NCE/

P2P HR
Basic Problem Solving Project
BASIC
Streamline P2P S&IM process flow
and ensure compliance to standards
NCE/
Objective:
Improve Satisfaction level for Procure To Pay Chapter with 3% (2012 December results)
Improve PO before invoice with 5% (2012 results)
Problem Statement check slide 4 and 5.




1 Domain of application:
All sites using S&IM Procurement flow.


Timing:




Measures:
Internal Satisfaction Survey, PO after invoice,
PRs in error, Efficient & In time training sessions



Impact:

To all of the stakeholders involved (requestors, approvers,
buyers, including super users and vendors) affecting
compliance to standards.






2
4
6
14/11/11
10/02/11
Streamline P2P S&IM process flow & ensure
compliance to standards
16/12/11
Expected Benefits:

- KPIs in target.
- Increase the satisfaction of all stakeholders.
- Endorse the compliance to standards.







3
5
7
__/__/__
01/10/11 09/03/12
Problem
Describe the problem with
5W1H and Is & Is not
P2P S&IM Flow Usage
P2P KPI (S&IM Scorecard) with low
results
A HR problem, organizational or people
development issue
A system (SAP) issue
Job description issue or empowerment
What / which
S&IM flows, ALL sites (Bucharest,
Timisoara, Clinceni, etc.)
Direct materials flows, Bucharest and
Timisoara, including FERTs





Customers, Operational Buyers

Where
End to end P2P + AP + DSDM When
Who
IS IS NOT
Requesters, Approvers, Super Users,
Vendors
How much
How many
86% POs before invoice (vs 90% target)
78 PRs in error in 5 months (~ 16 per
month)
10% of daily time spent to clarify different
errors/situations
Problem
Problem Statement


After 4 years of working in GLOBE environment and regular knowledge
refreshment sessions, the S&IM P2P flow is still considered to be slow
and inefficient.

This is correlated with daily agents performance, despite ongoing
training and support and it is affecting response time and service
provided to the business, generating poor KPIs and time waste.

Misuse of GLOBE, bypassing SAP and procedures maintains poor
satisfaction level for all involved agents (requestors, approvers, buyers,
including super users and vendors).


NCE/
SOURCE and DATA of the Problem
Source of Problem: % of S&IM PO lines created before invoice date
Data Description: Data of PO < Invoice from January to September 2011 vs target
19 October 2014 NCE/ 7 NCE/
SOURCE and DATA of the Problem
Source of Problem: Number of PRs in error
Data Description: Data of PRs in error from May to September 2011 vs target
Target 2011: 0 errors
Estimated solving time
workflow:
30 min per agent for
every error
5 days per month
(avg. 16 errors)
8
2010 ZEUR Procurement Customer Satisfaction
Questionnaire
Total Score - 0.35 difference Indirect
NRO vs. BIC (5,8% of BIC)
Procure to Pay Chapter - 0.26 difference Indirect
P2P efficiency (5% of BIC)
SOURCE and DATA of the Problem
Team Leader
Team Leader leads the
team, manages team dynamics &
teams progress against schedule.
Serves as a liaison with Sponsor, Coach
and Process Owner. Maintains records
& documentation.
Name & Function
Rinela Ivan
Junior L&T Specialist
Name & Function
Elena Manea
P2P Stream Leader
Coach gives expert
guidance and coaching to the
team on the DMAIC tools and
cycle.
Name & Function
Dana Calea
SC GA Lead
Process Owner
is the customer of the project who
the team needs to delight.
Name & Function
Name & Function
Team Member
Name & Functions
Ana Bota
Super User P2P
& Operational Buyer
Sponsor Approves
project and scope. Accountable
for the project result. Reviews
progress (tollgates). Removes
roadblocks for the team.
Celebrates the projects
conclusion.
Name & Function
R. Secretianu
Procurement Head
Name & Function
Irinuca Dobre
Procurement
Excellence
Name & Function

Resource might be
called upon by the team for
additional information & expertise.
Project Team Profile
Name & Function

Oana Negrea
Strategic Buyer
& Former SU P2P
Excellence
Resource might be
called upon by the team for
additional information & expertise.
Resource might be
called upon by the team for
additional information & expertise.
R. Secretianu
Procurement Head
Team Member
Team Member
Florin Agache
Market Role Coordinator
Excellence
DE
cautat
datele si
trimis
Dana
Project Plan
Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12

SCHEDULE
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D
e
f
i n
e

1.1 - Define scope of problem
C

1.2 - Identify/confirm the project KPIs
Evaluate trends over time (historical data)
Define target
C

1.3 - Define the team members
C

1.4 - Define project schedule
C

M
e
a
s
u
r
e

2.1 - Identify how to stratify the data
C

2.2 - Make sure data is consistent, reliable and detailed enough
C

2.3 - Identify and collect baseline data required for stratification
C

2.4 - Stratification of data and identification of focused problems
C

2.5 - Process Mapping & integration into the presentation
P

2.6 - Discussion on D&M
P

A
n
a
l y
s
e

3.1 - List possible causes for all focused problems - Brainstorming
P

3.2 - Group possible causes for the focused problem - Cause and efect diagram
P

3.3 - Detect root causes from the cause-effect diagram using the 5 Whys method
P

3.5 - Verify root causes with facts and data
P

3.6 - Update presentation and discuss D&M&A
P

I M
P
R
O
V
E

4.1 - Identify solutions to the root causes
P

4.2 - Prioritize the actions
P

4.3 - Build the action plan (5W2H)
P

4.4 - Execute the action plan
P

4.5 - Update presentation and discuss D&M&A&I
P

C
O
N
T
R
O
L

5.1 - Verify effectiveness of solution with data (Was the target achieved?)
P

5.2 - Create or update standards
P

5.3 - Identify training required for affected people
Transfer knowledge through training
P

5.4 - Review financial impact of the improvements
P

5.5 - Put a control plan in place
P

5.7 - Forward lessons learned for possible replication in other lines
P

NCE/
13
The Procurement Process
Process Purchase
Orders
Contract on paper/
Create new vendor
Request form
Identify
Requirements

Vendor
determination
Purchase
Order

Goods
Receipt

Vendor delivery
Invoice
Invoice
verification
Payment
PR purchase
requisition
Release
Purchase
Order
COR = centralised
Offer report
NCE/
M1: Data collection breakdown process
Basis of Data Collection Leading to Focused Problem
1. Creating &
approving PRs
2. Creating POs
Total PRs by type of error
Total PRs in error
per month Total PRs by department
Average approval time per
approver
PRs not approved
within SLA
PR purchase
requisition
Purchase
Order

Average approval time per
department
PO before invoice
date
PO before invoice per
requester
PO before invoice per PG
PR w/o
documentation
Approved PR without
support documentation
PO number on invoice
4. Knowledge
Transfer Process

Training
Delivery

Globe End User Training
Planning Effectiveness
NCE/
M2: Data Collection Plan
Collect Data following the CTQ Flowdown Draft (from Big Y to small y)
What to
measure
(WHAT)
Measuring
Unit
Where to
measure
(WHERE)
Sample
(WHEN)
How to collect
(HOW)
Why this data is
needed
(WHY)
Person in
charge
(WHO)
DPA M-1 Percentage % In SAP BW
report DPA
with Lags Shelf
Stable
Monthly, every
3
rd
of the
month to get
the previous
months result
MFR agreed
and Orders are
downloaded
and DPA is
calculated as
1- (abs(MFR-Order)
MFR)
To determine the
accuracy of the
forecast from last
month vs actual
orders
B/W report
based.
Report is
extracted
from SAP
by Michelle
Santos
Main
category of
DPA misses
PUM DPA
Consolidated
Report
Every month
after the B/W
snapshot
Top 80% DPA
misses per BU
is tagged by
the BU Demand
Planner
To identify the
cause of the DPA
miss
Demand
Planner:
Ann Dela
Pena
Subcategory
of DPA
misses
PUM DPA
Consolidated
Report
Every month
after the B/W
snapshot
Top 80% DPA
misses per BU
is tagged by
the BU Demand
Planner
To provide more
detail on the main
reason code for
the DPA miss
Demand
Planner:
Ann Dela
Pena
DPA misses
with BU and
Brand details
PUM DPA
Consolidated
Report
Every month
after the B/W
snapshot
The report is
generated
indicating the
BU and Brand
group per sku
For the demand
planners to easily
filter their Brand
and BU
Devt team
Michelle
Santos
19 October 2014 NCE/ 16 NCE/
M2: SOURCE and DATA of the Problem (Big Y)
Source of Problem: % of documents not approved in SLA
Data Description:
Values
Row Labels
Average of Approval time
in days Count of Document number
ROBETAAN 4 1
ROBUSUCR 3 1
ROBUSUMI 6 13
RODIMITRLA 3 9
RODOXANCR 4 6
RODUMITRMA 6 4
RONEAGOEST 8 6
RONUBERPA 3 5
ROSERBANRA 5 2
ROSTANCAAN 7 1
ROSTOIANCR 4 2
ROWATSONDA 3 1
ROWATSONST 4 22
Grand Total 4.5 73
2008
Data from September to November 2008
ROBETAAN
1%
ROBUSUCR
1%
ROBUSUMI
23%
RODIMITRLA
8%
RODOXANCR
7%
RODUMITRM
A
7%
RONEAGOES
T
14%
RONUBERPA
5%
ROSERBANR
A
3%
ROSTANCAA
N
2%
ROSTOIANC
R
2%
ROWATSON
DA
1%
ROWATSONS
T
26%
Chart Title
19 October 2014 NCE/ 17 NCE/
M2: SOURCE and DATA of the Problem (Big Y)
Source of Problem: % of documents not approved in SLA
Data Description:
2009
Values
Row Labels Average of Approval time in days Count of Document number
ROBETAAN 6 11
ROBUSUMI 5 8
RODIMITRLA 12 3
RODOXANCR 5 6
ROHEPESCO 33 2
ROMAGALINI 4 18
RONANCUDA 4 5
RONEAGOEST 4 2
ROPOULIQMU 3 1
ROREBERJA 3 6
ROSERBANRA 4 2
ROSTANCAAN 11 3
ROSTOIANCR 9 20
ROWATSONST 4 15
Grand Total 6 102
Data from September to November 2009
ROBETAAN
10%
ROBUSUMI
6%
RODIMITRLA
6%
RODOXANCR
5%
ROHEPESCO
10%
ROMAGALINI
11%
RONANCUDA
3%
RONEAGOES
T
1%
ROPOULIQMU
1%
ROREBERJA
3%
ROSERBANR
A
1%
ROSTANCAA
N
5%
ROSTOIANCR
28%
ROWATSONS
T
10%
Chart Title
19 October 2014 NCE/ 18 NCE/
D2: SOURCE and DATA of the Problem (Big Y)
Source of Problem: % of documents not approved in SLA
Data Description:
Values
Row Labels
Average of
Approval time
in days Count of Document number
ROBETAAN 7 26
ROBORTEARO 5 1
ROBUBENDTH 4 3
ROBUSUCR 3 3
ROBUSUMI 5 15
ROCHOINSKA 3 11
RODIMITRLA 3 2
RODOXANAN 3 4
RODOXANCR 3 10
RODRAGOMAL 4 2
ROERCEANDA 3 2
ROFARTUSDO 3 1
ROGEORGECR 5 10
ROGHINEAMA 6 1
ROHEPESCO 5 2
ROIACOBNI 9 1
ROILIESCO 4 10
ROLEDESEOD 4 21
ROMAGALINI 4 14
RONANCUDA 5 17
RONEAGOEST 4 49
RONUNEZVI 4 27
ROREBERJA 3 2
ROSERBANRA 4 17
ROSTOIANCR 3 7
ROVETISAAN 6 11
ROWATSONDA 4 8
ROWATSONST 7 8
ROZOGOPODI 4 1
Grand Total 4 286
2010
Data from September to November 2010
ROBETAAN
14%
ROBORTEARO
0%
ROBUBENDTH
1%
ROBUSUCR
1%
ROBUSUMI
6%
ROCHOINSKA
3%
RODIMITRLA
0%
RODOXANAN
1%
RODOXANCR
2%
RODRAGOMAL
1%
ROERCEANDA
0%
ROFARTUSDO
0%
ROGEORGECR
4%
ROGHINEAMA
0%
ROHEPESCO
1%
ROIACOBNI
1%
ROILIESCO
3%
ROLEDESEOD
7%
ROMAGALINI
4%
RONANCUDA
7%
RONEAGOEST
15%
RONUNEZVI
8%
ROREBERJA
0%
ROSERBANRA
5%
ROSTOIANCR
2%
ROVETISAAN
5%
ROWATSONDA
3%
ROWATSONST
4%
ROZOGOPODI
0%
Chart Title
19 October 2014 NCE/ 19 NCE/
D2: SOURCE and DATA of the Problem (Big Y)
Source of Problem: % of documents not approved in SLA
Data Description:
2011

Values
Row Labels Average of No.of days Count of Doc number
ROALEXANST 3 1
ROBETAAN 6 10
ROBUSUMI 5 18
ROCARELLGA 3 2
ROCHOINSKA 3 2
ROCONSTAAL 5 8
RODIMITRLA 5 2
RODOXANAN 4 20
RODOXANCR 6 1
ROERCEANDA 4 9
ROFOTABO 3 2
ROGATALI 10 1
ROGHINEAMA 4 1
ROHEPESCO 3 1
ROLEDESEOD 4 25
ROLEPADAAL 4 1
ROMAGALINI 3 4
RONUNEZVI 5 8
ROPOSTELIO 5 9
ROREBERJA 3 2
ROROCAVI 4 5
RORUSUEL 3 3
ROTUNARUOV 4 15
ROWATSONDA 3 3
Grand Total 4 153
Data from September to November 2011
ROALEXANST
0%
ROBETAAN
9%
ROBUSUMI
13%
ROCARELLGA
1%
ROCHOINSKA
1%
ROCONSTAAL
6%
RODIMITRLA
2%
RODOXANAN
12%
RODOXANCR
1%
ROERCEANDA
6%
ROFOTABO
1%
ROGATALI
2%
ROGHINEAMA
1%
ROHEPESCO
0%
ROLEDESEOD
16%
ROLEPADAAL
1%
ROMAGALINI
2%
RONUNEZVI
5%
ROPOSTELIO
7%
ROREBERJA
1%
ROROCAVI
3%
RORUSUEL
1%
ROTUNARUOV
8%
ROWATSONDA
2%
Chart Title
19 October 2014 NCE/ 20 NCE/
D2: SOURCE and DATA of the Problem (Big Y)
Source of Problem: Nr. of PRs in error by Department
Data Description:
Data from July 2011 to January 2012
19 October 2014 NCE/ 21 NCE/
D2: SOURCE and DATA of the Problem (Big Y)
Source of Problem: % PO after invoice
Data Description: Data collected for 2011 in COM box
ROBALABASA
19%
ROSTANCUAN
19%
ROCIOVICCR
9% ROBILBORRA
9%
ROGANGEAEL
9%
ROBASARARO
8%
RODAVIDCR
8%
ROSOHORCNI
7%
ROANGHELLA
6%
ROBATULEAN
6%
AVG PO after INV by Requester
RC3
67%
RC2
13%
RC0
9%
RC6
6%
RC1
5%
Max days PO after INV by PG
19 October 2014 NCE/ 22 NCE/
D2: SOURCE and DATA of the Problem (Big Y)
Source of Problem: % PO after invoice by Requester
Data Description: Data collected for 2011 in MAN box
RORUSUMA
41%
ROPRICOPFL
16%
ROSTANIO1
10%
ROMOCANUAL
7%
ROTIMOFTFL
6%
ROPREDOIRA
5%
ROSTAVILAN
5%
ROSTANCUAN
5%
ROHODOSACI
5%
AVG PO after INV by Requester
RD6
49%
RC6
16%
RA2
16%
RD5
14%
RB1
5%
MAX days PO after Invoice by PG
19 October 2014 NCE/ 23 NCE/
D2: SOURCE and DATA of the Problem (Big Y)
Source of Problem: Difference in days between the moment of hiring vs. role allocation vs.
training finalization
Data Description: Data collected for August November 2011
0
10
20
30
40
50
60
Aug-11 Sep-11 Oct-11 Nov-11
Globe End User Training Planning Effectiveness
Difference between hiring/
change of position date and
date of role allocation
Difference between the
date of role allocation and
date of training finalization
NCE/
M3: CTQ Flowdown - 1
st
Drill Down
From DPA M-1 to DPA M-1 Main Reason codes
-
1,000,000
2,000,000
3,000,000
4,000,000
DPA misses in cases from January to April 2011
Main Reason Code
Seasonality/Trend
Supply issue
Launch / Relaunch
Orders / Plans / System
Promotion
External Factors
Price Change
52%
18%
12%
11%
5%
1%
NCE/
M3: CTQ Flowdown - 2
nd
Drill Down
From DPA Main Reason codes to Sub Reason Codes
-
500,000
1,000,000
1,500,000
2,000,000
2,500,000
Sub reason codes for Seasonality and Trend
SE2 -
Unpredicted
decline
SE1 -
Unpredicted
growth
63% 37%
NCE/
M3: CTQ Flowdown - 3
rd
Drill Down
From Sub Reason Codes to BU contributors
DPA misses in cases 01.2011 02.2011 03.2011 04.2011 Grand Total
Ice Cream 371,321 618,305 989,626
Chilled 171,969 202,900 52,178 175,697 602,744
Beverage 86,102 30,806 79,536 115,350 311,794
Liquid Beverage 14,440 93,820 58,312 82,681 249,253
Nestle Professional 10,671 36,195 18,892 22,248 88,006
Coffee 62,167 62,167
Nutrition 3,480 1,301 8,400 13,181
Breakfast Cereals 1,006 3,578 511 5,095
Petcare 408 3,506 3,913
Healthcare Nutrition 114 114
Grand Total 658,990 983,734 274,664 408,506 2,325,894
Top candidates for the DMAIC would be Chilled and Beverages.
Beverages becomes a more ideal candidate due to the following reasons:
1. Impact on Finished Goods and Raw Materials is much more evident (Covers and Freshness)
2. Chilled is planned daily and weekly, thus, more frequent reviews
3. MBP is already in place in Beverages, thus, it should lead to less errors in forecasting
NCE/
M3: CTQ Flowdown - 4
th
Drill Down
From BU down to Brand level
Best candidate is Nestea as it shows consistent over forecasting month on month and the value is
increasing.
Drilling down further, this is mainly due to Nestea Lemon Litro Pack.
BRAND Material Desc 01.2011 02.2011 03.2011 04.2011 Grand Total
Nestea NESTEA Lemon Litro Pack MP12(12x45g) PH 39,080 79,536 52,927 171,543
NESTEA Lemon Litro Pack 72x45g PH 30,806 30,806
Nestea Total 39,080 30,806 79,536 52,927 202,349
MILO MILO ACTIGEN-E High-Malt 42(12x20g) PH 47,022 62,422 109,445
MILO Total 47,022 62,422 109,445
Grand Total 86,102 30,806 79,536

115,350 311,794
M4: Profile of the Focus Area
72%
99%
98%
86%
57%
73%
67%
73%
79%
78%
72%
81%
28%
-1%
2%
-14%
43%
27%
33%
-27%
20%
-3%
25%
17%
-40%
-20%
0%
20%
40%
60%
80%
100%
120%
May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11
DPA and Bias of Nestea Litro
DPA
Bias
From September 2010 to April 2011, Nestea has not hit the DPA target of
82%
6 of 8 times, the bias has been positive, over-forecasting
Target 82%
M4: Profile of the Focus Area
Monthly DPA is low averaging 77% vs target of 82%
Target: 82%
M4: Profile of the Focus Area
Weekly DPA performance is also low averaging 47%, ranging from -59% to 96%
Ave: 47%
M5: Understanding the Focus Project Y
a)What is the Operational Definition of y (including formula)?
y is DPA of Nestea Litro Demand Plan Accuracy. This compares the forecast
versus orders. The formula is defined as:
1- (MFR Agreed M-1 Orders)
MFR Agreed M-1

Bias is an indicator of over-forecast and under-forecast. Positive bias is over-
forecasting, while negative is under-forecasting. This is defined as:
(MFR Agreed M-1 Orders)
MFR Agreed M-1

b) What is the Performance Standard of y (how does the customer want y to
perform)? Includes Lower & Upper Limit and Target value as appropriate.
y should be between 82% to 100%
Target y is 82%

PROBLEM Statement (purpose): 5W1H


GOAL Statement: SMARTSpecific but Stretching Measurable Agreed, aligned, achievable & attractive Realistic & Relevant Time bound


One of the main contributors to DP misses in 2011 is the consistent over-forecasting of Nestea Lemon Litro in
the Beverages BU. From January 2011 to April 2011, Nestea Lemon Litro has been consistently over forecasted ,
averaging only 77% DPA M-1 with a Bias of +15%
To increase Nestea Lemon Litro DPA M-1 from the average of 77% to 82% from June 2011 onwards (5%
incremental, 7% increase vs base of 77%).
A 5% increase in DPA of Nestea Litro would result to 4.5% increase in Beverages DPA and 0.4% increase
in National DPA.
This would bring Bev DPA from 74% to 78.5% DPA and National DPA from 72% to 72.4% DPA.
M6: Project Charter Focus Area
Note: Once the GOAL is set, ALIGN this to the Goal Statement in DEFINE.
NCE/