OPERATIONAL EXCELLENCE

The Impact on Credit Management

Presentation for AICM W A DivisionCredit Symposium 22nd May 2015

DSO’s are a direct reflection on your Company’s qualitySo why is the credit manager the only person responsible

Source – NACM – Business Credit June 1993

Source – Resource Evaluation USA

Customer Service & Payment DelaysWhat your customers are saying

81% Say service offered impacts on payment cycle.

71% Quote factors other than financial for payment delays.

53% State level of service from vendors impacts decision as to when to pay.

51% Had with held payment of invoices due to poor level of service

Achieving Competitive AdvantageRethinking the role of Receivables Management is not a new concept

Source – NACM – Business Credit June 1993

The Cost of Being a LaggardCan you afford it…

Source – Aberdeen Research October 2014

Operational Excellence means attaining a position of advantage in the execution of business processes. It is typically characterised by:

1. Total organisational commitment to continual improvement

2. Customer experience levels exceeding industry standards

3. Higher levels of staff engagement

4. Sustained higher financial returns for Shareholder/Stakeholder

Defining Operational Excellence for Your Business

Defining Operational Excellence in Your BusinessIt does not come from posters on the wall

Lets discuss these examples or aspirational statements:

Extraordinary execution

Swift dependable service

Driving costs down aggressively

Guaranteed low price and/or hassle free transactions

Executing service one way and one way only

“Operationally excellent companies deliver a combination of quality, price and ease of purchase that no one

else in their markets can match. They are not product or service innovators, nor do they cultivate one-to-one relationships with their customers. They execute extraordinarily well, and their proposition to customers is guaranteed low price and/or hassle-free service.”

The Discipline of Market Leaders Treacy & Wiersema

Three Relationships of OE

Customers

OrganisationStaff

Culture

OE

1. The relationship between staff and the organisation defines the Culture.

2. The relationship between the staff and customers defines the Customer Service

3. The relationship between the customer and the organisation defines the Brand.

Customers

OrganisationStaff

Culture

OE

1. The relationship between staff and the organisation defines the Culture.

2. The relationship between the staff and customers defines the Customer Service

3. The relationship between the customer and the organisation defines the Brand.

1. The relationship between staff and the organisation defines the Culture.

2. The relationship between the staff and customers defines the Customer Service

3. The relationship between the customer and the organisation defines the Brand.

What makes Operational Excellence Different

OE has its origins in other business methodologies

Previous methodologies were anchored in what we often refer to as left brain or rational thinking whereas research is increasingly telling us that more social or right brain thinking is required in order to deliver balanced and effective outcomes

The "control from above" approach required prevented many programs from meeting the hype - they are typically manufacturing based

OE accepts that we may make mistakes, but we will have the structure to learn from them the first time!

OE supports (depends upon) empowerment and frontline decision making, accepting that good process design can allow that

OE places a larger responsibility on staff and empowered leaders to drive the programs

Operational Excellence doesn’t just happenIt requires a sustained effort- by everyone

Attaining Operational Excellence requires:

• A set of disciplines & sustained effort to transform into habit

• Improved contributions to business performance by all staff which is only achievable through improved engagement – “discretionary effort”

• Reduced operational errors

• Enhanced operational efficiencies

• Increased customer satisfaction

• Optimised margins or profitability

Operational Excellence requires an approach to performance improvement focused on new ways of:

• Thinking

• Managing

• Measuring

Stages of OE successWhere are you – what are the opportunities

Where the enterprise sits on this continuum is no longer measured by consensus around the board or executive table - it is now determined by your customers and employees

Defining Operational Excellence in Your BusinessAre you and your team up to the challenge…

INTRODUCING BBB ADVISORY

We are an Operational Excellence and Change Management

Consultancy, enhancing organisational performance and brand

vision through improvements in systems, processes and methods to

deliver cultural change that empowers and enables employees

and engages customers.

There are four outcomes that BBB Advisory consistently delivers:

Reduced operational costs

Improved customer experience

Released operational capacity

Increased revenues

Better Thinking Better Performance Better Outcomes