Transcript STREAMLINING - Michael De Kare

STREAMLINING
enable • automate • innovate
Internet “Did you know’s”
• How much is Internet traffic growing each year?
• How many SMS text messages are being sent around the
globe each month?
• How many people are online around the world?
• How many people have shopped at Amazon?
• How much revenue was generated in B2B through the
Internet in 2004?
There’s a big prize
Cisco
$800 m of cost savings
Oracle
“$1 bn on the bottom-line through e-enabling
our business”
Dell
“Reduce SG & A to less than 10%”
GE
$200m of cost savings
Tesco
£250m of mostly incremental business
BP
£200m gain from e-procurement
Progressive
Insurance (US)
Doubling of revenues over 3 years
Eastman
Chemical
7% of revenues – that is our target productivity
saving
Streamlining: the new agenda
enable
innovate
driving
productivity
+
performance
automate
Streamlining in action
•
Procter & Gamble, Phillips and Coca-Cola are backing a new web-based approach that will
streamline the development of global marketing campaigns – “automation of laborious
processes will give more scope for innovation, save cost and speed up campaign
development”.
•
“UK Government has pledged to streamline business for offshore oil and gas operators in the
North Sea by developing an e-commerce portal for the industry. The aim is to speed up
application for consents, approvals and reporting – “it’s vital that business and government
make the most of cutting-edge technology to make daily business easier and faster”.
•
“Dutch distributor Van Gerd and Loos is investing in a new scanning and wireless computing
solution to streamline and fully automate its distribution process to provide parcel tracking via
WAP phones over the Net”.
•
“Michael Dell attributes his company’s success to ruthless streamlining of its manufacturing
processes and linking its suppliers on the Net to deliver build to order and eliminate inventory”.
•
“Covisint aims to streamline an entire industry by moving business to business processes online
for major automakers – “this streamlines the industry supply chain by simplifying procurement,
reducing costs and speeding up the order to delivering process”
10 new Internet-based tools
•
•
•
•
•
•
•
•
•
•
Speeds up time for response and communication, eg: real time
Lower costs eg automated contacts, “zero touch”
New forms of convenience for customers
More information / more insight eg: 1 on 1 marketing
New routes to market / new sources of growth
New ways to communicate eg: mobile, virtual learning
New software tools eg: Xml, middleware
New software applications eg: Broadvision, Commerce One
Coopetition eg: boundaries blur, alliances
New forms of outsourcing eg: ASPs
• Profit growth
• Revenue growth
Streamlining: four key points of leverage
Suppliers
Purchasing
1. Procurement
Inventory
MFG
2. Supply Chain
Management
Distribution
Admin
HR
3. Knowledge
Management
Sales
Marketing
4. CRM
Internet
Wireless
iTV
Service
e-Procurement streamlining
COMPANY
SAVINGS
ACTIONS
• Eastman Chemical
• $150m savings
• Buysite desktop procurement for
orders < $5000
• Reverse auction tendering on the
Net
• Owens Corning
• $100m savings
(out of $3.7bn bill)
• SAP unified catalogue
• MRO focus
• Hewlett Packard
• $70m in first 6
months
• Data transparency
• Unified coding & visibility
• Program of “forced” supplier Net
connections
Supply Chain Management - Streamlining
COMPANY
P.I
ACTIONS
• Mitsubishi Auto (USA)
•
•
•
•
• Dealers linked in Net-based
collaboration system
• Guess Corporation
• “Attack the supply chain”
• Improve quality of raw materials
• JIT order quantities
• Net links with Suppliers
• Automated ordering
• Redeploy purchasing staff to
more value-added
• INTTRA (JV of leading
ocean carriers)
• Track n’trace
• Online booking with participating
carriers
• Load utilisation
• Internet venture
• Global transportation portal
• Common platform = common
processes = standardising
operations = reduced costs
• PolyOne
• JIT replenishment
• Sensors in customers’
chemicals tanks
• Zara
• 2 week order cycle
• Straight thru Net connections
• Aligned processes & structures
Dealer inventory reduced by half
Parts inventory eliminated
Vehicle lead times cut by 60%
Sales are up c.40%
KM - Streamlining
COMPANY
SAVINGS
ACTIONS
• BT
• £2m new customer win
• Rerouting of Web traffic
saved £70m
• Sales up 12% in one unit
• Shared KM environment
• Incentives to participate
• Early wins
• BP
• $600k by adapting another
drilling process
• $45m reduced drilling
costs
• Virtual project
management
• T-shaped
• Peer-assist
• CEO commitment
• Southwestern Bell
• Customer personalised
services
• Sales +5%
• ‘right-time’ knowledge
distribution
CRM - Streamlining
COMPANY
SAVINGS/ BENEFITS
ACTIONS
• Provident Central
Credit Union
• Loan sales up 4x
• 30% drop in admin costs
• Consolidated call centre /
one customer view
• Web front office
communication system
• Moray City Council
• Reduced fraud
• Better ‘customer
satisfaction’ figures
• Reduced costs
• Cross-department single
view of customer
• Integrated multi-channel
approach
• Customer self-service
• Oracle
• Sales up 12%
• Costs / transaction down
from $2 to 25 cents
• Migration of call centre to
Web
• Personalised database
building
Wireless - Streamlining
COMPANY
SAVINGS/ BENEFITS
ACTIONS
• Wells Fargo Bank
• Incremental revenues in
2004 (c.$30m)
• Increased Brand value
scores
• No.1 wireless banking
service
• South Korea
Government
• “Build new economy”
• “Leapfrog others”
• “Leading edge
communications network
quicker & more cheaply”
• 3G rollout
• Klever Kart
• Influencing 80% of all
purchase decisions made
at shelf
• Location specific
applications
• Wireless Net marketing
• Card swipe to Microwallet
infrastructure
iTV - Streamlining
COMPANY
BENEFITS
ACTIONS
• Domino’s Pizza
• Sales increases thru TV
and outlet
• Interactive TV advertising
• Sky (News Corpn)
• 6 million targeting 8m
households
• Market leader in UK
• EBITDA profitable
• Market-making /
commitment
• Wink TV
• 4m US households
• Trials from all leading
Advertisers
• Attractive paybacks
• Compatible system to all
STBs
• Free downloads
Looking for eai priorities across the value chain
Basic
Business:
Processes
R&D
Purchasing
Manufacturing
Logistics
Marketing
Sales
Product
excellence
?
?
Value-adds
Operational
excellence
?
Customer
intimacy
How use technology to turn a basic business process into a core
source of customer value-added and advantage
Admin
Pilot + Test
• GE initial e-procurement pilot cost $15k
• Hill & Knowlton (PR) invested $300k on a new KM system
($2m return in 12 months)
• Fisher Scientific invested $50k to pilot a new web invoicing
system
• Herman Miller put up $1m to build ‘DealerNet’
• “neutralise + co-opt”!
10 things to aim at
1. Dare
2. ‘Neutralise + Co-opt’
3. It is the Technology…
4. Develop a strong ‘new technologies’ team
5. … it’s also the processes and structures
6. Involve partners + customers
7. Continuous learning + development
8. “Hearts + minds”
9. Align the rewards structure
10. “MMR”
Aligning technology with process/ organisation /
strategy change
TECHNOLOGY
ORGANISATION
aligned
action
STRATEGY
PROCESS
New technology tools/ approaches across the
value chain
R&D
• Time to
market
• “Virtual
project
rooms”
• Partner
collaboration
Purchasing
• Ariba /
Commerce
One
• emarketplaces
• “reverse
auctions”
• “Information
Transparency”
• Leverage
Manufacturing
•Supplier
inventory
management
•Online
expertise
•“STP” –
straight thru
processing
Logistics
• “Mobile
connectivity”
• Supplier
extranets
• “Track ‘n
Trace”
Sales
• Customer
contact
management
Admin
• “Zero touch”
• Same day
financial close
• CRM
• “One View”
• Consolidated
databases
• “KM”