Moving quickly towards Fast Perfect Order (through EDI & GDS)

Renato Di FerdinandoRenato Di FerdinandoCustomer Service Manager, Kraft Foods Italia

March 2010

Main Topics Agenda

Storyline

N i l t ti th “B f V Aft ” i tNew process implementation: the “Before Vs After” picture

GDS & EDI integration: a successful synergy

KPI and benefits measurement

Next stepsNext steps

Key Learning & Deliverables

Storyline

Classic effectiveness & efficiency targets

EDI + GDSTraditional transaction EDI

EDI + GDS

To improve service guaranteed to cooperatives by CoopTo improve service guaranteed to cooperatives by CoopCustomer collaboration: the starting point for new projects

From Traditional Order To Cash To EDI

As it was…Manual Order

GenerationGeneration

Order PrintingManual Order

Typing

Order Sent via Fax

Manual InvoiceControl Invoice Printing

Manual InvoiceRegistration

Paper InvoiceMailing

From Traditional Order To Cash To EDI

First Step

EDI OrderProcessing

in ERP

EDI OrderGeneration

EDI Sales OrderConfirmation 1°

I i P i ti

Manual InvoiceControl

Invoice Printing

Paper Invoice MailingManual Invoice

Registration

From Traditional Order To Cash To EDI

Second Step

EDI OrderGeneration

EDI OrderProcessing

in ERP

EDI

EDI InvoiceRegistration

EDI Sales OrderConfirmation 1°& 2°

RegistrationEDI Invoice

From Traditional Order To Cash To EDI

Main features of EDI roll-out

Order and Order Confirmation:Order and Order Confirmation:regular implementation of standard messages

Sales Order Confirmation focus: upgrade with communication of amended quantities

EDI Invoice: the electronic flow reaches completion pCredit Note & Debit Note messages are coming soon

EDI Outstanding Issues

The flow was electronic but...

Product details were manually keyed into both MasterProduct details were manually keyed into both Master DataThe time needed to manage the information within Coopwas about 20 min per documentInformation on products communicated by different means such as fax mail phonemeans, such as fax, mail, phone...EDI Orders could be in error status due to Master Data mismatchesImprecise item details lead to a deterioration of invoice accuracy

GDS: The Missing Link

A review of obsolete processes: not only a technical tool, but the base to improve performance

Full awareness of the process across all functions

New KPI sharing to assure common understanding ofi timprovements

Reduction of IT systems redundancy: all relevant info on a single sitea single site

Shorter product introduction Lead Time

Less time spent on complaints/disputes: Invoice Accuracy,“Order Accuracy”, Returnsy ,

Before GDS implementation: critical areas

1W 1W 2DD

Itemintroduction

Product analysis Completion

StoreProduct

info

Edit & Publish

detailspartially

categorydept.:

kraft Sales dept.:

category dept.:

manualeditingpartially

sent viae-mail

briefing

approval

p

complete product information

p

infocollection

editing

info to affiliates

further requests

information retrieval & transmission

doc sent to assistant

New process implementationSteps of the process > From 5 to 3

1W 1W

Steps of the process > From 5 to 3

1DD

Itemintroduction

Product analysis Completion

StoreProduct

info

Edit & Publish

all details

categorydept.:

Kraft Sales Dept.:

Category Dept.:

Items info self details

via GDS access to all info via GDS-Pim

p

complete product information

p

Infocollection

storage

Info to affiliates

approval via Pim

information retrieval & transmission

doc sent to Assistant

affiliates

GDS+EDI: a successful synergy

During the Listing process, information requests andmanual typing delays are eliminatedmanual typing delays are eliminated

New Listing additions and Master Data changes detailsNew Listing additions and Master Data changes detailsare quickly notified via digital protocol

Orders and Invoices are based on complete and alignedMaster Data features

GDS KPI’s:GDS lit h k th li dGDS assures quality checks: the supplier needsto cleanse his Master Data to avoid technical blocksMaster Data harmonization and fine tuning, according to GS1 requirements and partners agreements(e.g. naming convention)

Data Consistency:Assure that COOP receives what Kraft sends in their systemsy

Time To Market:Streamlining the process assures time savingStreamlining the process assures time savingMaster Data harmonization, no template to fill

GDS KPI’s Measurements:

Data Consistency% item data with Correspondent

Data qualityIncrease

100%

75%

50%

27%

Correspondentattribute in KraftCoop Master data

Increase25%

0%

Time to market (dd)Time needed for a product to be stored

50% of time saving

21

1416p

into master data

Parameters

saving7

0Source: Coop assessment

168

ParametersTime to market is related to all the activities of the process (eg. Send information, Manual data entry, paper production)

Focus on consistency: before GDSGtin Consumer unit

Net contentProduct Description

Supplier internal code

100

100Supplier internal code

Each in a TITI per layer

Layers per pallet

010

098Layers per pallet

TI per palletGtin Case

Trade item Weight

98969387g

Packaging (Trade Item)Total Shelf life

Trade item Volume

857850

Packaging (C.U.)Each Volume

46312421

Source: Coop assessment

Parameters1/3 of total product as sample15 common critical attributes

2117

Focus on consistency: after GDSGtin Consumer unit

Net contentProduct Description

Supplier internal codeSupplier internal codeEach in a TITI per layer

Layers per palletLayers per palletTI per pallet

Gtin CaseTrade item Weight

100

gPackaging (Trade Item)

Total Shelf lifeTrade item Volume

Packaging (C.U.)Each Volume

Source: Coop assessment

Parameters1/3 of total product as sample15 common critical attributes

Performance Improvement Indicators

General Master Data Discrepancies....

Up to 20% of EDI Orders in error !Up to 20% of EDI Orders in error !

Up to 1h per Day to fix Orders anomalies !

More than 2000 Credit Notes per Year !

U t 30 i D t il I i !Up to 30mins per Day to reconcile Invoices !

..... after full GDS implementation everythingbecomes “0”!

Project timingK ft j i C i t GDSKraft joins Coop into GDS ....

2ndQ2006

3thQ2006

4thQ2006

1stQ2007

2ndQ2007

3thQ2007

4thQ2007

Collaboration ECR/Coop/Kraft on attribute set

Pil t h ith l

Q2006 Q2006 Q2006 Q2007 Q2007 Q2007 Q2007

Pilot phase with manual upload in 1Sync

Project requirements and resources allocationsresources allocations

Interface design and implementation

Massive upload testMassive upload test and Go-Live

Next Steps

Roll-Out to new Suppliers for Coop and new Retailersfor Kraft

Complete adoption of the new processes by Sales( f ) C (C )Managers (Kraft) and Category Managers (Coop)

I t f P I M f ti liti i tiImprovement of P.I.M. functionalities on existing products updating

Automating KPI’s calculation

Key Learning & Deliverables

The importance of moving together

Involve the business side in the project f th b i ifrom the beginning

Mutual trust in creating a value project

The leverage effect of multiple innovation