1. DI Supplier Development project Operated by Valcon & Implement
Hypothesis trees
DI Supplier Development project
Operated by Valcon & Implement

2. Levers for improving supplier development
Productivity
Quality
Product and specifications
Logistic and planning
Working capital

3. Productivity Production Production Administration Governance
Levers
Production
Production
Administration
Governance
Themes
Initiatives
Joint S&OP planning e.g. sharing of forecast
Batch size optimization e.g. using VMI
Minimise down time e.g. timely delivery
Reduce change over e.g. use of standard material
Reduce scrap e.g. by improved quality, see also “7 types of waste”
Increase volume e.g. more sales if lower unit cost
Avoid redundant processes e.g. in and outbound control
Investments e.g. possible if stronger customer commitment
Process optimisation e.g. common standards and correct master data
IT integration e.g. on order and/or invoice
Organisation and mandates incl. escalation of issues
Collaboration policies incl. process for continuous improvement
Alignment on goals and shared KPI’s
Joint Risk Management

4. Quality Level of quality QA/QC CSR Governance Shared code of conduct
Compliance gab and actions e.g. on safety and environmental
Traceability in supply chain
Levers
Themes
Initiatives
Avoid over engineering e.g. on tolerances
Common standards e.g. on quality level
Transportation requirements e.g. on temperature
Reduce excessive control e.g. level and placement of control
Right level of tracebility e.g. if recall
Use correct analysis methods e.g. knowledge transfer
Organisation and mandates incl. escalation of issues
Collaboration policies incl. process for continuous improvement
Alignment on goals and shared KPI’s
Joint Risk Management

5. Products & specifications
Levers
Product design & redesign
(Re) design to cost e.g. standard material selection, lower cost substitution, recycling
(Re) design for manufacturing e.g. lower change over time and scrap reduction
(Re) design for transport e.g. doublet stacking
Product design & redesign
Process
Governance
Themes
Initiatives
(Re) design for value e.g. commercial differentiation
Mass customisation
Make/buy business case & decision e.g. use BOM
Early supplier involvement
Common ECO process
Common standards e.g. on product specifications and certificates
Organisation and mandates incl. escalation of issues
Collaboration policies incl. process for continuous improvement
Alignment on goals and shared KPI’s
Joint Risk Management

6. Logistic and planning Planning and control Planning and control
Levers
Planning and control
Joint S&OP process incl. sharing of forecast, capacity and manning
Differentiated service level and lead time on ABC products
Move push/pull upstream by changing trigger for
VMI/Consignment stock
Planning and control
Logistic
Governance
Themes
Initiatives
Increase flow and reduce lead time in supply chain by aligning batch size and pace for supply of materials into production
Ensure correct master data incl. correct parameter setting in ERP systems
Joint planning e.g. factory pick up
Transparency in transport cost and TCO
Transport optimisation e.g. double stacking, filling rate
Logistic optimisation e.g. correct labeling, units customised to warehouse
Organisation and mandates incl. escalation of issues
Collaboration policies incl. process for continuous improvement
Alignment on goals and shared KPI’s
Joint Risk Management

7. Customer and supply outstanding
Working capital
Levers
Stock reduction
Joint S&OP process incl. sharing of forecast and agreement on stock level
Increase forecast accuracy e.g. fix MRP noise that create to high purchase demand
Parameter tuning on safety stock, order quantity, service level
Stock reduction
Customer and supply outstanding
Governance
Themes
Initiatives
Capacity reservation instead of stock building
Housekeeping, clean up dead stock
Reduce/remove excessive stock e.g. both parties holding safety stock
Improving timeline from invoice to payment e.g. by stop and unnecessary control processes
Correct invoices for faster payment and/or automatic invoice approval
Optimise payment terms e.g. by using reverse factoring
Organisation and mandates incl. escalation of issues
Collaboration policies incl. process for continuous improvement
Alignment on goals and shared KPI’s
Joint Risk Management