3. 21.10.11-stephan jockel- effective or efficient

Controlling Congress of the Baltic States 21. Oktober 2011 – Stephan Jockel 1

Effective or Efficient? – Key process indicators in a global

organization

Stephan Jockel CFO Crane Payment Solutions GmbH in Buxtehude, Germany

21. Oktober 2011


„NORD II.“

from

Northern Germany


Meeting at the following places, very often directly in the Industry:

Philips Bahlsen Bremer Lagerhaus Oetker Blaupunkt Kali Chemie Lilly Reithwisch BAT Cigaretten Nordland Papier Organisationspartner Bertelsmann TAD Gerresheimer Glas Fachhochschule Bielefeld ADV/ORGA Reemtsma Bramlage Berendson HDI Klöckner TH Leipzig Mohndruck Tielsa EDS Preussen Electra Putz&Partner Karstadt Corporate Planning Maschinenfabrik Niehoff KPMG Kühne Lehmann&Voss National Rejectors Dräger Wendeln Dr. Parge&Partner Datasave Nord Ostfriesische Teegesellschaft SIGNAL IDUNA Matsushita Electronics BLG Friedich Graepel Rheinmetall Möhlenhoff CCH Leuphana Lüneburg WTS NRI Friedich Graepel


Buxtehude – the story of the „Hare and the hedgehog“


Once upon a time there was a Hare who was very proud of his long powerful legs and wandered through a field with his nose in the air like some aristocrat. At the other end of the field was the house of the hedgehog family, where Mrs Hedgehog was taking care of the children and Mr Hedgehog was preparing himself for the usual evening stroll. Mr Hedgehog was also very proud in his way, not particularly on account of his legs, which – it has to be admitted – were rather tiny and crooked, but on account of his beautiful prickles. You see, every creature has some reason of his own to be proud. The hare and the hedgehog met in the middle of the field but the toffee-nosed hare made no reply at all to the hedgehog's “Good evening”. I said “Good evening” the hedgehog repeated. “Well now, who's there? A cripple with tiny crooked legs? What have I got to do with you then?”, the proud hare replied, full of disdain. “Oh!” thought the hedgehog, “that is really politically incorrect. Mister Hare is going to have to learn that every creature on Earth has his own value. And talking down to me like that! As if I were a child!” So, without letting his anger show, he made the following suggestion to the hare: “I am just as worthy as you, Mister Hare and I shall prove it. Let's have a race along the furrows in this field, we'll soon see whose legs are better.” “You're on!” laughed the hare. After the first lap the hare heard the rattling of hedgehog prickles from the next furrow and asked “Are you here already?”. Of course it was Mrs Hedgehog, who had finally put her children to bed and was having her own evening stroll. She already knew from her husband that Mister Hare was a stupid proud creature and, just as a joke, she replied in a low, almost masculine, voice “Yes I'm here already”. Mr Hedgehog stayed at the other end of the field and was stroking his prickles in an almost narcissistic way. He was in no hurry! The hare arrived there and again heard the rattling of hedgehog prickles and asked in astonishment “And are you here already?”. The hedgehog knew what the stupid hare was thinking: that he and his wife were the same person, and also said, as a joke “Yes, I'm here already”. After a hundred laps like this, the hare began to weaken, and after two hundred he finally died of a heart attack. Meanwhile, the gypsies from the neighbouring field arrived with clay, which they always use to remove the prickles – the cause of so much pride – from hedgehogs, and these two were so easy to catch, and with a bag for the hare, with his long and by now very well-toned legs, and made themselves a splendid supper of hare and hedgehog meat. And the gypsies lived happily ever after.

(from www.dwsolo.com)


Crane Payment Solutions GmbH

Founded in 1956, does 160 employees, does produce coin validaters and coin changers. A part of Crane Payment Solutions and belongs to CRANE CO., USA.

www.nri.de; www.craneco.com; www.craneps.com


Quo Vadis?

Today‘s products Tomorrow

New market‘s

Today‘s market

R i s k

L i n e

Validators and Changers Cashless Payment Systems

More activity in South Europe 6-Tube-Coin Changer

Kooperation mit Bill-Validation

(Komplementary-Products)


Doing the right things … Effective.

Doing the things right … Efficient.


What is a Key Process Indicator?

Performance Indicator or Key Performance Indicator (KPI) is an industry jargon term for a type of Measure of Performance.[1] KPIs are commonly used by an organization to evaluate its success or the success of a particular activity in which it is engaged. Sometimes success is defined in terms of making progress toward strategic goals,[2] but often, success is simply the repeated achievement of some level of operational goal (for example, zero defects, 10/10 customer satisfaction, etc.). Accordingly, choosing the right KPIs is reliant upon having a good understanding of what is important to the organization. 'What is important' often depends on the department measuring the performance - the KPIs useful to a Finance Team will be quite different to the KPIs assigned to the sales force, for example. Because of the need to develop a good understanding of what is important, performance indicator selection is often closely associated with the use of various techniques to assess the present state of the business, and its key activities. These assessments often lead to the identification of potential improvements; and as a consequence, performance indicators are routinely associated with 'performance improvement' initiatives. A very common method for choosing KPIs is to apply a management framework such as the Balanced scorecard. (wikepedia.de)


Categorization of indicators

Key Performance Indicators define a set of values used to measure against. These raw sets of values, which are fed to systems in charge of summarizing the information, are called indicators. Indicators identifiable as possible candidates for KPIs can be summarized into the following sub-categories:

Quantitative indicators which can be presented as a number.

Practical indicators that interface with existing company processes.

Directional indicators specifying whether an organization is getting better or not.

Actionable indicators are sufficiently in an organization's control to effect change.

Financial indicators used in performance measurement and when looking at an operating index

Key Performance Indicators, in practical terms and for strategic development, are objectives to be targeted that will add the most value to the business.[citation needed] These are also referred to as Key Success Indicators. (Wikipedia.de)


From Controlling-Wiki at www.controllerverein.de


Controlling – a value creating factor1st Controlling Congress of the BALTIC States

October 12, 2007 – Review:

• Value of the company and controlling – L. Valanciene

• Next generation controlling – Hendrik Vater

• Management accounting changes in Estonian companies – T. Haldma

• Soft Controls. Evaluation Tone at the TOP – R. Rupsys

• Controlling in the investment business – D. Slekiene

• Investment appraisal example for a reconstruction of a housing development in Berlin Hallersdorf – A. Siering

• Earned value analysis for a Construction Project from the perspective of a Consortium Leader – A Gielata

Conclusion:

The success of the consortium project is dependend upon the successful performance within the three perspectives:

time, cost and quality. In order to achieve the desired goals, all of them must be encompassed in the integrated tool of overall projects result management and monitored on a regular basis.

(ISBN 978-9955-9901-0-2)


Examples of Performance Evaluating

and Tracking


NRITop Level "X" Matrix - Strategy Deployment

lCreate and implement a product standardization process

l AP m m l m

l Improve and execute the DSO reduction program l AP l m m

lRefine and accelerate the material cost reduction program

l C l m m

l Refine and execute new product development process

l C m l

l Refine and execute new product identification process

l C l m

lDevelop and implement customer acquisition, retention, and expansion process (CARE)

l C l m

l m lCreate and implement a process to improve the product delivery system to match customer requirements

l l l l C m m l m m

l l l l Develop and execute intellectual capital plan l AP m m m m m l

Achi

eve

W/C

% o

f Sal

es o

f 17.

5%

Incr

ease

ope

ratin

g pr

ofit

to 1

0%

X m

io in

new

pro

duct

opp

ortu

nity

to th

e pr

otot

ype

stag

e

Achi

eve

sale

s of

26

mio

Eur

o

100%

com

plia

nce

to a

ctio

n pl

an th

roug

h 12

/31/

2005

Redu

ce le

ad ti

me

from

7 to

2 w

eeks

by

5/31

/200

5Im

prov

e fo

reca

st a

ccur

acy

from

x to

y b

y 3/

31/2

005

Incr

ease

turn

s fro

m 5

.79

to x

by

12/3

1/05

Impr

ove

prod

uctiv

ity fr

om 5

0.3%

to x

by

12/3

1/20

05

Achi

eve

26 m

io E

uro

sale

s by

12/

31/0

5

Achi

eve

x m

io E

uro

in n

ew p

rodu

ct id

entif

icatio

n by

12/

31/0

5

Com

plet

e th

e ne

w de

velo

pmen

t pro

cess

thro

ugh

prot

otyp

e fo

r x m

io E

uro

by 1

2/31

/05

Mat

eria

l as

a %

of s

ales

from

32.

73 to

x b

y 12

/31/

05

DSO

from

49.

2 to

42

by 1

2/31

/05

Redu

ce p

art n

umbe

rs fo

r val

idat

ors

and

chan

gers

from

x to

y b

y 12

/31/

05

Mül

ler

Mey

er

Beck

man

n

Paul

sen

Inkm

ann

Cohr

sleitn

er

Obe

rmül

ler

Tona

gel

l l Achieve sales of 45 mio Eurol Increase operating profit to 12%

l Achieve W/C% of Sales of 15%

Resource Deployment

3-Year FinancialBreakthrough Objectives

Top LevelStrategic Priorities

Annual Objectives

Targets toImprove

l Primary Responsibility or Link (type "l")m Secondary Responsibility or Link (type "m")


NRITTI Top Level Bowling Chart - Strategy Deployment

Target to Improve (TTI) JOP2005 YTD

ACTJanuary February March April May June July August September October November December

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

TTIActual

Improve productivity from 50.3% to x by 12/31/2005

Achieve 26 mio Euro sales by 12/31/05

Achieve x mio Euro in new product identification by 12/31/05Complete the new development process through prototype for x mio Euro by 12/31/05

100% compliance to action plan through 12/31/2005 (Intellectual Capital)

Reduce lead time from 7 to 2 weeks by 5/31/2005

Improve forecast accuracy from x to y by 3/31/2005

Increase turns from 5.79 to x by 12/31/05

Material as a % of sales from 32.73 to x by 12/31/05

DSO from 49.2 to 42 by 12/31/05

Reduce part numbers for validators and changers from x to y by 12/31/05


Nri - SBE (G. Albrecht)2nd Level "X" Matrix - Strategy Deployment

l D & I a Value Analysis Program l ll D & I the Supplier Reduction Process l ll Accelerate the LCC Sourcing initiative l l

Refin

e an

d ac

cele

rate

the

mat

eria

l cos

t red

uctio

n pr

ogra

m

Mat

eria

l as

a %

of s

ales

from

32.

73 to

x b

y 12

/31/

05

Incr

ease

the

% b

y Eu

ro o

f LCC

sou

rcin

g fro

m

40%

to 5

0% b

y 12

/31/

2005

Redu

ce th

e Su

pplie

r fro

m ~

80 to

60

by

12/3

1/20

05

100%

com

plia

nce

to a

ctio

n pl

an th

roug

h 12

/31/

2005

l Increase operating profit to 10% Resource Deployment

AnnualObjectives

2nd LevelStrategic Priorities

Top LevelStrategicPriorities

Targets toImprove

l Primary Responsibility or Link (type "l")m Secondary Responsibility or Link (type "m")


3-In-1 Data SheetThis sheet is specifically to create the charts and add the basic information on the 3-In-1 Sheet.The action items are entered directly on the presentation sheet.

Basic InformationName of TTI or KPI

Measurement ExplanationCompany NameFunctional Area

Date of 3-In-1

TTI or KPI Data Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Target 45 44Actual 44 56

Pareto of CausesReason % effect

Bankrupcty 60,0%Quality 20,0%Delivery 20,0%

Remaining % Unassigned 0,0%

March 31st, 2005

DSOAR per sales areaNRIFinance


Action Action Description Status Status Description OwnerOriginal Due

DateCurrent Due

Date

Top 5 Action Items

NRI - FinanceStrategy Deployment 3-In-1 Report for DSO

AR per sales areaMarch 31st, 2005

Metric Tracking

0

10

20

30

40

50

60

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

TargetActual Pareto of Causes

0%

25%

50%

75%

100%

Bankrupcty Quality Delivery

% Im

pa

ct


NRI - [Function]Action Plan (Macro) - Strategy Deployment

Action Step/ Kaizen Events Owner AssistingPlanned Dates Ja

n

Feb

Ma

r

Apr

Ma

y

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Current Year $ Impact

Annual $ Impact (if app)

Analize the CRANE IC process under consiteration of german legals W. Tonagel 03/31/05 X

Get copies and Examples of Crane IC processCall Elise Kopczick for Examples and RecommendationsContact XOMOX Lindau and CPFT D. and get planID key gaps and goals of IC developmentDevelop the NRI IC planDevelop strategyGet approval of Local Worker's council

Implement and execute the IC process

W. Tonagel

FR (St. Jockel)VM (R. Puchalski)

MW (M. Ziaja)QW (F. Cohrs)

R&D (K. Meyers-Steffens)

FL (H. Frankenfeld)

12/31/05 X

Integrate Workers Council in IC Process under reflection of Co-Determination

100 % compliance to action plan through 12/3/2005

Action Plan

Date of Next ReviewHR (W. Tonagel)Factors to Consider

Team

Target to Improve

Strategic PriorityDevelop and execute intellectual capital plan

Date12/31/2005

OwnerW. Tonagel


If you can‘t measure it, you can‘t manage it.


Sorry, the following examples are from real life – so not for

use in the internet.


Profit is Opinion, Cash is fact.

3. 21.10.11-stephan jockel- effective or efficient

Business

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