試談歐萊雅供應鏈診斷英文

L’OréalSupplyChainDiagnostic

March18,2004PresentationAgendaProjectScopeandActivitiesOverviewofOurSupplyChainFindingsProcessesInventoryReviewMaturityProfilesOrganization/PeopleandCultureTechnologySupplyChainRoadmapDiscussionofNextSteps2OurProjectApproachOverthepastthreeweeks,wehave:Interviewed5ExecutivesofL’OréalCanadaFacilitatedtwocross-functionalprocessworkshopsCollectedandanalyzeddataConductedahighlevelmaturityassessmentComparedL’OréalprocessandperformancetoCPGbestpracticeIdentifiedkeybusinessissuesandareasofimprovementSummarizedourfindingsinthispresentationdocumentProjectKickoffDataCollectionInterviewwithExecutivesProcessWorkshopsModelReview&ValidateBaseCaseReviewMetricsIdentify&ConsolidateIssues&OpportunitiesOpportunityPrioritizationBenefitsAssessmentFindings/RecommendationDevelopmentPresentRecommendationsDiscuss

NextSteps3Cross-FunctionalParticipantsSeniorManagement-SupplyChain

LaurentVenot(ProjectSponsor)JeanValoisPierreMassicotteValéryMayerSalesDominiqueDeCellesIsabelleGenestAnne-MarieNelsonDionGemmityCustomerServiceEliBengioPatriciaRaposoLogistics&ProcurementValérieLacerteYvesDubéNaityJacelInformationtechnologyPierreJournelMarcelyneCraftFinanceMartinDeschênes4PresentationAgendaProjectScopeandActivitiesOverviewofOurSupplyChainFindingsProcessesInventoryReviewMaturityProfilesOrganization/PeopleandCultureTechnologySupplyChainRoadmapDiscussionofNextSteps5ProcessesDemandPlanningSupplyPlanningOrderFulfillmentDevelopSalesForecastMaintainPromotionalPlanConsiderinventorylevels,backorderreports,safetystocklevelsConsolidateandconsiderexternaldata(POS,Nielsen,Customerdata)ReconcileDemandPlanwithBudgetNewProductIntroductionsNetInventoryandLeadTimesfromtheForecastDistributedRequirementPlanningCapacityRequirementPlanningCustomerAllocationsCommunicateforecasttoSuppliersReceivesuppliercommitmentProcessCustomerOrdersPlanandManageFinishedGoodsInventoryPickingandPackingManageOutboundProductFlowManageshipping&transportationGenerateInvoiceCreditmanagementandA/R(*)Outofscope6DemandPlanning–IssuesandOpportunitiesIssues ManualandInconsistentProcessesTheforecastprocessismostlymanual,inconsistentacrossbrandsanddivisions(duetodifferentlevelsofmaturity)aswellasbothtimeandresourceconsumingThereisnoformalprocessfordeterminingwhichproductsshouldbefocusedonduringtheforecastingmeetingsNoonedepartment“ownstheforecast”ThereisnomechanismforautomaticallygeneratingabaselineforecastToomuchtimeisspentonmanualprocesses,dataclean-upandgeneratingreports,leavinginsufficienttimetoanalyzedataandmanageexceptionsL’OréalCanada’sbrandforecastsarenotallaggregatedupintooneforecastlimitingvisibilityanddatasharing

L’OréalCanadadoesnothavesimulationor“whatif”capabilitiesManydisparatetoolsarebeingusedtofacilitateforecasting-Excel,Valo,SAPandOutilsGestion.Interfaceshavebeenbuiltbetweenthevarioustoolsandsystems,butmanualverificationisrequiredandthecurrenttechnologystilldoesnotmeetL’Oréal’srequirementsPOS,Nielsen,customerinformation,promotionalandadvertisinginformationarenotallintegratedinonecentralrepositoryOpportunityProcessRedesignSpendtimeforecastingproductsthatgivethehighestreturn.Notallproductlinesbenefitfromincreasedattention.Focusonhighmargin,lowvolume,bigticketitems,highprofileitemsanditemswithcomplementstomaximizeprofitabilityCommunicateandreconcileforecastassumptionsbyconductingaformalreviewaftereachplanningcyclewithallstakeholders.ReportforecasterrorandmodifyassumptionsasappropriateForecastingTool/BWImplementingaForecastingtoolwillenabletheautomaticgenerationofabaselineforecastbasedonsaleshistoryandadditionalvariables.Mostpackagesallowuserstoselectastatisticalmodel,enablethesystemtodeterminethemodelwiththegreatestfitoremployacompositemodelTheforecastingtoolselectedshouldallowforthegenerationofalertsbasedonpredefinedtolerances,highlightingtheproductsthatrequirefurtherconsiderationandmanualinterventionProductsshouldbereviewedtodeterminewhichonesarecriticalorhighmargintoplaninaForecastingtool,whilenon-criticalorstagnantproductsmaybeplannedinSAPR/3Theforecastingtoolselectedshouldprovide“WhatIf”simulationcapabilitiestodemonstratetheimpactofavariablechange(e.g.pricechange)CoordinatedatacollectionforallavailablesourcesandhouseitinacentralrepositorysuchasSAPBusinessWarehouse7DemandPlanning–IssuesandOpportunitiesIssues OpportunityPeopleEnsurethePlanningTeamisCross-FunctionalandCross-Trained:L’OréalwillneedtoevaluatetheirresourcesskillsanddetermineifadditionalresourcesarerequiredtogainforecastingexpertiseStatisticalproficiencyandsystemexpertiseshouldbebalancedwithindustry,companyandproductknowledgeCross-trainingsharpensskills,broadensperspectivesandimprovescommunicationCreateincentivestoimprovetheaccuracyofforecasts:EstablishforecastaccuracygoalsEstablishcompensationstructureMonitorandreviewcongruenceofgoalstorewardsThiswillremovetrade-offsbetweenforecastaccuracyandperformanceagainstforecast,leverageskeyinformationandhelpseliminatebiasesL’OréalCanadahasstartedtotiecompensationtoforecastaccuracy.ThispracticewillobtaingreateracceptanceamongemployeesonceatooltosupporttheprocesshasbeenimplementedDepartmentsInvolvedhaveDifferentPrioritiesWhilethegenerationoftheforecastisacollaborativeeffortbetweenSales,Marketing,FinanceandLogistics,theinvolvedpartiesdonotsharethesameviewoftheforecast’simportancenorappreciatetheimpactoftheirinput(orlackthereof)onotherdepartments’abilitytoexecutetheirfunctionsdownstreamSalesisseenastoodistantfromthecustomerandthereforelackingpertinentdatatoinputintotheforecastinge.g.whichstorecarrieswhichSKUSales’strategytopushproductsattheendofthemonthandyearbydecreasingprices,throwsofftheforecastL’OréalCanadarealizesthateveniftheyimplementaforecastingtool,withouttheproperprocessesorresourcesinplace,forecastaccuracywillnotlikelyimproveL’OréalCanadaexperiencesahighturnoveramongsalesandmarketingpeopleresultinginthelossofvitalcustomerandproductinformationTrainingforSalesandMarketingresourcesisinsufficient.Compensationre-evaluationhasbeguntoalignindividualgoalsandmetricswithorganizationalgoalswithrespecttoforecastaccuracyAlthoughL’OréalCanadahasmadegreatstridesinimprovingtheirforecastingprocess,theaccuracyhasnotimprovedsignificantlyleadingtofeelingsoffrustrationamongemployees8DemandPlanning–IssuesandOpportunitiesIssues OpportunityProductLaunchesAlthoughL’OréalCanadahasaccesstoothercountrieslaunchesaswellastolikeproducts’saleshistory,thereisnotoolorprocessinplacetoeffectivelyincorporatethisdataintotheirforecastsL’OréalCanadaisunabletoaccuratelyassessthecannibalizationeffectofoneproductonanotherNopost-mortemanalysisisconductedorcapturedonfailedproductlaunchesasinputtofuturelaunchesPromotionsThereiscurrentlynomeanstoaccuratelycleansepromotionalupliftsfromsaleshistoryPastpromotionalperformanceisnotadequatelymeasured,thereforemakingitdifficulttopredicttheimpactoffuturepromotionsPromotionsinvolvinggiftwarecanleadtoimbalancesindemand,makingitdifficulttopredicttruedemandfortheseproducts“OneShot”promotionsaredifficulttoplanProductAllocationProductallocationhasnotbeendeployedeffectivelyandhasevenledtoundesirableforecastingbehavioursProductLifecycleManagementInvestigateAPSfunctionalitytohandle:“LikeModeling”wherebysaleshistoryofasimilarproductisusedtoforecastanewproductPhaseIn/PhaseOutofproductswhichentailsweightingtheforecasttoreflectaproduct’slifecycleTheseparationofthepromotionalupliftfrombaselineforecastgenerationCannibalizationDataCleansingSufficienttimemustbespentcleaningdatasuchasSKUchanges,dataerrors,duplication,one-timeevents,stock-outs,promotions,outliersetc…toenableforecastingmodelstoseparatebusinessgrowthfromseasonalityandotherdeviationsProductAllocationAllocationisausefultoolforensurehigherprioritycustomers obtainincreasedservicelevelsincasesofshortages.L’Oréalshoulddevelopandimplementformalpoliciesforallocatingproducts(e.g.basedoncustomerforecasts)AllocationconfigurationshouldbemodifiedtoreflectthenewpoliciesinSAPR/3.Inthelong-termadditionalallocationfunctionalitycouldbeexploredinanAPStool9DemandPlanning–IssuesandOpportunitiesIssues OpportunityCustomerCollaboration

Cross-ShareForecastswithKey

CustomersIncorporatecustomerforecastswhicharedeemedasreliableintobaselineforecastsandchallengetheirnumbers(managebyexception)Onceforecastsaremoreaccurate,L’OréalshouldprovideawebsitetoalloweasyaccessfortheirCustomerstoentertheirforecastsandtopostL’Oréal’sconfirmedquantitiesforcustomerstovalidateinatimelymannerAggregation/DisaggregationDeterminetheappropriateleveltoforecaste.g.SKU/customerlocationforDSD,SKU/CustomerDCforwarehouseshipments…AnAPSsolutionwillfacilitatetheaggregationanddisaggregationoftheforecast,however,timeshouldbespentdeterminingtheappropriatelevelforforecasting.Top-downapproachescanmasktrendshiftswhilebottom-upapproachesmaynotconsidereffectssharedacrossbrandsMeasuringForecastInaccuracyOrderdateshouldbeusedasthepointforestablishingdemandsinceitgivesthemostaccurateinformationonwhendemandisinitiated.Otherwisestock-outs,lostsales,opportunitycostsandlostcustomersmaybemaskedEnsurethefullaggregatedcostsofforecasterroraremeasured:Insufficientinventory(stockouts)Excessinventory(returns,spoiled,destroyed,obsolete,slowmoving)SafetystockExpeditingcostsInventorycarryingcostsOvertimeCustomerCollaborationAlthoughsomeofL’OréalCanada’scustomersprovideforecastandPOSdata,L’OréaldoesnotpossesstheinfrastructureorprocessestoeffectivelyusethedataL’OréalCanadamustfirstfocusonimprovingit’sownprocessesbeforeextendingtheirprocessesanddataouttosharewithCustomersandSuppliersForecastAccuracyWhileforecastaccuracyisbetterattheBrandlevel,itvariesgreatlyattheSKUlevelregardlessofproductclassification(A,B,C)Only40%to50%ofitemsachievethetargetof±toleranceof20%(BIC75%ofSKUachievethistarget)SKUrankinghasbeenerroneousImpactsofForecastInaccuracyNumerousforecastmodificationrequeststothefactoriesCustomerServicelevels(linefillratein$)areat92%despitetargetsof98.5%(BICis99%)InventoryWrite-offsareat10.5%(BICforCPGis2%)InventoryTurnsare4(BICforCPGis17)SalesReturnsareat5.25%(BICis0.4%)

NOTE:WearecomparingL’OréaltoCPGcompanieswhichisnotafaircomparisoninsomecases.Thecomparisonismeantasaguideline.10SupplyPlanning––IssuesandOpportunitiesIssuesInputTheunconstrainedforecastisthemaininputfordevelopingthepurchasingplan.GivenL’’OréalCanada’spoorforecastaccuracy,thepurchasingplandoesnoteffectivelymeetcustomer’’sdemandsasdemonstratedbythenumerousforecastmodificationorderssenttotheplantsandhighinventorylevelsProductsleadtimes,safetystocklevels,min/maxlevelsarenotreviewedonaregularbasisFactoryConstraintsThepurchasingfrozenhorizonssetbytheplantsseemexcessivelylongandarenotreviewedsufficiently.Therefore,L’OréalCanadamustplaceordersfarinadvance,oftenbeforetheyareabletoassesstrendsTheplantsconfirmbackallorderedquantitiessincereplenishmentleadtimeisused.Asaresult,L’OréaldoesnotobtainarealviewofsupplyorcapacityconstraintsThefactoriesareProductfocusedratherthanSales/Customerfocused.TheresultisaPushmodelratherthanPull.L’Oréal’sfactoriesoccasionallypushexcessstocktotheDCsratherthantryingtomatchcustomers’requirementsNoglobalsupplyplanningisengagedinatL’Oréal.EachL’OréalSalesCompanyisprescribedwheretobuyeachproductandcanonlylooktootherfactoriesincasesofshortage/capacityconstraintsOpportunityFactoryConstraintsCollaborativePlanningwiththeplantswouldinvolveL’’OrééalCanadapostingtheirforecastontheWebandallowingthefactoriestoconfirmthequantitiestheycansupplyagainsttheforecastinatimelymannerContinuetoroll-outoneofthenewerL’’OrééalCanadaprocesseswherebyproductsarestockedintheUSandshippeddirectlytocustomersinCanadatoreduceinventorylevelsandcostsLongTermOnceL’’OrééalCanadahasimprovedtheirforecastaccuracy,theywillbeinabetterpositiontoapproachthefactoriestodiscuss:ShorteningfrozenhorizonsCommunicatingissuesObtainingvisibilitytotheplant’’sproductionschedulestogainabettersenseofsupplyplansandcapacityconstraintsReceivingASNstogiveL’’OrééalCanadaatruesenseoftheirATPtopassontotheircustomersDevelopnewpoliciesandeducationprogramacrossL’’OrééalcompaniestoensurecustomerservicelevelsaretheprimaryfocusratherthanfactorythroughputandcostsAllL’Oréalcompanyforecastsshouldberolleduptoacentralsupplychaingroupforglobalsupplyplanningpurposes.Thiswouldenableglobalfulfillmenttomatchsupplywithdemand11SupplyPlanning––IssuesandOpportunitiesIssuesOpportunityAllocationTheUSFactoriesoughttobeallocatingstockinratiotoL’OréalSalesCompanies’’forecasts.Thiswould:EncouragetheL’’OrééalSalesCompaniestoimprovetheirforecastaccuracyEnsurefairshareallocationinshortagesituationssinceeachSalesCompanywouldobtainstockinproportiontotheirforecastBeyondtheforecastedamountstockcouldbeallocatedona“firstcome,firstserve”basisTheUSFactoriesshouldmeasureandbecompensatedbasedontheirabilitytoserviceallofNorthAmericaandnotjusttheUSVMIImplementanAPStoolthatincludesVMIfunctionalityandchooseapilotcustomertomodelwithbeforeextendingthefunctionalityouttoothercustomersLeveragetheVMIexperienceofL’OrééalUSA(e.g.Lanc?me)ProductHarmonizationWherepossible,continuetorollouttheprocessofmanufacturingwithFinalAssembly,wherebyproductsareproducedandfinishedtothepointoflocalizationstepsFactoryConstraints(cont’’d)Canadamakesuponly3%ofL’Oréal’sglobalsales,whiletheUSwhichsuppliesCanadamakesup28%ofL’Oréal’sglobalsales.Therefore,L’OréalCanada’srequirementsareonlyfulfilledoncetheUS’sneedshavebeensatisfied.ThereisnoformalprocesstoallocatestockbetweenCanadaandtheUSTheUSfactoryismeasuredbasedonit’sabilitytomeettheUSrequirementsinsteadofNorthAmerica’s.ThisKPIfurtherencouragestheUSfactorytodisregardCanada’sordersVMIAfewkeycustomershaveexpressedawillingnesstoestablishaVMIrelationship,butL’OrééalCanadadoesnotyethavetheprocessandinfrastructuretofulfillthisrequestProductLaunchesTherushtobringnewproductsintothemarketiscausinglaunchdatestobepushedupwithaninsufficientbuffer.TheresultisthatthesupplydoesnotarriveintimetomeettheadvertisingtimelinesL’’OréalanditscustomershavealreadycommittedtoProductHarmonizationManyproductscannotbeharmonizedduetolocallegalrequirementsincludinglanguageandDIN#s12OrderFulfillment–IssuesandOpportunitiesIssuesCustomerSegmentationandServiceLevelsL’Oréalcustomershavebeensegmentedandtaskforceshavebeencreatedtoworkwithcustomers,yetL’OréalisstillstrugglingtoachievehigherservicelevelsL’Oréalis“notcloseenoughtoit’’scustomers”,the“arrogantculture”preventsL’OréalfromlisteningsufficientlytoCustomers’requirementsProductallocationisnotbeingeffectivelyusedtoensureprioritycustomersaresatisfiedfirstincasesofproductshortageAvailableToPromise(ATP)ATPaccuracyiscompromisedduetofactoriesvagueconfirmations(theyonlyagreetosupplyproductwithinamonthstimeframe).Asaresult,customerservicerepsareunabletoshareATPinformationwithcustomersL’OréalnolongerwidelyacceptsbackordersOrderDeskCustomersmustcallL’Oréalmultipletimessinceseparateordersareplacedbybrand.SomeoftheordersareconsolidatedusingthetransportationmanagementsystemtoshiptothecustomerOpportunityCustomerServiceAnalyzecustomerprofilesandsubsequentlycustomizeserviceefforttiedtoprofitability,customerloyaltyandpurchasehistoryImplementconsistentcommunicationwithcustomerse.g.orderacknowledgements,orderstatusupdatesandcustomersatisfactionsurveysWorkwithL’OréalfactoriestoobtainmorespecificATPdates(i.e.ASNs)tosharewithcustomersDeterminewhetherthecurrentorderentryprocessissuitabletomeetcustomerneedsorwhetheramoreefficientprocessisrequired.Domostcustomershaveseparatebuyers/receivingdocksbybrandorwouldtheypreferamoreconsolidatedviewofL’Oréal?TechnologyOncetheorderentryprocesshasbeenreviewed,theremaybeaneedtomodifySalesAreaconfigurationinSAPSDFormalizeproductallocationbusinessrulestoensuretopcustomersreceivepriorityincasesofproductshortage.BeginbymodifyingproductallocationfunctionalityinSAPR/3beforeexploringAPSATPfunctionalityLongTermOnceL’OréalhasacquiredgreaterATPinformationfromthefactoriestheycouldexploreAPSATPfunctionalitysuchas:CustomizationandautomationoftheATPsearchpathbycustomer/productcombinationtodeterminewhetheralternatelocationsoralternateproductscanbeofferedtocustomersincasesofproductshortagesMulti-stepavailabilitycheckingagainstATP,productallocationandplannedindependentrequirements13ProjectScopeandActivitiesOverviewofOurSupplyChainFindingsProcessesInventoryReviewMaturityProfilesOrganization/PeopleandCultureTechnologySupplyChainRoadmapDiscussionofNextStepsPresentationAgenda14WereviewedinventorydatatoassesstheeffectivenessofL’Oreal’’splanningprocessesDataUsedMonthendinventoryforJanuary2003Forecast&Sold-indataShipmentsdataQuantityreceivedfromplantsPeriodJanuary2003–January2004(13months)Products12L’OrealParisSKUsA,B,andCproductsfor4categories(HairCare,HairColor,SkinCare,andCosmetics)InventoryDataReview15ObservationsLongfrozenhorizons,highminimumorderquantities,andinconsistentshippingpracticesfromL’’Orealfactoriesresultinhighinventorylevelsandemergencyexpeditingcosts(outofscope)ThesameforecastingprocessshouldnotbeappliedtoallSKUs.Itwouldbebeneficialtore-evaluatethelogicusedfordifferentproductdemandtypes.Fourmainproductdemandtypeswereobserved:StabledemandpatternUnstabledemandpatternStablepatternexpectforpromotionsLowVolume-NegativeinventoryInventoryplanningpracticesduringPromotionalperiodsresultinlargeforecastingerrorsandlargeinventoryfluctuationsDataIssues:ItisourunderstandingthattheForecastdataprovidedisthelast“correctedforecast”ratherthantheoriginalforecastusedtomakeprocurementdecisions.Wewouldexpecttherealforecastingerrorwouldthenbehigherthantheaverage+/-32%calculatedforthe12L’’OrealParisSKUsDespitenotacceptingbackorders,thereisamismatchbetween“Shipmentsout”and“Sold-in”forafewSKUs.Thereisnoclearexplanationforthis.16AbsoluteForecastingErrorCategoryABCAverageHairCare21%28%66%39%HairColor26%15%21%20%SkinCare10%46%49%35%Cosmetics25%47%24%32%Average20%34%40%32%Asexpected,forecastaccuracyishigherwithAitems,exceptfortheHairColorcategory,whichneedsfurtheranalysisTheoverallforecastingerrorsuggeststhataforecastingtoolisneededL’OrealneedstoreviewitscurrentsafetystocklevelstoreflecttheforecastingerrorforeachSKUinordertopreventshortagesandreduceinventory17ManagingPromotionsPromotionalperiodsareknowntocreatedisturbancestodemandandinventoryplanningacrossproductclassifications18DataIssuesWeexpectedthedifferencebetweenSold-inandShippeddatatobeunder5%BClass–HairCareWefoundsomelargedeviations(upto36%)betweenSold-inandShippeddata.Investigationintopossiblecausesisrequired.AClass–HairCare19SupplyIssuesfromL’’OrealPlantsTherearestrongfactorsthatareoutofL’OrealCanada’’scontrolandwouldrequireL’’OrealinternationalinvolvementtomodifyDuringthemonthsleadingtoOctober2003,thesupplierhadover-shipped3timesinexcessofthemonthlyorderOneshipmenthadtobestoppedtopreventextremeinventorylevelsResultsininventoryimbalancesAitem––HairCareSupply:USPlantMinorderQty.=35,00020SupplyIssuesfromPlants(Cont’’d)AmoreflexiblesupplyprocessresultsinlowerminimumorderquantityandstableshippingpatternsCitem––CosmeticsSupply:USPlantMin.orderqty.=28821DemandPatternsStabledemandUnstabledemandStableexceptforpromotionLowVolume-NegativeinventoryAverageDemandvariability(σdemand)13%A-SkinCare79%C-HairCare148%(13months)10%(last9months)C-Cosmetics36%B-SkinCareAverageForecastvariability(σforecast)8%A-SkinCare54%C-HairCare144%C-Cosmetics56%B-SkinCareCommentsForecastingcanmakemattersworsee.g.HairCareC-item.ForecastingvariabilityishigherthandemandvariabilityForecastingtoolsareneededtoobtainagoodestimateHaveasingledemandpeakinMarchrelatedtopromotionExampleforC-Cosmetics:UsualSales=600MarchSales=7000OftencorrespondstolowdemandvolumesForex.:B-SkinCare.Stockoutfor2monthsSuggestionsDonotforecastManagebymin/maxRequireaforecastingtooltobeimplementedtoimprovedtheprocessRequireaforecastingtooltobeimplementedtoimprovedtheprocessReorderingtimingimprovementImprovedsafetystocksmaybeneeded22ProjectScopeandActivitiesOverviewofOurSupplyChainFindingsProcessesInventoryReviewMaturityProfilesOrganization/PeopleandCultureTechnologySupplyChainRoadmapDiscussionofNextStepsPresentationAgenda23MaturityProfile––ContextAqualitativeassessmentofyouroperationsfromdifferentperspectivesAjointassessmentofbusinessprocessesandpracticesAssessedonascaleof““innocence””to““excellence””whereexcellencereflectsthevisionforleadingpracticesInnocenceAnorganizationthatexhibitsfewornonoftheleadingpracticescommonlyadoptedaroundstrategy,processandsupportcapabilitiesAwarenessAnorganizationthathasarudimentary,loosely-wovensetofcompetitivecapabilitiesimplemented;lacksatrueunderstandingofleadingpracticesUnderstandingAnorganizationthatunderstandstherequiredcapabilitiesforcompetitivesuccessbuthasimplementedonlybasicstrategy,processesandsupportcapabilitiesCompetenceAnorganizationthathasnotonlydevelopedcompetitivecapabilitiesbuthasalsoactivelyintegratedthemintoitsdailyoperationsExcellenceAnorganizationthathasdifferentiateditselfbasedonstrategy,processandsupportcapabilitiesleveragingleadingpractices24InnocenceAwarenessUnderstandingCompetenceExcellenceMaturityProfiles-DemandPlanningSummaryL’’OrééalResponseAnalysisTotal#respondents:7Overallrating:UnderstandingRangeofresponses:InnocencetoCompetenceMostdisagreementregarding““SalesandOperationPlanning””Standarddeviationof1.1onascaleof1to525MaturityProfiles––SupplyPlanningSummaryInnocenceAwarenessUnderstandingCompetenceExcellenceL’’OrééalResponseAnalysisTotal#respondents:3Overallrating:AwarenessRangeofresponses:InnocencetoUnderstandingVerysmalldisagreementamongrespondentsforeachsub-elementAveragestandarddeviationof0.4outof1to5scale26InnocenceAwarenessUnderstandingCompetenceExcellenceMaturityProfiles––CustomerServiceSummaryL’OréalResponseAnalysisTotal#respondents:2Overallrating:Understanding27MaturityProfiles––EnablingProcessesSummaryInnocenceAwarenessUnderstandingCompetenceExcellenceL’OréalResponseAnalysisTotal#respondents:8Overallrating:UnderstandingRangeofresponses:AwarenesstoCompetenceVerysmalldisagreementamongrespondentsforeachsub-elementAveragestandarddeviationof0.9outof1to5scale28ProjectScopeandActivitiesOverviewofOurSupplyChainFindingsProcessesInventoryReviewMaturityProfilesOrganization/PeopleandCultureTechnologySupplyChainRoadmapDiscussionofNextStepsPresentationAgenda29OrganizationCurrentStateGeneralL’Oréal’sstrengthsareitsmarketing,productlaunches,strongbrandname,innovationsandinvestmentinR&D(4%ofrevenue)HealthandBeautyisagrowthindustryL’Oréaloperateslikeasmallbusinessinthatitisflexibleenoughtobeabletolaunchaproductin6monthwhileP&Gcantakeover2yearstolaunchaproductProcess-drivenorganizationwithcross-functionalteamsCustomersCustomershavebecomeincreasinglydemandingandstrongerinnegotiationsCustomersdescribetheirrelationshipwithL’OréalCanadaasa““Love/Hate””relationship.LOVEduetoL’Oréalproducts,brandstrengthanddynamicculturewhichhelpattractconsumerstotheirstores,butHATEbecauseL’OréalhasbeenineffectivestockingcustomersshelvesOpportunityStrategicChangeMovefroma…MarketingdriventoaCustomerdrivenorganizationPushtoaPullModelProductfocusedtoaSalesfocusedcompanyCommunicationwithL’OréalfactoriesshouldfocusonhelpingthemgainanawarenessoftheirimpactontheL’OréalSalesCompaniesabilitytodeliverandensuregreaterlevelsofcustomersatisfactionCustomerResponsivenessL’OréalhasdevelopedCrossFunctionalTaskForcesmadeupof1VP,clientservicerep,creditandsalestoenableL’’Orééaltopenetratethevariousteams/departmentsattheclientsiteImplementcustomersatisfactionsurveys30PeopleandCultureCurrentStatePeopleL’OréalCanada‘‘sSupplyChainorganizationhasundergoneabigtransformationintherecentpastinthatindividualswhowereconsidered““oldschool”orunwillingtochangewerereplacedbyhighlyeducated,youngeranddynamicresources(50-80%)Resourcesareencouragedtospeakoutandsharetheirpointofview.Theyarenotlookingfor““Yes,men””,butratherdynamicpeoplewhowillquestion,speakwithconvictionandimprovethecompanyandproductsHighenergylevelamongallfunctionsHighemphasisonemployeeempowermentandopennessSalesandMarketingemployeeshiredusuallyhavecreativepersonalitiesandhavedifficultywithadministrative/operationalprocessesL’OrééalCanadaisseenasadevelopmentcentretrainingresourcesforInternationalL’’OréalpositionsCultureL’Orééalisadecentralizedcompany;asumofsmallcompaniesrunbyentrepre