The Global ECR Scorecard

A Capability Assessment Tool

Santiago de Chile, September 6, 2001

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Global ECR Scorecard Journey Started in Oct. ‘98

Wouldn’t it be a good idea to

converge the world’s ECR
Scorecards into ONE that
could by consistently used by
companies around the world ?

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OBJECTIVES:
The Project Team was given four clear objectives

A tool capable of Globally consistent

supporting single
company or joint
engagement
but “modular” useable in
developing or “mature”
ECR situations

More pragmatic,
linked to KPIs Simple
(day-to-day Easy to use
management)

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The Global ECR Scorecard
Target setting

Gap analysis and target setting internal 1

Supplier

1
2
Retailer

as is internal target joint target

Joint target setting 2

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Scoring

 General Definitions
– Each improvement concept includes a general definition that
explains the concept and the philosophy behind its
application
 Considerations
– A scale from 0 to 4 is used to measure a company’s state for
each of the 37 considerations:
– 0 = Nothing planned
– 1 = Planning complete, but implementation not started yet
– 2 = Pilots implemented
– 3 = Roll-out started
– 4 = Completely implemented
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The Global ECR Scorecard scoring formula and range

200 Probable range 1400

Advanced
Core Concepts
Concepts
0 1000 1600

Score per points per all

* *
consideration consideration considerations
(0 - 4) (0 - 100) (37)

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Global ECR Scorecard Footprint

Demand Management Enablers

Demand Strategy & Capabilities Common Data &

Communication
Standards
Optimize Assortments Optimize Promotions
Cost/Profit
Optimize New and Value
Consumer Value Creation Measurement
Product Introductions

Supply Management Integrators

Supply Strategy & Capabilities Collaborative

Planning Forecasting
and Replenishment
Integrated
Responsive Operational
Demand Driven E-Business
Replenishment Excellence
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Supply Business to Business
Demand Side
Original Concepts

 The Optimize Assortments, Promotions and Product

Introductions concepts now follow the generic work flow ...

Plan Execute Evaluate

Integrate and Efficient and Check
incorporate effective implementation
brand and translation and and results
category implementation against agreed
objectives of the plan plan and
objectives

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There are three key considerations within Consumer
Value Creation

Knowledge Channels to Solutions for

management consumers consumers
• Datamining • Multi channel • Consumer
performance initiated
• Intelligent measurement
commercial solutions
actions • Channel • Services around
portfolio products
• Interactive management • Partners for
marketing • Alliance fulfillment
networks

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Solutions for consumers

TRANSACTIONS >>>> RELATIONSHIPS

TRANSACTIONS >>>> RELATIONSHIPS CUSTOMER RELATIONSHIP BASED
LOYALTY SOLUTIONS
MANAGEMENT

information

innovation

BASIC CATEGORY INTEGRATED VALUE

MANAGEMENT SOLUTIONS

PRODUCTS >>>> SOLUTIONS

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The Consumer and Retail Paradigm Shift

FROM TO

Share of Share of
product / market consumer / services

Share of wallet Share of life

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The concept of integrated pet care management

Source
Temporary
Vet
Housing
Care
Share of
life
Diet
Training Control
Information
Systems
Grooming Food

Accessories
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Companies will need to evaluate the impacts of specific actions
on smaller groups of consumers - more granular, faster, and
accurate assessment will drive decisions

Market Segmentation
Produt A Channel X Consumer I

Value Delivered to the Consumer

• satisfying consumer wishes
• increase “share of life”
Costs of Commercial Actions
Reactions
Commercial
Value of/to Consumer of Target
Actions
Consumers
Sales Revenue
Value Received from the Consumer
• impact on sales, profitability, image
• increase “share of wallet”
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Page 15
  Primary focus of the
tool is against 8, GCI
agreed Key
Performance Indicator
definitions and
measures.
 Companies and
Trading Partners can
benchmark these
quantitative results.
 Stop there or evaluate
the capabilities
needed to improve
these results.

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KPIs

 Category Share – Is the organization achieving the category

share desired?

 Service Level / Fill Rate – Are all items being delivered as

ordered?

 Inventory – Have we minimized the amount of inventory

needed in the supply chain?

 Out-of-Stocks – Can the consumer purchase the product

when they want it, where they want it?
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KPIs

 Cycle Time / Flow – How responsive are we to changing

consumer needs?

 Distribution Costs – Have we optimized the cost of product

transportation & storage?

 Data Synchronization – Do we get information flow right the

first time, fast?

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 Low Score
KPI’s Avg. Score
High Score
Key Performance
Indicators
Manufacturer Category Share 25.0 42.1 103.0 85.0
My Score
Retailer Category Share 35.0 75.0 92.0 NC

Supplier Service Level / Fill Rate 62.0 81.2 99.0 96.0  Confidential
Retailer Service Level / Fill Rate 90.0 94.4 97.0 NC benchmarking
capability
Raw Material inventory coverage 18.0 26.8 100.0 30.0

Days
Finishedfinished goods
goods inventory inventory
coverage 15.0
15.0 31.7
31.7 101.0
101.0 45.0
45.0

Retailer DC inventory cover 5.0 25.7 64.0 NC

 Validated
Retailer store inventory cover 2.0 17.0 39.0 NC Companies
Manufacture out-of-stock 4.0 9.1 30.0 10.0
 Companies
Retailer DC out-of-stock 1.0 9.0 27.0 NC

Retailer store out-of-stock 2.5 11.4 18.0 NC

requested to
Manufacturer's lead time 8.0 24.2 96.0 36.0 populate database
Retailer's lead time 8.0 21.6 48.0 NC
by Country /
Manufacturer's distribution costs 9.0 13.9 28.0 8.0

Retailer distribution costs 12.0 19.8 35.0 NC

Category
Data synchronisation (orders) 1.0 41.4 99.0 65.0
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Data synchronisation (invoices) 6.0 39.7 99.0 93.0
  3 engagement options
to evaluate skill and
capability needs.
 Currently, over 400
scorecards loaded
globally.

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Three engagement options to evaluate skill and
capability needs
 “Entry” and “standard”
versions best fit for
retailers & time,
resource constrained
occasions.
 “Full” best for strategic
partnerships and
internal assessments.

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  Individual
Benchmarking

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  Geographic
Benchmarking
LA versus all others

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  Direct links to
deeper
assessment tools
like GLOSUP
 Help understand
where to get best
return for supply
chain investment
– Value Chain
Analysis

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 A simple solution to four business questions

1. What is it I want to deliver ?

2. What capabilities do I
need to deliver it?

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A simple solution to four business questions

3. How developed are those

capabilities within my situation?
Score 0 1 2 3 4
Concep General Meaning Nothing Planned Plan agreed but have not Pilot tests being Roll out of Fully Implemented
t yet started conducted implementation started
Busine All partners communicate and exchange Business partners implementation
Business partners have Business partners are Network enabled Network enabled business
ss to information electronically in real time. All major have no plans to agreed plans to integrate testing integrated business processes and processes and decision
Busine business transactions are completed integrate business some business business processes and decision making are making are delivering
ss electronically. Net technology is used for processes. processes and test network enabled decision rolled out in mainstream superior value added
knowledge management. them. making. operations.

Entry – Are you ready to work collaboratively?

Do you have the basic Supply Chain
Infrastructure in place?

STANDARD DETAILED
• Majority of Joint scorecards • Current tool
• Time, resource constrained • Best tool for internal company
• Non-strategic business / assessment
relationship • Used jointly in strategic
• 80/20 approach relationships
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A simple solution to four business questions

3. How developed are those

capabilities within my situation?
Score 0 1 2 3 4
Concep General Meaning Nothing Planned Plan agreed but have not Pilot tests being Roll out of Fully Implemented
t yet started conducted implementation started
Busine All partners communicate and exchange Business partners implementation
Business partners have Business partners are Network enabled Network enabled business
ss to information electronically in real time. All major have no plans to agreed plans to integrate testing integrated business processes and processes and decision
Busine business transactions are completed integrate business some business business processes and decision making are making are delivering
ss electronically. Net technology is used for processes. processes and test network enabled decision rolled out in mainstream superior value added
knowledge management. them. making. operations.

4. How do I improve those capabilities?

e.g. link to VICS

CPFR site
www.cpfr.org
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The correct application of the full Scorecard requires
pre-work
 Leadership / support / participation of senior management
 Identify categories, channels, trading partners
 Schedule the right people for a one-day workshop to apply
the Scorecard and communicate
 Circulate pre-reading - understand the concepts!
 Compile, calculate Key Performance Indicators (KPIs)
 Apply Scorecard - start by leveling understanding of the
concepts
 Compile results and agree conclusions, implications among
functions
 Complete work plans

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How others have gotten started...

Strengths  Execute
Assessment &
Weaknesses the Plans

Joint Action Plans  Review

Results
Opportunities Prioritize
(Finding
Common Ground)
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