1. Purchasing BPO Overview1

2. Manufacturing & Sourcing in 2020
Table of Contents
India Team
Service Architecture
Solutions
Marketing Mix
Operating Framework
Manufacturing & Sourcing in 2020 2

3. India Team 3 www.procexcellenz.com 1 person
Ranjith J Devadoss
7 years experience as a Category Manager at Caterpillar Inc.’s Global Purchasing Division – Asia Pacific
6 years of experience as a Certified 6 Sigma Master Black Belt and Qualified Lean Champion cum Black Belt
B.E. (Mechanical Engineering), M.S. (Operations Management)
Managed and executed 30+ Strategic Sourcing projects as a Regional Internal Lead Consultant for US and European facilities touching various Commodity Groups, with a combined Annual Savings potential of $ 18 Million
Multiple Commodity exposure related to Direct Spend
Solid India Region Supplier Intelligence and Business know-how
Potential to tap 25+ Commodity Sourcing / Manufacturing experts for Projects on an assignment by assignment basis. Ability to scale up or down to manage resource costs
India Team
Sourcing Program Lead
1 person
Commodity Manager / Development Engineer (20 years experience + managed 75 Suppliers)
Certified 6 Sigma Green Belt / Qualified Lean Green Belt
Well versed in interactions with US and European clients
Commodity Manufacturing Process Engineers
6 persons (can be scaled to 15 persons as needed)
Expertise across 25 to 30 different Purchasing Commodity types
Average experience of 20+ years (Technical + Process Development + Value Engineering space)
Certified 6 Sigma Green Belts / Yellow Belts
Purchasing Buyers / Development Engineers
3 persons (can be scaled to 8 persons as needed)
Average Experience of 15+ years (Capacity Planning, Cost Management, Supplier Development & Certification space) 3

4. Services Architecture
Group A
Gears & Power Train Components
Machining
Hardware
PF Metallic (Brass / Aluminum)
Heat Treatment & Metal Finishing
Group B
Steel – Flat Products
Sheet Metal
Light Fabrication
Heavy Fabrication
Group C
Steel – Bar Products
Steel Castings
Iron Castings
Forgings (Open & Closed)
Group D
Springs & Bearings
Hoses / Rubber parts
Tools, Cutters, Dies, Moulds & Patterns
Jigs & Fixtures
CORE Process
Commodity-wise reshaped Sourcing Strategy with a 3 to 7 year outlook
Integrated solution to identify and develop Suppliers and Parts
End-to-end Program management & delivery
Strategic Sourcing Super Project Execution
Supplier Intelligence, Evaluation and Selection
Supplier Risk Assessment & Management (Financial & Non-financial)
Supplier Metrics and Performance Management
Supplier Capacity Planning
Supplier Tooling & Asset Management
Supplier Quality Inspection & Process Audits
Component Cost Modeling and Estimation
Supplier Relationship Management
APQP / PPAP Process Documentation
Price Negotiation & E-Auctions
Deploying Excellence initiatives (6 Sigma and Lean VS Transformation)
Supplier Education & Training
Project / Program Management
ENABLING / GOVERNING Processes
Support infrastructure for Ongoing improvement and management of Supplier processes
Supplier conditioning to World-class standards of Excellence (or) to Client norms
Change and Issue management at Supplier facilities 4

5. Suite of Solutions 5 www.procexcellenz.com Develop a 3 to 7 year
Strategic Sourcing Master Plan (6 Sigma Super Project)
Re-sourcing / Development Package Implementation
Process Support Infrastructure for Supplier Excellence
Full-fledged Local Purchasing Office function
Program / Project Management
Technology Enablement
Develop a 3 to 7 year
Transformational
Road map
Plain components
re-sourcing from
Source A to Source B
Support Enabling &
Governing processes
Complete Outsourcing
of the Purchasing &
Supply Chain functions
Manage Time, Cost &
Resource challenges
for the Client’s Supplier
focussed initiatives
Provide IT solutions for
real-time Customer
and Supplier
collaboration
communication &
reporting
6 Sigma rigour
applied to addressing
the Client’s CCRs
Project Management
rigour in
implementation
On-the-ground
support to drive
Supplier Excellence
initiatives
End-to-end Purchasing
support for the India
Supply Base
On-site support to
drive Program
completion
Supplier Training,
6 Sigma & Lean VST 5

6. Marketing Mix 6 www.procexcellenz.com Geographical Segmentation
Phase 1 – USA / Canada
Phase 2 – Europe
Industry Segmentation
Automobile & Defense Equipment
Energy & Power Generation
Construction, Mining & Material Handling Equipment
Heavy Industries
Machine Tool & Equipment makers
Targeting
Size (Large + Medium + Small companies)
Scope (Tap approx. 50% of COGS / Spend for re-sourcing opportunities)
Positioning
Premier AAA Rated mid-sized Purchasing Services Firm in India
Support and Coverage – India Suppliers
Resource Plan
Chennai based Core Team
Floating Hubs (Chennai, Bangalore, Noida, Pune, Coimbatore, Surat and Tata Nagar)
3rd Party Associations
Remote Management of Supplier Champions 6

7. Operating Framework TECHNOLOGY ENABLEMENT SUPPLIER MANAGEMENT
Front End
Services Marketing & Securing Orders
CRM
Onsite Issue Resolution
Accounts Receivables
Back End
Project / Program Management
Supplier Performance Management
SRM
Package / Bid Price Estimation
SUPPLY BASE
CUSTOMER BASE
LOGISTICS & DISTRIBUTION MANAGEMENT
Direct
3PL Provider 7

8. Manufacturing and Sourcing in 2020
Study involving 152 respondents in 8 countries
Sector spread of the study
General Manufacturing (40%)
Automotive, Aerospace & Defense (16%)
High Tech (20%)
Industrials : Chemicals, Steel, Medical Devices (24%)
Geographical spread of the study
US (18%) & UK (18%)
Germany (17%)
France (13%)
Sweden (12%)
Netherlands (11%)
India (8%) & China (3%)
Dimensions of the study
Engineering and R&D
Manufacturing
Supply Chain & Logistics 8

9. Engineering and R&D Supplier Collaboration
50% predict higher collaboration with Suppliers
More collaboration required when Outsourcing is involved 9

10. Engineering and R&D Product Lifecycle Management
25 to 50% levels of product lifecycle shrinkage expected
Shrinking lifecycles will put inevitable strain on Supply Chains
Supply Chains must be Lean, Responsive and Flexible 10

11. Manufacturing Globalization
Manufacturing will be for Global markets. A shift from manufacturing in one country to multiple countries expected
Proximity to raw materials and consumers, labor wage differentials, forex dynamics etc. will be key drivers 11

12. Manufacturing Subcontracting
With 56%, the balance is tipped in favor of subcontractors to help develop products for the future
The standardized products will be subcontracted while specific products will be made internally
Regular visits or a Local Management Team will remain while IT based Management & Reporting Systems deployment will increase 12

13. Manufacturing Low-Cost Labour
Manufacturing and Sourcing from cost-effective countries will increase despite partial erosion of the labor cost advantage
Logistics, distance, travel time, customs regulations, open market issues, accessibility, geopolitical stability and local expertise leadership could also be other determining factors
China and India will still continue to be preferred destinations 13

14. Supply Chain & Logistics
Overseas Suppliers
An increased reliance on Overseas Suppliers is expected in the future
40% wish to involve and collaborate with Suppliers right from the Concept to the Development process
60% of companies expect to be sourcing from more countries in the future than today
Closer relationship management envisaged . Co-location of Suppliers alongside Customers to increase. 14

15. Supply Chain & Logistics
Cost of Commodities
General agreement exists that Cost uncertainties or escalations could drive increasing complexity into our Supply Base positioning
Given the picture, proactive action to normalize Cost risks will be imperative. 15

16. Supply Chain & Logistics
Coping with complex Supply Chains
Deployment of more sophisticated and capable IT or Web based systems will be the global norm to improve real-time information visibility and communication
Acute Talent shortage foreseen in the area of Supply Chain management and IT integration
70% predict the overwhelming use RFID technology as a key enabler 16

17. Supply Chain & Logistics
Supply Chain Disruptions
Global Supply chains will have a diverse set of attendant risks
Companies must be capable of managing Business Risks by recognizing, analyzing and preparing to manage the vulnerabilities
Multiple options to mitigate these risks exist. Foresight and relevant action is the key. 17

18. Thank You !! 18