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Achieving Value Chain Transformation at DuPont -...
Transcript of Achieving Value Chain Transformation at DuPont -...
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Ginny Youngblood, CSCP, CPIM, SCOR-P
Achieving Value Chain
Transformation at DuPont
Ginny Youngblood is the Global BPM Lead for DuPont and the corporate Process Owner for the Performance Management element of the DuPont Production System.
She joined DuPont in 1982 and has worked at several manufacturing sites as well at corporate headquarters in Wilmington, Delaware. Her leadership and managerial responsibilities with DuPont include Sales, Marketing, New Product Development, Line Manufacturing, Operations and Business Leadership roles at various manufacturing and business sites throughout DuPont. She has a particular interest in teamwork and in the development of individual processes and team systems which support combined individual and business growth.
She is CPIM, CSCP, and SCOR-P certified. She received a Ph.D. in Chemistry from Yale University in 1982 and a B.S. from The College of William and Mary in 1977.
Global BPM Lead – DuPont
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DuPont is a market-driven science company
Our Purpose
DuPont is a science company. We work
collaboratively to find sustainable, innovative, market-
driven solutions to solve some of the world’s biggest
challenges, making lives better, safer, and healthier
for people everywhere.
DuPont Portfolio Changes
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Science Meets Demand
DuPont Global Supply Chain
DuPont Integrated Operations WorldwideGlobal Supply Chains 70 of 98
Plant sites 207 Sites
Warehouses 740+
Shipping Major Container user
Employees (approx.) 34,000+
Countries 45
Contract operations ~1000 Sites
Diverse Operations• Seeds • Discrete parts• Food additives• Industrial biotech• Film production• Polymer production• Fiber production• Consumer goods• Electronic materials• Continuous chemical process• Fine and custom chemicals• Fluorine chemicals
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to Identify Gaps . . .
Performance opportunities
Demand led fulfillment operating
model
+
Improve
customer
experience
Reduce
cost to serve
Reduce
inventory
From …
� High inventory � Misaligned policies� Non productive inventory
� High complexity� Manual interventions� Numerous work
arounds� Significant expediting
� Inconsistent delivery performance
� Difficulty meeting promises
� Significant churn and effort
To …
� Automated, streamlined, rules based processes
� Reduced manufacturing costs
� Reduced expediting costs
� Advantaged working capital productivity
� Aligned E2E performance
� Capital available to re-invest
� Reliable Supply� Competitive lead times� Differentiated service
levels
AND
and to Focus on Transformation
AND
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DuPont Process PerformanceGaps Come From E2E Processes
Suppliers Customers
Requisition to Pay Order to CashRecord to Report
DemandMgt
SupplyMgt
Material
Money
Information
Transactional Processes
% delivery promises broken
DuPont eTransactions << Hackett World Class of 50%
# invoices per sales
order
% shipments billed > 1 day late
% customer orders require
manual intervention
% requisitions released manually
% inbound material
shipments late
% of MRO purchases are
spot orders
E2E Processes Are Assets We ManageB
usiness A
IT
Finance
Operations
Business B
Up Down DuPontDuPont
IT
Planning
Sourcing
Deliver
E2E ProcessesDuPont
Resources Value
VALUE
Processes are assets . . . Process are cross-functional . . .
Need a discipline to manage E2E business processes across the white spaces of resource hierarchies
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Transparency
Ownership
Agility
BPM – Process Management Discipline
Business process management
(BPM) is a management
discipline that treats processes
as assets that directly
contribute to enterprise
performance by driving
operational excellence and
agility.
BPM Supports Transformation
Develop and maintain cross functional standard processes
Standard KPIs for integrated E2E supply chain
Behaviors to support change
Standard system and data architecture
Standard governance, accountability and centered teams
Business processes
Capabilities Strategy and KPIs
Systems and information
flowsStructure
Culture(M & B)
Mindsets, behaviors &organizational liquidity
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Process Hierarchies - SCOR Model
Level 1 Level 2 Level 3 Level 4 Level 5
Scope Configuration Activity Workflow Transactions
Differentiates business Differentiates complexity Names tasks Sequences steps Links transactions
Defines scope Differentiates capabilities Links, metrics, tasks and practices
Job details Details of automation
Framework language Framework language Framework language Industry or company specific language
Technology specific language
D1Deliver
stocked productDeliver D1.2
Receive, enter,& validate order
Industry Standard Definitions Company Definitions
EDIXML
Source: Supply Chain Council - Supply Chain Operations Reference Model
Business
Processes
Capabilitie
s
Strategy & KPIs
Structure
Culture
(M & B)
BPM: Managing ProcessesProcess transparency
Process ownership
Process agility (continuous improvement)
Order to Cash
A_(OTC) Order to Cash
Process Level: 3 Process Owner: Carol DandolosLast change: Jan 6, 2012 8:58:15 AM
Managing & Prioritizing Demand
Order Management process
DM4.5
Sales Policy Execution
DM4.4
Availability Check
DM4.6
Entitlement Check:Identify, Prioritize & Manage
Abnormal Demand
DM4.2
Plan Deliver/Make
Identify, Prioritizeand Aggregate
DeliveryRequirements
P4.1
Balance DeliveryResources andCapabilities with
Delivery...
P4.3
EstablishDeliveryPlans
P4.4
Make
Make
Deliver
Deliver
Deliver
Dx.4-14 Includes Export Docs & MSDS
Billing and Collections
Process Accounts Receivable
Fin7.02.3
ManageDeliver
Information
ED.3
Invoice the Customer
Fin7.02.2
Manage Process Collections
Fin7.02.4
Manage and ProcessAdjustments/Deductions
Fin7.02.5
Process Customer Credit
Fin7.02.1
Authorize Supplier
Payment (m-t-s)
S1.5
Consume Demand ConsensusForecast
DM4.3
[Freight Payment]
Enable Create/ Maintain MasterData
Business
Processes
Capabilitie
s
Strategy & KPIs
Structure
Culture
(M & B)
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Culture
Workforce
Response to
change
Open, honest, trusting
Engaged,
flexible
Positive,
embracing
1
2
3
New culture and capability must accompany standard processes
Elements:
Global standard process
Global standard reports
Cross-functional collaborationSales, CSR, supply chain, supply scheduling,
warehouse/logistics
Leader
behavior
Involved,
coaching
4
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DPP End2End Supply Chain
BPM: Capability
Business
Processes
Capabilitie
s
Strategy & KPIs
Structure
Culture
(M & B)
BPM: Strategy & KPIs
Process KPI StrategyStrategy
measured by
KPIs
KPIs flow down
and match
process level
Level 0
Level 1
KPIs standard
by process
Business
Processes
Capabilitie
s
Strategy & KPIs
Structure
Culture
(M & B)
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BPM: Organization Structure
Standard RACI – Processes tied to roles
Organizational design – collection of roles
Business
Processes
Capabilitie
s
Strategy & KPIs
Structure
Culture
(M & B)
BPM: Tools & DataProcesses connect to applications and data
Level 1
Level 2
Main Process L1 VACD
SCOR L2 VACD
Level 3
Level 4
Level 5 Detailed Process incl. SAP
Processes EPC (column display)
Level 6 SAP Process
SAP
FAD
SCOR L3 VACD
L3 - Process Description
FAD
SAP Scenario EPC
SAP Process
EPC (column display)
SAP Process step FAD
SAP Project VACD
DuPont Business EPC (row)
L4 - Process Description
FAD
Business Variations Overview
PSM DuPont
L2 - Process Descriptions
FAD
Process Variations Overview
PSM
DuPont Process Architecture
SAP Architecture
Scope
Configuration
Activity
Business
Processes
Capabilitie
s
Strategy & KPIs
Structure
Culture
(M & B)
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BPM: Capabilities
Business
Processes
Capabilitie
s
Strategy & KPIs
Structure
Culture
(M & B)
Transparency
• People work across process boundaries
• Change is an accepted constant way of life
Ownership
• People who do the work manage the process
• Fill roles rather than jobs
Agility
• Build to change mentality
• Leaders skills to lead transformation
Sustainable Results . . .
Requires All Transformation Elements
Customer Customer experienceexperience Inventory Inventory investmentinvestment
36% 36% Improvement Improvement
global promise global promise to policyto policy
15% Reduction 15% Reduction in in inventoryinventorydays salesdays sales
� All elements of value chain transformation are necessary to sustainable results
� Business process management enables each of the value chain transformation elements
Business
Processes
Capabilities
Strategy
&
KPIs
Structure
Culture(M
&
B)
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Results from Transformational Change
67%
81%
85% 86%
89% 90% 91%
60%
65%
70%
75%
80%
85%
90%
95%
100%
11/2011 12/2011 1/2012 2/2012 3/2012 4/2012 5/2012
Global Promise to Policy %
Goal = 95%
Business
Processes
Capabilities
Strategy
&
KPIs
Structure
Culture(M
&
B)
BPM Critical Success Factors
Start
small
Fix pain
points
Monetize
results
Executive
sponsor
Start with BPM projects that are small and that
create immediate wins for the business.
Begin with BPM projects that fix pain points;
internal clients will return for more help. . .
Be sure to put monetary value on all projects
� improved efficiency and effectiveness is
worth money
Get sponsorship for BPM from high level
executives – CSCO, COO, CEO, CFO; tie success
to corporate transformation strategy . . .
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Key Learnings
Connect to
change
efforts
Create a BPM
story
Fit with
corporate
strategy
Partner with
the IT Team
Align with six sigma, production system,
other change management efforts . . .
BPM speeds the rate of change
Create a value story for BPM �
sell, sell, sell the change to process thinking
BPM projects should align with corporate
value outcomes and support corporate
strategy objectives. BPM is an enabler.
BPM is a business initiative -- foster open
communications with IT partners.
Conclusions
�All elements of value chain transformation are
necessary to achieve sustainable results
�Business process management enables each
of the value chain transformation elements
�Business process management supports
increased transparency, ownership, and agility
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Recommendations
�Analyze the business operating and decision
processes that are critical assets to SC success
�Carefully design the time horizon and
granularity for each supply chain process layer
to support agile decisions
�Use business process management to enable
speed, accuracy, and innovation of change
Speaker Contact Info
Dr. A. V. (Ginny) Youngblood
Global BPM Lead
E.I. DuPont de Nemours
Barclay Juniper Building 2B-040
100 S. West Street
Wilmington, DE 19801
302-220-9540 cell
302-660-3040 office