The supply chain fulcrum (i)

1. The supply chain fulcrum (i) D I C DP Key D : Demand DP : Decision Point I : Inventory C : Capacity

2. The supply chain fulcrum (ii) D I C DP Visibility and Velocity enable the fulcrum to be placed nearer to Demand in order to reduce the need for inventory and/or capacity.

3. Visibility and velocity drive responsiveness Collaborative Planning Access to real demand Bottleneck Management Postponement Reduce non- value adding time Close to customers Process Management Simplification Responsive- ness Streamlined processes Internal Integration Velocity Visibility Shared Information Reduce batch sizes Reduce in-bound lead-times Close to suppliers Synchronous Supply Collaborative Planning Event Management Strategic Sourcing

4. The sales and operations planning process Generate aggregate demand forecast Modify forecast with demand intelligence Create a consensus forecast Create ‘rough cut’ capacity plan Execute at individual item (SKU) level against demand Measure performance

5. Benefits of CPFR Optimise production • Higher utilisation of production capacity • Greater supply chain visibility allows inventory and storage capacity reduction Reduce capital invested Reduce storage capacity Inventory • 20-25% reduction inventory carrying cost • Improved forecast accuracy • 50% reduction in unplanned overtime • Up to 500% ROI on promotions • Reduced excess and obsolete inventory • Reduction in lead time Wastage Benefits Decrease Costs Overtime Transportation cost Better availability • Reduced out-of-stocks • Improved consumer satisfaction ratings Increase revenue Improved consumer satisfaction