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![Page 1: Managing Cost & Optimizing Efficiencies Presenter: Ken Gunn Caliber Consulting Operational and Organizational Internist.](https://reader035.fdocuments.us/reader035/viewer/2022062421/56649e625503460f94b5e7b3/html5/thumbnails/1.jpg)
Managing Cost &
Optimizing Efficiencies
Presenter:
Ken Gunn
Caliber Consulting
Operational and Organizational Internist
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Format—Jump In!!!
• Free form discussion with limited slides except to guide flow and direction of dialogue
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Outline
• Expectations• Who You are and Symptoms
• Where Does It Hurt? POP!
• Market Past, Present, Future• Ongoing Consolidation
• The Additional Costs of Doing Business:• $$$$
• The New Opportunities• $$$$$$
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Outline
• The Data Snowstorm & Frostbite• How Deep Is It?
• Where to Start—The Assessment• People First!
• Pick Your Battles• Change is a Bad Word!
• The Battle Plan • The Victory and What is Next……
• Part of Company Fabric• Follow the Money $$$-- Good customers
and Suppliers!
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Who U R, Symptoms ( POP’s) & Expectations
• Company• Business mix• Overall sales volume• Back office system(s)• Other systems you utilize• Current data integration• POP’s• Expectations
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Market—P-P-F
• 1990 # Lube marketers—oil co’s
• 2005 # Lube marketers—oil co’s
• 2020 # Lube marketers—oil co’s
• Implications
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Additional Costs
• People• Technology—numbers of systems—
can they plug and play?• Geography• A/R exposures/capital employed• Market volatility—does the past help
predict the future?
Coupled with margin shrink!
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Opportunities
You Hold The Keys—Try One!
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New Opportunities
• Play the Aggregator
• Leverage Size
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New Opportunities
• Better access to technology with “new” size not scalable for smaller companies
• Be the Driving
Hub
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Scale Up for Best Practices
• Customer Order Centers• Web based tech support• “Ask Jeeves”• Web based ordering• Data Integration• Back Office—ASP—in-house and out-
house
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Scale Up for Best Practices
• Sales Mgt—ACT and Goldmine or similar
• Routes versus go when they call—can you still afford the fuel costs?
• Customer inventory mgt—dovetails to routes
• Cycle inventories for your company
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Scale Up for Best Practices
• “FISH”—toss it• Slow means Slow—order when needed• Sonar for bulk lubes• Warehouse/truck scanning• Commissions on net margin • Tiered commissions and bonus for EFT
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Scale Up for Best Practices
• Equipment ROI’s—include everything• Daily and weekly report quick analysis
—costs and gross margins• Month-end should be a yawn—seen it
already• Contingency Planning—think New
Orleans
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Where to Start
• Sponsors• Owner and or exec team• Resources—people and a budget—”no
mother may I every time” within a specific scope
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Where to Start
• Team Facilitator/Coordinator• Can be anyone• Non-judgemental• Good listener• Handles conflict and strong willed people• Time and due date oriented
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Where to Start
• Team Members—No “I” in Team• Can be anyone• Part time and full time on team• Team oriented• Allocated time to participate• New and old hands
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Where to Start
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Where to Start
• Contributing Participants• Anyone that the data touches or impacts
• Includes—employees, customers and suppliers
• Solicit candid, open
feedback to collect ideas
and clarify POP’s
—even small ones!
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Where to Start• Communicate!!!• Do not operate behind closed doors• Promote activities and projects with
the why that includes benefits--WIFM
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Pick Your Battles
• Remember…Change is Scary
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Pick Your Battles
• The POP list
• Prioritize and Include Quick Hits as a Category
• Hit singles to start• Get comfortable with process—work out
kinks• Reward the busy folks with help• Target a “naysayer”
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Pick Your Battles
• Does not have to fix 100%--small steps still get you toward your ultimate goal
• Recognize mistakes, talk about them, learn and move on
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Battle Plan
• Cost effective outsourcing with technology expertise, support and supplier/back office relationships
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My Change Pet Peeve “The Data Snowstorm”
• Sources of data streams—list
• Number of people involved—how many people per “X” new gallons
• Error rates and rework
• Get numb to the problem—co-dependent
• Recognize the onset of frostbite• Stuck in a rut—can’t catch up• Count the W2’s • Count the file cabinets
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Integrate
Consolidate data so it is coming from as few sources as possible.
Consider a service to translate and format data for integration such as a DTN or have your back office build the interfaces
““One source, One source,
one format, one format,
one interface”one interface”
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PricesPrices
• Entering prices manually____(time) x $__/hr = $______
• Incorrectly entered prices lead to:• Correcting customer invoices• Invoicing customers @ incorrect
price – AND – not being able to correct…
• Correcting Supplier invoices
• Losing Customers…
• Buying from wrong rack Room for Error?
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Supplier InvoicesSupplier Invoices
• Eliminates entering and matching invoices manually
• Electronic processing facilitates:• Identifying missing paperwork & invoices faster• Eliminates looking for “missing” invoices• Catch incorrect supplier invoices faster• More accurate cash flow projection
• Catch incorrect supplier invoices faster
• More Accurate Cash Flow Projection Hi! My name is Joe. I am a paperholic!
Help me!
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Draft Notices (EFTs)Draft Notices (EFTs)
• Entering EFTs manually____(time) * $__/hr = $______
• Electronic processing facilitates:• Better Cash Planning
• More accurate payables
• Faster identification of problem invoices• Customer may not be invoiced • Payment on invoices that are not yours…
Joe’s Filing System
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1. Increased Revenue $ ________
2. Displaced Costs $ ________
3.Avoided Costs $ ________
4. Redirected Costs $ ________
5. Intangible (Company Image) $ ________
6. Training and Turnover $ ________
TOTAL Benefits and/or Saving $ Sum of Benefits
COSTS (investment)
Products $ ________
Services $ ________
Maintenance $ ________
TOTAL Costs (investment) $ Sum of Costs
TOTAL NET BENEFITS $ Benefits - Costs
*Payback period :
Value JustificationValue Justification
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Victory and What Next….
• There is no finish line—just battles you win!!
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Victory and What Next….
• Break thru paradigms! Make advancement (change) a positive!! & part of your company fabric!
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Victory and What Next….
• Read the tea leaves continuously for opportunities!!
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Open Discussion & Questions?