With an extremely complex supply chain that handles over 50% of the nuclear reactors around the globe, and a revenue plan growing from $3 - $30 billion, Westinghouse Electric Company had to be extremely focused in their transformation efforts not to deter customer service or quality performance while driving out over $1 billion in costs... For the rest of the story, click here.

1. 6%0%
1%
8%
Transformation Benefits Delivery Plan ... $1.1 billion
Supply chain transformation is becoming a critical 40%
44%
element for driving business results. New Supplier Sourcing
Transportation
Sourcing
Inventory
Ops Effcy Req to Check
COLLABORATIVE TEAM WITH A COMMON MISSION
Juan Molina, Jack Lanzoni and Jim Dixon, each Vice President’s of their own BU supply
chains sponsored the transformation initiative for the Westinghouse organization. A core team
THE GREEN MOVEMENT HISTORY
was later formed to include approximately 8 members in total. Nine teams were formed to
In the years since Three Mile Island, not a single nuclear Nearly 50 percent of the nuclear power plants in operation
develop a high level plan consisting of key initiatives and a business case. The teams were
plant has been ordered and built in the United States. worldwide, and nearly 60 percent in the United States, are based
Inventory & Warehouse, Transportation, Brokerage, Packaging and Customs, Demand
Nuclear power used to be the environmentalist's ultimate on Westinghouse technology. Worldwide, the nearly 8,500
Planning, Project Management, Operations and Performance Management, Requisition to
pariah, but now the green movement has a new pariah - employees of Westinghouse Electric Company continue to
Check and Supplier Development and Localization. Benefits were calculated based on a 2007
fossil fuels and their carbon dioxide emissions. As a pioneer value-added engineering and services creating success
baseline spend and the $30 billion revenue, ten year, growth model.
result, some of the world's most ardent Greens have come for customers in their increasingly demanding markets. The
around to embracing nuclear power. In the last two years, three core businesses of Westinghouse — Nuclear Fuel, Nuclear
Our vision at Westinghouse was to create a world class SCM organization that would focus on
the US Nuclear Regulatory Commission has received 17 Services and Nuclear Power Plants — support this mission.
exceptional value creation for the entire company and for individual business units. The new
applications for 26 nuclear reactors. Proposals for six design would equip the organization with value creating, leading edge practices and
additional reactors are pending. CALL TO ACTION
technologies to enable the supply chain to outperform the competition by significantly reducing
Westinghouse’s supply chain transformation story is about
our total cost of goods while servicing our customers in the most efficient and effective manner.
continuous innovation and growth. The drivers for change at
Westinghouse included the global growth in demand for nuclear
energy, the development of emerging markets, the diverse Supply Chain Transformation: Focus on Implementation & Initiatives Organization Design
customer segments the company serves, and investor
TRANSFORMATION PROCESS IMPLEMENTATION AND RESULTS People Competency Development
expectations for improving margins. The Westinghouse
Once we gained agreement with the senior executive team By deploying a Core Team and a set of 9 Extended Teams Change Management
executive team challenged us to lower supply chain cost while
as to the goals, objectives and targets we agreed upon a (representing the main SCM processes) across the
implementing the new capabilities needed to support the longer
Supply Chain re-design process to develop the business units, we built a business case and strategic plan
Supply Chain Strategy & Configuration
term nuclear renaissance. The global growth projections for
infrastructure capable of delivering 10x growth. John geared to generate value, while improving our Governance
Westinghouse looked like a minimum 3x growth rate with an
Kotter was hired to lead Westinghouse through the change competitive position in the market place. This value
upside of 10x. This is a glide path greater than Starbucks coffee SCOR Model Process Design
process. We began our journey by having each of the core would come through increased leverage, synergies,
shops. To prepare for this growth, a major initiative was
launched to retool the company for growth and value creation team members interview key thought leaders in the reduction of duplication, closing existing gaps, and System Integration
organization. From voice of the customer interviews we improvements of existing processes. Over the next 6
immediately. The focus would include common global Data Management
further refined our requirements for the new supply chain months the teams developed their transformation plans
processes, infrastructure and controls, new technology and
organization. A benchmarking / best practices study was which were ultimately approved by the Supply Chain Configuration Control
systems and alignment with a future state business model.
conducted to assess our maturity. It was clear from the core team and the executive team. April 1, 2010 the three Planning
results of the benchmarking study that we would need supply chain organizations became one under the
In February of 2008 a one month analysis team was formed to
additional investments in people, process and systems to leadership of Juan Molina. The annual savings targets
Sourcing
identify synergy saving opportunities for the three separate
Supply Chain Transformation: Process Framework transform the organization. Based on our financial have been built into the business plan and the teams are Manufacturing
business units. A follow on team provided a more detailed
1. Baseline Assessment - Profile current performance vs. benchmarks and similar supply chains. constraints, we challenged personnel to join the team to executing the transformation plans and making great
bottom up view as to where the savings would come. The Logistics & Delivery
2. Improvement Opportunities - Assess performance and maturity improvement opportunities build a better future state, while performing their day jobs. progress. Benefits include time-to-market, lower risk,
and the value of the improvements in cost, quality and service. executive team quickly commissioned a new team called Global
Growth and Innovation to deliver the synergies and cost savings. So, we created cross functional teams with global improved agility and a lower cost. I believe two critical S&OP
3. Vision & Targets - Establish fact based future state performance targets, and a business case.
representation to ensure that we gained the appropriate factors were instrumental to the transformation success:
A supply chain core team was sponsored and nine teams across The iSCM Transformation Map
Level
4. Supply Chain Future State - Redesign the supply chain and identify initiatives to improve 1 2 3 4 5
FY2009 – FY 2012 Begin eP Phase III Implementation
insights into regions and also to build support for the new Leadership and communication of the vision. Leadership
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