Data-led insights are essential to breaking down silos and delivering visibility and control across supply chains and operations. Having full control of your organization’s data is critical to any transformational journey and should come before you discuss further technological investments.
With many horror stories of digital initiatives not delivering measurable value, it is key to start in the right way. With a clear vision and help to develop and implement your ROI business case, you can drive a step-by-step digital improvement program to go from a legacy to a synchronized, digital supply chain and operations at a pace that works for your organization and people.
Your instinct might be to dive headlong into new technologies but resist that instinct. The best place to start is by comprehensively reviewing the current maturity of your supply chain and operations. This does not have to take long. For example, we work with clients and conduct rapid insights and analysis that take, on average, between four and six weeks. The outcome is a clear ROI-driven business case and articulation of a measurable and actionable implementation roadmap, tailored to your organization.
Implementing an improvement program based on Total Value Optimization (TVO)™ maturity levels enables you to rapidly improve supply chain and operational performance, as well as track measurable improvement from an EBITDA, cash and growth perspective.
Aligned to the TVO Pyramid, the TVO Functional Attributes Model is a pragmatic tool for mapping out where your organization is and needs to be, to achieve a high-performing, digitally enabled supply chain and operations.
At level one, an organization operates in functional silos, with limited interaction between sales, procurement, manufacturing and logistics. Data also frequently resides in silos, with basic reports regularly produced manually, often on spreadsheets. This results in poor data integrity and visibility, leaving the organization without a reliable single source of truth.
In this environment, data analysts can collect, aggregate and cleanse data from multiple disparate systems without IT investment. For example, we worked with a manufacturer comprised of 11 affiliated businesses. Leveraging our TVO ControlTower, our analysts gathered data to provide visibility to category management across the company. This gave leadership the capability to mitigate future price increases, make better decisions and support continued sustainable growth, leading to a 20% EBITDA improvement.
At level two, organizations might have started to introduce some digital tools in some functions, such as eProcurement, while others like logistics and operations continue to use unsynchronized tools and systems. This lack of synchronization prevents cost, service, quality and throughput improvements.
A global, flexible packaging company at this level faced significant challenges with siloed operations, poor metrics and immature management operations. They had invested USD 6 million in ERP, which had only provided little reporting capability and value. We leveraged this investment and improved processes, data accuracy and people alignment across the business. A centralized data warehouse was also produced to provide daily trend analysis and accurate information for better decision-making, as well as predict future performance based on upcoming production plans. The result was 14% throughput and 56% EBITDA improvement.
A solid ROI-driven business case and measurable implementation plan give leadership and staff the confidence to move forward. As you start to see measurable results, confidence builds further and a cross-organizational, high-performance digital mindset is developed. This is critical as you continue towards a synchronized digital network.
Part of SGS Group, Maine Pointe is a global supply chain and operations consultancy, trusted by many chief executives and private equity firms to drive compelling economic returns for their companies. We achieve this through accelerated, sustainable improvements in EBITDA, cash and growth across procurement, logistics, operations and data analytics.
Our hands-on implementation experts work with executives and their teams to rapidly break through functional silos and transform the plan-buy-make-move-fulfill digital supply chain, to deliver the greatest value to customers and stakeholders at the lowest cost and risk. We call this Total Value Optimization (TVO).
Maine Pointe’s engagements are results-driven and deliver between 4:1-8:1 ROI. We are so confident in our work that we provide a unique 100% guarantee of engagement fees based on annualized savings.
For more information, visit www.mainepointe.com.