Diageo
Changing Guinness to a customer centric culture
CHALLENGE
Diageo plc is a British multinational alcoholic beverages company. It is the world's largest producer of spirits and a major producer of beer and wine. They were facing many challenges such as:
- Unresponsive and inflexible lead times
- Poor forecast accuracy
- Lack of integration and reliability – 60% system stock accuracy, processes disjointed
- High finished goods inventory
- Unbudgeted and increasing warehouse costs (£200k per month)
- Only 90% of orders delivered on time
- Lack of capacity requiring investment in new packaging lines
- Customers’ demands could not be met by manufacturing department
ACTION
We designed and delivered a programme which enabled the creation of an innovative supply chain, purely focused on customer demand and real-time supply. This was done in parallel to introducing a shift in corporate culture to bring about performance increases across productivity, profitability, innovation and personal satisfaction.
RESULTS
Our intervention greatly surpassed our client’s expectation by achieving a total of £3.1m of benefits for the organisation. Most notably this was through improvements in responsiveness, stability, people, processes and costs.
Examples include:
- Supply chain lead time reduced by 60% (56 day to 22 days)
- Planning cycle cut from 4-5 weeks to 1 week or less
- Capability and capacity to respond to unforeseen demand (e.g. 300% in 1 week)
- 70% reduction in product write downs
- Reduced finished goods inventory to 60% (equal to £2.1 million)
- £3.1 million benefits over six months
- Lead times halved
- £1 million CAPEX avoidance