Richard
Norén
, MBA, M
Sc
1. Where we are
2. Saving potentials
3. Processes
4. Evaluations
5. Organizational skills and competencies
6. The relationship
7. How to get there
8. Compensations and benefits
9. Lean Sourcing, Backup slides
© Richard NorénRichard
Norén
, MBA, M
Sc
© Richard NorénRichard
Norén
, MBA, M
Sc
Procurement is
getting thereProcurement has become increasingly sophisticated in order to drive margin improvements, tools, productivity and transparency is improving the approach
• Procurement function mainly contract administration function
• Procurement and contracting decisions highly decentralized
• Vendor base fragmented
• Vendor relationships “incestuous”
1st Wave Strategic Sourcing
• Centralized negotiations
• Fewer suppliers
• Competitive bidding process
Demand Management
• Standardized specs
• Policy/procedures outlined
• Some monitoring and tracking
2nd Wave Strategic Sourcing
• Abolition of “sacred cows” e.g., Marketing, IT functions, Legal
• Cost management imperative
Matrixed procurement function
• Procurement shares responsibilities with centers of competence
• Responsibilities by the various parts of the organization clearly defined
Effective “end to end” procurement management
• MIS allows unit/price tracking
• System allows “policing” of compliance
• Disbursement management
• Service and quality
improvement
Relative Efficiency
Up To Late 80s 90s New Millennium
Procurement(“In The Basement”)
Sourcing(Easier cost improvement lever)
Supply Chain Management(Source of sustainable total cost advantage)
> 2010
Close loop SCM(Dynamic sustainable total cost)
3d Wave Strategic Sourcing
• Establish “open season” on any function e.g., HR, R&D, Procurement, design
• TCO management focus
Functional procurement
• High level of communality, standardization and modular processes. Procurement shares responsibilities with centers of excellence (PMO)
• Organizational ”service threads” responsibilities clearly defined
Dynamic “in/outsourcing” management
• SLA/KPI allows service thread tracking
• System allows comparable “best practice” of sourcing
• Cash flow management
• Service, quality and added value (ex R&D) improvement
© Richard NorénRich
ard N
orén, M
BA, MSc
inter-dependenciesPurchasing comes down to three activities:
– Sourcing: includes all activities related to establishing and managing purchasing contracts
– Procurement: includes all activities related to identifying and fulfilling an actual purchasing need.
– Supply relationship management: Develop mutually beneficial relationships
Create
Requisition
Award
Payment &
Settlement
Sourcing
Procurement
Identify
Need
Create Purchase
Order
Shipping
Receive
Goods/
Services
Assess
OpportunityAssess Internal
Supply Chain
Assess Supply
Market
Execute
Sourcing Strategy
Define
Sourcing
Strategy
SupplierRelationshipManagement
Create/Refine
Supplier Groups
Initiate
Relationship
Define
Performance
Expectations
Manage
Performance
Assess
Relationship
Institutionalize
Sourcing Strategy
Go to tender and
evaluate
© Richard NorénRichard
Norén
, MBA, M
Sc
Productivity
and transparency
• Lack of evaluation standards and common processes
• Limited vision
• No fostering of best practice
• Reinventing instead of re-using
RFQ
GLA
SLA
KPI
SQA
RFI
© Richard NorénRichard
Norén
, MBA, M
Sc
Act in the presence
• Assure the right competencies at senior positions that foster and represent the new strategic sourcing
• Slamming the suppliers as hard as you can is old school, 0th wave, and will only cause organizational stress and reduce savings
0th
1st
2nd
3d
© Richard NorénRich
ard N
orén, M
BA, MSc
© Richard NorénRichard
Norén
, MBA, M
Sc
Not about winning its
about surviving
• Everyone is out there, they’ve read the same books, heard the same arguments, fighting the same demons
• Learning in action, Kaizen
• @ Managers, admit that you don’t have control, act accordingly. Increase span of control through procuring functions rather than components, master entire relationships, define service threads
• @ Skilled procurement officers, many times your insight is exactly what the suppliers need to excel, use it communicate, propose, change & think cross-functional
© Richard NorénRichard
Norén
, MBA, M
Sc
Don’t gamble
• Make the strategy
• Make it stick
• Don't emphasize on short-term profits
• Don’t award business on price tag alone
• Break down barriers between staff areas © Richard NorénRich
ard N
orén, M
BA, MSc
Reach out and it will
materialize
• Approach the entire sourcing chain flow
• Justify your need
• Merge processes with supplier
• Its never about the price only
• 30-10% is likely to be found
© Richard NorénRichard
Norén
, MBA, M
Sc
© Richard NorénRichard
Norén
, MBA, M
Sc
The processes’•Get it right, unless you know, no one else will know.•Transparency with suppliers, change if necessary•Value mapping, spaghetti chart•Identify the entire process from the supplier•Define service threads boundaries
Simplicity
© Richard Norén
Richard
Norén
, MBA, M
Sc
Packet your processes
• Make your homework, map your process and needs, define service value threads
• Good packages and wrappings are like nice gifts, you can bring them easily anywhere & anytime.
• Mind your own business, suppliers are many times much better equipped in knowing their own supply chain, your common work is to find out how to optimize and integrate the entire processes.
© Richard NorénRichard
Norén
, MBA, M
Sc
Value flow mapping
where do you add value?
• Assure that your SCM process are mapped, define ”service threads”
• Compare and match process flows and SLA/KPI.
• Transparency, evaluate & improve
• Focus on deliverables © Richard Norén
Richard
Norén
, MBA, M
Sc
All Pieces fits into TCO
• TCO is your procurement DNA
• Every link is needed and every part counts
• Use the precise supplier process at the right time
• Unnecessary links will suboptimize TCO
© Richard NorénRichard
Norén
, MBA, M
Sc
No silo thinking,
Think ”service threads”
• ”Service threads” are the entire process from end-to-end
• Know your boundaries, facilitate and break out.
• The sourcing is rarely one silo only, pull strings too all departments and dependants
Accoun-ting
IT
Marketing
HRBranding
Communi-
cation
Industrial operations
DesignR&D
Purchasing
Lean sourcing
© Richard NorénRich
ard N
orén, M
BA, MSc
Cost is everywhere
stack savings
• Stack and aggregate savings
• Define where you add or destroy value
• Include even parts where you might is better of doing it on your own.
• It’s the entire service thread that will save your cost, parts of it will not be interesting for suppliers or not even be feasible to grab as it e.g doesn’t make logistical sense. Think it through
© Richard NorénRich
ard N
orén, M
BA, MSc
anchoring
• Everyone needs to be part of it
• Personal agenda, empowerment, political, hierarchical level is second nature
• Sourcing service treads is cross-functional
© Richard NorénRichard
Norén
, MBA, M
Sc
modular processes
facilitates sourcing
• Make every function a separat process module, available for outsourcing
• String your processes as set of wild Strawberries into your own ”service thread”
© Richard NorénRich
ard N
orén, M
BA, MSc
Make sure that the
sourcing makes sense
• Work with anchoring, supplier transparency and modular processes, adopt yourself continuously
• Change process modules whenever needed without looking back
© Richard NorénRich
ard N
orén, M
BA, MSc
© Richard NorénRichard
Norén
, MBA, M
Sc
Where are you going
• Transparency, establish common grounds of evaluations, compare, use best practice for forward movements
© Richard NorénRich
ard N
orén, M
BA, MSc
Are the trees in the way
of the forrest
• Simplicity
• Focus on the ”do’s”
• Reenginering, productivity enhancements...
• Stay upstreams, not downstreams
© Richard NorénRich
ard N
orén, M
BA, MSc
Leveranskedjans komplexitet
Aff
ärs
risk
Låg Hög
Hö
g
Inköps-kategori
StapelIcke kritisk
Strategisk Hävstång
Placera in den röda punkten, och anpassa storleken efter spendvolymen
Kraljics inköpsmatris
Flaskhals
HLLL
LH HH
© Richard NorénRich
ard N
orén, M
BA, MSc
FlaskhalsStapel
Icke kritisk
Strategisk Hävstång
Låg Hög
Hö
g
Elektronik
LH
HL
HH
LL
Mekanik
Chassidelar
Montage-material
Kontors-material
Placera in samtliga inköpskategorier i kraljicsmatrisen
LeveransriskLeveranskedjans komplexitet
Aff
ärs
risk
Kraljics inköpsmatris – positionering av samtliga inköpskategorier
© Richard NorénRich
ard N
orén, M
BA, MSc
FlaskhalsStapel
Icke kritisk
Strategisk Hävstång
Låg Hög
Hö
gLH
HL
HH
LL
Samtliga inköpskategorier ger oss en samlad bild, ofta benämnd ”fingeravtrycket”. Denna bild kan sedan ge oss en sammantagen uppfattning om hur företagets strategier bör se ut.
LeveransriskLeveranskedjans komplexitet
Aff
ärs
risk
Kraljics inköpsmatris – Företagets ”fingeravtryck”
© Richard NorénRich
ard N
orén, M
BA, MSc
FlaskhalsStapel
Icke kritisk
Strategisk Hävstång
LH
HL
HH
LL
Kraljics inköpsmatris – Olika företag har olika ”fingeravtryck”
FlaskhalsStapel
Icke kritisk
Strategisk Hävstång
LH
HL
HH
LL
FlaskhalsStapel
Icke kritisk
Strategisk Hävstång
LH
HL
HH
LL
FlaskhalsStapel
Icke kritisk
Strategisk Hävstång
LH
HL
HH
LL
Systemleverantör fordonsindustrin
Grossistföretag Medicinteknikföretag
Byggföretag
Exemplen är mycket hypotetiska, verkligheten kan skilja sig väsentligt© Richard Norén
Richard
Norén
, MBA, M
Sc
Kraljics inköpsmatris - inköpsstrategierna
Kraljicsfält Strategisk Hävstång Flaskhals Stapel
Strategi PartnerskapKonkurrensutsatta anbud
Säkra försörjningKategoriintegration
Mål•Skapa ömsesidiga åtaganden i lång-varig relation.
• Hitta bästa kort-siktiga anbud.
• Säkra kort & långsiktig försörjning
•Reducera försörjningsrisk
•Reducera logistik-komplexitet
•Öka effektivitet
•Reducera antal leverantörer
Aktiviteter
•Korrekt prognos
•Riskanalys
•Noggrant lever-antörsval
•Kostnadsanalys
•Rulland inköpsplan
•Effektiva processer
•Leverantörsranking
•Förbättra marknads- och produktkunskap
•Sök efter alternativ
•Förflytta inköpsvolymer
•Konsolidera inköp
•Optimera inköps-kvantiteter
•Target-pricing
•Korrekt prognos
•Riskanalys
•Bestäm kundranking
•Utveckla förebyggande skydd
•Sök efter alternativ
•Utveckla alternativ
•Samla köp för hela kategorier
•Standardisera kategorier och processer
•Utveckla effektiva orderprocesser
•Delegera order-hantering
Källa: van Weele 2005, sid 153
FlaskhalsStapel
Icke kritisk
Strategisk Hävstång
© Richard NorénRich
ard N
orén, M
BA, MSc
Inköpsmodeller 62009-09-25
Alternativa portföljstrategier - Bensaous modell
Marknadsrelation Leverantören fjättrad
Köparen fjättrad Strategiskt partnerskap
Låga Höga
Höga
Låga
Leverantörens specifika investeringar
Kö
pa
ren
s s
pe
cif
ika
in
ve
ste
rin
ga
r
Källa: Bensaou, 1999); samt Skjött-Larsen sid 246
© Richard NorénRich
ard N
orén, M
BA, MSc
Inköpsmodeller 72009-09-25
Alternativa portföljstrategier - Persons modell
Många leverantörer, kort ledtid, få kvalitetsproblemStrategi: Prispress, mark-nadsorientering, alternativa leverantörer
Standard Special
Repititiva
Engångs
Typ av produkt
Ty
p a
v k
öp
Källa: Persson 1998
Hårda krav på ledtid ochkvalitet. Köparen beroende.Strategi: Ram- och sam-arbetsavtal
Liknande ovan, samt prob-Lem att känna leverantörer och prisnivå. Köparen är beroende.Strategi: Prispress ochreferenser
Långa ledtider, hårda kval-itetskrav. StyrningsproblemStrategier: Förhandlingar och referenser
© Richard NorénRich
ard N
orén, M
BA, MSc
Inköpsmodeller 82009-09-25
Alternativa portföljstrategier – Andra modeller och deras
egenskaper
Modell Utgångspunkt
Elliot-Shircore-Steel (1985) Vinst/värde vs. leveransens sårbarhet
Hadeler-Evans (1994) Produktvärde versus komplexitet
Lilliecreutz-Ydreskog (1999) Ekonomisk profil vs. Komplexitet/risk
Olsen-Ellram (1997) Strategisk vikt vs. Svårighet att leda
van Weele (2002) Vinstpåverkan vs. leveransrisk
Samtliga modeller liknar Kraljics modell.
© Richard NorénRich
ard N
orén, M
BA, MSc
Certification levels and the need to monitor suppliers
Process Performmance Expecctations *
Certification level
Total Business Assessment
(Management,
Quality system
(QPS)
Deliveryy Quality Affordability Customer Satisfaction
( g , quality, delivery, cost, technology, customer support)
(QPS)On time
(%)
Period
(Months)
Run.
average
Acceptance
(%)
Period
(Months)
Run.
average
Cost trends, cost reduction efforts, lean practices
Management, Schedule, Quality, Technical, Finance
Gold
Silver
Bronze
4,5-5.0 Min 4.0
> X, facility wide 100 12 100 12 4.0 or greater 4.4 or greater
3.5-4.4
Min 3.0
>Y, critical processes
97 12 99.5 12 3.4-3.9 3.8-4.3
2.5-3.4
Min 2.0
Basic
Initial
93 12 99 12 2.8-3.3 2.8-3.7
* May vary with product complexity
What are reasonable requirements to have?
How many certification levels does it make sense to have?
Monitor and improve
mutual expectations
© Richard NorénRich
ard N
orén, M
BA, MSc
© Richard NorénRich
ard N
orén, M
BA, MSc
Teamwork, teamwork,
teamwork...
• All reflections are valid in the corporates interest
• NO pride, NO bounderies, NO single voice
• Who is the owner of a issue? Focus on solutions
© Richard NorénRich
ard N
orén, M
BA, MSc
© Richard NorénRich
ard N
orén, M
BA, MSc
See the larger picture
• Recognise that the supplier is just a part in the value flow chain
• While a supplier may fit the requirement it may not fit the environment © Richard NorénRich
ard N
orén, M
BA, MSc
Trust the supplier to
fit in
• Give the supplier opportunity to fit into the picture
• The supplier is far better equipped in their area, appreciate it, listen and amend
© Richard NorénRich
ard N
orén, M
BA, MSc
TIME
Industralization
challange
Moduls
Approved supplier list
Outsourced
Lean manufacturing
Propriotority
manufacturing
Outsourced
manufacturing
Generationplanning
Plattforms
Features vs components
Pre assembly
© Richard Norén
Richard
Norén
, MBA, M
Sc
How mature is your
sourcing?
Finish or designIndicators or
control pannel
Tyre or wheel
Piston or engine
Lights or electrical system
Breaks or stearing system
© Richard NorénRichard
Norén
, MBA, M
Sc
Cherrypicking
• Work tighter with suppliers
• Establish a set of real prefered or ”symbiotic” suppliers
• Move from component sourcing to conceptual cherry picking of ideas without loosing control
© Richard Norén
Richard
Norén
, MBA, M
Sc
Boeing defense
• Boeing started in already in the early 90s to outsource design of aircrafts to Russia
• They do not make flight simulators, they only label them Through symbiotic realtionship, Boeing
had indication of a large govermental order a few years ago. They discussed it with their core supplier, they were able to deliver the first simulator the day after reciving the order without engaging in any corporate financial risk or comittment
Through brave outsourcing of product entire design and then cherrypicking, they have been able move quicker into communality and plattform standards across products to lower cost
”Its never about
the money”
© Richard NorénRich
ard N
orén, M
BA, MSc
© Richard NorénRichard
Norén
, MBA, M
Sc
step by stepLevel
of
Ad
ded
Valu
e
Time Line (potentially 3-5 Years)
Buying
Procurement
Partnership
Alliance
World Class
• Needs not anticipated, data not available or not used
• No Organizational wide procurement strategy, large supplier base• Transactional focus
• Procurement provides ad-hoc tactical support• Low skills and resource, little career planning
• Some category strategy creation, but not company wide, and not communicated effectively
• Volume leverage through effective use of competition across categories• Track commercial measure of performance, targets for savings
• Technology enables i.e. purchase to pay cycle improvement through automation• Selected supplier base consolidation
• Training and recognition of skills required
• Formal Planning processes
• Focus on SRM and sharing business plans• Longer term, bigger value contracts with fewer suppliers
• Collaboration on cost improvement, increased levels of risk sharing• Trained and qualified resources supporting all categories of spend
• Key Performance Indicators in place.
• Procurement strategy aligned to corporate strategy
• Suppliers selected for strategic fit and deliver continuous improvement• Data driven decision making
• Full support over purchasing cycle • Risk sharing higher with the Organizational co-located and jointly financed
• Business planning optimizes all commercial aspects, tax, investment, people
• Strategy fully supports the corporate goals and driven by corporate consensus
• Managing the supply risk while leveraging the competitive strengths• Nurturing supplier relationships
• Supplier base share improvement target for cost and innovation added value• Full visibility and trust across the external value chain
• Procurement maintains a rationalized supplier network that delivers technology, knowledge, products or service quality superior to competitors
Stage I: Reacting
Stage II: Developing
Stage III: Advancing
Stage IV: High Performing
Stage V:Pioneering
A procurement function needs to work through the defined stages to achieve world class procurement capabilities
© Richard NorénRichard
Norén
, MBA, M
Sc
Its never about the
price
Total Acquisition Cost
(Actual Opportunity)
Demand Drivers
SpecificationsProcurement Practices
Inventory Practices
Operational Practices
Decommissioning/ Disposal
Internal Policies & Procedures
Internal Processes
Management Systems
PurchasePrice
Amount paid to the Supplier
Factors generateadditional costs to an organization once an item is
commissioned and in use
The scope of sourcing extends beyond supplier price negotiation and takes into account the total cost of ownership
© Richard Norén
Richard
Norén
, MBA, M
Sc
Identify weakness and
strengths
• Make weakness and strengths your loved companions
• Be frank and transparent about it
• Map the SCM process, mirror it with the supplier
© Richard NorénRichard
Norén
, MBA, M
Sc
Impossible is not a fact
its a opinion
• Don’t listen to much on internal voices that claim that it cant be done, they may have different agenda or lack your insight
• Challenge; ask for process mapping; proofs of evidence for why it can’t be sourced
• Verify information from critical internal voices with themselves, analyse, summarize, propose a solution based on given information so that it cant be challenged © Richard NorénRich
ard N
orén, M
BA, MSc
The proposal
• Superimpose your processes, cut and paste, simplify, rethink
• Be frank about any expectancies, bad and good ones, NO one can read minds, not even your supplier
• Don’t use service KPI/SLA as punishments, it’s veichle for improvements and best practice dialogue
• Make it work, just make it. Never give up
© Richard NorénRich
ard N
orén, M
BA, MSc
Synchronize yourself
• Once the main mapping is done, continue with all sub processes if needed
• Let go of your own pride, your supplier is expected to deal with it, you’re sourcing a package, focus on: ”in and output”
© Richard Norén
Richard
Norén
, MBA, M
Sc
Get married
• Realize that true cost /quality advantages will only happens when you behave and act as there is no one else.
• Slapping the supplier only as hard as you can, will only dress you up for divorce.
• Never relax, measure and verify that you are doing the right thing to avoid competition.
© Richard NorénRichard
Norén
, MBA, M
Sc
© Richard NorénRichard
Norén
, MBA, M
Sc
How much cost
do you have?
• COGS, is typically in the range of 70-95% of revenue of most manufacturing firms. For those companies, net income is typically 3-8% of revenue.
• A representative company who's COGS is 80% of revenue and whose net income is 5% of revenue; if you can reduce COGS by 1% (to 79.2% of revenue), that savings goes directly to the bottom line, increasing net income to 5.8% of revenue thus increasing net income by 16%.
Agriculture, forestry and fishing
Mining
Construction
Manufacturing
Transportation
Communication
Electric, gas, and sanitary services
Wholesale
Retail
Insurance
0 20 40 60 80
Cost of operations
© Richard NorénRichard
Norén
, MBA, M
Sc
you get what you pay
for, use it wisely
• If you want to save cost be ready to pay for it. Also, be willing to change processes and structures
• Many old school is low cost, emerging 3d sourcing wave is still rare in supply
• Empower employees to challenge concepts, top management needs to be part and support it.
• If you buy a Ferrari and then drive it on a dirt rode, don’t complain if you can’t reach full velocity
© Richard NorénRichard
Norén
, MBA, M
Sc
Academical shift
• The number of specialised procurement education are avalanching
• More MBAs or people with dual education are entering the field, capable of dealing with multi dimensional and increasingly complex environment
• Multilingual with global experience, dressed for making sustainable savings. They’re skilled to be instrumental in increasing profit through saving cost
• Purchasing salaries of > £100,000 is becoming more common, moving towards financial industry wages
© Richard NorénRichard
Norén
, MBA, M
Sc
© Richard NorénRichard
Norén
, MBA, M
Sc
The 5s’
Step Name Action Catch Phrase
1Sort
(Seiri)
Remove unnecessary items from the workplace “When in doubt, throw it out”
2Straighten, Set in Order
(Seiton)
Locate everything at the point of use
“A place for everything, and everything in its place”
3Sweep, Shine
(Seiso)
Clean and eliminate the sources of filth
“The best cleaning is to not need cleaning”
4Standardize
(Seiketsu)
Make routine and standard for what good looks like
“See and recognize what needs to be done”
5Self-discipline, Sustain
(Shitsuke)
Sustain by making 5S second nature
“The less self-discipline you need, the better”
© Richard NorénRichard
Norén
, MBA, M
Sc
Wastes’The 7 Wastes – Definition Examples Causes Countermeasures
Over-|production Producing more than the customer needs right now
Producing product to stock based on sales forecastsProducing more to avoid set-upsBatch process resulting in extra output
ForecastingLong set-ups“Just in case” for breakdowns
Pull system schedulingHeijunka – level loadingSet-up reductionTPM
Trans-portation
Movement of product that does not add value
Moving parts in and out of storageMoving material from one workstation to another
Batch productionPush productionStorageFunctional layout
Flow linesPull systemValue Stream organizationsKanban
Motion Movement of people that does not add value
Searching for parts, tools, prints, etc.Sorting through materialsReaching for toolsLifting boxes of parts
Workplace disorganizationMissing itemsPoor workstation designUnsafe work area
5S, Point of Use StorageWater SpiderOne-piece flowWorkstation design
Waiting Idle time created when material, information, people, or equipment is not ready
Waiting for partsWaiting for printsWaiting for inspectionWaiting for machinesWaiting for informationWaiting for machine repair
Push productionWork imbalanceCentralized inspectionOrder entry delaysLack of priorityLack of communication
Downstream pullTakt time productionIn-process gaugingJidokaOffice KaizenTPM
Processing Effort that adds no value from the customer’s viewpoint
Multiple cleaning of partsPaperworkOver-tight tolerancesAwkward tool or part design
Delay between processingPush systemCustomer voice not understoodDesigns “thrown over the wall”
Flow linesOne-piece pullOffice KaizenLean Design
Inventory More materials, parts, or products on hand than the customer needs right now
Raw materialsWork in processFinished goodsConsumable suppliesPurchased components
Supplier lead-timesLack of flow, Long set-upsLong lead-timesPaperwork in processLack of ordering procedure
External kanbanSupplier developmentOne-piece flow linesSet-up reductionInternal kanban
Defects Work that contains errors, rework, mistakes or lacks something necessary
Scrap, ReworkDefectsCorrectionField failureVariationMissing parts
Process failureMis-loaded partBatch processInspect-in qualityIncapable machines
GembaSigmaPokayokeOne-piece pullBuilt-in quality3PJidoka
© Richard NorénRich
ard N
orén, M
BA, MSc
Drivers of change
From To Driver
Improving
Productivity
Single dimensions, limited complexity
Several dimensions, higher complexity Practical thinking become more scientific
Flattening Partly sharing information Instant sharing with everyone that want to know as to enhance collaboration and accelerate corporate competitiveness
Resource usage
Strengthen teamwork
Learning and control, ”smartness”
Control &
real time
information
Spending time on collecting and aggregating historical information
Instant real time information access
Spending time on evaluating and reacting on real time information
Resource usage based on real time information
Transparency
Improved planning and reaction
Authoring
information
Few author their own content digitally accessible for everyone
Easy and convenient authoring of content digitally, accessible for anyone that want to know
Increased productivity
Time to market
Cost Unnecessary administrative work
Silo thinking
Sliding cost trend based on mutual needs and expectations
Holistic thinking and planning
Savings
Simplicity
Leverage on volume
Improvement Long reaction times to bottle necks
Identify bottle necks quickly and being able to prioritize planed reactions
General efficiency and cost cutting
Accelerated product and process improvement
Process Limited alignment between process and information flow
Alignment in-between process and its information flow
Better process control
Predictability
© Richard NorénRich
ard N
orén, M
BA, MSc