Kinaxis, Inc. · TSX:KXS
Kinaxis — Investor Presentation (April 2015)
31 slides from Kinaxis's investor presentation, April 2015
Slide 1: Case-in-Point: Avaya's Supply Chain Transformation
CASE-IN-POINT: AVAYA'S SUPPLY CHAIN TRANSFORMATION - ENABLED BY A VISION FOR PEOPLE, PROCESS, AND TECHNOLOGY April, 2015 Bryan Ball, Vice President and Group Director, Supply Chain, Retail and Operations Practices Benji Green, Director Global Ops, Sales, Supply, & Inventory Planning, Avaya
Slide 2: Bryan Ball speaker biography
Over 30 years experience in supply chain, operations, and materials management. Industry Experience: • VP of Supply Chain for FuelCell Energy, Inc BRYAN • VP of Global Supply Chain for Fluidmaster, Inc BALL • Director of Supply Chain for Dover Industries Unified Brands • Leadership roles at Stanley
Slide 3: Benji Green speaker biography
15 years Supply Chain & Operations experience in Integrated Business Planning; Demand, Supply, Inventory, Product, & Financial Risk BENJI GREEN Industry Experience: • Director of Global Supply Chain Operations; Avaya Director, • Sr. Manager of Americas Supply Planning; Lenovo Global Ops, • Manager o
Slide 4: Aberdeen Research Methodology
ABERDEEN RESEARCH METHODOLOGY
Slide 5: Aberdeen Maturity Class Framework: Defining the Best-in-Class
ABERDEEN MATURITY CLASS FRAMEWORK DEFINING THE BEST-IN-CLASS Selected Performance Criteria (KPI) Best-in-Class - Top 20% Organizational Goals Industry Employee Performance Total Average - Middle 50% Respondents Bench Strength Laggard - Bottom 30% Respondents are scored individually across KPI 5
Slide 6: Aberdeen's Research Methodology
ABERDEEN’S RESEARCH METHODOLOGY PACE: END-USER INVESTIGATION PRESSURES ACTIONS CAPABILITIES ENABLERS ! What is causing What strategies are Why are they achieving What technologies and organizations to think they using to respond greater success? services are enabling differently? to pressures? them
Slide 7: Case-in-Point: Avaya's Supply Chain Transformation
CASE-IN-POINT: AVAYA'S SUPPLY CHAIN TRANSFORMATION - ENABLED BY A VISION FOR PEOPLE, PROCESS, AND TECHNOLOGY
Slide 8: Introduction: The Avaya Case Study
INTRODUCTION THE AVAYA CASE STUDY • Welcome • Why this case study? Seldom does a case study involve a complete transformation • For our community -a real world story - a picture is worth 1000 words! • The Avaya story could be described as the critical intersection of basic needs and a vision, into a
Slide 9: Business Pressures: Different Focus for Best-in-Class vs. Others
BUSINESS PRESSURES DIFFERENT FOCUS FOR BEST-IN-CLASS VS. OTHERS 61% Reduce supply chain operating costs 36% 42% Customer mandates for faster, more accurate, and more unique fulfillment 35% 32% Need for better integration between supply chain Best-in-Class planning and supply chain execution 36% All
Slide 10: The Start: Avaya's Situation – About Avaya
THE START: AVAYA’S SITUATION – ABOUT AVAYA • A leading global provider of business collaboration and communication with over $4B Annual Revenue • Headquarters in Santa Clara, Singapore, Basking Ridge, Galway, & RTP • Unified communications . . . • Voice & Telephony Infrastructure • Real-time Video C
Slide 11: The Start: Avaya's Situation
THE START: AVAYA’S SITUATION • Recent Nortel acquisition; – More than doubled MRP's – New Organization – New People – Disparate processes – Primary issue after the Nortel acquisition was the lack of visibility across multiple instances of the existing ERP system for the Nortel side of the business.
Slide 12: Transformation Plan and Approach
TRANSFORMATION PLAN AND APPROACH • Approach – Technology decision – Key organizational changes provided a catalyst for the transformation – Hired domain experts for key positions including Logistics, Procurement, Planning, Maintenance, and Strategy – Leadership not only had a vision of what needed t
Slide 13: Avaya's Planning Strategy – Solution Decision
AVAYA’S PLANNING STRATEGY – SOLUTION DECISION • Requirements – One common view for the business • Issues - process—decision – Blending process of the two cultures, the dilemma of which tool as the enabler – Prior where some success had already occurred or new for all – Chose Kinaxis – good partner –
Slide 14: Planning Strategy: Mapping Multiple ERPs to One Planning Tool
PLANNING STRATEGY MAPPING MULTIPLE ERP’S TO “1” PLANNING TOOL 80% 69% Best-in-Class 70% Percentage of Respondents n=167 61% 60% All Other 50% 39% 40% 31% 30% 20% 10% 0% All or partially - more than one None - planning is strictly driven transaction planning system from within each transaction (ERP/M
Slide 15: Best-in-Class Metrics Ahead in Every Category
BEST-IN-CLASS METRICS AHEAD IN EVERY CATEGORY – BUSINESS AND PROCESS Performance Metric Best-in-Class All Others Average customer service level % 93.7% 85.3% Average cash conversion cycle - Days 44 65 Average forecast accuracy at the 81.5% 63.0% Product Family level Gross Margin Improvement 2.70% 1.
Slide 16: Value Pyramid: The Transformation Vision
VALUE PYRAMID THE TRANSFORMATION VISION 16
Slide 17: Value Pyramid: Discussion Points Critical to Vision
VALUE PYRAMID DISCUSSION POINTS – CRITICAL TO VISION • What is ‘Value’ – “External Value” = Customer Value – “Internal Value” = Revenue & Profit, Employee Satisfaction • Why is the Value Pyramid so important • Employees and Management need a realistic view of where they are within the Pyramid • Spec
Slide 18: The 5 Phases
THE 5 PHASES ABERDEEN GROUP
Slide 19: How We Got There: Phase I
HOW WE GOT THERE: PHASE I • Basic Rapid Response Implementation: Connected Outsourced Contract Manufacturers • Response to Change in Sourcing Strategy • Not accompanied by comprehensive Strategy • No Business or Process Integration • Minimal Benefits 19
Slide 20: How We Got There: Phase II
HOW WE GOT THERE: PHASE II • 3 years after initial implementation • New leadership had Vision of an advanced Planning Environment based on previous experience • Selection and Re-Commitment to Rapid Response • Addressed most critical issue first: Supply Forecasting & Supply Visibility • With Supply v
Slide 21: How We Got There: Phase III
HOW WE GOT THERE: PHASE III • Sales & Operations Planning Phase I • Focused on Demand Planning process standardization, integration, & automation • ‘Flattened’ plannable part numbers • Automated SAP forecast load & validation • Integrated Distributor sales out & inventory data • Concurrent with Vend
Slide 22: How We Got There: Phase IV
HOW WE GOT THERE: PHASE IV • Sales & Operations Planning Phase II • ‘Flattened’ Distributor data to align planning data • Standardized Lifecycle Management, Transition Keys, Announce & End of Sale process, SKU paired analytics • Integrated Sales Funnel Data • ‘What If’ Scenario Modeling • Alerts to
Slide 23: How We Got There: Phase V
HOW WE GOT THERE: PHASE V • Product Costs Reductions; driving procurement focus on volume/spend & integrating projections • Integrated BOM data into Rapid Response • Transportation ‘sandbox’ enabled supply planners to model changes in freight method • Created Distributor Predictive Model, quantifyin
Slide 24: Results and Success
RESULTS AND SUCCESS ABERDEEN GROUP
Slide 25: The Real Story – Where the Process Capabilities Advantages Lie
PROCESS CAPABILITIES THE REAL STORY – WHERE THE ADVANTAGES LIE Source: Aberdeen Group, December 2014 25
Slide 26: Success
SUCCESS - • On Time Ship at 94% • Top Performer Attrition 2.6% • Ave Past Due Rev down $42M to $10M • Engagement Survey scores up 57% 92% Net Promoter Score Improvement 26
Slide 27: Success: Avaya Transformation Metrics
SUCCESS - Table 1: Avaya Transformation Metrics Transformational Metrics Start of End of % 2011 2014 Improvement Gross Inventory Reduction $286M $116M 60% Improved Inventory Turns 5.8 turns 9.2 turns 59% Cash-to-Cash Cycle 44 days 26 days 41% Average Past Due Shipment $42M $10M 76% Net Promoter Scor
Slide 28: Success: Avaya vs. Best-in-Class
SUCCESS - Best-in- AVAYA Class • Supply Chain Exp/Rev Ratio CSAT Profit 4.2% 4.0% • Ann Gross Margin Increase 2.7% 3.4% • On Time Ship 94% 94% • Net Promoter Score 50 50 • Cash to Cash Cycle CASH 44 26 • Inventory Turns 10 9.2 28
Slide 29: Success: Transformation Impact
SUCCESS TRANSFORMATION IMPACT • Transformative levels of improvement and not just incremental • Also exceeded their goal of employee turnover • One of the most heavily touted outcomes of the entire transformation - employee empowerment and engagement • Passion about the level of engagement and emplo
Slide 30: Key Takeaways: Highly Successful Transformation
KEY TAKEAWAYS HIGHLY SUCCESSFUL TRANSFORMATION • Success due to the leadership and the vision that encompassed all areas of the business relative to people, process, and technology • People - The move from the low value pyramid to the high value pyramid - enabled by the technology, but it took the v
Slide 31: Congratulations Avaya! Questions?
CONGRATULATIONS AVAYA! QUESTIONS? 31