End to End Supply Chain

Transformation
Jan Eeckhoudt Lean Six Sigma DPC, DuPont
2010 Supply Chain Council. ALL RIGHTS RESERVED. |

< filename >

Slide 1

November 2, 10

Contents
1. Introduction to DuPont and DuPont Performance Coatings
2. SCC and DuPont
3. Project DELIVER
Objectives
Plan, phases
Approach

4.Workstreams - Impact
PRODUCT
CUSTOMER
ORGANISATION
NETWORK
TRANSPORT

5. Looking forward
6. Key Success Factors & learnings

DuPont Company Vision

To be the world's most dynamic science

company, creating sustainable solutions
essential to a better, safer and healthier
life for people everywhere.

DuPont in 1802

DuPont in 2010

40 employees

58,000 employees

1 site

> 210 sites

1 country

> 70 countries

1 product

Hundreds of thousands of
DuPont products and
customers

12 customers
$15,116 in sales (1804)

$26.1B in sales (2009)

DuPont 2009 Sales by Segment - $26.1 (*)5

13 businesses
$3.4 B

$8.3 B
DUPONT AGRICULTURE &
NUTRITION
Pioneer Hi-Bred
Crop Protection
Nutrition & Health

DUPONT PERFORMANCE
COATINGS
Core Markets:

Core Markets:
Production Agriculture
Food & Nutrition
Products

$1.9 B
DUPONT ELECTRONICS &
COMMUNICATIONS Core Markets:
Consumer Electronics
Advanced Printing
Photovoltaics
Displays

Automotive OEM
Collision Repair
Industrial Coatings

$4.8 B
DUPONT PERFORMANCE
MATERIALS
Performance Polymers
Packaging & Industrial
Polymers

Core Markets:
Automotive
Packaging
Electrical/Electronics
Construction
Consumer Durables

$2.8 B

$5.0 B
DUPONT PERFORMANCE
CHEMICALS
Titanium Technologies
Core Markets:
Chemicals & Fluoroproducts Construction

Specialties
Industrials & Chemicals

* Includes $.1B in other sales including Applied BioSciences.

Total company sales exclude transfers.

DUPONT
SAFETY & PROTECTION
Protection Technologies
Building Innovations
Sustainable Solutions

Core Markets:
Industrial Personal
Protection
Construction & Industrial
Military & Law
Enforcement

2009 Sales by Geography

$26.1B
2009 Company Sales

In 2009, 30% of sales were in Emerging Markets*

*Refer to the companys website for a definition of emerging markets.

Aligning Strategies with Megatrends

The Needs of the World Drive our Science

Megatrends

Increasing Food Production

Decreasing Dependence
on Fossil Fuels

Protecting People, Assets

& the Environment

Growth in Emerging Markets

Market Opportunities

Strategies

More food
Better food

Grow production agriculture

Alternative energy solutions

Energy efficiency
Renewably-sourced materials

Photovoltaics & Biofuels

Lightweighting vehicles
Accelerate conversion to biobased raw materials

Workplace safety
Personal protection
Environmental sustainability

Accelerate innovation

Infrastructure
Energy
Materials applications

Increase local application

pipeline
Strategic acquisitions
Geographic expansion

development
Drive further penetration

customized for local markets

More than 75% of R&D is directed toward megatrends

DuPont Performance Coatings

DuPont Performance Coatings serves the transportation industry

Aircraft / Aerospace
Automotive
Commercial
Recreation & Sports Vehicles
DuPont Performance Coatings Mission in E/MEA
We will safely, ethically, and respectfully
help our customers be successful by significantly
improving our Quality & Supply chain responsiveness
while delivering business innovation.

DuPont Performance Coatings

Automotive OEM Coatings:
DuPont Automotive Systems is the largest global manufacturer of
automotive OEM coatings providing technologically sophisticated
and environmentally responsible coatings. Paint & Coatings for
Metal Exterior, Plastic Exterior and Interior
Vehicle Refinish:
DPC Refinish Systems is the largest global manufacturer of
coatings for aftermarket car repair. Spies Hecker , Standox , DuPont Refinish
Powder Coatings:
DuPont is the second largest world-wide manufacturer of powder
coatings offering a complete product range including
polyurethane, acrylic and thermoplastic polymers.
DuPont Nap-Gard Functional Coatings, Alesta Decorative Coatings

DuPont Performance Coatings

Electrical Insulation Systems

For many years, DuPont have been providing the electrical
insulation market with Wire Enamels, Impregnating Resins and
Core Sheet Varnishes now all combined under the single brand
name Voltatex. The DuPont Voltatex products create value
for the customers as they evolved from three complementary
strategies: reducing environmental footprint, driving breakthrough product innovation and creating total system solutions.

10

DuPont Performance Coatings

Commercial Transportation
DuPont offers the commercial transportation industry a wide
variety of products ranging from plastics and polymers to paints
and car covers.
DuPont is a leading supplier of paint and finishes to over the road
heavy duty truck companies, railroads, fire & emergency
equipment, and fleets of delivery vehicles. DuPont's product
offerings help to protect and enhance the performance of
commercial transportation vehicles and personnel.
Imron , Centari ,

11

DuPonts Journey
Market Driven Science Company

Demand Driven Enterprise

&

Effective and Efficient Advanced S&OP Business Process

&

Competitive Imperative Strategic Supply Chain Capability

&

Optimizing The Sustainable Safe Production Of The Molecule

12

SCC Methods and SCOR support DuPonts13

Supply Chain Development

Metrics &
Diagnostic
s

Enable

BPM

Benchmarking
& ScorCards

SCC & DuPont

14

Getting Started 2003-2006

Supply Chain Transformation Vision & Roadmap
Metrics for awareness
Independent projects
Total Company Benchmark

Development of a Standard Approach to Supply Chain Management 2006-2009

Deeper use of metrics automation and analytics
Major projects Deliver back to Plan
Supply Chain Excellence Path

Implementation 2010 +
BPM SCOR based, technical model
Supply Chain Benchmarking / Segmentation
SCOR Projects Integrated into Continuous Improvement
Integration with S&OP, Product, Demand, Supply
People, Process and Tools Integration to implement future state

The scene at start: End 2007 DPC had gone through many transitions
and was falling short against benchmarks for service & cost.
Customer service performance for the supply chain was not
satisfactory for DPCs management or customers, FPDE & WC was
too high.

3. Flawed
replenishment
model

5. No MPS/
MRP
-visibility
-trade-offs

Manufacturing

6. Poor adherence
to plan and high
variance

Sales and
Customer
Management

Supply Chain
Planning

4. No use of /
adherence to
stock
triggers

Scorecards &
Assessment interviews

1. Supply Chain
Cost not reflected
in Customer
Policies

2. ATP
process
broken

Benchmark
15

The Deliver project was tasked with a holistic review of the

European DPC supply chain
Remit & Scope

Benefit Aspiration

On-time and in full delivery

performance target: 10% point
improvement in 2008 and
another 5-10 points in 2009-2010
(based on deliver to request).

Address the holistic deliver

process
to identify and execute
specific projects that prioritize,
optimize and enable project work
underway

Secure finished product

distribution expense
reductions... estimated at
15%-20% Finished Product
Distribution Expense

.to yield improvement in: ontime deliveries, working capital

(inventory) and FPDE.

20% Inventory reduction

Build out a vision and multigenerational plan for DPC

Europe
Focus on Refinish, OEM, and
Industrial Liquids [but excludes
Industrial powders]

16

2008: We set up a project (using Six Sigma DMAIC method)

Approach: Deliver Improvement Programme
Deliver project
Review
April 11th / 23rd

Analysis phase
Review
March 19th 2008

I
Define and Measure
(4 Weeks)

1
Project
Setup
-Stakeholder
Interviews
-Review of
previous
studies
-Agree timeline
and scope

2
Baselining
-Product flow
-Process maps
-Cost
-Orgn
-Interfaces
-Hypothesis
development

II

III

Analyse
(5 Weeks)
3
Capability &
Organisation
Assessment
-5-level charts
-Interviews
-Orgn comparison

4
Benchmarking

5
Initial
Opportunity
Identification
-Gap analysis
-RCA

2010
IV

Improve (Design)
(4 Weeks)

6
High Level
Design
-Process / Org
redesign
-Bus. case
development

7
Implementation
Planning
-Socialisation
-Impn planning

Improve
(Implement)

8
Detailed
Design and
Implementation

Control

9
Maintain,
Monitor &
Enhance

-Costs
-Service Levels
-Operational
-Process
-Policy

Critical to identify pain points & mid-term improvements and

get fast return on investment.
17

Project Review

and fully delivered its remit during these three phases

Initial Objective

Status

How have we done?

Full review of SCOR processes and
policies, network and logistics for
DPC

Address the holistic deliver

process
Identify new projects and enable
project work underway

Identified 5 key workstreams, with

14 major initiatives, ... many more

Build business cases for each

initiative

Cases built and validated totalling in

excess of initial expectations

Create ownership and

implementation plans

Project management proposal

complete to enable execution
Plan for minimum 10 point
improvement in OTIF in 08 with
additional 5-10 points in 09

Secure a 10 point improvement in

2008 on time delivery
Obtain FPDE reductions

Project targets 15 20% FPDE and

20% working capital

18

Deliver created 5 workstreams with 14 initiatives & +60 projects

Product

Network

Customer

Balance supply and

demand early and in
the right place

Review warehouses
across DPC and
then

Create stock targets

that account for real
volatility

Close those with

overlapping delivery
areas

Create customer
segmentation and
then differentiate
supply chain policies
accordingly

Reduce volatility

and configure the

remainder according
to customer demand

SKU rationalization

Ensure customer
delivery processes
drive SAP not the
other way round

Finally optimise
supply routes

19

Transport

Organisation

Impose central
management on
haulier purchasing

Allow supply chain to

focus primarily on
cross-site planning

Tailor transport
contracts to the
demand profile of the
business

Where ever possible

ensure supply chain
activities operate
across DPC

Distinguish between
transactional and
cooperative
relationships with
transport providers

Organized around 5 workstreams

across 3 segments or at DPC level
... shock for the segments...
Business

OEM

Refinish

Industrial

Projects

Block of
analysis

DPC

Product

Network

Customer

Transport

Organisation

20

PROJECT DELIVER : based on SCOR

10

EP3

P1.1

Improve
Inventory
Management

P2

P3

S1-6

Manage
Production
Variability

D1.7a

M1.1

Cycle
Stock
Mgmt

Improve
Customer
Service
Rules

D1.2

D1.3

Warehouse
and
transport

D1.1D1.6

D1.8D1.10a

D1.11D1.15

Deliver

Improve MPS Process

Full review of SCOR processes and policies, network and logistics for DPC

Ship & invoice

Consolidate & build

loads

Enter order

Process inquiry

Make

D1.1

Make

Source

M2-6

Detailed
prodn schedule

Source
carriers

Plan deliver

Define Resin
Sourcing
Process

P4

Plan make

Plan source raw

materials

Plan supply chain

Plan

Pick & pack product

P1.2
-P1.4

Plan demand

Manage compliance

Manage data

Assess performance

Establish & manage

rules

Enable

EP9a

Improve
Forecasting

Reserve inventory & set

delivery date

EP3

Simplify
Product
Slate

Source raw materials

EP2

Improve supply chain

EP1

Improve
Systems
Data
Accuracy

21

Product Workstream
Goal: Design & Implement
Integrated Planning Levels

22

Strategic Planning

FEEDBACK
Business Planning

DEMAND
S&OP
Forecasting
And
Demand Management

Supply Plan
Master Scheduling

Volume,
value: product
family level

Resource Requirements
Planning

MIX:
disaggregate
level - end item

Master Production Schedule

PRIORITY
SETTING

CAPACITY MANAGEMENT

Rough Cut Capacity Planning

(RCCP)

Material Requirements
Planning

Capacity Requirements
Planning

Plant and Supplier Scheduling

Input/ Output Control and

Operation Sequencing

Execution

= within project scope

23

Linked with Integrated Business Management long term Planning

Supply &
Sourcing/Logistics
Technical Content
Assessment
Process
Tools

Product
Development

Sales &
Marketing
Technical Content
Assessment
Process
Tools

Technical Content
Assessment
Process
Tools

Mindsets & Behaviors (not part of Deliver)

Capability Building
11/2/10

Managing Process

The objective: Balancing CSL, WC and SC Cost :

clearcoat example

24

Customer Service Level

or cost for Lack of CSL
No customer Shutdowns

96% Order Fulfillment w/o Expediting

Process Total
Supply Chain Cost

Balancing
Supply &
Demand

Working Capital

95% MPS Stability

Total Inventory down 43%

58% reduction in excess

stocks

Safety stocks down 51%

Reduction of expediting cost

How: Forecasting improvement, DIBM, MPS, RCCP & Inv. Opt.

Working Capital Reduction

6 months Average inventory level -35%
6 IDS MMA -12 days

25

Customer Workstream

Define and introduce of DIFFERENTIATED service level policy

Min order quantity
Deliver frequency
Fixed delivery schedules
Surcharges for emergency shipments
And having this automated in SAP

IT optimisation : delivery consolidation

1 shipment for many customer orders optimise warehouse and transportation cost
drivers

Result : 1% FPDE reduction

Sales-to-cash reduction
Accounts receivables reduced by >15%
Touch free transactional processes in SAP

26

Organization workstream

Challenge:
755 DPC employees maintain the key supply chain processes across fifteen
different organisation structures with many hand-offs & duplication,
misalignment and in-efficiency.

Initiatives:
Allow supply chain to focus primarily on cross-site planning
Wherever possible ensure supply chain activities operate across DPC
Reduce the number of reporting layers

27

15 different organization structures in DPC touching supply chain

Supply Chain
Refinish

Production Planning

OEM

Wuppertal OEM

Mechelen Ref

Industrial

Jan Bergmann
DPC Operations Director, EMEA

S&L
Logistics

Andreas Bohlender
DPC Operations Manager, Mechelen

Annemie Sollie
Production Planning, Mechelen

Hans Asaerts
MIXSB + primer

Johann Debacker
FP Clears/MIXSB OEM

FP Planning, Scheduling,
Scheduling Intermediates

+ Intercompany Resins / Intermediates

Rita Lauwerts
Raw Material Planning

Tessa Jacobs (temp contract)

FP Planning Clears REF
FP planning + scheduling:

David Claes
Projects (IBIP, APO, LEAN, etc)

Maria Dalemans
Batchcard Processor

Jovan Colans (Temp Contract)

Batchcard Processor

activators, thinners, Cromax

Li Ma (Temp Contract)
Raw Material Planning

Supply Chain Manager

Jeff Serpan (53.1FTE)
Regional Supply Chain Manager - DPC
Europe.
Randall K. Willis

Supply Chain Manager

Klaus Rohde (53FTE)

Site Manager
Klaus von Juterczenka

Geert Simons
(Project + IBIP Key user)
Raw Material Planning

Supply Chain Manager

Guntramsdorf & Supply Chain Leader
Industrial Liquids EMEA

Derek Tutt
Packaging Planning

Eva Gellaerts
Master data
SOX Reporting

Werner Van Beneden

Scheduling: Clears / Resins

Sofie Wambeke (Contractor)

CSR & Planning Intercompany Products
Logistics Manager
Werner Recks (22FTEs)

Planning Manager
Martin Rubach (29 FTEs)

SOX Inventory Control

Specialist

Toon Gyssels (Contractor)

Outsourced filling / packing / drumming
Packaging Planning

Process & Project

Supervisor

Ilse Lazou (14.1FTEs,

incl. 1 open, 3HC=1.1FTEs)

Philippe Rigaux (15FTEs)

Supply Network Planning
Thomas Hahn (9FTEs)

Produktionsplanung*
Michael Wilkesmann (6FTEs)
Supply Planners
Wuppertal
Incl. CS, Export 7 SOX
(8 FTEs)

Warehouse Operations
Mechelen

Lager/ Versand /
Gefahrgutbeauftragter
Hans Teufelsbauer

Planung
Stefan Guger

Container Management
Rolf-Guenter Krieger (2FTEs)

European Warehouses +

Operative Planung
Edi Ovcak

Versand
Sybille Muik

Lager
Christian Paukovits

Susanne Samer

Process + Project Team

(5 FTEs)

Bestandsmanagement
Alfred Prrer
Petra Heinrich

Dispatching
Andreas Schmidt (11FTEs)

Operative Planung/
Springerfunktion
Zelle CC/Hrter/Verdnnung/
Farblose HF
Manuela Malek

Vorarbeiter
Christian Biricz

Guntramsdorf Ind

Versandabwicklung**
Fr. Gutschi
Fr. Htter
Fr. Lang
Fr. Mikl
Fr. Maul

(11FTEs)

Stammdaten
Michael Hagemann (7FTEs)
Warehouse Operation
Wuppertal Team
(0.6 FTE)

Wuppertal Ref

Bert Vaes
Container Planning + SOX reporting
OEM FP + other tasks

Strategische Planung /
Bestandsmanagement/
Reporting / SOX

Freight Control
U. Adler + S. Kalms (2FTE)

Erwin Boons
(IBIP Key User)
Packaging Planning

(12.5 FTEs)
Vormaterialsteuerung*
Markus Plog (6 FTEs)

Supply Planners
Mechelen
Incl. CS, Export & Metrics

Jill Schoenmackers (Temp Contract)

CSR & Planning Intercompany Products

Dirk Verbole

Melanie Waechter (1FTE)

Physical Distribution
Supervisor

MPS / Supply + Inventory

Supervisor
Hans Verbeek (20 FTEs)

Admin / IT
Ralf Dahlhaus (6 FTEs)

SOX / Reporting
Claudia Steiner

Operative Planung
Zelle Reiben/ IMRON
Cornelia Frisch

Refinish Material +
Customer Master Data
(9 FTEs)

Strategische Planung /
Controlling
Susanne Samer

Operative Planung
Zelle Basecoat
Edi Ovcak
Sophie Frhlich

Hauptgruppe*
H. Kaminsky (Stellvertreteder
Vorarbeiter, Schichtfhrer)

221 RPSL

Fertigung 218/222
MIXSB/MIXWB

Fertigung 218/222
FACPAC

Fertigung 220
PRIME / PUTTI

Fertigung 208
ACTIV / THINN / CLEAR

Produktionsplanung

Produktionsplanung

Produktionsplanung

Rohstoffdisposition

Rohstoffdisposition

Rohstoffdisposition

Rohstoffdisposition

Fertigungs
steuerung

Fertigungssteuerung

Fertigungssteuerung

Produktionsplanung

Produktionsplanung

H. Goger
H. Haag***
H. Probst***
H. Fahnler
H. Kberl
H. Nachtelberger
Schichtgruppe 1*
H. Birnbammer (Schichtfhrer)
H. Zilic

Fertigungssteuerung

H. Schnitzer

Schichtgruppe 2*
H. Sassmann (Schichtfhrer)
H. Breit
H. Gspurnig

Abfllplanung

Etikettendisposition

Abfllung 218

Abfllkoordination

Abfllung 220

Industrial

OEM

Asun
Martnez
EMEA
94 fte
(excl. PoD)

Manager POD
J Walbrodt

Secretary
C. Schmidt

Geert
Van Moer
IBIP
1 fte

Torsten
Schrauf
COLOGNE
11 fte

Loredana
Locati
CAVENAGO
9 fte

Edith
Christian
Ramm
Gijsbregts
Ekwall
MECHELEN GOTHEBORG Domingo
PESCOLA
54 fte
5 fte
9+ 4 fte
+ BeNe PoDs + Scan PoDs

Joachim
Walbrodt
PODs

Manager Logistics
Germany NW

Project & infrastructure

P Herzog

POD Support RSCAC

Project & Infrastructure

S. Duehr

M Duwart

LC Freiburg
J Owczaryszel
+7

LC Stuttgart
H. Koehler

O. Benkau

LC Berlin
F. Friedrichs
+13

Manager LogistIcs North

RSCAN
U. Drosselmeyer

Peter Czisch
APC Manager

SH Nossen/Dresden
K. Seiffert
+8

+16

SH Karlsruhe
P. Schubach
+6

LC Neu-Ulm
M. Schneider

C. Ebert

LC Bremen
A. Seiderman
+3

LC Thorey
R Killmann
+4

Customer Service France

Annik Duchee
SH Saarbruecken
H.J. Potthoff
+4

LC Rhein-Ruhr
U. Sperl
+16

Miek
Wim
Kathrin
Sabine
Key Users
de Wel
Bernaert
Baldzun
Melis
Other
FRANCE &
CE, EE,
UK & SCAN CB &Other
4 fte
BENELUX MEA & A
6 fte
5 fte
10 fte
12 fte

Mila
Herreros
DCS
16 fte

Virgilio
Maia
M.MARTINS
4 fte

LC Hagen
E. Ebbinghaus
+17

Customer Service
Improvement
Dieter Zander

CS Leader
Rudiger Baier

+11

LC Koeln
R. Welz
+17

S. Hegemann

LC Lehrte
D Karus
+14

SH Regensburg
S. Muecke
+6

LC Frankfurt
M. Schmidt
+19

K.Vogeler

LC Meerane
G. Schroeder
+5

LC Schweinfurt
M. Leuchs
+7

H. Wobedo

LC Rostock
M. Guthman
+6

SH Muenchen
M. Berkenstraete
+7

SH Bielefeld
E. Althof
+9

LC Nuernberg
P. Borschel
+12

LC Hamburg
T. Grothkop
+14

LC Magdeburg
H.Mews
+6

Verpackungsdisposition

Abfllung 228

Abfllung 208

Sales, Demand

Customer Service
Refinish

Abfllung 222

Customer Service Turkey

Team Leader CS Group 1

Stefanie Knaak

Customer Service
South Africa

14 CS Agents based on site

Team Lead CS Group 2

Gabriele Fontaine

12 CS Agents based on site

28

Refinish

OEM

Industrial

We have subjected these structures to six tests or screens

Organisation Screens
Function

Process
A

Does the
organisation
assure
continuity of
process?

Does the
organisation
group
appropriately by
function?

Size

Location
C

Does the
organisation
group
appropriately by
location?

D
Is the
organisation
sized
correctly?

29

Spans
Does the
organisation
have the right
spans of
control?

Reporting
F

Does the
organisation
have an
optimal
upward
reporting?

Three pure tone options have become apparent.

Option 2, less hand-offs, simplified structure, more 1 DPC.
Status Quo

Option 1:
Plan Driven/
Order Driven

Option 2:
SC Back
Office

Option 3:
End To End

EP1 Establish and manage rules

SC

SC

SC

SC

EP2 Assess performance

SC

SC

SC

SC

SC/CS

SC

SC

SC

SC

SC

SC

SC

S&L/SC/CS

SC

SC

SC

Sales

Sales

Sales

Sales

SC/CS

SC

SC

SC

P2 Plan source raw materials

SC/OPS

SC

SC

SC

P3. Plan make

SC/OPS

SC

SC

SC

SC/CS

SC

SC

SC

S1-6 Source raw materials

OPS/SC

OPS

OPS

OPS

D1.7a Source carriers

S&L/CS

S&L

S&L

S&L

M1.1 Schedule production

OPS/SC

OPS

OPS

OPS

OPS

OPS

OPS

OPS

D1.1 Process inquiry (including complaints)

CS

CS

CS

SC

D1.2 Enter order

CS

CS

CS

SC

D1.3 Reserve inventory & determine delivery date

SC/CS

CS

SC

SC

D1.4 - D1.6 Consolidate & build loads

CS/SC

CS

SC

SC

S&L/SC

CS

SC

SC

SC/CS

CS

CS

SC

Process Level
1

Enable

Process Level 1/2

EP3 Manage data

EP8 Manage regulatory compliance
EP9a Improve supply chain
P1.1 Demand planning
P1.2-P1.4 Supply chain planning

Plan

P4 Plan deliver (warehousing and transport)

Source
Make

Deliver

M2-6 Make

D1.8 - D1.10a Pick & pack product

D1.11 -D1.15 Ship & Invoice

30

As a result of this analysis we were able to isolate the Supply

Chains Organisational Design Principles
Themes
The Supply Chain must be
responsive to the businesses

Principles
Within the SC organisation there must be a strong link to the business teams. The people
having this role will represent the extended SC (Buy-Make-Deliver)
Master Production Scheduling (MPS) to be done in SC by business short-term and product
family mid-term

The Supply Chain is an endto-end, cross-site activity with

planning at its core

MPS to include Raw Material Planning, Production Planning, and Distribution Resource
Planning however the changes involving Production Planning should be process-led and
gradual
Detailed Scheduling, and Raw Material call-offs to be done in Manufacturing and across
businesses on site

Whenever possible, the

Supply Chain activities will
be organised across DPC

The SC organisation will be evolving to a 1-DPC SC organisation

A number of discrete activities can be managed across DPC including: Metrics, ERP data,
SOX administration, Container management
S&L to act as a 4PL governed by a SLA and therefore S&L is responsible for contract
management and administration

The Supply Chain

organisation will not
replicate roles better
performed elsewhere

Customer complaint management is done by the Customer Service team and not in SC
SC is accountable for the complete Warehouse Network Design. SC should delegate or
outsource the day to day execution of Warehouse Operation and Dispatching where
practical.

Supply Chain organizational transformation is not contingent on CS reorganisation

Customer service
restructuring depends on
CS reorganisation will require an in-depth understanding of customer requirements and the
DPCs value proposition to the
Source:
Organisation
Workshop
involving
and CSR
leads in
April
2008assistant role
need
forSC
CSRs
to play
a31
sales
market

Organization workstream

32

and to design on a high level the new EMEA SC Organization

Liqu

Leveraged across DPC

id o

EMEA SC
Manager

nly
Commentary

Warehouse
Lead

Control &
ERP Data L.

CDC

Master Data
Team 1

Master Data
Team 2

Continuous
Improvement
Lead

DPC SC
Planning
Lead

Business
Link
REF

Business
Link
OEM

Business
Link
IND

LSS
Continuous
Improvement
Team (BB)
SC Planning
MPS 1

LW &
Consignment

Control
Team 1

Control
Team 2

SC Planning
MPS 3..n
SC Planning
MPS 2

Container Mgt

Container
Management

Reporting
Team

SC Planning
Resin

Reporting layers were reduced from 6 to 4.

Requires standardised
product hierarchy
between three
businesses
Resultant synergies will
lead to increased
efficiencies through
greater scale and lower
costs
One DPC should form
basis of end-state
business architecture,
ensuring strategic
alignment of future
initiatives

However structure is only one part of an

33
organisations DNA

Network workstream
All Distribution projects will, by end 10, reduce FPDE by + 17%
DPC EMEA Target Network Structure
(1)

Multiple waves of consolidation

Mostly into the Genk ELC

Manufacturing
site
Warehouse
Closing
Warehouse

UK warehouse closure
Germany 3 locations
Portugal
France 2 locations
Spain
Italy

Note (1) OEM customer required, powder and consignment warehouses are not
represented

34

Transport Workstream

35

Central procurement of freight

Extensive usage of groupage & intermodal shipments
Consolidation of many small deliveries to one customer delivery address on
the same day, to one shipment.
Techniques to increase the transport loading factor

Pallet load optimization techniques

Parcel shipments rather than palletized loads.

Shipping policies such as min size & frequency

More robust process to manage and control rush shipments

Looking forward
Complete
Simplified
Ship-tos

Q4 - 2008

Closure of
Geserick and
LMS

Turkey ApplicationLane
Russiaof analytical
effectivenesLane
safety stock
s
effectivene
calculation
ss
SKU
rationalization

W1
warehouse
closures

Footprint
reduction
POD
restructuring

Network

Raw / Semi
Inventory
Reductions

Supply
Chain Reorganization

Delivery Due
List
Service Policies
(Small shipment
upcharge)

ATP
-PODs to DRP
ATP
- STO

ELC Delivery consol

Receivables
reduction

Carrier
Management

OTIF
baseline

Small (parcel)
shipments

Resin
availability

DIBM
MPS tools

NGST Inventory
Exposure Reduction

AS

Transport

Heated transport
Pallet Load Opt

RCCP
Product Master Data
Management

Customer

Rush
shipments

Central Procurement of
Transport

MPS

M&B

2011+

OTIF II

Application of
analytical safety
stock calculation

Organisation

2010

Differentiated
service levels

Freight
Consolidated
Settlement

Production
execution to
Increase in
Plan
forecast
accuracy

2009

36

MTO/ MTS policy

change
MPS-AS
interface

Adv Inv Mgt

Product

Key Success factors & - learning

The engaged, senior, Steering Committee created momentum both inside and
outside the project team
The team engaged the business and the business engaged the team
consistently through all phases
The project used data and diplomacy to create change
Projects must be directionally toward the vision (Vision Required) and aligned
with the strategy.
Results must be a COMMITMENT for the project team AND the line
Watch both the project validations AND the balance sheet, must hot bottom
line.
Progress must be reported via routine reviews attended by key stakeholders,
and senior leadership , based on a formal Program Management Office structure
Projects touch and interact, strategic decisions allow projects to link, build or
detract from each other
A long term end-to-end strategic view that does not ONLY focus on pain
points & quick hits. Projects must be transformational in nature, major step
changes not small increments.

37

38

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