make lean an innate way of thinking and increase purchase order compliancy
DESCRIPTION
This session was presented at '15 Secrets to Shared Services Success" conference organised by sharedserviceslink.com.To find out more about forthcoming conferences check http://www.sharedserviceslink.comTRANSCRIPT
Make Lean An Innate Way of Thinkingand Increase PO Compliancy
Lucy Wilson & Jason McGovern
Marks & Spencer - A Brief history……..
1884 Michael Marks, a Russian born Polish refugee, opened a stall at Leeds Kirkgate Market. All items were sold for one penny, including nails, screws, soap, wooden spoons and luggage labels.
1928 The St Michael trademark was introduced as a guarantee of quality and value.
1954 Operation Simplification – a project to streamline internal processes in order to save paper and cut down on unnecessary administration– was launched.
1975 In 1975 M&S made its first step into Europe, opening a store on Boulevard Haussman in Paris.
1986 Our first edge of town store opened at the Metro Centre in Gateshead.
1999 Online shopping was launched on our website.
2003 Marks and Spencer Shared Services established
2007 Plan A launched - 100 point five-year ‘eco plan’ to address challenges in the key areas of climate change, waste, sustainable raw materials, fair partner and health
Marks and Spencer Shared Services Ltd(MSSSL)
Location: Salford Quays, Manchester
110 FTE Finance, 120 FTE HR
5 Teams
5 core process areas
6 Years old
Manage: c£10bn revenuesc£8bn payables c£3bn receivables
Supports 65,000 employees and 600+stores
Marks and Spencer Shared Services
Our Journey
January 2003
Finance Shared Services set up
December 2006
New leadership team appointed
Strategy set
Move from accounting centre to Shared Services begins
April 2007
SAP Go live
ERP platform launched for AP, AR, NMP and core financial transactions
March 2008
First year in SAP complete
90% customer satisfaction ratings
66% average KPI rating
£60m of annualised cashflow generation support
July 2008
New business migrated
100% customer satisfaction ratings
79% average KPI rating
Further £30m-£40m annualised cashflow generation targeted
Creating Value with a Passion for Excellence
Why Lean in Marks and Spencer Shared Services?
New Business
Process efficiencies
Change
Business Foundation Programme
What is Lean?
Lean is a philosophy focusing on reduction of waste to improve overall customer value. By eliminating waste, quality is improved, production time and costs are reduced.
The goal of Lean is to accelerate the velocity of the process by reducing waste in all its forms.
Lean is not cost reduction, its finding a better way to get the work done
What is Lean?
Lean is simply creating an environment where you have the right amount of resources, where work is paced
and content targeted according to customer demand.
More importantly, Lean is having the ability to rapidly respond to a signal from the customer
through a standardised process, which means it is predictable, controllable and sustainable
“
”
Lean Principles
In their 1996 book ‘Lean Thinking’, Womack and Jones defined a set of five basic principles that characterise a lean enterprise.
Value in customer eyes
Identify all the steps
Flow
Customers pull value
Pursue perfection
History of Lean
Early Years
CPI – Erratic non defined
Silo working
Little inter department communication
Shared ServicesIntroduction
CPI initiated
ERP implementation
CPI / Lean Discovery
Lean Project IdentifiedLean trainingBenefits realisedCPI cultureLean WorkshopsIdea generation
Embedded CPI culture
• Enthusiasm• Appropriate
level of investment
• Enhanced toolkit
Self Sufficient
.Embedded within process areas
BAU
Automated
Creating Value with a Passion for Excellence
Roll-out in Finance Shared Services
Lean Training across management
Blitz Kaizen workshop
Roll out across Finance Shared Services– Teaser campaign
– Project selection by management
– Monthly workshops (cross functional)
– Benefits tracker
– Monthly updates cascaded
– Governance process ensures return on investment
CPI Implementation
Project Selection tool
Pure LEAN STARS
CPI Control IssuesReturn
Delivery Risk
Low
Low High
High
Continuous Process Improvements
CPI is the ongoing effort within FASS to incrementally improve how products & services are provided and
how operations are conducted to ensure we maximise value and maintain control at all opportunities
“”
CPI - Criteria
Reduction in variation
Removal of non-value add
Improves Customer Satisfaction
It reduces time / money / physical waste
Increases quality of our product
It enables us to improve activity measurement
It is required for statutory reasons
It enables the required level of control
Benefits from Lean in Finance Shared Services
Cash Management Process
KPI Reporting Process
NMP Procurement
Intercompany
PO Compliance – Our first Lean project ??
No PO, No Pay removed non-value add activity
Invoices scanned & recorded
Invoices with a PO keyed into SAP
No invoices parked
No PO – invoice returned
KPI’s monitor turnaround times
Vendors were advised how to comply
Go live: 55% compliant
Six months: 90% compliant
Impact on FTE is minimal
WinsCreate a competitive atmosphere
Size of potential benefits
Cross functional teams
Team building
Learns Clear Goal and Objectives
Not always a ‘Big Idea’
Don’t over commit
Biggest bang for your buck
ChangesContinually reassess scope
Pace of implementation
Key Learning’s?
Make Lean An Innate Way of Thinkingand Increase PO Compliancy
Lucy Wilson & Jason McGovern