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GroupAnklesaria
ABOUT ANKLESARIA GROUP, INC.
• Over the past 20 years, we have enhanced skill sets for thousands of procurement professionals through our suite of
training programs including: Strategic Cost Management, Supply Market Analysis, Strategic Sourcing, and
AIM&DRIVE®. This is supplemented by our cost management services where we work shoulder to shoulder with
client teams to develop sourcing strategies, build cost models, perform supply market analysis, track competitive
advantage, benchmark prices and contract terms and conduct supplier feedback surveys.
What we do
• The Anklesaria Group (AGI) is an education and consulting firm specializing in supply chain cost management
solutions. We have an exceptional reputation and track record of working with some of the world’s most respected
corporations in a variety of industries. Our clients have achieved returns of over 10x on their investment with us.
Who we are
• We strive to build cost management capability throughout our clients’ organizations and differentiate ourselves by
focusing specifically on the transferring of process knowledge that ensures a sustainable program.
• In addition to providing strategic guidance to our clients, we strongly believe in delivering grass-root solutions that
can be implemented by all levels in the organization. Our unique processes and tools have been implemented by
thousands of category managers, buyers, analysts, and suppliers across the globe.
• We are a Minority owned business
Why work with us?
Rakesh Keswani
▪ Anklesaria Group
▪ Provide training and consulting services to enhance capabilities
of organization and help with sourcing transformation
▪ Lead operations, business development & HR for Anklesaria
Group
▪ General Motors
▪ Production Manager @ Bay City Powertrain Plant
▪ Operations, HR, Engineering, Maintenance, Supply Chain,
Quality & Safety
▪ Carnegie Mellon University
▪ MBA – Operations & Strategy
▪ University of Massachusetts, Amherst
▪ Industrial Engineering
MY SIMPLE GOALS – DO SOMETHING WITH CARS AND SEE THE WORLD
OPERATIONS/SUPPLY CHAIN MANAGEMENT SEEMED TO BE THE ANSWER
➢ Opportunities
➢ Work with cars
➢ Work any where in the world –
everyone drives cars
➢ Learn Lean Manufacturing &
Constraints Management
➢ Opportunity for immense
career progression
➢ Help companies achieve
immense success
IMPROVING THE BOTTOM LINE
FACTORS IMPACTING THE BOTTOM LINE
MANUFACTURING – THE HARDEST JOB I LOVED
➢ Pros and Cons
➢ Worked with cars
➢ Hardest job I have ever done
➢ Found work in a foundry instead
of assembly factory
➢ Landed in Indiana/Michigan
instead of Paris
➢ Learnt and implemented Lean
Manufacturing and Constraint
Management
➢ Learnt the “Art” of Leadership – to
take people on a “journey”
➢ Experience in all aspects of
Manufacturing – Operations,
Supply chain, Quality,
Engineering and HR
Manufacturing Operations not enough to satisfy my curiosity and goals
DM 60DL 10OH 10COGS 80SGA 15Profit 5Total 100%
Impact Limited on P&L Still had to see the world
Anklesaria Group Inc.
Share Price = Earning/Share * Price/Earnings Ratio
DM 60DL 10OH 10COGS 80SGA 15Profit 5Total 100%
PROCUREMENT’S ROLE IN IMPROVING SHARE PRICE IS IMMENSE
Consider a company with $100 million revenue &1 million outstanding shares
$5 MM/1 MM * 20 = $100
($5 MM + $5 MM)/1 MM * 20 = $200
($5 MM + $2 MM)/1 MM * 20 = $140
$6 MM
$1 MM
$0.5 MM
$7.5 MM
$0.5 MM
+ $2 MM
+$10 MM
x55
Supplier negotiation woes
How do you stay in front of the competition?
By identifying supply chain
strategies that enable a
company to achieve its
goals and objectives
• Understanding market
forces
• Enabling competitive
cost structures
• Extracting value from
the supply chain.
• Positioning for success
How do we create world class strategies?
Systematically
Developed
•Single, global process with comprehensive analysis of options focused on total value chain
•Truly cross-functional/-location team driven with key personnel to conduct basic &
secondary research
Thoroughly
documented &
Innovative
•Written strategies established for all categories/purchase families including SWOT & gap
analysis & strategy innovation
•Forward looking; 36 month horizon focused on total value chain
•Linked to business & technology strategies & objectives, reviewed by executive group
Comprehensively
Measured
•Goals & Metrics extensive, clearly established, measurable & valid
•Supplier performance measured with variable rewards and emphasis on relationship
development
•Metrics reviewed regularly, corrective action taken, learnings captured & considered for
the future
Source: Monczka & Petersen, CAPS Research 2011
A category strategy aligns, challenges and improves the commercial and operating models of the organization
Category strategy
Immediate and Long term strategy:✓ How we will work with suppliers
under different scenarios (tactical or strategic)
✓ Rules and boundaries for future contracts – less uncertainty in tender process
✓ How we expect to deliverincreased value over time (demand, efficiency, price, risk etc)
✓ How we measure the value✓ How we expect to mature the
category (business or supply base)
✓ What are the key market factors that are driving my strategy now and in the foreseeable future
Operational challenge:• Improved alignment to business
objectives• Operational performance• Increased TCO thinking• Capabilities of client• Capabilities of suppliers
Commercial challenge:• Market forces and attractiveness• Existing contractual constraints• Characteristics of the supply base• Cost models• Value improvement ideas
Potential operating models for the
business
Potential contracting models
We need to create category strategies to gain an advantage and avoid pitfalls
How do we enable the organization to produce great results
With great processes &
tools
▪ Consistency
▪ Predictability
▪ Data backed actions
▪ Risk Mitigation
▪ Value creation
▪ Continuous
Improvement
A typical sourcing process begins with strategy creation & goes all the way to post award contract management
Understand the business’s needs and goals
Your current spend (How much, where and with whom) and forecasts
• You want to make sure we
procure what our customers
want
• With the right suppliers
• With the right attributes
• At the lowest Total Cost of
Ownership and highest
competitive advantage
Gathering supply market intelligence to understand market forces, your supply base and how to position yourself
What?
Where?
Why?
How?
Competitive
Advantage
Separating assumption from facts
69%
14%
10%
7%
Scaffolding Insulation Painting
Electrical Instrumentation
Rentals and Cranes
69%
14%
10%
7%
Do you understand your supplier’s cost structure?
Anklesaria Group
Mechanical
Example: Construction phase of a
project
Should cost models demonstrate value
Focus on gaining business stakeholder buy in
Validating assumptions with sensitivity analysis
From leveraging volume to leveraging ideas
This is where we generate real cost savings
Time
Com
para
tive
Cost
s ($
)
Initial cost savings
•Jointly develop written cost management strategies with suppliers (Cost Challenges)
•Execute strategies with maximum speed•Create knowledge base to leverage
ideas
Breakthrough (AIM&DRIVE®)
•Leverage Volume•E-procurement•Price Analysis
(CAMSTM)•Cost Modeling
➢Should Cost➢Price Discipline™➢TCO
Negotiation (SCM)
Benchmark Competitor
Your Company
Cost is a measure of effort and our goal is to demonstrably improve your return on effort in a sustainable way
CommercialEfficiency Demand
• Strategic Sourcing• Volumes• Market conditions• Contract terms• Negotiation
• Specifications• Good internal design
practices• LEAN principles• Supplier processes• Customer processes
• Planning• Substitutes• Technology• Customer demand• Policy compliance• Regulations• Pricing policy• Marketing and sales
The Strategic Options above are generic examples onlyEach AIM&DRIVE® typically produces 50-100 context specific strategic options
Key levers we use to improve value
Demonstrable, collaborative value creation with suppliers and stakeholders
Helicopter services, North Sea
MSC– Variable Cost Element (Pilots)
27%
MSC– Variable Cost Element (Engineers)
8.5%
Total costs
Seat Demand
Pilot Day Rate
Engineer Day Rate
Airframe Maintenance Schedule
Fuel Efficiency
Business plan requirement
Cost drivers Strategic options
Daily Airframe Cost• Aircraft Type• No of airframes• Level of Insurance• Critical spares holding cost• Backup airframe• Regional sharing of airframes
Flying Hours Utilization• Daily / weekly flying plan• NUI flying plan timing• Offshore bed constraints vs. work activities• No of airframes• Regional sharing of airframes• Capacity of the airframes• Offshore based airframe• NUI bus stop flying / take off and landing exposure • Infield transfer of personnel within SNS (Online
booking system to handle booking requests)
Hourly Fuel Burn Rate
MSC– Fixed Cost Element
20%
Other MSC11%
Daily Airframe Cost
Flying Hours Utilization
Rotor Running Time
Payload Utilization
Seat Utilization
Other Contract Charges
4%
Flying Charges22.5%
Fuel Charges7%
Rotor Running Time• Onshore Taxi Time• Offshore Deck Time• Infield transfer of personnel within SNS (Online
booking system to handle booking requests)
Payload Utilization • Shuttling from offshore to onshore (dead leg)• Infield transfer of personnel within SNS (Online
booking system to handle booking requests)• NUI - Lack of infrastructure for people to stay• Industry best practice (Talisman)
Text in blue boxes represents Critical Cost Elements and Key Cost Drivers selected by the Team
Text in blue font represents key strategic options selected by the Team
Commercials and
Specification
(Standardization)
Specifications
(resulting in increased
utilization)
Demand
(reducing dead legs)
Total Benefits
By developing strategic options linked to cost drivers… …the team demonstrated opportunities worth 15%
Need help surveying the ocean floor – how hard can it be to get this service?
• Project
• Determine “Day Rate” for this
service
• Contracting strategy – long term
vs. short terms, terms and
conditions, etc.
• Challenges
• Market conditions – oil price
• Expensive Asset
• Labour from all over the world
• Lack of knowledge about service
and equipment
Outcome – Understanding of price and market dynamics + Sourcing and Negotiation strategy
• What was done
• Research on Seismic Surveying
• Subject Matter experts
• Articles
• Papers
• Internet
• Developed a Cost Model
• Performed Financial Health Analysis
of primary suppliers
• Market research on Off-Shore oil
• Specific Outcome
• Detailed Cost Model on “should” cost
of service
• Financial health evaluation of
suppliers
• Negotiation/Sourcing strategy
PROCUREMENT SUPPLY CHAIN OFFERS A CHANCE TO USE A BROAD RANGE OF MBA TOOLS & CONCEPTS
• Strategy
• Finance
• Accounting
• Operations
• Negotiations
Companies want our help
• Create a competitive advantage
• Find money left on the table
•Increase their stock value
We do work at the far ends of the planet
UK
Netherlands
Norway
Nigeria
Gabon
Russia
MalaysiaBrunei
Philippines
New Zealand
Qatar
Oman
China
Canada
USA
Thailand
India
Brazil
Anklesaria resources home countries
Indonesia
Australia
Azerbaijan
Kazakhstan
Venezuela
Angola
UAEEgypt
Columbia
Trinidad & Tobago
Algeria
Georgia
France
Anklesaria resources have been deployed
Argentina
Chile South Africa
Japan
South Korea
Finland
Singapore
Hong Kong
Note: Anklesaria training courses have been applied in even more locations!
Boliva
Germany
Mexico
Portugal
SpainItalySwitzerland
Poland
SwedenDenmark
A FEW OF OUR CLIENTS…SOME OF MOST WELL KNOW IN THE WORLD
Questions
Anklesaria Group, Inc.
201 Lomas Santa Fe, Suite 460
Solana Beach, CA 92075Phone: +1 858 755 7119
Fax: +1 858 755 2139E-mail: [email protected]
www.anklesaria.com
CONTACT US:
