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ATC Logistics & Electronics
IS OUT SOURCING THE WAY TO SUPPLY CHAIN EXCELLENCE? Prepared For: LQ SYMPOSIUM Prepared By: Bill Conley President (817) November 9, 2006
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IS OUTSOURCING “THE WAY” ???
Introduction to ATC Logistics & Electronics Is Outsourcing “The Way” to Supply Chain Excellence ATCLE Conclusion
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WHO IS ATCLE ? ATC Logistics & Electronics Proprietary Information - This slide may not be altered
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Who We Are Parent Company – ATC Structure NuVinci Logistic Services
Engineered Products Drivetrain Drivetrain Operations Logistic Services Electronics Material Recovery NuVinci ATC Logistics & Electronics Proprietary Information - This slide may not be altered Aftermarket Technology Corp., Downers Grove, IL Specializes in supply chain management, forward and reverse logistics, electronics repair and remanufacturing, and powertrain, transmission, and engine remanufacturing 3,280 Employees 2005 Revenue: $442 million Publicly Traded on NASDAQ as ATAC
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Who We Are ATCLE - Full Service Value Add Supply Chain Management Company 1. Customers 2. Forward Logistics/New Product Suppliers Customer / Stores Web site Call Center Advanced Exchange Returns management Outbound Fulfillment Direct to Consumer and Bulk Fulfillment New and Refurbished Warehouse and Inventory Management Kitting and Light Assembly Outbound Finished Goods OE quality and specification Specialized technology 4. Test / Repair / Refurbish 3. Reverse Logistics Value Added Services Testing and sorting Quality inspection Return product inspection Packaging ATCLE Customer Value Proposition Growth End-User Satisfaction Enhanced Profits Supply Chain Velocity Quality
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Who We Are ATCLE Customer Listing by
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IS OUT SOURCING “THE WAY” TO SUPPLY CHAIN EXCELLENCE
ATC Logistics & Electronics Proprietary Information - This slide may not be altered
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YES AND NO Is Out Sourcing “THE WAY” To Supply Chain Excellence?
OR more correctly stated: Can you achieve superior supply chain performance, serve your customers, maintain control over costs, maintain expertise over the process, and deliver exceptional results through a service provider and better utilize critical corporate resources for core competencies that improve your competitive position ??? YES AND NO
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IT ALL STARTS WITH THE CUSTOMER AND THE CUSTOMER’S CUSTOMER
Is Out Sourcing “THE WAY” To Supply Chain Excellence? IT ALL STARTS WITH THE CUSTOMER AND THE CUSTOMER’S CUSTOMER DO YOU REALLY KNOW THEM ?
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Is Out Sourcing “THE WAY” To Supply Chain Excellence?
THE BASIC QUESTIONS ARE OFTEN LEFT UNANSWERED Who are they What do they do best What is their long term strategy Where are they located What do they need Why do they need it Why do they buy your product or service What happens if it does not work What is the best way to serve them What keeps them up at night
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IT IS ABOUT EXPECTATIONS
Is Out Sourcing “THE WAY” To Supply Chain Excellence? IT IS ABOUT EXPECTATIONS WHAT DO THE CUSTOMER’S EXPECT ? HOW DO YOU MANAGE EXPECTATIONS?
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Is Out Sourcing “THE WAY” To Supply Chain Excellence?
Do Customer Expectations Conflict With Corporate Goals ? CUSTOMERS They want it at the lowest cost They want it tomorrow or soon They need after sales and service They expect total visibility to orders They need information CORPORATE Expand market share in new locations Introduce new products or services Drive Lean, Continuous Improvement Lower Costs Reduce Headcount Focus on core competencies Capital for non-core hard to secure IT resources dedicated to production Outsourcing Is A Way To Close The Gap Between Customer Expectations And Corporate Competencies/Resources
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Is Out Sourcing “THE WAY” To Supply Chain Excellence?
There is a belief that outsourcing can solve the ills of the past and pave the way to the future YES If you have well understood and documented processes If you have a clear understanding of what you want to accomplish If you have executive commitment to resources If you have specific metrics you wish to achieve NO If you answer NO to any of the items to the left Many Companies Outsource For All the Wrong Reasons That May Have Seemed Like The Right Reasons
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Is Out Sourcing “THE WAY” To Supply Chain Excellence?
REASONS GIVEN TO OUTSOURCE: Cut Costs Reduce Capital Expenditures Upgrade IT Improve Service Performance Improve Quality Reduce Obsolescence Lower Headcount The Reasons Will Vary With Each Situation: Should You Still Outsource To Achieve Excellence?
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FIRST, DEFINE WHAT IS EXCELLENCE?
Is Out Sourcing “THE WAY” To Supply Chain Excellence? YES, IF … FIRST, DEFINE WHAT IS EXCELLENCE? “THE QUALITY OF BEING EMINENTLY GOOD, FIRST CLASS, SUPERIOR” Merriam-Webster Look For Best In Class Performance And Never Settle for Second Best
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Is Out Sourcing “THE WAY” To Supply Chain Excellence?
EXCELLENCE IS IN THE EYES OF THE BEHOLDER Order to Delivery Dock to Stock On Time Delivery Perfect Order Inventory Turns First Pass Yield RMA Order Processing Cycle Count Accuracy Return on Assets Return on Invested Capital EBIT/EBITDA You Have To Know What You Want To Achieve
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Next: List the Services That You Need To Serve Your Customers
Dedicated and Multi-Client Contract Warehousing and Distribution Logistics and Supply Chain Consulting E-commerce Order Fulfillment B2B and B2C deliveries Inventory management Collateral distribution Web store design, hosting, and management Fulfillment Services Direct and bulk fulfillment Turnkey fulfillment solutions Insurance Replacement Program Configuration and bundling services Kit-to-order (KTO) fulfillment Custom seasonal kitting Cycle counting Inspection – over, short, and damaged Reverse Logistics Programs Advance exchange Post exchange Same unit repair Cradle-to-grave serial number tracking Asset recovery Recall management Contract Repair Services and Logistics Repair center management Test and repair Services parts support Billing Credit line management Invoicing Receivable collection Web-based Reporting Other Value-Add Services Testing and sorting Quality inspection Return product inspection Packaging Procurement Services Operating supplies Transportation Multi-modal and carrier neutral International (Mexico and Canada) Same day special delivery courier Integrated with FedEx and UPS Next day and two day (air/truck) ATC Logistics & Electronics Proprietary Information - This slide may not be altered Call Center 24/7 Credit card transactions Client specific script
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Next: Divide And Conquer. Determine What To Outsource and What To Keep
Be Realistic In Expectations, and Evaluations Of Capability Ensure That There Is Corporate Buy-In And Support Establish Realistic Project Plans and Road Map To Success Be Clear From The Start On Roles And Responsibilities Secure The Proper Resources At All Levels Be Prepared For Contingencies And Potential Road Blocks Stay Focused On The Customer And The Goal Communicate, Communicate, Communicate
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Finally:Establish Agreed Upon Performance Goals And Make Them Reality
Customer Expectations Are Defined In Quality Metrics Everyone Is Measured Off The Same Dashboard
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Conclusion ATC Logistics & Electronics Proprietary Information - This slide may not be altered
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Conclusion Features Benefits
Supply Chain Excellence Can Be Achieved By Outsourcing Features Best-in-class service and quality Fully Integrated Turn Key Solution Full Integration with the customer Fully integrated with FedEx, UPS, DHL, and the USPS Experienced responsive operations and transition team Proven ability to deliver and exceed quality SLAs at high volumes Option to have returns and test/repair activity co-located Green friendly programs Cradle to grave serial number tracking ISO 9001:2000 certified processes Carrier and geography neutral Ability to flex and scale Benefits Improved customer experience and satisfaction Improved control and visibility Single point of accountability Compressed turn-around times Reduced handoffs Reduction of total stock days on-hand Reduced risk of obsolescence Improved velocity of the supply chain
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Conclusion Supply Chain Excellence Can Be Achieved By Outsourcing
IT ALL DEPENDS ON THE CUSTOMER AND HOW YOU MANAGE THE EXPECTATIONS
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ATC Logistics & Electronics
IS OUT SOURCING THE WAY TO SUPPLY CHAIN EXCELLENCE? Prepared For: LQ SYMPOSIUM Prepared By: Bill Conley President (817) November 9, 2006
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