ir ist11 continuous improvement in the supply chain pls tcm13 276977

8/13/2019 Ir Ist11 Continuous Improvement in the Supply Chain PLS Tcm13 276977

1/31

Becoming The Best

Unilever Supply Chain

Pier Luigi Sigismondi


2/31


3/31

We are now Playing to Win

Supply ChainCreating Value


4/31

Winning is about

Sustainable Profitable Volume Growth

2009 2015

Gross Margin

%TO

EnablingGrowth

DrivingGrowth

FundingGrowth

ImprovingMargin


5/31

Consistent Improvement in Quality

2009 2010 2011

Product Incidents

-68%

2009 2010 2011 YTD

Consumer Complaints

1.9%

-28%

YTD


6/31

Enabling Growth through Quality ExcellenceLifebuoy Case

Consistent Quality


7/31

Enabling Growth through Quality ExcellenceLifebuoy Case

Market Share >+80bps

Better consumer

AttributesImproved Fragrance & BarStructure

Consistent Quality

+ =

Continuous improvement in all categories


8/31

Consistent Product Availability improvement

2008 2011 YTD

On Shelf productAvailability More and More Stores

From 5 to 20 Countries

+700bps


9/31

Driving growth through Service Excellence

2011 2015

On Shelf productAvailability Channels

Modern Trade

All Channels

From 20 to >150 Countries

Potential of 360bps UVG

+400bps


10/31

Superior Service in difficult timesFlood in Thailand

Unilever Thailand

# 1


11/31

Consistent Working Capital improvement

Top League performance

-10%

-6%

-2%

2%

-2000

-1000

0

1000

2008 2009 2010

Closing WC Mio Euros WC %TO

+2.1bn


12/31

Consistent Working Capital improvement

Top League performance

-10%

-6%

-2%

2%

-2000

-1000

0

1000

2008 2009 2010

Closing WC Mio Euros WC %TO

Funding growth through Excellencein Cash Management

+2.1bn

Mexico Case

Integrated Business Planning

&Customer Integration


13/31

Step-up in CapEx to fuel growth

Increased focus on D&EIncreased focus on

growth and innovation

2008

Developed D&E

2008 20112011

+70%

+30%

Infrastructure and Savings

Growth and Innovation

IT

+40%

+70%

+50%


14/31

Increasing savings

2006-2008 2009-2011

Sustainable Step Up in SC Savings

1.9% +47%

2.8%

but not reflected in higher margin

Savings %TO(avg)


15/31

Increasing savings

2006-2008 2009-2011

Sustainable Step Up in SC Savings

1.9% +47%

2009 2010 2011 H1

but Gross Margin down

-230bps

2.8%

but not reflected in higher margin

Savings %TO(avg)


16/31

Improving margins through Cost ExcellenceLow Cost Business Models

ReplicableE2E Solutions Significant potential Reaping the benefits

Demand VolatilityManagement

Network Redesign

Direct Deliveries

Product Formulation

Improved A&P and TTSInvestment

Indirects Management

1100bps

900bps

1350bps

850bps

920bps

Rollout to

Other Countries

&

New Categories

*

Operating Margin Improvement for Products in scope LCBM*


17/31

Commodity Risk Management is EssentialCommodity Risk Management

Volatility

Start 2011 End 2011 2012

Reliability &Economic Protection

Unilever spend actively

hedged

Uncertainty

Commodity Price Trend Example


18/31

We are determined to be The Best

World Class

Value Chain


19/31

1. Global Scale & Local Agility

2. Lean Organisation

3. Speed

4. Partnership with Suppliers

5. Unilever Sustainable Living Plan

Enabler of Unilevers Financial Growth Model

Unilevers Supply Chain is UniqueSources of Competitive Advantage


20/31

Global Scale

31bn ProcurementGlobal Sourcing fromLow Cost Countries Scale in Logistics

76%

24%

Global Cluster

D&E >150 of 260Factories

From Europe to Asiaand Americas


21/31

Local Agility

> 160.000 Point of Sale Served > 7.000 Islands Served

Unique Route to Market Capabilities in Growing Markets


22/31

Local Agility: Differentiated Supply Chains


23/31

Local Agility: Differentiated Supply ChainsIndonesia Case

in General Trade

Individual, 24hrsProduct Dispatch Drives profitable growth

New Route to Market

Before After

Normal Express Orders

>100%


24/31

Lean Organisation

Strong TeamLean Fast Decisions

3 layers between CSCO

and factory director

Shares vs main competitors

17

Direct

Reports

One

Real Estate

Team

FourCapEx

signaturesOne

PurchasingOrder

Savoury Over 2x

Skin Over 2x

Ice Cream Over 1.5x

One

Information

PortalOne

Travel Cost &

Compliance

Report


25/31

Speed: New launches in RECORD TIME

35 Markets

Global Sourcing7 Factories

40 Moulds9 Sizes7 Resins

Set-up in


26/31

Speed: New production lines in RECORD TIME

New productionLines

35% faster

In 30 Markets from 6 Factories


27/31

Speed: New Factories in RECORD TIME

20M, -6 months 7M, -3 months 10M, -12 months

* Value Delivered , Time reduction versus Original Plan


28/31

Strategic Partnerships with Suppliers

Growing with suppliers through Innovation

Supplier Investment to

grow where Unilever grows

>1.3bnSupplier

Capacity

Investment

>90%

D&E

>70

Active supplierinitiated

innovation

projects

500.000

smallholder

farmers linkedinto our supply

chain

Unilever

Exclusive

Innovation

USLP


29/31


30/31

20112010/112009

In Summary:

Cost DrivenSupplyChain

Building

Foundations

Supply ChaincreatingValue

Playing to Win

Lean andAgile value

chain

Fit to

Compete

Be

The Best

World ClassValue Chain


31/31

In Summary:

1. Operational Excellence:Foundation (Not a Destination)

2. Best in the Industry

3. Enabler of Unilevers Financial

Growth Model

Live Superior Service Deliver Sustainable Profitable Growth

ir ist11 continuous improvement in the supply chain pls tcm13 276977

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