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1. • Market leader
• Steady business - solid CAGR 15%
• Robust Supply Network – 1 Plant & 4 DCs
• Complex RM footprint - 90% Global
sourcing
• Wide product portfolio(200+)
• Pipeline of innovation across the board
Step by step approach for Business Leaders
1
• Misconceptions & their remedies to reduce Customer
Churn
2
• Improve service level by modifying supply chain
segmentation & improving forecast accuracy
3
• Tackle the space shortage at factory by appropriate
inventory classification, use of effective KPIs & Deep Rack
system
4
• Improving the success rate of innovation by removing the
silo thinking among various departments i.e. Open
Innovation
• Customer churn - switching to
competition
• Declining service levels
• Space challenges at Factory
• Decline in Innovation Success
rate
• Misconception 1: Poor service level is causing churn
Reality: Churn results from a series of episodes over time
Remedy: Focus on the entire customer journey, not the latest episode
• Misconception 2: Intervention at any point can save the day
Reality: It’s more costly and less effective to intervene later
Remedy: Excel at a few interactions from the start in order to build equity with the
customer
• Misconception 3: One silver bullet will stop churn
Reality: Churn will not succumb to a single initiative, because churn takes different paths and
each path stems from several root causes
Remedy: Focus on the subset of root causes that have the greatest effect
• Misconception 4: Satisfying customers is good enough
Reality: Customers who call themselves satisfied may be passive and easily wooed by
competitors
Remedy: Earn customers’ active advocacy by delighting them at key moments
• Misconception 5: Success hinges on installing the right technology and processes
Reality: Having the right technology & processes are important, but great service also
requires employees with a customer-centered mindset and the latitude to act
Remedy: Give employees the tools and incentives they need to rapidly address customer
feedback
KPI ?
1. Consumer Retention Rate – Measures Repeat business and Customer Loyalty
2. Customer Churn Rate – Rate at which your customer stop buying your products
POST CHURN
PRE-CHURN
ROOT CAUSES
TIPPING POINT
FINAL TRIGGER
Poorly set expectations during the sale process
Event that trigger the decision to defect
One or more event that disposes a customer to churn
Interaction that build frustration
customers more or less likely to return
About the Company Problem Statement
Reducing Customer Churn

2. • Space shortage at factory can be handled by :
1. Appropriate Inventory classification
 FSN (Fast, Slow & non-moving) inventory classification to be used
 Efficient to find dead stock and reduce its accumulation in the inventory
2. Use of latest KPI to identify slow-moving inventory
 Inventory turnover & Inventory sell-through are basic KPIs & insufficient
 E.g. 3 dimensional metric to identify slow-moving
 inventory developed by G Chodak
(SWi, d1i, KoPi)
3. Use of Deep Racking system to efficiently use the available space
 Use 1-Deep in use in Normal Condition
 Use 2-Deeps in use in emergency
• Cross docking for common and core Sku reducing storage at DC
• For Pure pull responsiveness is critical so carrier delivery to be implemented
• RM Sourcing to be Ocean mode for Pure Push and for Pure pull air carrier to be used
• To improve service level, we must :
1. Perform Supply chain segmentation (Product-wise)
2. Reduce forecasting error
3. Calculating Safety Stock (Considering demand and lead time variation)
• Supply chain segmentation
 Here there are 4 types of products :
1. Common products (70%, low margin)
2. Speciality products (20%, high margin)
• Reducing forecast error
 For core SKUS, traditional forecasting techniques are sufficient
 For Innovative new products, AI/ML based forecasting required, which shall be
accomplished in two stages:
1. Clustering technique to classify the new product into some category
2. Regression method to compute the forecast
• Calculating Safety Stock
Service Level KPI –
OTIF (On Time In Full) – Shows that the company was able to deliver the full quantity
requested by the customer on the requested date the latest
Pull
Pull
Push
Push
Pure Pull Supply Chain (Build-to-Order)
 Speciality & Innovative
Push-Pull Supply Chain
 Common & Innovative
Pure Push Supply Chain (Build-to-Stock)
 Common & Core SKUs
Push-Pull Supply Chain
 Speciality & Core SKUs
ECONOMIES OF SCALE
DEMAND
UNCERTAINTY
LOW HIGH
HIGH
LOW
1-Deep in use in
Normal Condition
2-Deeps in use in
emergency
• To achieve success in innovation:
 Innovation must be centralized
 Each department of the organization must jointly involve
 Silo thinking would eventually lead to failure in success of new products
• Open Innovation would solve the decentralization problem by
 connecting the numerous business units across geographies
 leveraging from the sharing of knowledge and the ability to cooperate across divisions
Improving Innovation Success Rate
3. Core SKUs (Low demand uncertainty)
4. Innovative (High demand uncertainty)
Tackling space shortage at Factory
Logistic Strategy
Improving Service Level