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Supply Chain and Operations Strategy

A strong and clear overall Business Strategy and Vision is the “starting point” for leadership for any company. SCAP helps its clients distil that Business Strategy, whether that include grow market share, improve profitability or develop new markets, and help clients establish a well aligned Supply Chain or Operations Strategy.

This may include the infrastructure, systems and capability considerations that need to be included for successful execution of the strategy. Detailed financial business cases will be needed to project capital and human investments in the supply chain and establish ROI’s, as well as risks, timing and other critical insights.

A company’s supply chain and distribution network may be challenged or constrained in supporting the new vision. Strategic network optimization initiatives may need to be conducted to better understand what the network “needs to look like” in terms of facilities, inventory investment and transportation network.

Other strategic services SCAP provides is the leadership and expertise in developing an appropriate Logistics Outsourcing Strategy as well as conducting Due Diligence reviews for possible acquisitions or mergers.

SCAP focuses on the following specific professional services in helping clients create the supply chain vision or roadmap and more critically how it will be executed.

Logistics Outsourcing Governance

We help our clients understand the opportunity and high level business case as well as the potential risks and benefits by outsourcing a current logistics function. Through our assessment of current capabilities, investments and overall company strategy and objectives, we provide a scorecard and roadmap for logistics outsourcing.

We typically help our clients answer the following questions:

  • Is outsourcing a viable strategy and solution for our company?
  • How can we best offset risk yet gain additional capacity and capabilities in an outsourcing environment to support our business objectives.
  • What key considerations are taken into account as we consider outsourcing?
  • What is the timeline, sequence of activities and gameplan if we want to pursue this direction?
  • What is the business case for outsourcing a component in our supply chain?
  • What activities should remain under our control and how do we raise capabilities in these areas if these should be core competencies.

Read the Case Studies on how SCAP designed and delivered successful Logistics Outsourcing Governance solutions.

Mergers and Acquisitions Due Diligence

We serve the private equity industry including venture capital, principal investing firms and institutional investors. Our consultants support our private equity clients in benchmarking and assessing operational performance of their target acquisition companies, validating projected efficiencies as well as identifying the organization, process and system constraints and capability in both a quantitative and qualitative manner.

We typically help our clients answer the following questions:

  • Is the operational strategy and implementation roadmap sound?
  • How long should the planned initiatives take and relative ease of difficulty?
  • Does the company have the management capability to effectively execute?
  • Can we validate the savings and efficiencies based on the company projections?
  • Are the company systems and infrastructure aligned to their projected plans?
  • How does the company line up when benchmarking its operations to same or similar industry leading performers?
  • What gaps are present that may impact EBITDA and by how many basis points?

Read the Case Studies on how SCAP designed and delivered successful Mergers and Acquisitions Due Diligence solutions.

Supply Chain Transformation

We help lead, manage, change and introduce  best supply chain management practices and provide the skill transfer to clients going through transformational projects in the supply chain of their busiess.

We typically approach these projects in the following manner:

  • Once we understand the overall corporate strategy and objectives, we would conduct a current state assessment and gap analysis
  • This would include a review of organization, processes, and systems supporting the current state
  • Also included would be a benchmarking exercise to compare current state to comparable best practices
  • We would then work with the organization to develop a vision of what type of supply chain organization, process and system requirements would be appropriate for the "future state vision"
  • We then develop an execution roadmap that is time-phased and designed to build capability and building blocks for change and evolution to meet the future state vision
  • Our firm then povides the hands-on leadership and subject matter experts to partner with our client to enable a successful transformation

Read the Case Studies on how SCAP designed and delivered successful Logistics Outsourcing Governance solutions.

Strategic Sourcing

We help our clients develop and implement leading practices in Strategic Sourcing and provide the tools, templates and seasoned subject matter skill transfer to enable improved capability and set a continuous improvemenet and self-sustained environment in place .

We typically approach these projects in the following manner:

  • We conduct an in-depth assessment of the buying organization, its role in the business and how it ties to the overall supply chain or business strategy
  • The assessment would include a review of organization, tools and systems used in the buying process and vendor management / contract development as currenty used in the business
  • In some instances, based on available data and review of practices, we may benchmark an approximate savings opportunity dependant on category analyzed
  • We would develop a gap analysis and opportunity roadmap that would prioritize and identify "quick wins", phrases and a pilot to prove the introduction of best practices in Strategic Sourcing.  Appropriate tools, spend analytics and templates would be utilized in the pilot along with hands-on senior support to mentor the pilot team or individual
  • We would support both the strategic and tactical approach and communication in dealing with a vendor as part of the Strategic Sourcing pilot and may be part of the support team for hands-on negotiation support to our client when introducing more evolved strategic sourcing approach with a vendor
  • Team assessments may also be part of the assignment to identify specific training or skill set gaps in the current team
  • Based on the pilot, we would apropriately support the roll-out across other commodities with the Strategic Sourcing teams and provide an execution roadmap for continuous improvement and self-sustained internal management
  • Savings trackings and performance may also be a service provided through the rollout to other commodities

Read the Case Studies on how SCAP designed and delivered successful Logistics Outsourcing Governance solutions.

Organization and Network Infrastructure

We help our clients develop and refine their supply chain strategy as well as support the identification of the organizational and network requirements needed to successfully execute the strategy.

We typically help our clients answer the following questions:

  • What is the roadmap over the next 3 - 5 years that identifies the actions for building integrated supply chain management as a strategic objective for our company?
  • What are the phased actions and what results should we expect?
  • What type of supply chain organization, leadership and capabilities are needed for us to successfully execute our strategy?
  • What change management steps are needed to take us from current state to desired future state?
  • What should our supply chain infrastructure be for us to support our company objectives for growth, improved profitability or market dominance?
Read the Case Studies on how SCAP designed and delivered successful Organization & Network Infrastructure solutions.
Strategic Business Case Development

We assist our clients in developing the financial business cases that support supply chain infrastructure and significant organizational investments. These projects entail close interaction with senior stakeholders in an organization, deep insight to strategy and close knowledge of all financial information

We typically help our clients answer the following questions:

  • If we were to merge our organizations, what would be the organizational model and infrastructure needed?
  • What would be the investments and capital required for integrated start up and 5 year plan and what would be the payout for Return on Investment or Internal Rate of Return?
  • What efficiencies and savings would result from a merger / reorganization or acquisition and what would be the recommended implementation strategy?
  • What would the Implementation and Execution Plan look like in terms of steps, timing and resources?

Read the Case Studies on how SCAP designed and delivered successful Strategic Business Case Development solutions.

Supply Chain Design and Engineering

Supply chain excellence is driven by the development of upfront and expert design and engineering standards and work processes that bring a blend of best practices and unique requirements for each client.

Whether it be developing an optimized transportation network that reduces costs and improves services, or designing the ideal distribution sizing footprint and Material Handling solution, or incorporating a best practices process blueprint for a planning module for an ERP implementation, SCAP provides the leadership and technical know for each project requirements and deliverables.

SCAP focuses on the following specific professional services in helping clients create the supply chain vision or roadmap and more critically how it will be executed.

DC Warehouse Sizing and Material Handling Design

We help our clients understand the exact space footprint driven from a material handling design and operational layout to determine their Distribution Centre requirements. We deploy advanced techniques in modeling the storage and throughput requirements based on current and projected volumes and develop an appropriate facility sizing model. Once sizing is determined we then develop a more detailed and engineered design of the material handling equipment, operational layout and flow for the facility. At this stage we usually support our client in dealing with the various material handling suppliers in a Request For Proposal scenario and assist and support with final selection and implementation.

We typically help our clients answer the following questions:

  • How much square footage do we need for our Distribution facilities, from a real estate perspective?
  • What is the optimal material handling design for the type of products we handle?
  • What would be the capital cost as well as ROI and payback for a new facility and optimal material handling design?
  • What would the annual operating budget be if we implement this new facility and design?
  • What productivity and throughput gains can be delivered with this new design?
  • What kind of performance metrics should we be seeing from the material handling equipment and design as well as our direct workforce?
  • What would be a short term strategy for current facilities and operations until we can develop and get approval for a consolidated operation?

Read the Case Studies on how SCAP designed and delivered successfulDC Sizing and Material Handling Design solutions.

Distribution Network Design / Optimization / Implementation

We support our clients in helping them understand and quantify optimization scenarios in their supply chain networks. This would include location of Distribution Centres and sizing, inbound and outbound transportation network modeling and inventory deployment investments. All three elements would be articulated in annual operating costs or cost of capital.

We typically help our clients answer the following questions:

  • If we were to optimize our distribution network, how many facilities do we need, what would be the approximate square footage, where should they be located?
  • What would be the annual operating costs of the new optimized network?
  • With this new network what would our transportation network look like in terms of modes, shipment sizes, volumes?
  • Which customers would be served from each distribution centre?
  • What would be the impact of the new network on the amount of inventory required at each facility?
  • How would the new network improve service levels to our customers?
  • How can we optimize and redesign our transportation network to reduce overall costs and what actions need to be taken to implement these changes?

Read the Case Studies on how SCAP designed and delivered successful Network Design and Optimization solutions.

Supply Chain Planning

Robust planning environments need to be built on proven and best practices that are in turn supported by the appropriate tools and technology that take company data, and then perform the algorithms and calculations that enable planners to make the correct decisions and optimize and impact company inventory performance. We like to start at the Sales and Operations Planning process to bring all key and integrated company stakeholders into a “one number” environment. Supporting clients with a focus on things like improvement of forecast accuracy or providing input to inventory and replenishment strategies and policies is where we have had great success with our clients.

SCAP focuses on the following specific professional services in helping clients create the supply chain vision or roadmap and more critically how it will be executed.

Supply Chain Execution

Making it happen downstream with flawless execution is where the rubber hits the road for all businesses. A key core competency of SCAP is supporting our clients with not just the ideas on what to do but actually taking those ideas and being accountable for implementation. Whether its’ leading an outsourcing project for a client, implementing a new transportation management solution, project managing a DC move or supporting implementation of DC operational improvements, we have the seasoned expertise and change management resources to successfully support these initiatives. Where appropriate we also support operational turnarounds, where we provide leadership and expert direction in those specific engagements.

SCAP focuses on the following specific professional services in helping clients create the supply chain vision or roadmap and more critically how it will be executed.

3PL RFP Management and Implementation

We offer full support to our clients once there has been a strategic decision to outsource with full and deep subject matter expertise. We deploy an approach and process that ensures diligence and rigor that not only best leverages the marketplace, but also facilitates the best fit for our client as their ultimate selection. Our process builds steps to ensure that the most successful and demonstrated service provider proves itself and earns the right to our clients business, through the exercise. Where needed, we also support implementation and project management leadership on behalf of our client.

We typically help our clients answer the following questions

  • How can we ensure that we absolutely make the right choice in the selection of a 3PL?
  • What risk mitigation techniques should we deploy in rolling out the transition to a 3PL solution?
  • How should we structure pricing that is an incentive to the 3PL but also supports non-performance financial impacts?
  • How do we drive a performance driven contract with our 3PL?
  • What are the benefits of us owning our own real estate in this arrangement?
  • What should be the performance scorecard used to help manage the performance of the services?
  • What are some of the transition strategies that could be used to ensure the human resource considerations are managed for success?
  • What should the communication strategy be with our employees?
Read the Case Studies on how SCAP designed and delivered successful 3PL RFP Management and Implementation solutions.
Logistics Optimization

We support our clients in helping to quantitatively and qualitatively assess their current Logistics operations. This would include Inbound and Outbound Transportation Management as well as Distribution or Warehousing Operations. Based on the assessment and state of health, we then develop recommendations and an implementation roadmap to drive implementation for improvements in performance and efficiencies.

We typically help our clients answer the following questions:

  • How does the efficiency of our distribution operations compare when benchmarked to other similar operations?
  • What would be the roadmap and set of activities to improve these efficiencies and in what time frame can they take place?
  • What tactics can I use in controlling better inbound planning to our DC’s and how can I leverage the inbound carriers to provide visibility?
  • How does my inbound and outbound freight spend compare to other similar benchmark volumes and spend?
  • How can I leverage specific WMS or TMS capabilities to improve performance and efficiency and what would be the approximate investment that would be required?

 

Read the Case Studies on how SCAP designed and delivered successful Logistics Optimization solutions.

 

Operations Turnaround

In specific situations, clients will use our expert services to lead a business turnaround and develop a plan to recovery where a company has encountered distress. We would focus our skills and resources, both from a leadership and technical perspective needed in the supply chain, including the following areas, Inventory Planning, Procurement, Distribution Operations and Transportation.

Read the Case Studies on how SCAP designed and delivered successful Operations Turnaround solutions.
Transportation Spend Management

Transportation as a key supply chain element has become both strategically and tactically a challenge for most companies over the last few years, due to unprecedented energy and fuel costs. Companies are being forced at a strategic level to better understand how to best configure their distribution networks.

Macro trends are emerging from these dramatic changes in rising transportation and logistics costs and these trends will impact how buinesses will have to manage their supply chains in the future.

Macro Trend #1: Network Optimization Modeling to Balance the Rise in Transportation Costs vs. Inventory Investment / Deployment and DC Facility Costs

  • As Transportation is moving closer to being 70% of total logistics costs, centralized distribution systems, depending on a "high miles" network is not optimal
  • Companies need to examine their Distribution Network (Sourcing / Inventory Deployment Points / Customer Ship To's) to determine with high cost transportation what an optimal network may look like, cost and understand potential impact to service changes

Macro Trend #2: Greater Use of 3PL's Infrastructure / Assets to Enable Inventory Deployment Closer to Consumed Use

  • Companies will need to use the assets of others (Transportation providers / 3PL's) to enable deployment of inventory closer to its point of use and rely on these external assets to enable lower transportation costs and efficient inventory deployment

Macro Trend #3: Lowest Cost Country Sourcing Strategies Offset by Rise in Transportation Costs (Container Costs)

  • The cost of shipping a standard container from East Asia to the U.S. Eastern seaboard has already tripled since 2000 and will double again as oil prices head towards $200 per barrel
  • At $200 per barrel, we are back at "tariff" rates not seen since prior to the Kennedy Round GATT negotiations of the mid-1960's
  • As oil prices keep rising, pretty soon, those transport costs start cancelling out the East Asian wage advantage - they already have in steel. Soaring transport costs have already more than eroded the wage advantage and suddenly Chinese-made steel is uncompetitive in the U.S. market

Leveraging the transportation service provider marketplace professionally with the right analytical output, format as well as being armed with benchmark rate / volume / class is how we help our clients achieve a successful and cost effective transportation management program.

We typically help our clients answer the following questions:

  • How do we compare when we benchmark our current spend, volumes and shipment characteristics to other similar best practice businesses?
  • What is the best process to professionally represent our company to the transportation service provider marketplace to leverage our spend and volume?
  • What negotiation strategies should we deploy to ensure we maintain a high level of quality yet ensure we receive fair market pricing?
  • What technical strategies can we use to offset fuel surcharges and accessorial charges and be able to monitor any impacts on an immediate basis?
  • Which are the carriers that we should be dealing with and who can bring the best informational and performance monitoring tools?
Read the Case Studies on how SCAP designed and delivered successful Transportation Spend Management solutions.

Supply Chain Systems

Leading our clients to develop a clear articulation of business requirements relating to either a full ERP or Supply Chain Planning or Execution System is an established skill set within our practice. From our experience we also provide best practice insight to the Request For Proposal process and have developed an approach that has been successful for our clients. SCAP consultants facilitate and provide the leadership to ensure there is an objective and effective process that supports the selection of the best qualified software company and provides input and guidance around risk and constraints in review of the implementation plan.

SCAP focuses on the following specific professional services in helping clients create the supply chain vision or roadmap and more critically how it will be executed.

Best Practice Design & Blueprinting

Many companies believe that moving to a new ERP or Supply Chain System business application will provide them “best practices and processes”. Not true. In advance of implementing any system there needs to be a fresh look at the work processes that currently support the key business functions and develop a “new” improved way of running the business, unconstrained by any system. Developing those new work processes and incorporating “best but appropriate” practices provide the right platform for making a selection for a new system

We typically help our clients answer the following questions:

  • How should our “order to cash” processes be designed to ensure speed and efficiencies both internally and to our customers?
  • How should we design our Sales and Operations Planning process through Demand Planning / Inventory Replenishment and Finished Goods Deployment?
  • What are appropriate best practices that we can incorporate into our Logistics Execution process blueprint before finalizing with our software supplier?
  • If we fundamentally change our Buying processes and accountabilities to a more centralized model what will be the organizational impacts that need to be aligned with the new processes?

Read the Case Studies on how SCAP designed and delivered successful Best Practice Process Design and Blueprinting solutions.

ERP and SCM Systems Selection

We support our clients in providing a professional approach, rigour and objective experienced focus when the business has decided to engage the marketplace for the best technology solution that will improve internal capabilities and efficiencies.

We typically help our clients answer the following questions:

  • What is the best method of objectively and efficiently developing the business requirements to enable our company to engage the ERP or Supply Chain Software vendors?
  • We need someone to help us manage the RFI / RFP process that is focused on the initiative and can best represent our business to the vendor community?
  • What technical elements need to be in the RFP and how do we best state and format those needs?
  • What is the best methodology for us to "score" or weight the RFP elements and our selection criteria?
  • How do we best leverage the process to ensure we include expectation of performance as well as leading us into the negotiation phase once we have selected a vendor?
Read the Case Studies on how SCAP designed and delivered successful ERP and SCM Systems Selection solutions.