Brad Weller_Nando Galazzo Packaging Solutions Presentation Berlin 2001
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This document summarizes a presentation given by Sonoco Packaging Solutions on their end-to-end supply chain solutions. It discusses Sonoco's evolution from packaging products to providing supply chain services. Sonoco Packaging Solutions (SPS) offers innovative, customized, collaborative, and scalable supply chain solutions from design through distribution. The implementation model follows the SCOR methodology with an assessment of the current supply chain, design of a new model, and continuous improvement. SPS encourages customers to think big with their vision, start smart with a first implementation, and scale fast by leveraging SPS's resources and experience.
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Brad Weller_Nando Galazzo Packaging Solutions Presentation Berlin 2001
- 1. Sonoco Packaging Solutionstm -End-to-End Supply Chain Solutions – by Nando Galazzo, Supply Chain Director, Sonoco Chairman, Global Supply Chain and logistics council, Conference Board Europe Brad Weller, Director Sonoco Packaging Solutions tm October 1, 2001, Berlin, Germany c © 2001 by Sonoco
- 2. Agenda Credentials Supply Chain thoughts Sonoco Packaging Solutions Implementation Models Get started ! SPStm case studies
- 4. Sonoco Global Packaging Credentials Supply Chain thoughts SPS Implementation Models Get Started ! Case Studies 285 operations 32 countries/5 continents 17,000 employees Customers - 85 countries Turnover - US$2.8 billion
- 5. Sonoco Packaging Portfolio Credentials Supply Chain thoughts SPS Implementation Models Get Started ! Case Studies Pack Center
- 6. European operations: over 43 plants Credentials Supply Chain thoughts Industrial Products SPS Implementation Models Consumer Products Get Started ! Paper Mills Case Studies
- 7. Credentials “Only Perceptive, Adaptable and Innovative packaging Supply Chain companies can get closer to their customers and markets by thoughts developing extended enterprises & supply chain SPS partnerships”. Implementation Models Get Started ! All others … will just be passengers during the journey Case Studies
- 8. Sonoco’s Traditional Value Drivers … Paper Tube Recycling Credentials Mechanics & & Supply Chain Reclamation Design thoughts SPS Sonoco Implementation Models Value Drivers Get Started ! Case Studies
- 9. Sonoco’s Traditional Value Drivers … Product Dependent Model • Defends existing position Service • Protects existing margins Service Credentials • Builds barrier to competition Supply Chain Limitations Product thoughts • Commodity model • Value extraction is limited • Costs justified on product margin SPS • Short life time for incremental benefits Implementation Models Get Started ! Case Studies
- 10. Sonoco’s Traditional Value Drivers … Product Dependent Model • Defends existing position Service • Protects existing margins Service Credentials • Builds barrier to competition Supply Chain Limitations Product thoughts • Commodity model • Value extraction is limited • Costs justified on product margin SPS • Short life time for incremental benefits Implementation Models Supply Chain Driven Model Possibilities Get Started ! • Products are pushed or pulled • Higher point of entry (food chain) • Fully defined value • Multi-site scalability • Sustainable over time • Long-term activity Case Studies • Non-product Dependent • Diversification of income portfolio Products Sourcing W. Housing Pac Center Logistics Products Consultancy / Implementation
- 11. Sonoco’s journey to add value … Paper Tube Recycling Credentials Mechanics & & Supply Chain Reclamation Design thoughts SPS Sonoco Inventory Implementation Models Six Sigma Value Management Drivers Systems Get Started ! Case Studies Pack Center Concepts Sonoco Proprietary
- 12. Evolution: from products… Credentials Supply Chain Paper Textile Film / Tape Specialty thoughts SPS Implementation Models Get Started ! Case Studies
- 13. Evolution: …to packaging… Credentials Supply Chain Paper Textile Film / Tape Specialty thoughts SPS Implementation Models Get Started ! Film Packaging Paper Packaging Case Studies
- 14. Evolution: …to services… Credentials Supply Chain Paper Textile Film / Tape Specialty thoughts SPS Implementation Models Get Started ! Film Packaging Paper Packaging Case Studies Pack Design Logistics Supply Chain Procurement Reclamation
- 15. Sonoco’s extended enterprise … Paper Tube Recycling Credentials Mechanics & & Supply Chain Reclamation Design thoughts SPS Sonoco Inventory Implementation Models Six Sigma Value Management Drivers Systems Get Started ! Case Studies End-to-End Pack Center Supply Chain Concepts Management Sonoco Proprietary
- 16. Sonoco’s extended enterprise … Credentials 3M Europe DuPont Europe Supply Chain thoughts MFE Europe SPS MFE US Implementation Whirlpool Models Cryovac Get Started ! Gillette UK Case Studies Gillette US Consultancy Design / Sourcing JIT / Pack Planning W.H. Distribution Return Graphics VMI Center Scheduling Mgmnt. Recycle Refurbish = assessments = implementations
- 17. Offering experience through partnership Credentials Supply Chain thoughts SPS • Global scale and infrastructure •• Resources & Scalability Resources & Scalability • Supply Chain Management Sonoco Consulting Methodology •• Consulting Methodology Implementation • Packaging Solutions Packaging •• Venture Capital Venture Capital Models • Customer Relationships Solutions •• IT & B2B Integration IT & B2B Integration • Operational integration / •• Previous project Previous project Get Started ! Pack-Centre management SPS Client experience •• Client experience Case Studies
- 19. Competitive Pressures in the Supply Chain More demanding More demanding customers Global competition Global competition Credentials customers & shareholders & industry & industry & shareholders consolidation consolidation Supply Chain thoughts Shorter product Shorter product SPS life cycles life cycles Implementation Models Get Started ! Speed of technology Speed of technology change change Case Studies Environmental Environmental risk and issues risk and issues
- 20. Competing through collaboration Credentials No company, on its own, has the ability to Supply Chain dominate the future … without: thoughts SPS A vision that creates growth & wealth Implementation Models Accelerating the speed of change Get Started ! Executing and sustaining improvement Case Studies New partnerships that manage complexity
- 21. Managing for change & performance Credentials ACCESS… Supply Chain thoughts access to economies of scale SPS access to know-how Implementation Models access to technology and innovation Get Started ! access to new collaborative models Case Studies
- 22. An evolution toward greater collaboration H Credentials Supply Chain Collaboration thoughts Supply Chain Performance SPS Coordination Implementation Models Transactions Get Started ! Case Studies L Partnership & Trust H
- 23. Areas of desired collaboration Credentials Supply Chain 1 Supply Chain Re-engineering Optimisation Synchronisation End-to-end & Packaging solutions thoughts implementation 2 SPS Co-asset and Pack Centre Inventory and Production Implementation Labour Management WC management planning Models management 3 Get Started ! Packaging & Smart Outsourcing & Multi-use/reuse/ Case Studies Graphics packaging design JIT Kit Delivery returnable Design 4 Information ERP systems Optimisers The emerging Packaging web Technology Market place…
- 24. Therefore… Credentials Sonoco has developed and implemented Supply Chain thoughts end-to-end supply chain solutions for its SPS customers around the world … called Implementation Models Get Started ! Case Studies SPS ™ SONOCO PACKAGING SOLUTIONS
- 26. Credentials Supply Chain SPS ™ SONOCO PACKAGING SOLUTIONS thoughts SPS innovative Implementation customized Models collaborative Get Started ! scalable Case Studies profitable 3pl
- 27. 3rd party 4th party logistics 3pl used to be mainly about sub-contracting warehouse and Credentials distribution services … Supply Chain thoughts SPS Tomorrow’s 4pl will sit in the middle of the value chain, drawing products or components Implementation Models from all parts of the network as available … Get Started ! managing product assembly or packaging … Case Studies and then handling the distribution to individual customers by the fastest and most efficient route. Financial Times October 2000
- 28. Credentials Supply Chain thoughts 4pl SPS Implementation with a Models difference Get Started ! Case Studies
- 29. Credentials Supply Chain Scope Supply Chain thoughts Extended enterprise asset management SPS sourcing & information management Implementation Models Pack-centres / packaging operations Get Started ! Packaging materials planning & inventory management Case Studies Packaging materials sourcing, procurement, leverage Low Sub-contracting warehousing & distribution 3pl Transportation management - outbound / reverse logistics Intensity
- 30. Credentials design, development, & engineering support Supply Chain Scope Supply Chain Packaging material life-cycle management: thoughts Return,, Re-use, Recycle SPS Med. Logistics sourcing & information management Implementation Models Pack-centres / packaging operations Get Started ! 4pl Packaging materials planning & inventory management Case Studies Low Packaging materials sourcing, procurement, leverage Sub-contracting warehousing & distribution 3pl Transportation management - outbound / reverse logistics Intensity
- 31. Enterprise asset management High Credentials Packaging design, development, & engineering support SPS Packaging material life-cycle management: Supply Chain Scope Supply Chain thoughts Return, Refurbish, Re-use, Recycle SPS Logistics sourcing & information management Med. Implementation Models Pack-centres / packaging operations Get Started ! 4pl Packaging materials planning & inventory management Case Studies Packaging materials sourcing, procurement, leverage Low Sub-contracting warehousing & distribution 3pl Transportation management - outbound / reverse logistics Intensity
- 32. Vision is Critical - for instance Keeping the Strategic … Outsourcing the Tactical Customer Supply Chain Finished Factory Marketing Goods Manufacturing Distribution Planning Planning Packaging Materials Procurement Outsourced Supply Package Systems & Planning Pack Chain Activities to Planning Integration Product Sonoco 3rd Party Logistics Reverse Logistics
- 34. The Methodology Credentials Supply Chain thoughts SPS Implementation Models Get Started ! Case Studies
- 35. What is the SCOR model and framework? Supply Chain Operations Reference Model Process reference map that allows you to construct supply chain implementation models. Of itself it is not sufficient to describe a supply chain implementation. You cannot implement a “reference” model. You use the reference model together with business attributes (I.e. geographic, organization, product, etc.) to specify and implement a process model that can be analyzed (metrics) and executed.
- 36. Vision of an Extended enterprise Plan COLLABORATIVE SYNCHRONIZED OPTIMIZED Deliver Source Make Deliver SOURCE MAKE DELIVER Source Make Deliver Source • Finished • Procurement Pack Goods Suppliers SONOCO Customer’s Customers • Inbound Logistics Warehousing Customers Your • Inventory • Shipping & Management Outbound Logistics • Optimized Core & packaging Design Integrated Packaging Design & Life Cycle Management SONOCO CUSTOMER SONOCO • RETURN PROGRAMME
- 37. Applying a Tool Framework to Support Supply Chain Modeling Drilling Down to Levels of Detail AS- IS Assessment Enterprise Processes Level 1 Process Scenarios - Value Chain Diagram Level 2 Level 3 Business Processes - * Event Driven Process Map Level 4 Activities - Event Driven Processe Map
- 38. Objective of this work: Align Scenario Implementation with SCOR Methodology … SCOR Methodology TO - BE Employs a Top-Down Approach Implementation Material Flow View Identify Roles within the logical flow Establish product responsibility Analyze for performance to select Analyze Basis scenarios of Business Scenario View Competition Role-based Scenarios Configure Collaborations/Biz Documents Supply-Chain Encapsulation of process detail Align Process Definition View Performance Levels, Practices, * Consistent Modeling and Systems Link to public protocol definitions Bounding events Implement Supply-Chain Process Specification View Processes and Systems
- 39. GET -ED!
- 40. Think Big, Start Smart, Scale Fast ig Credentials Think B • Vision Supply Chain 1 thoughts Performance SPS • Leverage resources Implementation Scale Fast 3 and experience Models Get Started ! Case Studies 2 Start Smart • First Plant Implementation 2001 2002 2003 2004 Source: Accenture
- 41. Think Big Think BIG Because…nothing short of a step-change Credentials will keep you ahead of the competition Supply Chain thoughts ging SPS Implementation Think packa Models Get Started ! Because…packaging touches every Case Studies aspect of your supply chain
- 42. Think Bi g Credentials Package Supply Chain Reclamation Design/ thoughts Reuse Engineering Recycling Graphics Management SPS Implementation Packaging Models Packaging Machinery Engineering Supply Packaging Get Started ! Chain Materials Case Studies Inventory Management Package Procurement Package Filling
- 43. Improvement Criteria & To-Be Success Metrics Internal Credentials Customer Facing Facing Supply Chain Performance Responsiveness Flexibility Assets thoughts Attribute SPS Order fullfillment Superior Implementation Lead Time Models Supply Chain Advantage Get Started ! Response Time Case Studies Production Advantage Flexibility Inventory Advantage Days of Supply
- 44. Building the Treasure Map High Credentials Supply Chain thoughts Silver Bullets Strategic Step Changes Effort / Benefit SPS Implementation Models Get Started ! Case Studies Quick Wins Low High Value Achievement
- 45. Start Smart Start SMART Assess Performance Attributes Credentials Supply Chain thoughts Benchmark Performance SPS Implementation Prove Scenarios Models Get Started ! Design Supply Chain Model Case Studies Optimize
- 46. Assess Benchmark Prove Design Credentials Supply Chain thoughts SPS Implementation Models Get Started ! Case Studies
- 47. Project overview Opportunities Pre-Screening Prioritisation Assessment Cycle End Letter of Full Final SPS Education Pre-Assessment Intent for Supply Chain Presentation & Presentation Assessment Implementation and Contract Implementation Adjustments and Subsequent Phases Solution Design, Deployment Benefits Project Continuous Tracking Development Start-up and Planning Operation and and Validation Transition Sharing Implementation Cycle
- 48. Project overview Opportunities Pre-Screening Prioritisation Assessment Cycle End Letter of Full Final SPS Education Pre-Assessment Intent for Supply Chain Presentation & Presentation Assessment Implementation and Contract • Define Offering and • Team of 3-4 • Resource aligned • Team of 4-6 for 1-4 weeks • Process and Financial Analysis Implementation SPS Supply Chain • 2 days per site • Project Scope & KPI’s Management Program • High level discovery • Steering Committee • AS-IS Mapping • Opportunity pockets • Resource ID’d • Stakeholders & Implementation Issues/barriers • Value extraction • Assess SOP’s • TO-BE Mapping (game changing) • Prepare LOI (?) • Recommendations & Implementation roadmap Adjustments and Subsequent Phases Solution Design, Deployment Benefits Project Continuous Tracking Development Start-up and Planning Operation and and Validation Transition Sharing • Milestones • Joint team formed • 2-6 months depending on scope • Daily • Assess • Timing • Duration depends on complexity site, equipment, & management of delivered value • Resources scope & complexity systems operations • Quarterly • Plan / Metrics • QA review • Change management performance review Implementation Cycle
- 49. Fast Scale FAST To pick the fruit Credentials Leverage resources and experience Supply Chain thoughts SPS Implementation Models Get Started ! Case Studies
- 50. Infrastructure = reusable capabilities START SCALE 1 2 3 5 6 7 SMART Acceleration FAST 8 Nth Gillette Whirlpool Mitsubishi Mitsubishi Gillette 3M yourco yourco N.America. N.America N.America Europe Europe Plant 1 Plant 20 Insights: It’s not about one site, it IS about leverage and speed It is not about a fad, it IS about improving the business It’s not about going for change, but it IS about going dollars
- 51. CASE STUDY
- 52. SPS™ Europe - Global Film Manufacturer Key Bottlenecks Logistically Independent Production Units - Duplication Credentials of Logistics Activities and Costs Lack of Collaborative Planning between Manufacturing and Packaging Replenishment Supply Chain Inventory Accuracy and Visibility thoughts Network of Past Relationships Size of Carrier Base vs. Synergies Interfaces and Transaction Processes - use of SAP SPS SPS Solutions Implementation Reorganised pack matl. planning & purchasing Models SAP - Inventory control Re-engineered packaging supplier base Get Started ! Return & refurbishing with on-site service provider Selected 3PL for warehousing, dispatch, Case Studies transport Reduction of Carrier Base from 40 to 6 Achieved Cost Reduction of 11% Logistics 8% Procurement 9% Warehousing 17% Return / Recycling 20% Core Cutting (JIT) 30%
- 53. SPS Europe Implementation Example - Major Film Company PLAN Source Make Deliver CONTAINERS MILKRUN Prod LINE 4 3 1 2 Prod LINE 5 Third Party FIN GOODS Suppliers Warehouse Prod LINE 6 4 3 Customers Refurbishing Dispatch Operation Consignment Customer Prod 2 Warehouses Sonoco 3 5 Prod LINE 1 Sonoco Plants Prod LINE 2 FIN GOODS Warehouses Prod LINE 3 Customer Prod 1 Managed by Sonoco Managed by Sonoco and Outsourced to 3PL
- 54. SPS™ Europe – Global Tape Manufacture High Credentials Cost Optimisation / Opportunity Size Packaging Supply Chain Cycle Ph. 3 thoughts Converting Outsourcing SPS Packaging Cycle Ph. 2 Implementation Models Scrap Purchasing Reduction Leverage Get Started ! Kaizen Lean Ph. 2 Kaizen Lean Case Studies Ph. 1 DPOU Low High Speed of Implementation
- 55. Conclusion. What makes SPS™ so different ? Experience & success in 4 areas Credentials Outsourcing & Supply chain Supply Chain Contract Re-engineering thoughts Management & Implementation SPS Packaging SPS ™ IT integration Implementation Models Design & & interface Manufacturing optimization Get Started ! Ability, desire, and culture to implement & Case Studies partner – Gain sharing (accountability) – Co-asset management – Resource sharing & leveraging
- 56. Changing the way the world sees PACKAGING Sonoco Europe s.a. Boulevard du Souverain, 100 box 3 1170 Brussels – Belgium Tel: +32 2 663 45 40 Fax: +32 2 675 02 25 www.sonoco.com