Case Study: FMCG Business Development of Formal Planning Process

Client Requirement

This company is a well known fast moving consumer goods company, with a very high and dominant share of the office equipment and household packaging market. It was under threat from strong competition who was getting into its traditional territory through the innovation of new products.

The company had implemented what they called Sales and Operations Planning process. However Richard Watkins' review of their process quickly identified that the organization had a weak sales forecasting and planning process, and a weak new product planning process. Above all they were perpetually engaged in fire-fighting, and their focus was largely short term. Because of the lack of effective forecasts, they had a mountain of inventory from previous promotions and seasonal builds. Customer service was already very high – but as is the case in fast moving consumer goods businesses, this was being achieved at high internal hidden costs.

Solution proposed and delivered

Richard ran a three day workshop, focused on establishing a formal process, based on the Delos Model. As part of this a formal forecasting process was established, building on figures already available within the sales area. The New Product process was strengthened, and integrated through the formal process into the rest of the business. The need for a formal planning process was established, and the need to establish the correct policies and procedures was identified. The workshop was built around several workshop sessions which focused not on the theory, but on the practical aspects of how the new processes were to be established. A timetable for the introduction of the new ways of working was established, and the processes implemented over the coming months.

Costs/Benefits

  • The cost was less than £ 10,000.
  • The benefit was immediate visibility to the operations side of promotions, and seasonal events, tied to the plans agreed with customers. New products were launched on time, and inventories were reduced. Greater visibility was introduced into the planning process.