Fiskars Presentation

36
Building a competitive and sustainable supply network Case Fiskars Tiina Nieminen 26.11.2012 Director Logistics, Fiskars Group

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Reading materials for Finnish UAS Exam 2013

Transcript of Fiskars Presentation

Page 1: Fiskars Presentation

Building a competitive and sustainable supply

network

Case Fiskars Tiina Nieminen 26.11.2012

Director Logistics, Fiskars Group

Page 2: Fiskars Presentation

Agenda

Page 2 Company confidential

1. Introduction to Fiskars Group

2. Operations

3. Manufacturing

4. Sourcing and supplier base

5. Logistics

6. Processes and tools

7. Summary

Page 3: Fiskars Presentation

Our over 360-year heritage From Finnish ironworks to global consumer product business

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From Fiskars Village to Fiskars Campus

Fiskars Village

• Founded in 1649 as an

ironworks

• Centre for Finnish art, design,

and craftsmanship

• 20 Fiskars employees work in

the village

Page 4

Fiskars Campus

• Arabia factory, founded in 1873,

was named after the district

• Houses today over 450 Fiskars employees • Corporate headquarters

• Business area management: Home,

Garden EMEA & Boats

• Marketing and product development

• Arabia ceramics factory

• Shared Services

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Page 5

1915 Fiskars is listed

on the Helsinki Stock

Exchange

1883 Fiskars becomes a joint

stock company and expands into

a number of new businesses

1967 A wide range of plastic

consumer products – iconic

orange-handled scissors

1985 Fiskars starts producing

garden tools

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Fiskars has acquired several innovative companies to

enlarge its offering in consumer products

Page 6

2007 Iittala Group

1985 Gerber Legendary Blades

2007 Leborgne

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Fiskars in 2011

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AMERICAS in 2011

net sales EUR 233 million

31% of consolidated net sales

565 personnel (FTE)

Manufacturing

Office

Sales office / distributor

Production units in Finland:

Helsinki, Iittala, Nuutajärvi,

Billnäs, Sorsakoski, Ähtäri

Portland

Outdoor/Gerber

Madison/Garden &

SOC

EMEA in 2011

net sales EUR 517million

69% of consolidated net sales

2,609 personnel (FTE)

Sourcing offices,

Bangkok &

Shanghai

Net sales EUR 742.5 million

Some 3,400 employees around the world

Products sold in over 60 countries

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Our business areas

Page 8

GARDEN

Ergonomically designed

tools for gardening and

construction

294 MEUR in 2011, +7%

40% of total sales

HOME

Modern Scandinavian

design products for the

kitchen, table, living room

and school, office and craft

306 MEUR in 2011, -1%

41% of total sales

OUTDOOR

Innovative, essential

products for an active

lifestyle and durable leisure

boats

138 MEUR in 2011, +7%

19% of total sales

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A portfolio of clearly defined brands

Page 9

Essential equipment

for outdoor activities

Key international brands

Leading global brand for

scissors and garden tools

Internationally renowned

design brand

Leading regional brands

Local and tactical brands

Finland’s most popular

motor boats

Finnish design for the home

for over 135 years

Nordic expert in

cookware & cutlery

DRIVE BOATS

EBERTSANKEY

GINGHER

HÖGANÄS KERAMIK

HØYANG-POLARIS

KAIMANO

KITCHEN DEVILS

LEBORGNE

MONTANA

RAADVAD

RÖRSTRAND

ZINCK-LYSBRO

Essential equipment

for outdoor activities

Page 10: Fiskars Presentation

Pathway to global growth

Page 10

Tomorrow’s

Fiskars

2010 →

Powering the

machine

• Defining future

operating and

business model

• Unified processes

and systems in EMEA

• Focus and group-

wide integration

2012 →

Gearing for growth

• Global ambitions

• Refined category

and brand strategies

• New organization -

Tomorrow’s EMEA:

Design for Function

and Growth

2008–2009

Fixing the base

• New management

• Integrated consumer

goods company

strategy introduced

• First step towards

global growth: 360°

Integration Program

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Executing the integrated company strategy

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FISKARS STRATEGIC

AGENDA

FOCUS Strong business area focus

Specialist premium brand portfolio

Optimized product range for selected

categories

EFFICIENCY Simplified structure

Integrated business processes

Demand-driven supply chain

GROWTH Consumer-focused product development

Innovative R&D

Commercial expansion

ACTIONS IN 2011

FOCUS Increased focus on international brands,

Silva divested and Bodanova discontinued

Continued SKU efficiency

EFFICIENCY Business platform investment program

launched in EMEA

Nordic distribution centre established in

Hämeenlinna

Global sourcing office established in Bangkok

GROWTH New market openings in Central Europe and

Asia for Home

Strengthened position in key markets for

Garden

Successful product launches boosted

Outdoor categories in the Americas

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Implications to supply network

Page 12

Focus

Efficiency

Scalability

Shared, simplified structure, SKU’s

Harmonized processes

Growth

Page 13: Fiskars Presentation

Agenda

Page 13 Company confidential

1. Introduction to Fiskars Group

2. Operations

3. Manufacturing

4. Sourcing and supplier base

5. Logistics

6. Processes and tools

7. Summary

Page 14: Fiskars Presentation

Financial impact of Operations Cost of goods sold x% of sales / gross profit

Page 14

Product cost

Other COGS

Distribution

& warehousing,

freight,

Driven by manufacturing and

sourcing strategy

Driven by logistics strategy

Page 15: Fiskars Presentation

Page 15 Company confidential

How can Operations contribute to margin

improvement?

1. Launch new products with targeted minimum margin requirement

• Increase modularization of the products

2. Strengthen the main brands -> Premium price

3. Build competitive supply network

4. Optimize warehouse locations and distribution cost

Margin improvement

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Page 16 Company confidential

How can Operations contribute to working capital

improvement?

1. Increase stock turn

2. Increase sales responsibility of

the stock

• Forecast = commitment to sell

3. Reduce complexity (# stock

keeping units)

4. Implement S&OP (demand and

supply planning process)

Working Capital Improvement

16

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Business level key performance indicators / operations

Page 17

Ambition

level

Inventory turnover

0

5

10

15

20

25

30

35

40

45 Ambition

level

Gross profit margin

Page 18: Fiskars Presentation

Agenda

Page 18 Company confidential

1. Introduction to Fiskars Group

2. Operations

3. Manufacturing

4. Sourcing and supplier base

5. Logistics

6. Processes and tools

7. Summary

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EMEA manufacturing footprint today

Garden

Home

Outdoor

S

CuS

DC

M

Sales and

customer service

Customer service

Distribution center

Manufacturing

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Size of DCs to be reviewed

Americas manufacturing footprint today

Apopka, FL

Pottery

Portland, OR

OR/Gerber

Page 20

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Page 22 Company confidential

Manufacturing vision Own manufacturing maintained when cost efficient and/or strategically justified

Cost R&D

IPR

Brand Service

level

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Both own manufacturing and external suppliers have

special roles in the supply network

Role of own manufacturing

• Special technology/materials know-how and close cooperation with R&D

• IPR protection

• Flexibility in production (small batches) and fast reaction capability to meet demand changes and customisation needs – close to sales markets

• Cost competitive

Role of external suppliers

• Cost competitive

• Capacity flexibility

• Access to new materials and technologies

Wednesday, 28

November 2012

H

Korhonen 23

Page 24: Fiskars Presentation

Agenda

Page 24 Company confidential

1. Introduction to Fiskars Group

2. Operations

3. Manufacturing

4. Sourcing and supplier base

5. Logistics

6. Processes and tools

7. Summary

Page 25: Fiskars Presentation

Page 25 Company confidential

Drive quality for competitive advantage

Create and maintain cost leadership

Ensure flexible and reliable supply

Develop new products

Fiskars sourcing cornerstones

Build capable organization

Manage risks

Page 26: Fiskars Presentation

We work in close cooperation with our suppliers

Fiskars Supplier Days 2010

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Sustainability throughout Lifecycle

Manufacturing: Efficiency in

• Energy and Material use

• Environmental, health and safety

protection

• Quality systems

NPD: Starting point!

Build in

• Environmental Aspects

• Product safety

• Good Quality

Distribution:

• CO2 emission

• Efficient packing

• Goods turnover speed

Consumption:

• Durable, functional

with lasting design

• Environmental

friendly materials

• Reuse, recyclability

Leadership and Administration

• Knowledge, Involvement, Support

Page 28: Fiskars Presentation

Page 28 Company confidential

Supplier Code of Conduct project Scope

Training and communication

• Fair treatment

• Prevention of

involuntary and

underage labor

• Working hours

• Wage and

benefits

• Freedom of

association

• Injury prevention

• Prevention of

chemical

exposure

• Emergency

prevention,

preparedness

• Occupational

safety

procedures

• Dormitory and

dining

• Hazardous

substance

management

• Wastewater

management

• Air emissions

management

• Solid waste

management

• Environmental

permits and

reporting

• Business

integrity

• Disclosure of

information

• Protection of

intellectual

property

Management systems (audits, corrective actions etc.)

Labour and

Human Rights

Health and

Safety Environment

Business

Ethics

Page 29: Fiskars Presentation

Agenda

Page 29 Company confidential

1. Introduction to Fiskars Group

2. Operations

3. Manufacturing

4. Sourcing and supplier base

5. Logistics

6. Processes and tools

7. Summary

Page 30: Fiskars Presentation

World Class Logistics adds value to our business

Highly competent

people thanks to

larger entities and

shared processes

Capability to

serve

different sales

channels (e.g. wholesale,

web shop)

Cost efficiency;

economies of scale

Improved availability • optimization in the whole chain

• allows small markets to sell

wider assortment

Scalability /

flexibility

Value Added

Services

Global partners –

high performance

Logistics becomes regional service

for all BAs with less DCs

Page 31: Fiskars Presentation

Agenda

Page 31 Company confidential

1. Introduction to Fiskars Group

2. Operations

3. Manufacturing

4. Sourcing and supplier base

5. Logistics

6. Processes and tools

7. Summary

Page 32: Fiskars Presentation

What is an “operating model”?

Page 32 Company confidential

“An operating model is the abstract representation of how an organization operates across process, organization,

technology domains in order to deliver value defined by the organization in scope.“

(Wikipedia http://en.wikipedia.org/wiki/Operating_model)

Fiskars Operating Model defines

how Fiskars will work as an integrated company.

Strategy Business

model(s)

Operating

model(s) Processes

Customers

Products

Value chain

Organization R & R

Competencies

Governance Metrics

Deliverables

IT

Architecture

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People Processes IT systems

UP! Program Mission

Execute Fiskars operating model transformation in EMEA

for supply chain and financials

by 2015

Structures

85% business 15% IT

UP! Program is the vehicle to implement Fiskars

Operating Model

Page 34: Fiskars Presentation

Agenda

Page 34 Company confidential

1. Introduction to Fiskars Group

2. Operations

3. Manufacturing

4. Sourcing and supplier base

5. Logistics

6. Processes and tools

7. Summary

Page 35: Fiskars Presentation

Building competitive Supply Network

Page 35

Focus – Efficiency - Growth

Simplified operations structure

Harmonized way of working

Platform for growth - scalable

Page 36: Fiskars Presentation

Lasting everyday design,

since 1649