment of organizational structure and world class industries; interrelation of departments. Review of organizational issues (power strug- gles, irritants and communication problems). Brainstorming with employees Support and Concept Implementation: Establishment of proposed to establish cause-effect diagrams; concepts following an operational analysis. Supplier and project manager selection, contingency plan and product removal; Operational diagnosis: Conduct short initial study to provide clients with an outside evaluation of their operation. Implementation of the logistics Reverse logistics: Introduction to reverse logistics flows. Implementation function in the company. Audit established working methods. Recommend of returnable containers throughout the supply chain. Management of cores and document new processes; and returns. Presentation of a real-life corporate case: Chemical logistics operations for the Toronto region, GCL options and recommendations for the company’s man- Group was involved in a series of projects comprising: agement committees. Our client is one of the biggest producers and the diagnosis of overall logistics performance, the distributors of chemical and related products world- development of short-term recommendations, provid- GCL Group was also contracted to implement the wide. The company, strongly diversified, possesses ing guidelines for performing an intensive exercise in recommendations. In particular, the development of installations across the world. It is renowned for the order to estimate future sales, product lines, order guidelines for acquiring equipment, selecting quality of its products, its research and development profile, inventory turnover, assistance in the establish- suppliers, developing an implementation schedule, as well as its environmental consciousness. ment of design criteria, developing scenarios for opti- supervising the installation of new equipment and last mizing productivity, space utilization and increased but not least performing a full post-implementation Within the scope of this project to reorganize inventory control, a financial analysis of the developed audit.
GCL GROUP Logistics Consulting• Tr a c e a b i l i t y • R e a c t i v i t y • C o n t r o l • E f f e c t i v e n e s s • Logistics Information SystemsPresentation of a real-life corporate case: Pharmaceutical Integration of Logistics Our client is the world’s leading Information Systems pharmaceutical company, with its head office in New York. Its mission is to discover and to develop medicines and other Minimizing Risk innovative products to improve the quality of life for human beings and animals. In June of 2000, our client acquired More and more organizations recognize the need for establishing a permanent logistics Warner-Lambert and became the number function to improve their customer service. Along with this recognition, managers realize the one pharmaceutical company in the world. complexity of the issues and discover that logistics information management is at the centre of On April 14th, 2003, by concluding the logisticians’ concerns. Information management is essential when undertaking customer service acquisition of Pharmacia, it became one of improvement through better product availability or personalized delivery. In all cases information the most important global companies for market capitalization and strengthened its will be at the centre of each decision. Consequently, business leaders today work together to set up dominant position on the principal pharma- IT tools for capturing and managing information. ceutical markets. There are usually three main avenues logisticians can take to manage distribution centres: The combined revenue of products and firstly the internal development and adaptation of IT solutions with new desired features; secondly operations reached 45 billion USD in 2002. there is the integrated software (ERP) approach which will offer a very integrated but limited func- In 2003, the company dedicated tional coverage; and finally the integration of specialized software packages. The optimization of approximately 7 billion USD to research and development worldwide, more than any integrated logistics processes generates considerable savings. These savings cannot however be other pharmaceutical company. achieved without appropriate management of information, resources and costs. The popularity of logistical information systems has grown in recent years in order to meet the requirements of Due to the significant increase in logis- today’s logistics managers. Analyzing and setting up the available systems can sometimes prove to tics flows following the integration of be a difficult task. Warner Lambert, the company in question decided to put in place a warehouse man- OUR OFFERING FOR INTEGRATION OF LOGISTICS INFORMATION SYSTEMS IS GOVERNED BY THE FOLLOWING PRINCIPLES: agement system (WMS) on the cutting edge of technology. This system would assure them control, traceability and efficient dis- Functional Analysis: Analysis of business processes. Establishment of functional requirements tribution of products in high demand. In the based on optimal processes, development of specifications, operational impact study, cost/benefit course of this project, GCL Group was analysis of the logistics information system implementation, organization and training of the involved in a series of projects touching on: resources, presentation to top management; • Needs analysis; • WMS and TMS vendor research; • Preparation of invitations to tender; Software selection: Definition of requirements and establishment of an evaluation grid. • Analysis of the submissions and Identification and evaluation of potential suppliers. Selection of optimal solution based on recommendations; pre-established parameters. Vendor information analysis, pre-qualification and selection; • Management of the implementation of the selected software; • Preparation of the functional analysis; Software integration: Establishment of optimal business processes, detailed functional analysis • Identification of the specific required for development, analysis and tracking of specific required development, testing of specific developments; developments and training on the new software. Loading of operational data and assistance in • Configuration of the warehouse and the start-up. management of the required changes; • Preparation of invitations to tender for RF equipments; In addition to these basic services, GCL Group is currently setting up a laboratory with various • Analysis and selection of the RF equipment partners (information systems, equipment, printers, conveyers…) in order to test and contribute to supplier; the adoption of RFID in Canadian enterprises. This laboratory should be operational at the • Development of test scenarios; beginning of the year 2005 and will allow businesses to test their equipment in an industrial • Tests of the selected functionalities; • System validation according to environment with their own products. pharmaceutical industry standards; • Assistance during system start-up; • Participation in the training of employees.
GCL GROUP Logistics Consulting• Traceability • Reactivity • Control • Effectiveness • Knowledge • Globalisation • Training and Coaching Training and Coaching The increasing complexity of activities linked to Consequently, the reengineering of procedures Evaluation of workforce competencies: Revision supply chain management and logistics places requires tailored training programs in order to of roles, responsibilities, communication processes, enormous pressure on the knowledge of today’s ensure greater success, and increase personnel pro- identification of conflicts and under-performance, logisticians. The impact of globalization requires ductivity and motivation. Timely and continuous evaluation of positioning and competencies, managers to have knowledge of international training constitutes without a doubt a means for development of training needs; transportation and regulation; the desire to organizations to perform and remain on the cutting constantly reduce operation costs as a first priority Follow-up and transfer of knowledge edge of industry best practices. necessitates automated procedures on the cutting (coaching): Establishment of coaching objectives, edge of technology; the complexity associated with implementation of a follow-up procedure, process the motivation and management of human THE FOLLOWING PRINCIPLES GOVERN OUR RESOURCE TRAINING documentation, development of task descriptions, resources demands strong communication skills. AND COACHING OFFERING: process for candidate selection; Over the last decades, human resources Change management: Change planning and Course content development: Definition of management has faced many challenges in order to preparation, transition management, change course objectives, identification of target audience, increase business productivity and competitiveness management. Contribution to the creation of communication modes and frequencies, detailed in an ever changing environment. One of the most teams, assignment of roles and activities, as well as documentation of content, training support, related important challenges is to manage business team and individual performance indicators; material, evaluation. restructuring while maintaining and increasing human resources’ confidence in senior manage- ment, as well as their mobilization to realize greater challenges. Our objective is to maintain a constant Presentation of a real-life corporate case: commitment to developing a tight and harmonious link between each group of people involved in the Foods project and the project itself. We align our actions Our client whose head office is based in exhaustive diagnosis of logistics operations that with the aims of your new management software Toronto, Ontario, is the country’s leading principally highlighted a need for coaching and and in relation to the predictable reactions to your distributor of beverages and food products and training. Over the course of a year, GCL Group was human resource changes. services. Indeed, close to 99 % of Canadians are then involved in the coaching of the person consumers and have bought one of their products responsible for logistics activities. The Chambly over the last year ; on average, 21,9 million factory is uniquely complex due to the range of Canadians consume at least one product per products manufactured there. As such, one of the month. This company employs over 7100 people in factory sections operates constantly throughout Canada. Besides its Canadian head office in the year and supplies juice to the North American Toronto, our client possesses 16 sales outlets market. The other section of the factory operates across the country. It operates 20 plants and seasonally to can a variety of vegetables. biscuit factories in Ontario, Québec and British Columbia, as well as 15 distribution centres in During the course of the mandate, we Ontario, Québec, Alberta and British Columbia. contributed to increasing recognition of the logistics function within the organization, resource While undertaking a process for optimizing development, space redevelopment, implementing the logistics efficiency of the Chambly factory, this new technologies, reengineering of processes, important food distributor called on GCL Group to development of performance indicators and role develop and drive a companion project covering and responsibility changes that allowed the inte- the implementation of a more effective logistics gration of the whole logistics chain. function. This companion project followed an
GCL GROUP Logistics Consulting• Tr a c e a b i l i t y • R e a c t i v i t y • C o n t r o l • E f f e c t i v e n e s s • K n o w l e d g e • G l o b a l i s a t i o n • View of GCL Group’s development For over 20 years we have been offering our clients a team of qualified consultants made up of project managers and experts possessing in-depth knowledge as well as different areas of profi- ciency (industrial engineers, operational research and operations management specialists) con- stantly seeking to increase this knowledge with further training. Our multidisciplinary resources allow us to provide our clients with an unsurpassable team pos- sessing the knowledge and experience necessary to meet their requirements. Our presence in North America and Europe as well as the numerous projects we have realized around the world over the course of the last few years impart us with the vision and unique understanding of world class prac- tices. Having successfully completed thousands of mandates for different sized companies, we are proud of our innovative approach. Our research and development efforts provide our clients with an expertise always on the leading edge in areas of performance evaluation, procedure simulations and decision models. GCL GROUP TURNED TOWARD THE FUTURE, OUR CONSULTING GROUP HAS SET ITSELF THE MISSION TO: Montreal: Recommend and integrate creative solutions of value to the supply chain process; 3100 Côte Vertu, Suite 240 Stimulate the development of its resources through collaboration, improvement of competen- Saint-Laurent, Québec cies and involvement in the functioning of the organization; H4R 2J8 Develop unique partnerships with our clients, based on quality, and innovative and appropriate Telephone: (514) 733-3000 solutions. Fax: (514) 733-3439 In order to remain competitive in a merciless market, we invite you to join the hundreds of sat- Toronto: isfied clients that continue to call on our services and in this way remain among the businesses cited 5230, Glen Erin Dr. Suite 89 as examples of best practices. Mississauga (Ontario) L5M 5Z7 Reaching for world class recognition. Telephone: (416) 525-1606 Fax: (905) 821-2384 The GCL Group team. Europe: 13 René Boylesve Ave France 75016 Telephone: + 33 (0) 1 42 24 74 68 Fax: + 33 (0) 1 46 47 77 01 Internet: www.gclgroup.com