Syn Lean and Agile Intro 1 © The Delos Partnership 2005 Syngenta Workshop to produce a lean and agile customer led supply chain

Syn Lean and Agile Intro 2 © The Delos Partnership 2005 Fundamental needs Delighting the Customer: Right Product Right Value Right Time Right Place

Syn Lean and Agile Intro 3 © The Delos Partnership 2005 Customer Focus Every action taken by a company should only be undertaken if it is something that we are sure that the customer would be prepared to pay for….anything else is waste and adds cost Every interaction with a customer should exceed the customers’ expectations of the company’s behaviour Wow! I never thought you would ever have been able to do that. I will certainly use you again.

Syn Lean and Agile Intro 4 © The Delos Partnership 2005 Customers Requirements What do Customers require from any supplier of Agrochemicals Seed products Professional products What problem are they trying to solve ?

Syn Lean and Agile Intro 5 © The Delos Partnership 2005 Current reality What are the visible signs of problems for the Supply Chain today ?

Syn Lean and Agile Intro 6 © The Delos Partnership 2005 Current reality What are the Supply Chain strengths of competitors ?

Syn Lean and Agile Intro 7 © The Delos Partnership 2005 Conflicting objectives Inventory Customer Service Manufacturing Costs Manufacturing Flexibility

Syn Lean and Agile Intro 8 © The Delos Partnership 2005 But it does not stop there.. Higher Quality Faster Response Greater Variety Lower Cost Tighter measurements

Syn Lean and Agile Intro 9 © The Delos Partnership 2005 Customers demand ? Higher Quality Faster Response Greater Variety Lower Cost Tighter measurements Customer Service Department Warehouses of Inventory Large Product range Far East Manufacturing facility Ever higher levels of internal efficiency and more PPV

Syn Lean and Agile Intro 10 © The Delos Partnership 2005 Business response ? Higher Quality Faster Response Lower Cost Tighter measurements Six Sigma project Agile Project Cost Reduction exercise More KPI’s

Syn Lean and Agile Intro 11 © The Delos Partnership 2005 Focus or initiatives ?

Syn Lean and Agile Intro 12 © The Delos Partnership 2005 Today’s Value ? Time is money... Time is waste...

© The Delos Partnership 2005 Lean?: waste removal

Syn Lean and Agile Intro 14 © The Delos Partnership 2005 Lean is elimination of waste Run Set up Set up Receive Suppliers Inspect Store Pick Set up Set up Queue Inspect Operation 10 Queue Set up Set up Run Operation 20 Inspect Store Queue Inspect Store Customers Operation 30

Syn Lean and Agile Intro 15 © The Delos Partnership 2005 Before After Assembly time: -47% W.I.P.: -99% Lead time: -99% Floor space: -40% Lean example: oil cooler cell

Syn Lean and Agile Intro 16 © The Delos Partnership 2005 Lean - application Production process Supplying process Invoicing process Expenses claim process Recruitment process… ……any others ?

Syn Lean and Agile Intro 17 © The Delos Partnership 2005 Lean summary The use of the minimum resources, i.e. manpower, machinery, materials, space and time, and cash to manufacture and supply the product

Syn Lean and Agile Intro 18 © The Delos Partnership 2005 Physical = Production + Distribution + Storage Costs Costs Marketability = Obsolescence + Lost Sales + Sub-optimum Costs Costs - stockout Pricing - competition Total supply chain costs

Syn Lean and Agile Intro 19 © The Delos Partnership 2005 Waste Variability Inflexibility (Volume and Mix) Seeing the potential…

Syn Lean and Agile Intro 20 © The Delos Partnership 2005 Waste Variability Inflexibility  Value Added  Reliability  Responsiveness (Volume and Mix) Seeing the potential…

© The Delos Partnership 2005 Agility Martin Christopher Cranfield 2003 Postponement Bottleneck Management Reduce NVA Time Streamlined Processes Synchronous Supply Reduce In-bound Lead times Velocity Agility Visibility Internal Integration Close to Customers Collaborative Planning Access to Real Demand Process Management Shared Information Close to Suppliers Event Management Collaborative Planning Level 1 Principles Level 2 Programmes Level 3 Actions Strategic Sourcing Simplification Reduce Batch Sizes

Syn Lean and Agile Intro 22 © The Delos Partnership 2005 The ability to respond to changes from customers and markets, when the customer wants it, and deliver when the customer requires it 99 % + of the time. Agility summary When do you want it ? No problem at all, you can expect it then.

Syn Lean and Agile Intro 23 © The Delos Partnership 2005 Agile Lean H L H L Variety Variability Lean and Agile application

Syn Lean and Agile Intro 24 © The Delos Partnership 2005 Agile Lean H L H L Variety Variability Traditional pressures…. Supply Chain Sales and Marketing

Syn Lean and Agile Intro 25 © The Delos Partnership 2005 Complexity or Agility ? Development Purchase Active Ingredient Formulate Label and Pack Distribute “Real” Customer Places Order here Complexity/Cost Elapsed Time Where do we Stock and Where do We decouple How do we Simplify ?

Syn Lean and Agile Intro 26 © The Delos Partnership 2005USALocalChinaRegion LowMediumHigh High Low Variety Of Product Variety Of Product Demand Variability From Customer Demand Variability From Customer Agile requires appropriate Supply Chain design E.G Mexican Market Market

Syn Lean and Agile Intro 27 © The Delos Partnership 2005 The Value Chain Co-op/dealer Farmer Food Chain Customer Distribution Customer Distribution Europe Americas Far East Europe Syngenta AI And Form’n Syngenta AI And Form’n Raw Material Transport GOODS CASH Shareholders/Stakeholders INFORMATION

Syn Lean and Agile Intro 28 © The Delos Partnership 2005 Raw material Suppliers Intermediate Producers AI Manufacturing Storage & Distribution Formulation, Filling & Packing ChannelCustomer Customer Focused SC Design will need to cover the end-to-end Supply Chain Postponement Points Global AI Regional F&P Lambda-Cyhalothrin Mefanoxam Karate Ridomil External External/Internal Internal Internal/External External Getting the balance right is reliant upon having no bottleneck between AI & F&P, and the closer we get to the customer, the more influential we can become Objective: Cost Efficiency, Robustness & Reliability Objective: Cost Efficiency, Customer Focus & Responsiveness

Syn Lean and Agile Intro 29 © The Delos Partnership 2005 Where do we introduce complexity ? Marketing Selling Design Manufacturing Purchasing Finance IT Human Resources Management Product Range Customers Components Sources/Quality Suppliers Invoicing/Budgetting Systems Recruitment/Policies Strategy

Syn Lean and Agile Intro 30 © The Delos Partnership 2005 Workshop Where in the Supply and Demand Chain do we add value to the customer? Where does Syngenta do things which do not add value to the customer and what can be done to prevent this from happening ?

Syn Lean and Agile Intro 31 © The Delos Partnership 2005 The Delos Model Vision Strategy Prioritisation Prioritisation Innovation Innovation Demand Support Supply Supply

Syn Lean and Agile Intro 32 © The Delos Partnership 2005 People Values TraditionalNowFuture Process problems Not my jobOwnershipAccountability Management Style SuperviseFacilitator/ Team Leader Coach Working Style IndividualTeamEmpowered Teams Training and Education Non-existentLuxuryNecessity KnowledgeIgnorantUnderstandsExpert Attitude to People LiabilityCostAsset

Syn Lean and Agile Intro 33 © The Delos Partnership 2005 Challenge Tradition FactorHistoricalNowFuture DeliveryPromiseRequiredNeed SuppliersAdversariesPartnersSeamless QualityAcceptable6 sigmaZero defects ScheduleForgetFollowAdhere InventoryAssetLiabilityZero MaintenanceRemedialPreventEliminated ComplexityNormalReducedEliminated TeamworkRareCIT’sConstant PeopleFollowersThinkersLeaders

Syn Lean and Agile Intro 34 © The Delos Partnership 2005 Behavioural problem If you measure me rationally I will behave rationally But if you measure me irrationally I will behave irrationally If you measure me rationally I will behave rationally But if you measure me irrationally I will behave irrationally

Syn Lean and Agile Intro 35 © The Delos Partnership 2005 Vertical Functional Organisation MD Sales Marketing Technical Operations Finance HR R&DR&D R&DR&D MKTGMKTG MKTGMKTG SALESSALES SALESSALES OPSOPS OPSOPS ACCTSACCTS ACCTSACCTS HRHR HRHR Directors Managers Supervisors/Team Leaders

Syn Lean and Agile Intro 36 © The Delos Partnership 2005 Integration the right blend! CULTURE/ BEHAVIOUR TECHNOLOGY WAYS OF WORKING

Syn Lean and Agile Intro 37 © The Delos Partnership 2005 Change Minds not just systems Successful change CULTURE TEAMWORK SHARED VISION COMMUNICATION WAYS OF WORKING ACCURACY AND DISCIPLINE POLICIES AND PROCEDURE HARDWARE PLANNING TOOLS LEAN TOOLS AGILE TOOLS SOFTWARE ACCURATE DATA VALID SCHEDULES TOOLS