New Year, New Approach:
Take Your Integrated
Business Planning
Processes to the Next Level
in 2014
January 28 2014 Steelwe...
KPMG Presenters: Frank Kang and Peter Yu

Background
Frank, a managing director in KPMG Advisory Services, has 21 years ex...
KPMG Advisory Overview

U.S. Advisory


Approximately 7,000
dedicated professionals



490 partners/MDs



10 service l...
Agenda

 Questions

to address when evaluating the effectiveness of your planning
processes and deciding where and how to...
IBP questions we will address throughout this webinar

1) What is IBP and how is it different than S&OP?
2) How do you sta...
IBP v. Traditional S&OP

Business Strategy Scenarios

Finance

Executive IBP

Primary Focus of Traditional S&OP

Demand

C...
Challenges with business planning

The current globalization of the supply chain, heightened competition, and increased cu...
IBP principle #1: An IBP strategy must harmonize financial and
operational processes to customer demand
Harmonize the Plan...
IBP principle #2: An IBP strategy must enable an organization to
optimally collaborate and address critical, cross-functio...
IBP principle #3: An IBP strategy must create cross-functional alignment
and integration of planning and execution process...
Agenda

 Questions

to address when evaluating the effectiveness of your planning
processes and deciding where and how to...
KPMG’s recommended Integrated Business Planning (IBP) operating model
KPMG’s IBP Operating Model balances demand and suppl...
IBP operating model establishes leading capabilities across the planning
process to meet the needs of today’s corporations...
End-to-end, cross enterprise financial and operational visibility is an
important enabler of IBP

IBP is capable of provid...
IBP reference architecture is an integrated and agile process enabled
through technology advances

Demand

Supply

Executi...
© 2014 KPMG LLP, a Delaware limited liability partnership and
the U.S. member firm of the KPMG network of independent
memb...
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New Year, New Approach: Take Your S&OP, Demand and Supply Planning Processes to the Next Level in 2014

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Featured Presenters:
Frank Kang, Managing Director, Supply Chain and Operations Advisory Services, KPMG
Peter Yu, Director, Supply Chain and Operations Advisory Services, KPMG
Ed Lewis, Vice President, Product Marketing and Planning, Steelwedge Software

Whether your company is already advanced in its Integrated Business Planning (IBP) journey or is just starting to consider Sales and Operations Planning (S&OP), it can benefit from improved strategic and tactical alignment and increased agility.

Please join us for this free webinar to learn about the many opportunities best-practice S&OP processes and technologies offer. The results? You meet financial targets, strengthen customer relationships and establish accountability within your organization by integrating your demand/supply planning with long-term strategic business goals.

You will learn about:

- The questions to ask when evaluating the effectiveness of your planning processes and deciding where and how to start on an effective IBP journey
- A discussion on leading IBP Operating Model capabilities
- The opportunities offered by the right technology to continuously improve your business planning processes

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New Year, New Approach: Take Your S&OP, Demand and Supply Planning Processes to the Next Level in 2014

  1. 1. New Year, New Approach: Take Your Integrated Business Planning Processes to the Next Level in 2014 January 28 2014 Steelwedge Webinar 28, kpmg.com
  2. 2. KPMG Presenters: Frank Kang and Peter Yu Background Frank, a managing director in KPMG Advisory Services, has 21 years experience in supply chain transformation consulting experience in the Electronics, Consumer Packaged Goods, Retail, Retail Industrial Products and Telecommunications Industries He leads KPMG’s offering in Products, Industries. KPMG s integrated business planning, inventory optimization and supply chain analytics.. Frank Kang Managing Director, Supply Chain and Operations Advisory S i O ti Ad i Services KPMG LLP, Washington, DC area office Tel 415-577-1804 fkang@kpmg.com Frank has extensive experience working with multinational firms attempting to achieve greater supply chain integration into emerging markets. He has been a speaker at numerous global conferences focusing on supply chain strategy, planning, visibility, analytics and sustainability. Prior to KPMG, Frank was with IBM GBS, PwC Consulting and Booz Allen & Hamilton. Frank holds graduate and undergraduate degrees in Operations Research from Cornell University. Background g Peter, a director in KPMG Advisory Services, has 15 years experience in supply chain transformation consulting experience in the Hi-Tech, Consumer Packaged Goods, Retail, Industrial Products, and Automotive Industries. He has expertise in Integrated Business Planning (IBP/S&OP) process improvements, and currently one of the leading members of IBP/S&OP offerings at KPMG. Peter J. Yu Director, Supply Chain & Operations Advisory Services KPMG LLP, Chicago, Office Tel 312-665-1397 pjyu@kpmg.com Peter also has a strong background in global supply chain processes and systems management with a focus on advanced supply chain planning (Global Demand, Supply, Inventory, Capacity Planning) across number of industries improving their operations and business performance. Peter holds graduate and undergraduate degrees in Industrial & Operations Engineering and Computer Science from the University of Michigan, Ann Arbor. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS 1
  3. 3. KPMG Advisory Overview U.S. Advisory  Approximately 7,000 dedicated professionals  490 partners/MDs  10 service lines  35 service networks Americas  Over 7,000 dedicated professionals EMEA  Over 20,000 dedicated professionals Asia Pacific  Over 5,000 dedicated professionals More than 30,000 talented professionals across a worldwide network – Wherever our clients need us 100+ global methods and toolkits to bring knowledge of the firm to each client Advisory areas:  Management Consulting  Risk & Compliance  Transactions & Restructuring And we offer clients the benefit of working with a professional services firm that draws upon the skills and experience of 140,000 audit, tax, and business advisory colleagues across 146 countries. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS 2
  4. 4. Agenda  Questions to address when evaluating the effectiveness of your planning processes and deciding where and how to start on an effective IBP journey  Leading IBP Operating Model capabilities  The opportunities offered by the right technology to continuously improve your business planning processes  Q&A © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS 3
  5. 5. IBP questions we will address throughout this webinar 1) What is IBP and how is it different than S&OP? 2) How do you start an IBP transformation journey? What y g are some key considerations when embarking on an IBP initiative? 3) Who should own the IBP process? 4) What are the leading capabilities firms need to drive an effective IBP process? 5) How can you assess your current IBP maturity level? © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS 4
  6. 6. IBP v. Traditional S&OP Business Strategy Scenarios Finance Executive IBP Primary Focus of Traditional S&OP Demand Customer Collaboration Supply Development: Products/ Services © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS Supplier Collaboration 5
  7. 7. Challenges with business planning The current globalization of the supply chain, heightened competition, and increased customer requirements have hindered business performance using traditional planning process: Issues Characteristics Representative KPI Impacts Unreliable financial forecasts as they are often not based on accurate profitability analysis. ■ Financial forecast and operations plan misalignment Misalignment/Disconnect between financial plan and operational plan due to the lack of consistent collaboration with sales & marketing, supply chain, and ll b ti ith l k ti l h i d finance ■ Difficult to understand where the gap is Delayed New Product Introduction (NPI) and End-ofLife (EOL) due to lack of integration into Demand & Supply Planning and Execution ■ Unable to meet market demands fast enough ■ Unable to plan and control EOL product inventory ■ Revenue Poor sales & marketing promotion planning effectiveness due to lack of integration into demand planning, inventory execution, and budget allocation ■ Unclear benefit of promotions ■ Promotion ROI ■ Negative impact on materials planning ■ Revenue/Cost y pp y Lack of visibility on critical and chronic supply issues (supplier’s repeated de-commits, no dual-sourcing strategy) ■ On-going critical shortages g g g ■ Customer Service ■ Unclear n-tier supplier issues ■ Revenue/Cost Business units and functional areas with their own agendas therefore organization have difficulties aligning the operations ■ Unaligned business targets ■ Revenue/Cost ■ Difficult to achieve strategic objectives ■ Customer Service © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS ■ Financial forecast accuracy ■ Overall financial performance ■ Customer Service ■ Inventory 6
  8. 8. IBP principle #1: An IBP strategy must harmonize financial and operational processes to customer demand Harmonize the Planning Process: Right product, right place, right time, right price at the right cost  Maximize revenue while simultaneously minimizing operating expense and investment  Improve customer service p  Capture market share  Collaborate with global and local operations to address market needs Demand shifts – Supply changes – Promotions – NPI – EOL Illustrative “Hug the Demand Curve Hug Curve” Demand $ Recovery Supply Lost Opportunity & Shareholder $ Value Recession 2005 2007 © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS 2009 Time 2011 2013 7
  9. 9. IBP principle #2: An IBP strategy must enable an organization to optimally collaborate and address critical, cross-functional business decisions across a product’s lifecycle Supply Chain Sales & Marketing  How can we source, source produce, and deliver products on-time?  What is the forecasted demand and can it be fulfilled?  How can operations achieve greater scalability and cost reduction?  What is the achievable customer service based on sales strategies and fulfillment capabilities? PLM Product Development Finance  How is the product aligned to customer need?  Is the product achieving profitability targets?  How can we consistently achieve on-time product launches?  How can we achieve greater financial forecast accuracy? © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS 8
  10. 10. IBP principle #3: An IBP strategy must create cross-functional alignment and integration of planning and execution processes to ensure optimal business performance  Align operational planning and execution to strategic corporate objectives  Integrate the executive team, finance, sales & marketing, supply chain, and product development to drive real cost reduction and customer service excellence – – © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS Increased on-time delivery of products and services –  Reduction of operating expenses & inventory y Improvement in budgeting and costing accuracy Leverages greater utilization of information for scenario management, analytics, and reporting 9
  11. 11. Agenda  Questions to address when evaluating the effectiveness of your planning processes and deciding where and how to start on an effective IBP journey  Leading IBP Operating Model capabilities  The opportunities offered by the right technology to continuously improve your business planning processes  Q&A © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS 10
  12. 12. KPMG’s recommended Integrated Business Planning (IBP) operating model KPMG’s IBP Operating Model balances demand and supply, integrating product lifecycle and financial goals, with key enabling processes and capabilities that support the operating model Business Integration and Strategy Process Integration & Collaboration Finance Governance and Compliance Planning and Optimization Financials Suppliers Operations Supply Balance Demand Sales and Marketing Customers Products Change g Management Analytics and y Reporting Product Lifecycle Technology Enablement and E bl t d Infrastructure © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS End-to-End Supply Chain Visibility 11
  13. 13. IBP operating model establishes leading capabilities across the planning process to meet the needs of today’s corporations IBP Capability Categories Leading Capabilities Description  Business Integration & Strategy Improved ability to use business drivers in planning, collaboration, and execution is planning collaboration achieved  Process Integration & Collaboration By integrating process across finance and operations, greater cross-functional collaboration and functional alignment can be achieved to drive improve business performance  Governance & Compliance Manage and control the IBP operating model, coordinate and balance decision-making globally vs. regionally vs. locally  Change Management Continuous process improvement is essential to successful integrated business transformation with demand planning, supply, product management and finance  End-to-End Supply chain Visibility Integrated Planning Activities Process Governance and Continuous Improvement Increased Planning Visibility Robust technology that enables integrated business planning process with real-time information visibility regardless of IT platform configuration  Optimized Business Decisions Through Analytics Technology Enablement & Integration  Planning Optimization IBP optimization across financial, operational, tactical, and strategic plans through advanced analytics for increased effectiveness, standardization and consistency  Analytics & Reporting Enables ‘single version of the truth’ of the extended supply chain by providing actionable real-time data across finance, transactional and planning platforms © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS 12
  14. 14. End-to-end, cross enterprise financial and operational visibility is an important enabler of IBP IBP is capable of providing visibility across the entire supply chain network. A complete view of current activity and future plan from inbound supply and outbound fulfillment activity across supply chain network Supply & Inventory Visibility  Real time inventory across the globe  Supply-demand Supply demand disconnects  Collaborative planning (multi-tiers)  Production / Capacity capability  Transportation and logistics Financial Visibility Demand Visibility   Profits and margins  Customers   Pricing  Sales & Marketing   Working capital  Point of sales   Cash flow  Promotion plans  Asset Management  Product lifecycle: NPI and EOL © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS 13
  15. 15. IBP reference architecture is an integrated and agile process enabled through technology advances Demand Supply Executive Consensus Demand IBP Processes Constrained Supply Executive Review Integrated Business Planning Demand, Supply & Financial Integration , pp y g IBP Technology Enablement Demand, Supply & Finance Data Point Solution Technology Data Forecasting, Demand Plan, ERP, CRM, Excel SCM, ERP Demand Products & Customers Supply Products & Suppliers © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS Business Intelligence, Data Warehouse Revenue, Units 14
  16. 16. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. NDPPS 161986 The KPMG name, logo and “cutting through complexity” are registered trademarks or trademarks of KPMG International.

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