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Presentation on theme: "11 ABEL BEKELE YOSHI BUDIYANTO SYLVAIN CROIZER LINDA GOLABIEWSKI JOSH JOHNSON Team 5 – Day 7."— Presentation transcript:


2 2 Translating Vision and Strategy: 2 of 4 Perspectives Financial Process Vision & Strategy Source: Norton and Kaplan

3 3 Balanced Scorecard Translating the Vision Feedback and Learning Business Planning Communic ating and Linking Managing Strategy: 4 Processes Source: Norton and Kaplan

4 Information Flow in Partnership Demand Mgmt & Marketing 4 Source: Houghton et al Orders & Production Request Production Western Digital Demand Mgmt & Marketing Orders & Production Request Production DELL Suppliers Customers

5 5 Data Delivery Highway Data Highway for Manufacturer and System Reseller WD Data Dell Data Source: Grean and Shaw Billing/ Shipping Supply Chain Technology Sharing Profitability Replenishment Joint Product Development Information Sharing Production Status

6 6 Strategy Map & Balanced Scorecard CategoryKey Strategic ObjectiveMetricsInformation Needed to Measure FinancialIncrease shareholder value by increasing business and finance plans  Earnings per share  Revenue and cost changes due to partnership  Units sold YTD  Gross margin per SKU/product line Number of outstanding shares Revenue to date Units sold YTD Fixed and variable costs Price per unit sold YTD Cost of BOM per unit Cost of labor per unit FinancialExchanging immediate and reliable revenue information  Financial transfer latency  Overhead required for billing and receipting Day unit billed Day payment received for unit FTE in AR / AP / Returns FinancialIncrease cash flow and reduce finance charges through improved supply chain management Finance charges on inventory Cash flow from sales Unit costs Plant productivity Raw material prices Orders Inventory on hand Short-term interest rates Bank account balances Cost of build of materials Cost of labor Number of units by product Derived from: Turban, Sharda, Delen, & King

7 7 Strategy Map & Balanced Scorecard CategoryKey Strategic Objective MetricsInformation Needed to Measure FinancialOn time delivery and within specifications  Unplanned downtime  Units produced per unit of labor Hours of unplanned production stops Hours worked Units produced per day FinancialReducing inventory and transport costs Shipping costs Inventory on hand Number of delays per month Shipping latency Number of shipping locations/point of sales Days of inventory on hand (DOH) Shipping cost per unit Units on hand Average number of days for products to arrive at destination once shipped Number of locations FinancialIncrease visibility of product through its life cycle from parts to assembly to product returns  Number of finished units on hand  Amount of goods or units in midst of production  Yields  Units ordered by product or product line Units on hand Units on order Batch results Units in process Derived from: Turban, Sharda, Delen, & King

8 8 Strategy Map & Balanced Scorecard CategoryKey Strategic Objective MetricsInformation Needed to Measure Internal Process Quick delivery of new products to market  Days to market for new products  Orders for new product  Gross margin per SKU Production start date Product delivery date Order count by SKU Price Cost per unit Internal Process Provide high quality and reduce waste by uncovering root causes of product failures at the source  Yield  Percent defective per batch  Units passing SPT Counts of yield Defective units Units passing SPT Units being tested in SPT at any given time Number of functional SPT stations Internal Process React more quickly to changes needed in manufacturing  Downtime to retool between products  Latency measures Estimated finished product batch times Actual finished product batch times Average production down-time Mins/Hrs needed to resume production Internal Process Integrate information so that WD- Dell can manage cross-enterprise processes in a more efficient way to improve product manufacturing, forecasting and planning through shared information Days of inventory available Units of inventory on hand Number of units demanded as forecast Production time on a per unit basis Inventory turns Average number of days that the finished units sit before being shipped Derived from: Turban, Sharda, Delen, & King

9 9 Dependencies / Relationships  For the metric “days to market for new products from inception to delivery”, the sooner a new product is released and sold into the marketplace, the more likely both Dell and WD are able to compete successfully in the technology space, and the sooner revenue can grow.  Yield, defect, downtime to retool between products and unplanned downtime per month metrics, strongly affect unit costs and productivity growth, as poorly manufactured units count against productivity metrics.  On-time delivery to Dell affects cash flow from sales.  All metrics describing levels of inventory affect finance charges on inventory, including the product mix in inventory.

10 10 Dependencies / Relationships  Percent of joint development in product mix will also reflect inventory levels, as a product created without enough input from Dell may not get the orders needed to keep inventory levels down, or worse, a particular product could be over-produced and sit in the inventory longer than average.  A higher number of shipping locations will affect shipping costs, as the complexity increases with the number of locations that product has to be shipped to.  Raw material prices affect unit costs.  SPT utilization affects overall plant productivity, unit costs and cash flow.

11 Dependencies / Relationships The number of units that pass the SPT affects 11 Plant productivity Yield Defect Net unit costs Units manufactured per unit of labor Shipping latency Amount of goods in production Cash flow from sales Gross margin per SKU WD Inventory levels Dell inventory levels Inventory turns

12 12 Q & A 12

13 13

14 14 Enhanced Supply Chain Source: Houghton et al


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