ppm at dsm_nov14 bpm conference_v1_final
TRANSCRIPT
Process Performance Management @ DSM
Going from Re-active to Pro-active BPM
Caspar TC Jans MSc Manager Business Process Management
November 14, 2014
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• Our purpose is to create brighter lives for people today and generations to come
• We connect our unique competences in Life Sciences and Materials Sciences to create solutions that nourish, protect and improve performance
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Mission
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Chemical synthesis & biotechnology
Energy, chemistry & polymer technology
Biotechnology
Hoffman La Roche’s Vitamins (1930s)
DSM (1902)
Gist-Brocades (1869)
Vitamins
Omega’s
Carotenoids
Premixes for food & feed
Enzymes
Minerals
Cultures & Yeasts
Nutraceuticals
Pharmaceuticals
Cellulosic bioethanol
Biomedical materials
Bio-plastics
High Performance Plastics
Polyamides and precursors
Resins for coatings and composites
Functional Materials
Solar – advanced surfaces
Life Sciences
Materials Sciences
Building on an impressive history
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DSM at a glance*
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Sales ~€10 billion
EBITDA ~€1.3 billion
Global presence
~24,500 employees worldwide
Listed at Euronext
NYSE
Share price quintupled in 25 years
• DSM is a global Life Sciences and Materials Sciences company active in health, nutrition and materials
• DSM delivers innovative solutions that nourish, protect and improve performance in global markets such as food and dietary supplements, personal care, feed, medical devices, automotive, paints, electrical & electronics, life protection, alternative energy and bio-based materials
Sustainability leader
Top ranking Dow Jones
Sustainability Index
* 2013 numbers total DSM
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Leader in Health, Nutrition and Materials
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• Leading supplier of nutritional ingredients (including vitamins, carotenoids, omega’s, food/feed enzymes, cultures, yeasts, nutraceuticals) for the feed, food and personal care industries
• Leading supplier of sustainable high performance materials for the automotive, electrical & electronics and building & construction industries
• Recognized as top innovator active in biomedical materials, advanced biofuels, bio-based chemicals and advanced surfaces for solar systems
Health Nutrition Materials
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12%
4%
7%
2%
24%
3% 6% 8%
7%
9%
11%
7%
Key markets Food &
Beverages
Pharma E&E
Textiles
Automotive
Building & Construction
Other Infant nutrition
Dietary Supplements
Animal Feed
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Personal Care
2013 Sales by end-market
(Food) Packaging
DSM offers products & solutions to a wide range of markets
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Latin America ~2,000
employees
North America ~5,000 employees
Europe
~12,500 employees
Strong & increasing global presence World total ~24,500 employees*
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* 2013 numbers including employees Pharma cluster
China: ~3,500
employees
Rest of Asia: ~1,500
employees
41%
5% 34%
20%
Rest of the World
High Growth Economies
Western Europe
North America
2013 Sales by destination**
Increase in % of sales to High Growth Economies**
22% 32% 41%
2005 2010CSD
2013
** 2013 Sales from continuing operations
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To support the DSM strategy “DSM in Motion, driving focused growth” our key assets needs be fitter than ever…
“To my own big surprise, it is not the strongest nor the fastest but the fittest who survives” – Charles Darwin
People Plants Knowledge & IP Processes & IT
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MASTER DATA
RISK
MANAGEMENT REPORTING IT SYSTEMS
BUSINESS
PROCESSES
1 INTEGRATED
CONCEPTS LEAN 6 SIGMA
2 CONTINUOUS
IMPROVEMENT
FLEXIBILITY
WHERE
NEEDED
BEST
PRACTICES IF
POSSIBLE
STANDARDS IF
BUSINESS
INDEPENDENT
3 BASIC
PRINCIPLES
SHAPE SHARING SOLUTIONS
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SHAPE solutions model
GOVERNANCE
PEOPLE & BEHAVIOR
KPI’S, RISKS, REPORTING & MASTER DATA
BUSINESS PROCESSES & CONTROLS
IT SYSTEMS
Single Standard Solution
Modular Standard Solution
Unique Business Solution
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SHAPE BPM supports DSM businesses and enables us to choose between flexibility where required and full standards where possible
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SHAPE
EaZBiZZ Up!BiZZ
Up!BiZZ… …an opportunity to unlock potential and becoming sustainably successful…
Process
Promoter Score Value created
1 BUSINESS
INSIGHTS
2 IMPROVEMENT
POTENTIAL
3 QUANTIFIABLE
VALUE
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• Inefficiencies COST money
• Process optimization is CONTINUOUS activity
• We need to become SMARTER
• BENCHMARKING, for better and worse
• Transparency on LINK between business process & value
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Up!BiZZ & PPM
SOFTWARE AG PPM (“Process Performance Manager”) … is a service that supports Up!BiZZ with full process insight. Detailed process scanning reveals opportunities, benchmarking information, cycle times, etc…
MANUFAC-TURING &
SUPPLY CHAIN
PROSPECT TO ORDER & ORDER TO CASH
SOURCING &
PURCHASE TO PAY
SMART index alert! OTC opportunities identified!
Scanning…
!
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Optimizing Business Processes based on measured performance
DOCUMENTED
PROCESSES
IMPLEMENTED
PROCESSES
EXECUTED
PROCESSES
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Positioning Up!BiZZ & SOFTWARE AG PPM
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Financial Managerial Reporting
(periodically)
Process Performance Management
(periodically)
Operational Process Monitoring
(real time when required)
Financial KPIs and PPIs
• Revenue • Profit • Margins • ….
Process KPIs and PPIs
• Order Cycle Times • Analyze Order Blocks • ….
Operational Reporting
• Manage Deliveries Due • Manage Blocked Orders • ….
SOFTWARE AG PPM SAP Business Warehouse
Up!BiZZ
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Up!BiZZ & BPM PPM scans processes end to end, all BPM elements taken into account
… other available and used sources: • Corporate
Reports • Unit Reporting • External
benchmarking • PA&S & BG
process expertise
• ….
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Up!BiZZ & Value Tree
MANUFAC-TURING &
SUPPLY CHAIN
PROSPECT TO ORDER & ORDER TO CASH
SOURCING &
PURCHASE TO PAY
Process Performance Indicator “SMART” Indicators !
“Value” indicators Fictive Numbers
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Up!BiZZ & OTC Scanning the process 360°on cycle times, process efficiency and effectiveness
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CASH IN BILLING DELIVERY HANDLING
ORDER TO CASH
ORDER HANDLING
Optimize Cash-flow and minimize bad debt
Uninterrupted order flow
Timely and accurate billing with minimized revenue
leakage
Fast and successful delivery with quality material from SCM
2. First time right:
More order changes occur then the actual number of created orders
1. Credit blocks:
Orders with a credit block take xxx days longer
until cash collected 3. Revenue Leakage:
€ xxx mln in order
values have not been invoiced
4. Overdue Accounts Receivable:
X% overdue > best in class for DSM Globally (>XX%)
Scanning… Scanning
complete
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Same
day
1 Order Handling Cycle time from order entry until cash received is xx days longer for credit blocked orders.
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… correlation is strong on business unit level
… 50% of all credit blocks
is released same day…
€ xx k cost in
handling direct
released orders
€ xx mln AR
reduction
!
∆ = 34%
1-2
days
3-5
days
6-10
days
10-30
days
>30
days
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2 Order Handling # Order Changes > # Orders!
€ XX k worth of FTE costs spent on order changes related same day intervention in 1 Business Group…
!
Create Change
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… Approximately
xx mln order
value confirmed
without invoiced
value. …
!
0m €
-xm €
0m €
-xm €
0m €
-xm €
Confirmed versus Ordered value
3 Invoicing Revenue leakage identified. Potential impact on sales value
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… up to xx% was requested however not confirmed and therefore a missed sales opportunity…
… > xx% is located in two legal entities…
Page ©2014 Software AG. All rights reserved. 34 |
Up!BiZZ & SOFTWARE AG Process Performance Management
• Proven Value generation
for DSM
• Business Connect required
• Strong driver for
continues improvement
• Think big, Start small
…
BG4
BG3
BG2
BG1
OtC PtP SCM …