Schneider Electric – EyeOn Planning Inspiration Day 2017
Confidential Property of Schneider Electric
Claude De Paoli
Oct 5th 2017
Collaborative Planning with Key Customerleverage for growth
Our technologies ensure that
everywhere, for everyone and at every moment.
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ENERGIZED•+50% energy consumption by 2050 due to
urbanization, Industrialization , digitization.
• Electricity to grow twice faster than energy
consumption
•2.3 bn people do not have
either access or reliable access to electricity
EFFICIENT
•3X efficiency needed to solve climate change
•82% of untapped energy efficiency in buildings
•>50% of untapped energy efficiency in industry
CONNECTED
• 10X more incremental connected devices
than incremental connected people by 2020
• 30bn connected things by 2020
• Software runs everything
when life is…
Sources : Industry Reports
Schneider makes life Safe, Reliable, Efficient, Sustainable and Connected
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Megatrends are provoking a rise in Energy Demand
URBANIZATION+2.5B people in cities
by 2050Source: United Nations, DESA
DIGITIZATION
Source: Cisco
50B connected things
by 2020
INDUSTRIALIZATION+50% Energy consumption
by 2050Source: IEA
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Resources in the next 40 years
Energy consumption will grow by 50%
CO2 emissionsneed to be halved
×1 ÷2We have to become
3 times more efficient
3×.5
Note: Forecast for 2050 compared to 2009 levels
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At Schneider Electric,
we combine Energy Management,
Automation and Software
serving 4 markets, i.e. 70% of the
world energy consumption
Energy Automation
Softwareand
Analytics
% are calculated on final energy
Industry & Infrastructure
> 30%
~2%Data Centres &
Networks
Residential Buildings
> 30%
Source: IEA Explore 2015
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Schneider Electric, the Global Specialist in
Energy Management and Automation
Balanced geographies – FY 2016 revenues
28%North America
18%Rest of World
27%Western Europe
27%Asia Pacific
€24.7 billionFY 2016 revenues
160,000+people in 100+ countries
5%of FY revenues devoted to R&D
Four integrated and synergetic businesses FY 2016 revenues
43% 22% 20% 15%
IndustryBuildings & Partner Infrastructure IT
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Schneider Electric Global Business in Over 100 Countries
1: Published figures in billion € restated to reflect country-market view;
2: Billion € pro-forma basis including LTM Sep 2014 revenue for Invensys
3: Including Invensys, excluding Delixi and Fuji
North America
33,700 Employees3
38 Factories
Western Europe
47,600 Employees3
92 Factories
Asia Pacific
61,500 Employees3
Including JV
77 FactoriesIncluding JV
Rest of the World
34,100 Employees3
38 Factories
7
20031 20142
6.32.3 6.74.1
20031 20142
1.2
20031 20142
1.2 4.8
20031 20142
Schneider Electric, a global Supply Chain in
Page 9Confidential Property of Schneider Electric |
90,000 employees (Total industrial headcount incl. Purchasing, Manufacturing and Logistics)
Purchasing
• 45,000 suppliers
• €12B purchases
Manufacturing
• 218 factories
• 44 countries
Logistics
• 100 distribution
centers
• 130,000 order lines / day
• 500,000 references
Customer
Orders
December 2015(including Delixi and Invensys, w/o CST)
A vast worldwide set up
Country Sales &MKTDistribution Network FactoryFactory / Suppliers Customers
Schneider-Electric
Plant
Schneider-Electric
Distribution centerCustomerTier 1
Supplier
DemandDemand Demand Demand
Tier 2
Supplier
Demand
Schneider-Electric
Distribution center
Sales, Inventory & Operations Planning
Distribution
Requirements
Planning
Master Production
Planning
Product lines
Collaborative
Sales
Forecasts
Collaborative Planning
with critical suppliers &
Vendor Forecast
Collaborative
Planning with
key customers
Aligning Demand, Supply, Inventory & Financial
SIOP
A full End to End global Supply Chain supported by
Sales, Inventory & Operations Planning
C
U
S
T
O
M
E
R
S
Schneider’s SIOP and Planning Processes
Sales, Inventory & Operations Planning
Distribution
Requirements
Planning
Master Production
Planning &
Capacity Plng
S
U
P
P
L
I
E
R
S
CountryDistribution Network Factory
End-to-end Supply
Chain
Collaborative Sales
Forecasts
Vendor Forecast &
Collaborative Plng
with suppliersFactory
Project Management Process PMP
Product Evolution Process PEP
Product Withdraw Process PWPIndustrial Transfer Projects
Demand
Management
Offer
management
Supply
ManagementInteraction &
Reconciliation
SIOP Reviews
Step 1
Step 2
Step 3Step 4
Step 5
Collaborative
Planning with
key customers
SELL IN
CoPlanning with key Customer; A breakthrough initiative
CoPlanning; a shared inventory & end-market demand visibility
through Ritualized collaboration,
supported by a joint Sales & Marketing strategic vision
and materialized through a Synchronized supply chain.
@
SELL TROUGH SELL TROUGH SELL OUT
=S= DISTRIBUTORPARTNER
&
INTERMEDIATE
END
CUSTOMERDistribution Center Distribution Center
Point Of Sales
E-Business
Co-Planning scope
Factories
Evolving our business model, from a B2B2B model focused on Sell-In relationship to a B2B2B2C
model also focused on Sell-Through relationship.
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1 2 3 @
An approach to better envision efficiency & growth opportunities
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Competitive weapon to boost growth
• Joint, structured, targeted collaboration on new
product introduction, promotions, campaigns
• Increased on-shelf availability through shared visibility
of forecasted market demand and joint stocking policy
Collaborative optimization of the extended supply chain
• « Healthy Stock » approach to clean excess and
obsolete and avoid missing inventories
• Increased efficiency and performance through better
demand forecast and bullwhip reduction
CoP Value Proposition« A la carte » toolkit to address specific customer’s objectives in a structured way
Price
Increase
Healthy
Inventory
Planning &
Projection
Sales
campaigns
Quarterly &
End of Year
Bonus
Joint
Stocking
Policy
Promotions
New
Product
introduction
Sell
thro
ugh
to
Se
ll In
Sig
n O
ff
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Business collaboration proposal Step Up
Price
Increase
Healthy
Inventory
Planning &
Projection
Sales
campaigns
Quarterly &
End of Year
Bonus
Joint
Stocking
Policy
Promotions
New
Product
introduction
Se
ll th
rou
gh
to
Se
ll In
Sig
n O
ff
1 2 3
4.2
4.1
4.3
4.44.5
4.6
4.7
4.7 Joint Stocking Policy
4.6 Sales & Commercial Event
4.5 Price Increase
4.4 Promotions
4.3 Phase In – Phase Out
4.2 Quarterly & End of Year Bonus
4.1 Inventory Planning & projection
3.Forecast Sign Off
2.Sell-In Sales Forecast (DRP)
1.Sell-Through Sales Forecast (CSF) Mu
st
ha
ve
Growth
levers to
select
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•Commit on agreedSell-Through Sales Forecast & GenerateSell In
•Define a joint Sales &Marketing Rolling Roadmap
• Generate Sell-Through Sales Forecast
•Jointly Review&Agree
on 1 Market Demand
Plan (Sell-Through Sale
Forecast)
• Propagate Demand Signal
in Supply Chain Processes
• Ensure Execution of
Business Strategy
• Sales Events
• Loyalty Program
• Catalog & Web Info
• Promo & e-Promo
• Phase In - Phase Out
• Customer Classifications
• Offer Coordination w/ BU
• Project Pipeline
• Price Increase
• Market Trends
• Extract Historical Sales
• Clean History
• Aggregate Data
• Calculate Statistical Forecast
• Integrate/Translate Sales & Mkting
Rolling Roadmap Inputs
•Sales Growth&Performance (cash,…)
•Service level
•Healthy stock
CoPlanning
Business process
Benefits
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CoPlanning in a 7 steps monthly cycle (Day In A Life – DIAL)
Generate Sell
Through
CoP discussion
and override ST
ST
Simulated
vs
Ambition
Adjust inventory
parameters &
generate Sell In
Sign Off
committed
ST
SI
Simulated
vs
Ambition
Sign Off
committed
SI
Accepted
Refused
Accepted
Refused
=S= SIOP Integration
CoP Sell Through review
CoP Review
Step 2
Step 3
Step 4
Step 5
Step 6
Sales &
Marketing
Roadmap
omodo
Process &
Perf KPI’s omodo
Acquire and
Validate Master
Data
Step 1
Supply
Commit
Step 7
Define action plan (Adjust sell in or sell out
commitment for the current or
next cycle)
* Adjustment of Sell Through to be done on the next cyclePage 17Confidential Property of Schneider Electric |
• Log assumptions• Promotion
• Campaign
• Project
• Phase In/Phase Out
• Price increase / price decrease
• …
Collaborative Sales Forecasting in Kinaxis
decision making support
• Check master data consistency
• Create Forecasts Items
• Correct history
• Generate and review statistical forecasts
• Consensus meeting
• Consensus meeting
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• Prepare data in scenarios
• Launch DRP initialization
• DRP analysis
• Create Sell-In forecasts
• Review Sell-In Forecasts
Distribution Requirement Planning in Kinaxis
Stock optimization and SELL In creation
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WeaknessesStrengths
• Joint governance relies on people willingness
• Joint Business Planning activities pretty new
for some of historical transactional Partners
• Perceived complex & resource intensive effort vs. tangible, traceable benefits
Lessons learned for Collaborative Planning with Customer
• Perceived as a “nice-to-have” Supply Chain"
initiative and not business potentials
• Variable Customer digital maturity
• Change Management Culture apprehension. Between companies and inside each of them on a multi disciplinary level (Sales/Mkt/SC…)
• Concurrent forecasting & collaborative tools available on the market for
customer choice
Opportunities
• VIP customer treatment analysis with CS&Q*
• Multidisciplinary efficiency Supply Chain,
Sales & Marketing
• Full benefits from SIOP Integration
*Customer Satisfaction & Quality
• Bring Voice of customer into Supply Chain
• Switch from Sell-In to Sell-Through visibility
• Align growth and Supply Chain added value
• Co-design capabilities = new process creation (Supply Commit) -Customer centricity
• Best of breed IT tool - Leverage platform & capabilities enhancement
Threats
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Business collaboration proposal Step Up
Price Increase
Healthy
Inventory
Planning &
Projection
Sales
campaigns
Quarterly &
End of Year
Bonus
Joint
Stocking
Policy
Promotions
New
Product
introduction
Se
ll th
rou
gh
to
Se
ll In
Sig
n O
ff
4.2
4.4
4.7
4.7 Joint Stocking Policy
4.6 Sales & Commercial Event
4.5 Price Increase
4.4 Promotions
4.3 Phase In – Phase Out
4.2 Quarterly & End of Year Bonus
4.1 Inventory Planning & projection
3.Forecast Sign Off
2.Sell-In Sales Forecast (DRP)
1.Sell-Through Sales Forecast (CSF) Mu
st
ha
ve
Growth
levers to
select
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4.1
4.3
4.5
4.6
• Breakthrough statistical generation of end market demand trend
• Last 6 consistent months results show a Forecast Accuracy between 60% and 80%*
• Ability to deep dive into data analysis to better understand end market• Trend analysis of customer segment versus Schneider ranges
• Visibility on End of Quarter/Year incentive and impact on inventory and Sell In
Up to 18 months horizon of end market demand, at different aggregation level (up to reference)
SELL THROUGH PROJECTION : Co-planning
anticipation about End of Year business achievement
and comparison with previous year.
SELL THROUGH FORECAST ACCURACY :
calculated with 3 months offset
and product family aggregation
Visibility with CoPlanning Sell-Through Stat. Forecasting
* 6-months period Nov’16 to Apr’17
1 2 3
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• Downward trend spotted in July after poor
H1 performance alert ! Sell-In target is
going to be missed by more than 50%
• Aug/Sep/oct Quick actions taken jointly by
SE and the Customer to secure fulfillment
of business
• SE provided the Customer with ‘resources’
(, promotion, joint sales event…) to capture
more business and offset PCP trend
• Finally, although gap could not be totally
recovered, it was greatly reduced to 25%
Case of PCP product family for which EoY Sell-In projection fell under the ambition.
OTDc* On Time Delivery Customer
Anticipation with CoPlanning Alert & Joined sales efforts
Jul’16
Oct’16
Dec’16
EoY projected
gap VS target
EoY actuals
gap reduced to 25%
1 2 3
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• Proactive communication on potential deficit during CoP Sell Through review and escalation
for decision during CoP Review
• Customer prioritization in case of major deficit. Happened during the Q1/Q2 drives deficit.
Anticipation with CoPlanning Successful mgnt of supply alertIndustry Drives quantity deficit (Asia Q1/Q2 2017)
SELL THROUGH : Co-planning anticipation and impact on demand measured in
SELL Through trend Supply crisis
SELL Through
maintained to a
good level
1 2 3
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• Additional Growth = +10% May 2017 (estimated end of 2017: 15%)
• Launch Forecast Accuracy = 96% End Of Life & 80% New Product Introduction
• Time to Market = 5 months substitution with 50% substituted in 2 months
• Healthy Stock = -50% of old stock in 1 month
• Availability on shelves = 100% at launching month
Speed & agile launch with CoPlanning Inventory optimizedNew Product Introduction (France 2017)
SELL THROUGH : Co-planning substitution speed measured in
SELL Through Old range
SELL Through New range
SELL Through New range - Forecast
2016
2017Launching
month+20%
Fcst FY2017 :
+15%
4.1
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• Additional Growth = +3,9M€ +12% in 2017
• Competitive Advantage = +9 pts vs Competition
• Enrichment Mix Offer = +10 pts on Door Mix, +30% growth on Trunking
• Launch Forecast Accuracy = 85% at product family
• Time to Market = 4 months substitution + 100% availability on shelves
• Healthy Stock = 0 old stock (100’s of kEuros) at customer & 0 return to SE
Speed & agile launch with CoPlanning Beat the competitionNew Product Introduction (France 2016)
SELL THROUGH : Co-planning substitution speed measured in
SELL Through Old range
SELL Through New range
SELL Through New range - Forecast
4.3
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• Orders placed in April, 100% availability on shelves for the launching date
• Additional Growth = +48% vs same month 2016
• Feed back from DC’s and Factory for being able to sustain
• Promotion successful : 90% forecast accuracy, ~ 100% delivered on time
Anticipation with CoPlanning Successful sales campaignsSpecial commercial event (France 2017)
SELL THROUGH Forecast : Co-planning anticipation and impact on demand measured in
SELL Through Y vs Y-1
on impacted references
2016
2017
All references scope
SELL IN, SELL THROUGH,
Stock forecast
SELL Through
SELL In
Inventory
SELL Through
Fcst
SELL Through
Actuals
Accuracy
90%
SELL Through actuals
4.6
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