building a corporate supply chain platform. delivered value
TRANSCRIPT
Building a Corporate Supply Chain platform
UNIDADES CORPORATIVAS DE APOYO
Who we are ……
ÁREA COMERCIAL
Delivered Value
Differentiation
Magical experiences
Business Model
Tourism mix
Cancun / Riviera Maya
Country of OriginSIM 2010
2010 XCARET XEL-HÁ XPLOR
42.1% •UNITED STATES 15.8% 29.0% 41.4%
26.7% •MEXICO 42.7% 24.4% 22.6%
12.6% •CANADA 6.4% 15.3% 18.5%
7.2% •EUROPE 4.8% 2.6% 4.2%
4.2% •CENTRAL & SOUTHAMERICA 21.3% 7.6% 6.6%
3.6% •SPAIN 7.0% 11.3% 2.7%
3.2% •GREAT BRITAIN 1.8% 9.5% 3.6%
0.5% •REST OF WORLD 0.3% 0.3% 0.5%
Experiencias Xcaret:
México (34.4%)
Estados unidos (11.6%)
Canadá (18.3%)
España (39.0%)
Brasil (34.9%)
Argentina (22.8%)
Reino Unido (10.3%)
Market Share 2010
9
Building a Corporate Supply Chain platform• Define corporate team and roles
• Define plan and scope– Initial focus on indirect goods and capital investments(not services)– Standard codification system to classify sku´s– Spend analysis on commodities/categories (80/20)– Identify high potential savings commodities
• Define negotiation approach to supplier– Volume Leverage– Centralized solution with local execution
• Work process flow
Category profiling
Total Spend analysis
Prioritize top OEM/MRO commodities
Negotiation Implementation -
deployment
10
Launching a corporate sourcing process Goods &
Capital Management Performance
Goods & Capital Management Performance
Implementation
• Build structural platform– Define segregation process– Use an standardized classification code
– Prioritize high spending categories
• Global solution with local execution– Initiate sourcing process focusing on “speed to cash”
– Look for new solution for CNT reduction
11
Usage of all levers to reduce purchase price
Reduce purchase price
Leveragemarketpower
Standardize
Set correctproducttolerances
SubstituteRevise specificationsMake changes
Tighten
Loosen
Reduce custom productsIncrease purchase quantities
Unbundle contracts
Consolidate suppliersCombine with other materials
Compare across facilities
Try out new suppliers
Eliminate middle person
Increase use of components/ subassemblies
Reduce purchase price
Leveragemarketpower
Standardize
Set correctproducttolerances
SubstituteRevise specificationsMake changes
Tighten
Loosen
Reduce custom productsIncrease purchase quantities
Unbundle contracts
Consolidate suppliersCombine with other materials
Compare across facilities
Try out new suppliers
Eliminate middle person
Increase use of components/ subassemblies
12
Overall approach structured according to waves
July 2011 December 2011 December 2012
Pilot
Wave 1
Wave 2
Diagnostic
Top 3 Categories
Next Categories
Next commodities
• Pilot results will define strategy for following waves
13
Example of Category Spending Matrix
Groceries
1.2 MUSD
95 skus
Seafood
1.9 MUSD
46 skus
Specialties
0.4 MUSD
25 skus
Meat & Poultry
4.9 MUSD
80 skus
Cleaning solutions
0.6 MUSD
40 skus
Produce
0.6 MUSD
60 skus
Bakery
0.5MUSD
65 skus
+Va
lue
Complexity +
__
Oil
0.4 MUSD
10 skus
Pilot
Levels of consolidation on purchases
14
Leader Requirements
• Direct involvement of area managers
• Establishment of agreements for consolidation
• Interdisciplinary team effort
CEO• Deployment of initiative• Direct involvement of top
management• Multidisciplinary team
effort
• Direct drive • Establishment of criteria for
consolidation• Internal team effort
General Manager
Area Manager
Business Unit Consolidation
Corporate Consolidation
AreaConsolidation
High
Low
Agressive
Moderate
Conservative
15
Data analysis
and candidates selection
Demand consolidati
onPurchasing
Strategy Bid processBuy
Decision & Agreement
Contract administrat
ion
• High volume & turnover categories
1. MRO2. Office supplies3. IT equipment
Category selection
• Project team conformation
• Demand trends and consumption pattern analysis
• Purchasing models
• Standardization of specification
• Market intelligence:
1. Capacities2. Price history3. Supplier´s
locationDefine Bid structureTimeline and
responsibles
• Bid launch• Bid reception• Bid evaluation
Implementation Methodology
• Cost reduction monitoring
• Performance metrics evaluation
• Agreement administration
• T&C revision• Agreement• Follow up
metrics
16
Project resources needed
• Dedicated resources are needed to guarantee speed to cash
• Look for practical approach at all stages – Standardized code makes classification complicated and difficult for consolidation
– OEM/Brand classification facilitates consolidation, spend analysis and negotiation with vendors
• Spare parts standardization requires a separate project– Standardization requires technical validation and may delay “speed to cash”
• Define clear rules and communication channels for data management
17
Pilot consolidation results
• Achieved average savings of 10-15% per category
• Increase credit leverage from 15 days to 60 days
• Reduced 50% Supplier base by volume consolidation
• Improved Supplier performance driven by evaluation
• Estimated potential of 15-20% inventory optimization thru standardization between BU.
Productivity 2011
29%
Incoming Avg: Jan to July = 10.7 & Aug to Dec = 13.8 (orange line)Processed Avg: Jan to July = 10.2 & Aug to Dec = 14.1 (green line)
37%
PO
lines
Resources Suppliers
Process/ SistemsStrategy
Collaboration in SCM………..
All companies are different. They may sell the same products and services to the same people in the same volumes. But it is the very culture of companies that dictates how this is done.
