Avon Canada

The Promise Project

GROUP 4 GENNA BERSANI, ERICA WYNN-KEARSE, ANTHONY SMITH

Agenda

AVON BACKGROUND

PROJECT OVERVIEW

TIMELINE

INITIAL PROBLEMS/RED
FLAGS

MATURITY LEVELS

PREVENTION

RECOVERY

LESSONS LEARNED

Who is Avon?

Beauty Product Company

Founded in 1886

Multi-level Marketing Structure

Offices in over 100 Countries

Millions of Representatives

CEO at the time: Andrea Jung

Pic 1: http://wildmorrealty.com/wp-content/uploads/avon-logo.jpg
Pic2: http://www.forbes.com/profile/andrea-jung/

Project Background Perspective

2006, Avon announces its plan to invest in its Representatives

$120 million investment in revisions

Expected $400 million cost savings

Initiatives included:

Training representatives for leadership

Restructuring global supply chain operations

Realigning certain local business support functions

Streamlining transaction-related services

Why Create the Promise Project?

Problem:

Original Ordering Done from Catalogs

Slow order placement or acknowledgement

No indication of availability or backlog

Result:

Unfulfilled orders

Backlogs

Excessively Long Lead Times

Pic: http://www.hints4beauty.com/avoncatalog/2013/campaign5/p42.jpg

The Promise Project

Goal:

Create a new interface and app for use on mobile devices

Integrate real time inventory and shipping info

The Result:

Install three separate pieces of software to update the process

SAP

CRM (Customer Relations Module)

ERP (Enterprise Resource Planning)

IBM WebSphere e-commerce

Timeline finish by late 2012 (less than 2 years)

Budget Between $100-120 million ROI of 5 years must not be exceeded

Pic1: http://egov.eletsonline.com/wp-content/uploads/2012/08/SAP-2.jpg

Timeline
2006:
Announcement
to stakeholders

May 2011: Plan

is signed off by
Executive
Leadership

Late 2012: Big

Bang Release
in Canada

2014:
Estimated
$48.4 Million
Loss
Today: Still
amassing losses

2010: Planning
Began
A team is
established in
White Plains, NY
and comprised
of select
associates from
Brazil, Mexico,
Russia, US, and
UK

April 22, 2012:

Andrea Jung is
Replaced with
Sherilyn McCoy

2013: Shut
Down in Q3
$55.4 Million
Loss

Initial Problems

Combined two independent vendor products with a third party to

integrate

No clear Lead Project Manager Identified

Hiring individual PMs for each module of software during building process

Leadership of the company lacked cultural competence

Executive Sales Leader had little knowledge of new technology being

launched

Large Scale Project

Poor communication with sales reps

Mobile App concept was relatively new

Rollout and Problem Discovery

In 2012/2013, the Promise project was released in Canada

From the start, Representatives faced issues

Couldnt properly use the new system

Logging in

Saving orders

Checking Inventory

Saving Inventory

Representatives

Not tech savvy

Part time Low Pay

No incentives to stay

Results

Estimated that 16,000 employees left the company

Total Number of Avon Representatives lost: 6.21mill (2013) 5.96 mill(2014)

(4% decrease)

7% decline in revenue by Q3 of 2013

Discontinued global rollout indefinitely

1. Project Integration
Level:

Project Plan
Development

Ad hoc

Documented
process

Risk, cost,
schedule,
quality, HR

Integrated w/
organizations
strategic plan

Improvement
process in
place

Project Plan
Execution

Informal,
verbal
direction

Summary
level metrics

Detail level
metrics,
templates

Variance &
performance
analysis

Lessons
learned

Change
Control

Ad hoc,
without PM
awareness

Scope only
changes
identified

Scope, cost,
schedule
identified

Integrated w/
control, risk
management

Changes are
in efficiency
metrics

Project
Information
System

None

Simple PM
information
system

Standardized
system for all
projects

Automated
system

Continuous
improvement
of data & sys.

Project Office

Informal, no
standards or
training

Established,
training
available

PM methods,
PM training
mandatory

Best practice,
PM training
for all team

Cost-tracking
support, EV,
PMP training

Project Management Maturity Model, Crawford, 2002

2. Project Quality Management

Level:

Quality
Planning

High-level
plans, ad hoc

Metrics of
reviews, tests

Quality
milestones,
checklists

Product
environment
included

Process
critiqued
during project

Quality
Assurance

No
established
practices

Walkthroughs
peer reviews

QA checklists
standard

Walkthroughs
with other
project teams

Feedback on
processes

Quality
Control

No
established
practices

Guidelines for
testing (unit,
integration)

Standards for
testing, client
involvement

Performance
standards in
place

Decisions on
usability and
fit of product

Management
Oversight

Management
involvement
limited

Mgt assigns
PM, receives
reports

Institution has
standard PM
practices

Integrated w/
corporate
processes

Active role in
management

Project Management Maturity Model, Crawford, 2002

3. Human Resources
Management
Level:

Organization
Planning

Ad hoc
assignment,
informal
report

Skill sets,
timeframe
identified

Resource
constraints
included

Resource
mgt and
prioritization

Periodic
evaluation

Staff
Acquisition

Ad hoc

Skill
matching,
resource cost

Resource
pool
management

Skills
inventory
data base

Enterprise
resource
forecasting

Team
Development

Occasional
team
meetings

Kickoff,
reviews,
meetings

Collocation,
peer
evaluation

Team
member
training

Member
training
forecasting

Professional
Development

No standards
or processes
for PM

PM exper &
knowledge
required

Solid PM
exper &
knowledge

Corporate PM
development

Lessons
learned
training

Project Management Maturity Model, Crawford, 2002

4. Communications Management
Level:

Communications
planning

No standards

Informal
stakeholder
analysis

Comm plan
expected for
all projects

Update and
refine comm
mgt plan

Lessons
learned
analyzed

Information
Distribution

Ad hoc
distribution
of
information

Stakeholder
distribution of
status

Formal info
status system
for stkholder

Automated
database
queries

Improve
process
measures

Performance
Reporting

Informal
reporting of
status

Summarize
status,
progress

Graphical
performance
reporting

Formal
variance &
trend analysis

Efficiency &
effectiveness
metrics

Issues
Tracking

Issues
handled as
ad hoc basis

Issues
management
not enforced

Regular
issues
meetings

Impacts of
issues on
other areas

Tracking
process
evaluated

Project Management Maturity Model, Crawford, 2002

5. Project Risk Management

Level:

Risk
Identification

Risks not
identified

Risk
identification
process

Standards for
risk/symptom
identification

Integrated w/
cost & time
mgt, PMO

Identify org.
priority,
lessons learn

Risk
Quantification

Speculate on
impact if risks
occur

Structured
approach to
rating risks

Multiple
criteria
prioritization

Integrated w/
cost & time
mgt, finance

Improve
quantification

Risk
Response
Development

Risks
considered
as they arise

Informal
strategy for
handling risks

Contingency
plans

Integrated w/
cost & time
mgt, PMO

Tracking
project
reserves

Risk Control

Day-to-day
problem
solving

Individualized
approach to
managing risk

Risks
routinely
tracked

Integrated
with control
systems

Risk assess
included in
proj execution

Risk Documentation

No historical
database

Some
historical
data

Historical
data on
common risks

Interdependent risks
betw projects

Improve
collection
activity

Project Management Maturity Model, Crawford, 2002

Recovery

Form Task Force to Analyze User Interface

Cross-functional Team

New Training Program

Top-down approach

Training Simulation

Recovery Team

Identify Risk and Mitigation techniques

Assessing Representatives Capabilities

Propose Ideas for future updates using collected data

Prevention

Improved Initial Planning Phase

Phased Approach

Include sales execs and representatives

Improved communication

Investors

Representatives

Hire Experienced Project Manager

User testing

Provide training opportunities for representatives

Lessons Learned

Learn from previous failures

Importance of understanding company culture

Planning should include members of each level

Testing should start small

Softer Rollout when possible

Open Communication

New Software = Employee Training

Questions?
KIND REGARDS
Group 4

Picture Sources:
Slide 2:
http://wildmorrealty.com/wp-content/uploads/avon-logo.jpg
http://www.forbes.com/profile/andrea-jung/
Slide 4:
http://www.hints4beauty.com/avoncatalog/2013/campaign5/p42.jpg

References
http://www.trefis.com/stock/avp/articles/218972/maryimplications-of-discontinuing-smt-program-on-avons-q4/2014-01-06
https://www.linkedin.com/jobs2/view/2640116
https://www.linkedin.com/jobs2/view/5290641
http://www.upperedge.com/2013/12/avon-to-sap-we-cant-put-enough-lipstick-on-this-pig-a-failure-in-program-risk-management/
http://www.zacks.com/stock/news/116796/layoffs-amp-smt-halt-at-avon-shares-fall
http://www.computerweekly.com/news/2240211011/Avon-drops-SAP-big-bang-transformation
http://www.informationweek.com/software/information-management/inside-avons-failed-order-management-project/d/d-id/1113100
http://www.forbes.com/sites/benkepes/2013/12/17/avons-failed-sap-implementation-a-perfect-example-of-enterprise-it-revolution/
http://blogs.wsj.com/cio/2013/12/11/avons-failed-sap-implementation-reflects-rise-of-usability/
http://
www.dailymail.co.uk/femail/article-2335348/As-Joan-Peggy-battle-Avon-account-Mad-Men-beauty-giant-transformed-housewife-staple-favorite-working-woman.h
tml