Canon Strategic Marketing Plan - Supply Credits

Marcus Downey

2

Background – Current Process

1. Register customer for CSMP support

2. Sell machine to customer

3. Identify all supply sales from CSMP Customers

4. File for credit with vendor

5. Current reports are generated via ODS

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Background – Current Process

6. Vendor identifies eligibility of credits

7. Vendor pays credit in full or partial

8. Credit is received by Accounts Payable

9. Vendor Credit Specialist is contacted for posting information

(Marketplace, Branch, etc)

10. Credit is posted to OMD

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Project Definition

Problem Statement:

IKON does not currently take advantage of all supply credits for equipment sold under the CSMP program.

Approximately 60% of all Canon equipment placements are CSMP. IKON purchases approximately $40 million per quarter in supplies from Canon.

If 60% of supplies sold are for price supported customers we should claim $1.2 million per quarter ($40 mm * 60% * 5%).

As not all products are included in the program the estimate is $3 million per year. In fiscal 02 IKON claimed and received $640K (460K from current OMD paths). This project is focused on improving the supply claim process.

Project Definition:

To increase the number of supply credits claimed from 460K to 2 million per year for OMD paths.

Project Benefits:

Improve cash flow, decreased cost of goods, and improved profit margins estimated at $1.54million in missed credits annually.

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Project Definition, Cont’d

Financial Benefits: Increase supply credits by 437% from Fiscal Year 2003. Increased income, increased cash flow

Project Metric “Y”: Y1 = Price supported supplies not claimed. Y2 = Ability to identify eligible records.

Defect Definition: Eligible supplies delivered under entitlements or invoiced to the

customer not recognized as eligible for CSMP supply claim. Leveragability:

Project can be leveraged across Region still on the OMD system.

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Project Team

Black Belt – Marcus Downey Champions – Linda Frisinger, Bruce Fiscus Financial Analyst – James Palmer Process Owner – Linda Frisinger Master Black Belt – Bob Conrad Team Members:

IT Support – Dottie Mann Process Professional – Georg Shannon Process Professional – John Lepley

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CT TREE

CT Satisfaction

Y1 = Price SupportedSupplies not Claimed

Critical toQualityCritical to Cost Critical to

Delivery

Project # 0307-27-003CT Tree

Marcus Downey8/11/2003

CSMP SUPPLY CREDITS

Canon has astandard Format forsubmitting Data

All Records musthave CanonApproval Number

Percent VendorCredits receivedversus dollaramount claimed

Vendor Creditsnever submitted -lost revenue

90 Daywindow tomake claims

CT Satisfaction

Y2 = Ability to IdentifyEligible Records

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SIPOCProcess Owner:

Inputs Outputs

(Resources required by the process) 6

(Deliverables from the process) 3

Requirements Requirements

OMD correct invoice info

Location of CSMP customers supplies purchasing invoice info

Access to invoice data in OMD. IKON Coordinator

VCTS

Track current Vendor Credit customers that qualify for Vendor Programs

System that identifies CSMP customers and purchased equipment.

Database Entries Report allows processor to identify possible new CSMP registered customers. IKON Coordinator

ODS

Extract the billed info in OMD and into Excel spreadsheet

First cut at srubbing data needed to process supply credits

Need to include CSMP registered customers name, Canon supply product #'s and invoice date info to enable ODS to extract needed info from OMD. IKON Coordinator

ExcelAllows us to export into the Canon format. 2

Canon required spreadsheet format

Proper information to Canon to process the credit request claim. CANON

EmailCommunicate results of data submitted by IKON

Send back amount of money IKON will be rebated versus amount submitted Outlook/Lotus Notes, etc. IKON Coordinator

Knowledge/Skill

Persons trained to dothe individual processes that are required to receive the claims from Canon.

Employees that process the manual information into the Canon Format

Information sent to Canon in their requested format CANON

ComputersStore individual Spreadsheet Records

Historical Data for tracking amount of money claimed and received from Vendor

Used to reconcile credits with Canon IKON Coordinator

Account Registration ListsCheck for Qualified Customers 1

Qualified Customers Approval Number Need before credit is approved CANON

Canon on Line/ ISG Marketing

Website Communication Portal for Canon Dealers

Supply Program Information and Current CSMP Customer Information from Canon

allow IKON to updated CSMP Customer list & check status of qualified customers IKON Coordinator

CSMP Supply Credits Linda Frisinger

Process(Top level description of activity)

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Customers(Anyone w ho receives a deliverable from the process)

5 4

Identify CSMP Customers eligible for Supply Claims and await credits

Starts when Ikon receive customer registration from Sales Rep

Ends with Receipt for credit from Canon

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RegisteredCSMP

Customer

•Equipment Customer isregistered•Automatic qualification forCSMP Supply Program

OracleDiscoverer

•Input Supply Query inOracle•Run Supply Claim reportfrom ODS

•Pull customerInformation

EXCELSpreadsheet

• Transfer new CSMP Customers• Get CSMP Supply Credits from New Customersequipment• Check VCTS for new Customers• Check OMD for missing Information

•Transfer Data

CHECK CustomerQualification

•Manually check each account line by line•Cross Reference against currentcustomer list or expired list

•Prepare to Validate

CSMP DiscountDocument

•Sort File

• Sort by Machine Model• Check Current qualifyingmachines•Ensure use of most currentCSMP Document

Non-QualifyingMachines

• Delete Records

• Delete Non-QualifyingMachines• Sort by Marketplace•Sort by Customers Name

ApprovalNumbers

• ManualInformation Input

• Add Canon CSMP ApprovalNumbers• Copy & Paste Manually•Check OMD for missingInformation

New CSMPCustomer List

• Add New CSMPCustomers

• Add Canon CSMP ApprovalNumbers• Copy & Paste Manually

• Create one Report• Combine First time customerswith current CSMP Customers• Ensure List in Canon ExcelFormat

Consolidate List

• CombineInformation

• Sort by Toner Type andCartridge Type• Subtotal Credit Amounts foreach by Supply Type

Sub-Total SupplyTypes

• Resort File

CanonApproved

CSMPSubmission

File

• Store Copy of File

• Store copy of CSMPSubmission File on hard drive• Submit File to Canon ProgramCoordinator

Canon ProgramCoordinator

• E-Mail Spreadsheet

• E-mail File to ProgramCoordinator• Follow up with estimated timeto be processed

Money Issued toIKON

• Receive Supply Credits

Detailed Process Map - Project Name: 0307-27-003 CSMP Supply Credits

Detailed Process Map

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Detailed Process Map – cont.

RegisteredCSMP

Customer

•Equipment Customer isregistered•Automatic qualification forCSMP Supply Program

OracleDiscoverer

•Input Supply Query inOracle•Run Supply Claim reportfrom ODS

•Pull customerInformation

EXCELSpreadsheet

•Transfer Data

CHECK CustomerQualification

•Manually check each account line by line•Cross Reference against currentcustomer list or expired list

•Prepare to Validate

• Add Canon CSMP ApprovalNumbers• Copy & Paste Manually

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Detailed Process Map – cont.

CSMP DiscountDocument

•Sort File

• Sort by Machine Model• Check Current qualifyingmachines•Ensure use of most currentCSMP Document

Non-QualifyingMachines

• Delete Records

• Delete Non-QualifyingMachines• Sort by Marketplace•Sort by Customers Name

ApprovalNumbers

• ManualInformation Input

• Add Canon CSMP ApprovalNumbers• Copy & Paste Manually•Check OMD for missingInformation

New CSMPCustomer List

• Add New CSMPCustomers

• Transfer new CSMP Customers• Get CSMP Supply Creditsfrom New Customers equipment• Check VCTS fornew Customers• Check OMD formissing Information

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Detailed Process Map – cont.

Consolidate List

• CombineInformation

• Sort by Toner Type andCartridge Type• Subtotal Credit Amounts foreach by Supply Type

Sub-Total SupplyTypes

• Resort File

CanonApproved

CSMPSubmission

File

• Store Copy of File

• Store copy of CSMPSubmission File on hard drive• Submit File to Canon ProgramCoordinator

Canon ProgramCoordinator

• E-Mail Spreadsheet

• E-mail File to ProgramCoordinator• Follow up with estimated timeto be processed

Money Issued toIKON

• Create one Report• Combine First time customerswith current CSMP Customers• Ensure List in Canon ExcelFormat

• Receive Supply Credits

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Data Collection Plan

Process Owners

Vendor Credit submission Reports for past 12 months or last 4 quarters

8/29/2003 E-Mail

Corporate Purchasing

CSMP Customer Information

9/2/2003 Canon Website Access

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Areas to Complete

• DPMO and Zst (baseline and target)

• MSA completed and issues identified

• Process performance and entitlement

• Preliminary graphical analysis of data

• Define any red flags and recommendations to resolve

• Next Steps

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Project DMAIC Checklist/Status

Problem Statement: To increase the number of supply credits claimed from 460K to $1.5 million per year for OMD paths

Black Belt: __Marcus Downey ____________________ CTS’s: _______________________________________________________

Project Champion: Linda Frisinger________________ Defects to be Reduced: _________________________________________

Deployment Champion: __________________________________ Beginning DPMO/Sigma Level: ___________________________________

Master Black Belt: __Bob Conrad_____________ Final DPMO/Sigma Level: ________________________________________

Six Sigma Project DMAIC Checklist

Project :__CSMP Supply Credits_____________________

Define Measure Analyze Improve Control

Completion Date: Completion Date: Completion Date: Completion Date:

Discover Variable Relationships

Establish Current Performance

Establish Performance Objective

ID Alternative Solutions

Determine “Best Fit” Solution

Establish Process Tolerances

Update FMEA

Develop Pilot Plan

Pilot “Best Fit” Solution

Validate Improved Performance

Conduct Cost/Benefit Analysis

Complete Improve Phase Project Review

Redefine Process Capability

Develop Control Plan

Develop Mitigation Plan

Implement Process Controls

Develop Monitoring Plan

Implement Process Control Plan

Obtain Financial Validation

Completion Date:

Define Project Scope

Initiate Team (Kick-off)

ID Process Customers

ID Process CTS’s

ID Process Metrics (Y’s)

Complete SIPOC Map

Complete Define PhaseProject Review

Receive Approval to Move to theMeasure Phase

Receive Approval to Move to theControl Phase

Confirm Baseline Capability

Identify Sources of Variation

Complete Detailed Process Map

Complete C&E Diagram & Matrix

Complete FMEA

Perform Data Collection for Analysis

Screen Potential Causes

Conduct Graphical Analysis-

Conduct Hypothesis Testing

Complete Root Cause Analysis

Receive Approval to Move to theAnalyze Phase

Develop Data Collection & Sampling Plan

Identify Potential X’s

Validate Measurement System

Collect Data on Y’s

Perform Capability Analysis

Voice of Process/Benchmark

Define Performance Objectives

Complete Measure Phase Project Review

Receive Approval to Move to theAnalyze Phase

Receive Approval to Close the Project

Complete Control Phase Project Review

Obtain Financial Analyst Sign Off

Obtain MBB Sign Off

Obtain Project Champion Sign Off

Obtain Steering Committee Sign OffComplete Analyze Phase Project Review

Leverage Project within Organization