C O N S U L TA N C Y P R O P O S A LT E A M A 1

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B r i e f o f C o n s u l t a n t s

1. Faizan Qadri: Knowledge Management & Streamlining

Business Processes Expert.

2. Richard Sharman: Supply Chain & Logistics Expert

3. Pauline Mmbaga: Facility Management Expert

4. Henry Ortiz Toloza: Facility & Space Management Expert

5. Parminder Singh: Health & Safety Expert

6. Modar Bakir: Human Resources Expert

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P e t e r D r u c k e r & B r i ti s h G o v e r n m e n t o n K n o w l e d g e M a n a g e m e n t

• In 1988 Peter Drucker wrote: “The typical business [of the future] will be

knowledge-based, an organisation composed largely of specialists who direct

and discipline their own performance through feedback from colleagues,

customers and headquarters. For this reason it will be what I call an

information-based organisation” (Economist 2009).

• In the British government’s 1998 White Paper on the competitiveness of the

nation, it said: “Our success depends on how well we exploit our most valuable

assets: our knowledge, skills and creativity … they are at the heart of a modern

knowledge-driven economy” (Economist 2009).

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O u r U n d e r s t a n d i n g o f t h e B r i e f

The Current Status of the company

(Q3/2012)

To be the first choice for clients where high quality

meets affordability and set high standards in the UK

and European Market

Vision (Q3/2017)

Five Years’ Plan

Strategy No. 3

Tangible Assets

Intangible Assets

Processes

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Meet the criteria of the European

Excellence Model

Apply KM & AM

W a v e R i d e r s G A P A n a l y s i s

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GAP Target Current Status Timeline Actions Responsibility

1 Expand distribution and logistics to Europe

Supply chain in the UK Q4/2012 Outsourcing the distribution function in Europe and hiring a Logistic Manager (reporting directly to CEO)

CEO, Production Director, Finance

Director and Richard

2 Improve supplier base Multiple suppliers (10+) Q4/2012 Assess and review current supplier base and streamline

CEO, Production Director and

Richard

3 Allow a suitable environment for employees to perform core functions

No facility director no awareness and concern on improving the value of the properties and No concern of the safety of the buildings

Q4/2012 Hire Facility Director (reporting directly to CEO)

HR Director, Henry and Pauline

4 Increase inventory turnover Poor management of inventory

Q4/2012 Implement Just In Time Production Production Director and

Pauline

5 Improve Safety Standards in plant and products

No records Q4/2012 Hire Health & Safety Manager (Reporting directly to Facility Director for plant daily operation issues/ reporting directly to the CEO for company policy & road safety)

HR Director and Parminder

6 Vision/Mission and competency framework for the whole company

No core values/competencies and shared vision

Q1/2013 Setting up a Steering Committee chaired by the HR Director, the committee will be consisting of members from different levels and departments of the organisation

Board of Directors and Modar

7 Setting up a new organizational structure/ job descriptions/HR Policies & Procedures/Employee Handbook /Orientation Program/ER/Recruitment & Retention Strategies

The current organizational structure/ job descriptions while the rest are not available

Q2/2013 HR Director and Modar

C u r r e n t S u p p l y C h a i n o f W a v e R i d e r s

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Material Suppliers UK Factory Sales to

Retailers

Sales to End Users

UK Warehouse

F u t u r e S u p p l y C h a i n S t r a t e g y

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UK After Sales

UK Market

EU Market

EU After Sales

UK WarehouseUK FactorySuppliers

Sales/Marketing

Sales/Marketing

S u p p l i e r M a n a g e m e n t

Strategies: Improve Supplier Base through assessing and reviewing current supplier base and streamline in order to Improve Working Relationship and therefore bring new benefits.

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Supplier WaveRidersCustomer Feedback

Marketing/Sales Forecast

Market Information

Materials Knowledge

Materials R&D

Manufacturing Processes R&D

Competitive AdvantageSupplier / Manufacturer Information Model

D i s t r i b u ti o n i n t h e E U M a r k e t

• Outsourcing the distribution function in the EU Market.

• Increase the Distribution Manager scope of work where he will be

responsible of the distribution operation in the UK and supervising

the outsourcing contract of distribution in the EU market.

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A s s e t L i f e C y c l e m a n a g e m e n t

• Measuring assets on a COST Vs. PROFIT basis• Group assets into processes• Consistently gather and log information and knowledge of the assets

outputs and inputs on an accessible database.

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Machines

Output (profit) Resale Value Useful Life

Initial Cost Running Costs/Maintenance Man hours required to operate

RawMaterials

Finished Goods

R e c o m m e n d a ti o n s

• New Asset Strategy – Use information from sources such as manufacturers/past experiences/forecasts/departmental requirements to assess and compare potential new assets to gain best balance of cost/capability and quality. (the head of the department that will use the asset should carry out these procedures)

• Use financial measures such as Payback period and NPV to give financial insight. (finance department)

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R e c o m m e n d a ti o n s

• Current Asset Strategy – the manufacturing process and the storage process.

• Log data, and keep records of performance and any costs incurred in the past.

• Make operatives responsible for logging data and regular inspection to prevent problems escalating.

• Have procedures in place to deal with the maintenance of assets so down time is reduced.

• Constantly reassess the costs vs profit performance to map when parts of the processes need updating or replacing.

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F a c i l i t y & P r o p e r t y M a n a g e m e n t

• Facility management is ‘an integrated approach to maintaining, improving and adapting the building of an organization in order to create an environment that strongly supports the primary objectives of that organization’ (Barrett and Baldry,2003).

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R e c o m m e n d e d S t r a t e g i e s

• Hiring a Facility Director: the main objective of this role is to ensure that an organisation has the most suitable working environment for its employees and their activities. Also, implementing cost cutting initiatives and Initiating projects which will enhance the image of the company.

• Estimated Annual Salary: £60,000

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CEOJohn Excellence

Facility Director

A s s e t s r e q u i r i n g m a n a g e m e n t

• Property Management: Design and Build Activities, Facility

Services(Safety, Health and Environment), Space Management and

Maintenance of Equipment

• Inventory Management: Just-In-Time Production

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P r o p e r t y M a n a g e m e n t

Design and Build Facilities Current Situation• There is very little awareness and concern on improving the value of the

properties and inaccessible property inventoryAction Plan• Facility Director should outsource an external surveyor to conduct

valuation on the plant at least every 3 yearsAnticipated Outcome• Reduced cost of wear and tear and reduced time wastage

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I n v e n t o r y M a n a g e m e n t

Production Scheduling and InventoryCurrent Situation• Tied-up capital, inaccessible inventory auditAction Plan• Implement Just-In-Time productionAnticipated Outcome• OTIF (On time in-full production, on time delivery and customer

satisfaction ration to increase by 99%)

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C u r r e n t S i t u a ti o n t o J I T

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S RM WIP FG

S p a c e m a n a g e m e n t

Current situation:• There is not a fixed travel route for material and products transport from

stock area to the dispatch area• There are not clear routes for loading vehicles, (forklifts)• The employees do not enough space to work comfortably Action plan • Optimize the space in the production area, creating fixed routes for the

vehicles and create open plan offices. Anticipated outcome• Reducing the lead time• Improve communication between departments.

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M a i n t e n a n c e

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Reactive policy

Proactive policy

H e a l t h & S a f e t y

• What Environment?

the surroundings in which an organization operates, including air, water, land, natural resources, flora, fauna, humans, and their interrelation.

Clause 3.5 ISO 14001:2004(E)

• Who’s Safety & Health?

OH & S relates to the Conditions and factors that affect, or could affect, the health and safety of employees, or other workers (including temporary workers and contractor personnel), visitors, or any other person in the workplace.

Clause 3.12 OHSAS 18001:2007

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T h e P r e s e n t a t W a v e R i d e r s :

• No Procedures for the safety and health of the employees• Fire fighting and no proper elimination of Safety concerned

issues• No focused effort to prevent damage to the environment.

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W h a t n e e d s t o b e d o n e

• Consider SHE as a strategic part of the overall business strategy.

• Develop a system for SHE management.• Create a culture of health , safety and environmental

awareness.• Create awareness regarding conservation of resources.

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S H E M a n a g e m e n t - T h e w a y a h e a d ( s t r a t e g y )

• Hire a SHE manger (reporting directly to Facility Director for plant daily operation issues/ dotted reported to the CEO for company policy & road safety).

• Incorporate a SHE Policy• Train employees – create awareness

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CEOJohn Excellence

Facility Director

SHE Manager

S H E M a n a g e m e n t - T h e w a y a h e a d ( s t r a t e g y )

• Conduct – An Environmental aspect evaluation– A Hazard risk analysis

• Identify the most significant aspects.• Make Safety management procedures (SMP) and environmental management

procedures(EMP).• Eliminate the aspects (Follow the PDCA methodology).• Make Operational control Procedures (OCP).• Have an emergency preparedness plan in place• Maintain a legal register.• Management Review• Apply for ISO 14001 and IS 18001 certification.• Start a near miss reporting and recording system.• Start energy conservation and safety committees

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K n o w l e d g e m a n a g e m e n t

• Procedure manual (Environmental and Safety:• OCP• EMP & SMP• List of most significant aspects• Emergency preparedness plan• Legal register

• Near miss reporting and analysis.

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T i m e f r a m e f o r I m p l e m e n t a ti o n

Timeframe for SHE implementation.xlsx

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E s ti m a t e d B u d g e t f o r S H E

• SHE manager £40,000 per annum• Training £ 10,000 - £ 15,000• Certification: £ 3,000 – £3,500 per certification

• Other costs depending upon the work to be carried out to make the work place more safe and environmental friendly.

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E ff e c ti v e A s s e t M a n a g e m e n t t h r o u g h P e o p l e E ff e c ti v e n e s s

In order to have an Effective Asset Management system within

WaveRiders, we recommend you to apply the following three

strategies (Lutchman 2006):

• Organizational and People Effectiveness

• Corporate Knowledge Retention

• Performance Management (Balanced Scorecard)

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O r g a n i z a ti o n a l E ff e c ti v e n e s s

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Vision & Mission

Tangible Assets

Intangible Assets

Processes

Develop Organisational

Structure

Define RolesResponsibilities

Competencies FrameworkJob DescriptionsStaffing Numbers

HR Policies & ProceduresC&B Plans

Recruitment StrategyRetention Strategy

Succession Planning StrategyL&D Program

Employee Assistance ProgramEmployee HandbookOrientation Program

SOPs

KnowledgeManagement

Performance Management

Empowered Teams

Continuous Improvement

Developing a High – performance Organization (Lutchman 2006)

O r g a n i z a ti o n a l D e v e l o p m e n t & L e a r n i n g

• Develop the core values/competencies framework for the company.• job evaluation based on a Knowledge and Skills Framework. Validate Job Descriptions, Roles,

technical and general skills. Introduce the competency skills framework to all posts.• Identify individual learning and development needs against the approved competency

framework through carrying out TNA of current skills, knowledge and competencies (skills gap analysis).

• Develop a training program for all employees based on the TNA results.• Assigning a training budget for the Sales team who are going to be involved in the EU market and

for the SHE Manager.• HR Team to achieve CIPD certification.• Orientation program (Corporate and Departmental Induction).• SOPs / best practices in coordination with the rest of the departments• HR Policies & Procedures / Employee Handbook• Employee Assistance Program / Redundancy Plans & Payments• Job Rotation• Establishing an E-learning portal for the company might not be suitable at the time being

(EFQM 4e. Using information technology to support knowledge management).

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R e c r u i t m e n t & R e t e n ti o n

• To ensure that the attrition rate is at the minimum for the next five years (voluntary and involuntary resignations).

• Offer a variety of career packages and employment contracts (permanent, temporary, flexible ... Etc.)

• Building a professional reputation for the company (employer of choice).• Recruitment processes must fulfill all legislative requirements and demonstrate fair and

equitable treatment of all applicants. The HR department is committed to providing an efficient service to managers and applicants, and to ensuring that recruitment systems are reviewed as required to maintain a smooth process.

• Reward & Recognition policy.• It is important to determine what causes staff to leave. To this end an exit procedure and

guidelines is being developed and will be implemented in Q4 2012. The results will be analyzed to identify trends so that counter measures may be introduced where appropriate (employee branding).

• Staff Monthly meeting with BoD (staff involvement, enhancing two way communication).

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Balanced Scorecard Action Plan

Objectives Measurement Target Initiative Budget

Increase Profitability ROCE 13% - -

Increase the efficiency of using the assets ROA 11.93% - -

Increase the space use within the premises of the company

Lower the cost of maintenance and cleaning on a monthly basis Hiring Facility Director £300k

Decrease the Dispatch time No of frequency and complaints from customers 2 Create fixed routes for materials and

products, create clear routes for loading

vehicles

£30k

Increase inventory turnover Percentage of stock outs 0 Implement Just In Time production

-

Increasing on time production On-time in full production ration 99% Implement Just In Time production

Improve supplier base Percentage of perfect orders received 95% Assess and reduce suppliers

-

Reduce HR Team Number of staff reduced annually 1 Applying Redundancy £77k

Identify New Distributor (s) in the EU market Percentage of on-time delivery to customers in Europe 98% Expand the distribution and logistic in EU

£2k

Improve Safety Standards in plant and products No. of accidents and near misses due to design and procedures 0 Hiring Health & Safety Manager, obtaining certifications and

Training

£217k

Recruit and Retain Qualified Sales Rep Turnover of Sales Personnel 2% Take on new 3 Sales Rep

£96k

Increase value of learning (ROI) Percentage of employees active in improvement teams and team learning

90% Measurement of effectiveness and TNA

-

Increase knowledge sharing between employees and within departments

Number of job rotations each year per employee 2 Job rotations between and within

departments, orientation programs

and graduate schemes

£90k

TOTAL BUDGET £812k

P e r f o r m a n c e M a n a g e m e n t - B a l a n c e d S c o r e c a r d -

S u m m a r y

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Effective Knowledge & Asset Management

System

Supply ChainFacility Management

Health & Safety

Human Resources

Organizational & People Effectiveness

Corporate Knowledge Retention

Performance Management

Review, Assess and Optimize Supplier

Base

Outsourcing Distribution function

in EU market

Hiring Facility Director

Hiring Health & Safety Manager

Implement Just In Time Production

Optimize the usage of the space of the premises

Obtain ISO 14001 and IS 18001 certification

Set up procedure manuals for safety and

environmental management

WaveRiders’ Vision

Reduce Lead Time

Increase and maintain the life of the physical assets

of the company

T o w a r d s E F Q M

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EFQM Model

4c: developing and implementing strategies for managing buildings, equipment and materials

4c: minimizing impact on environment

4c: affect of organisation asset on health and safetyPartnership

& Resources

4c: Optimising material inventories

4c: optimising transportation usage

4c: improve total life cycle performance

4e: identify information and knowledge req.

4e: collecting and structuring information and knowledge

4e: providing appropriate access

4e: cultivating and protecting intellectual property

4e: generating innovative and creative thinking

R e f e r e n c e s

• Economist (2009) knowledge management [online] available from http://www.economist.com/node/12960225 [24th April 2012]

• European Foundation for Quality Management (2009) EFQM Excellence Model, EFQM Publications.

• Lutchman, R. (2006) Sustainable Asset Management: Linking Assets, People, and Processes for Results. Pennsylvania: DEStech Publications, Inc.

• Shanthi, N. (2006) Knowledge Management for Business Strategy. Hyderabad: The ICFAI University Press.

• Fileding, K and Whicker, L (2012), ‘Planning and Control Systems: JIT, Logistics and Operations Management’, Supply Chain Lecture at the University of Warwick.

• Pain, S. W. (2010). Safety, Health, and Environmental Auditing. New York: CRC PRess.

• OHSAS 18001:2007. OHSAS project group• ISO 14001:2004(E) Environmental management systems – General guidelines on

principles, systems and Support techniques.

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T H A N K YO U

Q & A 41