Complexity Management
Tackling the Sources and Costs of Product Complexity at Global Cosmetics Products Company
Identified the sources and cost impacts of product complexity for a billion dollar manufacturer of cosmetic products. Initiatives included product simplification and harmonization (including packaging simplification), and optimization of the product launch process via cross-functional communication and use of packaging pallets. Significant savings $38-$40MM were discovered and worldwide rollout is expected after initial successes in the US and Europe.
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Developing Segmented Operations and Service Strategy at Full-line Industrial Goods Manufacturer
Devised an approach for segmenting SKUs in a diverse SKU environment based on a several qualitative factors such as contractual customer requirements, marketing strategy, and sourcing considerations, and a statistical scoring methodology incorporating several demand pattern factors such as sales, margin, demand variability, demand frequency, broken shipments, and requirements of top customers. Devised and implemented differentiated operations and service strategy (make-to-stock vs. manufacture-to-order) for the SKU segments which contributed to an 28% improvement in on-time delivery and a 25% reduction in inventory.
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Rapid Inventory and Supply Chain Cost Structure Diagnostic at Niche Apparel Producer
Conducted an inventory and cost structure diagnostic and created a plan for capture of opportunities at a recently acquired private equity portfolio company. Identified $11+MM in inventory reduction, $1.2–1.9+MM in overhead expense reduction, and $0.4–1.2MM in freight cost reduction opportunities.
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Assessing Product Design and Network Simplification Opportunities at Global Environmental Machinery Manufacturer
Analyzed product portfolio and design platforms, manufacturing and engineering facilities, and cost structure to establish cost reduction opportunities at a machinery manufacturer with operations distributed over 13 facilities in 8 countries. Due diligence identified $23-39MM (12-21% of total COGS) in cost savings from standardizing/modularizing product line and executing a low-cost manufacturing strategy, simplifying/consolidating the manufacturing and engineering network, and reducing material, labor, and freight costs.
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Throughput and Cost Improvements to Become a Competitive Full-line Beverage Co-packer
2 week diagnostic that benchmarked conversion costs for the company and identified 15-20% in cost reduction opportunities. The effort indicated that with improved scheduling processes and more efficient use of labor, the company could save at least $1.5MM in the short-term. Recommendations also included putting in place a system to track true costs and performance to enable longer-term improvements.
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Creating a Fact-based, Realistic Strategy for Performance Enhancement at Leading Industrial Machinery Manufacturer
Conducted a 2-week diagnostic of current performance as a first step in helping craft and execute an operations strategy. Specific elements of the proposed strategy included: (1) outsourcing non-core activities; (2) rationalizing the vendor based and developing focused supplier partnerships; (3) segmenting operations (equipment vs. consumables) to improve supply chain management; and (4) Moving towards standard and modular system design to greatly simplify inventory and production. Short-term cost savings of $2MM successfully captures and $3+MM longer-term savings capture on track.
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