The Global ECR Scorecard

A Capability Assessment Tool

Santiago de Chile, September 6, 2001

Page 1
Global ECR Scorecard Journey Started in
Oct. 98

Wouldnt it be a good idea to

converge the worlds ECR
Scorecards into ONE that
could by consistently used by
companies around the world ?

Page 2
OBJECTIVES:
The Project Team was given four clear
objectives

A tool capable of Globally consistent

supporting single but modular useable in
developing or mature
company or joint
ECR situations
engagement

More pragmatic,
Simple
linked to KPIs
(day-to-day Easy to use
management)
Page 3
The Global ECR Scorecard
Target setting

Gap analysis and target setting internal 1

Supplier

1
2
Retailer

as is internal target joint target

Joint target setting 2

Page 4
Scoring

General Definitions
Each improvement concept includes a general
definition that explains the concept and the
philosophy behind its application
Considerations
A scale from 0 to 4 is used to measure a companys
state for each of the 37 considerations:
0 = Nothing planned
1 = Planning complete, but implementation not started yet
2 = Pilots implemented
3 = Roll-out started
4 = Completely implemented

Page 5
The Global ECR Scorecard scoring formula
and range

200 Probable range 1400

Advanced
Core Concepts
Concepts
0 1000 1600

Score per points per all

* *
consideration consideration considerations
(0 - 4) (0 - 100) (37)

Page 6
Global ECR Scorecard Footprint

Demand Management Enablers

Demand Strategy & Capabilities Common Data &

Communication
Standards
Optimize Assortments Optimize Promotions
Cost/Profit
Optimize New and Value
Consumer Value Creation Measurement
Product Introductions

Supply Management Integrators

Supply Strategy & Capabilities Collaborative

Planning Forecasting
and Replenishment
Integrated
Responsive Operational
Demand Driven E-Business
Replenishment Excellence
Supply
Page 7 Business to Business
Demand Side
Original Concepts
The Optimize Assortments, Promotions and
Product Introductions concepts now follow the
generic work flow ...

Plan Execute Evaluate

Integrate and Efficient and Check
incorporate effective implementation
brand and translation and and results
category implementation against agreed
objectives of the plan plan and
objectives

Page 8
There are three key considerations within
Consumer Value Creation

Knowledge Channels to Solutions for

management consumers consumers
Datamining Multi channel Consumer
Intelligent initiated
performance solutions
commercial measurement
actions Services around
Channel products
Interactive portfolio Partners for
marketing management fulfillment
Alliance
networks
Page 9
Solutions for consumers

TRANSACTIONS >>>> RELATIONSHIPS

TRANSACTIONS >>>> RELATIONSHIPS CUSTOMER RELATIONSHIP BASED
LOYALTY SOLUTIONS
MANAGEMENT

information

innovation

BASIC CATEGORY INTEGRATED VALUE

MANAGEMENT SOLUTIONS

PRODUCTS >>>> SOLUTIONS

Page 10
The Consumer and Retail Paradigm Shift

FROM TO

Share of Share of
product / market consumer / services

Share of wallet Share of life

Page 11
The concept of integrated pet care
management

Source
Temporary
Vet
Housing
Care
Share of
life
Diet
Training Control
Information
Systems
Grooming Food

Accessories
Page 12
Companies will need to evaluate the impacts of
specific actions on smaller groups of consumers -
more granular, faster, and accurate assessment
will drive decisions
Market Segmentation
Produt A Channel X Consumer I

Value Delivered to the Consumer

satisfying consumer wishes
increase share of life
Costs of Commercial Actions
Reactions
Commercial
Value of/to Consumer of Target
Actions
Consumers
Sales Revenue
Value Received from the Consumer
impact on sales, profitability, image
increase share of wallet
Page 13
Page 15
 Primary focus of the
tool is against 8,
GCI agreed Key
Performance
Indicator definitions
and measures.
Companies and
Trading Partners
can benchmark
these quantitative
results.
Stop there or
evaluate the
capabilities needed
to improve these
results.

Page 16
KPIs

Category Share Is the organization achieving

the category share desired?

Service Level / Fill Rate Are all items being

delivered as ordered?

Inventory Have we minimized the amount of

inventory needed in the supply chain?

Out-of-Stocks Can the consumer purchase the

product when they want it, where they want it?

Page 17
KPIs

Cycle Time / Flow How responsive are we to

changing consumer needs?

Distribution Costs Have we optimized the cost

of product transportation & storage?

Data Synchronization Do we get information

flow right the first time, fast?

Page 18
 Low Score
KPIs Avg. Score
High Score
Key Performance
Indicators
Manufacturer Category Share 25.0 42.1 103.0 85.0
My Score
Retailer Category Share 35.0 75.0 92.0 NC

Supplier Service Level / Fill Rate 62.0 81.2 99.0 96.0

Confidential
Retailer Service Level / Fill Rate 90.0 94.4 97.0 NC benchmarking
Raw Material inventory coverage 18.0 26.8 100.0 30.0 capability
Days
Finishedfinished goods
goods inventory inventory
coverage 15.0
15.0 31.7
31.7 101.0
101.0 45.0
45.0
Validated
Retailer DC inventory cover 5.0 25.7 64.0 NC
Companies
Retailer store inventory cover 2.0 17.0 39.0 NC

Manufacture out-of-stock 4.0 9.1 30.0 10.0

Companies
Retailer DC out-of-stock 1.0 9.0 27.0 NC requested to
Retailer store out-of-stock 2.5 11.4 18.0 NC
populate
Manufacturer's lead time 8.0 24.2 96.0 36.0
database by
Retailer's lead time 8.0 21.6 48.0 NC

Manufacturer's distribution costs 9.0 13.9 28.0 8.0

Country /
Retailer distribution costs 12.0 19.8 35.0 NC Category
Data synchronisation (orders) 1.0 41.4 99.0 65.0
Page 19
Data synchronisation (invoices) 6.0 39.7 99.0 93.0
 3 engagement
options to
evaluate skill and
capability needs.
Currently, over 400
scorecards loaded
globally.

Page 20
Three engagement options to evaluate
skill and capability needs
Entry and
standard versions
best fit for retailers &
time, resource
constrained
occasions.
Full best for
strategic partnerships
and internal
assessments.

Page 21
 Individual
Benchmarking

Page 22
 Geographic
Benchmarking
LA versus all others

Page 23
 Direct links to
deeper
assessment
tools like
GLOSUP
Help understand
where to get
best return for
supply chain
investment
Value Chain
Analysis

Page 24
 A simple solution to four business
questions

. What is it I want to deliver ?

2. What capabilities do I FOOTPRINT GLOBAL

SCORECARD
Demand Management Enablers

need to deliver it? Demand Strategy & Capabilities

Optimize Assortments Optimize Promotions

Common Data &
Communication
Standards

Cost/Profit
Optimize New and Value
Consumer Value Creation Measurement
Product Introductions

Supply Management Integrators

Supply Strategy & Capabilities Collaborative

Planning Forecasting
and Replenishment
Integrated
Responsive Operational
Demand Driven E-Business
Replenishment Excellence
Supply Business to Business

Page 25
A simple solution to four business
questions
3. How developed are those
capabilities within my situation?
Score 0 1 2 3 4
Concep General Meaning Nothing Planned Plan agreed but have Pilot tests being Roll out of Fully Implemented
t not yet started conducted implementation started
Busine All partners communicate and exchange Business partners implementation
Business partners have Business partners are Network enabled Network enabled business
ss to information electronically in real time. All have no plans to agreed plans to testing integrated business processes and processes and decision
Busine major business transactions are completed integrate business integrate some business business processes and decision making are making are delivering
ss electronically. Net technology is used for processes. processes and test network enabled rolled out in mainstream superior value added
knowledge management. them. decision making. operations.

Entry Are you ready to work collaboratively?

Do you have the basic Supply Chain
Infrastructure in place?

STANDARD DETAILED
Majority of Joint scorecards Current tool
Time, resource constrained Best tool for internal company
Non-strategic business / assessment
relationship Used jointly in strategic
80/20 approach relationships
Page 26
A simple solution to four business
questions
3. How developed are those
capabilities within my situation?
Score 0 1 2 3 4
Concep General Meaning Nothing Planned Plan agreed but have Pilot tests being Roll out of Fully Implemented
t not yet started conducted implementation started
Busine All partners communicate and exchange Business partners implementation
Business partners have Business partners are Network enabled Network enabled business
ss to information electronically in real time. All have no plans to agreed plans to testing integrated business processes and processes and decision
Busine major business transactions are completed integrate business integrate some business business processes and decision making are making are delivering
ss electronically. Net technology is used for processes. processes and test network enabled rolled out in mainstream superior value added
knowledge management. them. decision making. operations.

4. How do I improve those capabilities?

e.g. link to VICS

CPFR site
www.cpfr.org
Page 27
The correct application of the full
Scorecard requires pre-work
Leadership / support / participation of senior
management
Identify categories, channels, trading partners
Schedule the right people for a one-day workshop to
apply the Scorecard and communicate
Circulate pre-reading - understand the concepts!
Compile, calculate Key Performance Indicators (KPIs)
Apply Scorecard - start by leveling understanding of
the concepts
Compile results and agree conclusions, implications
among functions
Complete work plans

Page 28
How others have gotten started...

Strengths Execut
Assessment &
Weaknesses
e the
Plans
Joint Action Plans
Review
Results
Opportunities Prioritize
(Finding
Common Ground)
Page 29