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CASE STUDY

Pellton International:
Developing a SupplyChain Partnership
Charles J. Corbett,
Assistant professor of Operations and
Technology Management, John E. Anderson
Graduate School of Management, UCLA

Joseph D. Blackburn,
James A. Speyer Professor of Production
Management, Owen School of Management,
Vanderbilt University

Luk N. Van Wassenhove


Henry Ford Professor of Manufacturing and
director of the Center for Integrated
Manufacturing and Service Operations,
INSEAD

Pellton International, a multinational


chemical firm, produces and sells PVB
plastic to windscreen manufacturers
in the automotive supply chain. The
case describes Pelltons efforts to
build a stronger supply-chain partnership with Basco, a key European
customer and to extend their success
to another large European customer,
Perdirelli. The potential partners
struggle with issues of building trust
and overcoming conflict between
the organizations, measuring and
sharing benefits of process
improvement, consignment stock as
an incentive to customers, and SKU
rationalization.

The good news is that our efforts to improve our relationship with Basco in Belgium finally seem to be paying
off, even though it was a slow and tortuous process to
get there, Peter Jackman said. The bad news is that in
the next supply chain project, about to start with
Perdirelli in Milan, the pressure really is on, as theyre
going through a major business redesign exercise. We
cant afford to take as much time and make as many mistakes as we did in this first project.
Peter Jackman is Pelltons logistics manager for Europe.
He has been involved in a project with Basco, a major
customer, to jointly improve the supply chain linking
them and build a strong partnership with their Belgian
and German operations. Because of the success of that
project, Pellton had initiated a similar project with
Perdirelli in Milan, another major customer. Jackman
and some colleagues were trying to decide how to organize this new project, based on what they'd learned from
the previous experience. Jackman was keenly aware of
the challenge he was facing: This time there are opportunities for even greater benefits, but if we fail, we could
lose all of our business with Perdirelli.

Pellton International and Basco PLC


Pellton International is a multinational chemical firm
with European headquarters in Maastricht, Netherlands.
Pelltons main product is Pell-Q, a PVB plastic which it
produces and sells to customers world-wide; the majority of their product is sold to windscreen manufacturers
in the automotive supply-chain (see Exhibit 1). All windscreens are made with laminated glass: a layer of PVB (a
transparent plastic which adds resistance, prevents
shattering, and sometimes a band of color for shading)
sandwiched between two layers of glass. Pellton shares
approximately 85% of the world market with three other
major suppliers of PVB. Pellton supplies almost 70% of

Supply Chain Forum

An International Journal

Vol. 2 - N1 - 2001

Interested readers
can refer to the complete casePellton International, Partnerships
or Tug of War (A), (B) and (C)
INSEAD, 1997

Bascos total PVB requirements, which constitutes 30%


of its total sales in Europe (Perdirelli consumes 20%).
Basco PLC. Based in London, Basco manufactures a wide
range of glass products for the automotive and
construction industry, including windscreens, for which
they have four plants throughout Europe. They are one
of the largest windscreen suppliers in Europe. To
respond to increasing customer cost pressures, Basco
recently centralized purchasing for all critical raw materials, which includes Pell-Q (approximately 4.40 Euros
per m2, which accounts for 25% of windscreen production cost), at Basco Purchasing (BasP) in London. BasP
would conduct negotiations with key suppliers, acting
as a service center to the Basco production sites.

The Product and the Production Process


Pell-Q is sold in rolled sheets (250 m in length) to manufacturers of automotive windscreens. Pellton produces
about 50 different widths in 1 cm increments with most
falling in the 70 to 110 cm range. The addition of colored
bands and different product formulations combined
with the range of widths yield a variety of over 2000 different stock-keeping units (SKUs) for Pellton. Some
customers have special quality requirements; for
example, Perdirelli requires a special formulation of PellQ (called S2/P), and Pellton must produce a large number of SKUs that are unique to Perdirelli. Demand for
Pellton
International

Basco
Antwerp

Auto
Assembler 1

Competitors

Perdirelli
Milan

Auto
Assembler 2

Exhibit 1 - Pellton Internationals Automotive Supply-Chain

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PELLTON INTERNATIONAL: DEVELOPING A SUPPLY-CHAIN PARTNERSHIP

Pell-Q, especially at the individual SKU level, is highly


variable. Summary statistics of demand patterns for
Basco Belgium and Perdirelli Milan are given in Exhibit
2. Production planning to match supply with demand is
difficult for Pellton because of the need to produce in
Exhibit 2 - Summary Demand and other Statistics For Pellton
Internationals Maastricht plant
2-year total
demand
(m2)

Avg. weekly
demand
(m2)

st.dev. of
Avg.
weekly demand inventor held
(m2)
(m2)

Basco Belgium
S1
Total S1

1 780 950

16 961

35 294

4 783 058

45 553

79 963

Basco Belgium
S2
Perdirelli S2/P
Total S2 and
S2/P

391 193

3 726

10 955

2 104 710
8 555 320

20 045
81 479

21 883
115 064

199 091

454 186

sales price: 4,40 Euros/m2


Inventory costs 20% per year
The summary data provided here are based on demand data from March 1,
1994 through March 1, 1996. Average and standard deviation are calculated over the entire two-year period and then summed over all sizes.

large batch sizes with long time intervals between production runs.
Pell-Q is produced in batch production runs ranging
from several hours to several days; changeover times
vary from several minutes to a full day for some of the
die changes. Because of the long changeovers, production batch sizes are large, and cycle times between
batches of the same product range from ten days to six
months for lower demand items. Production lines in
Maastricht run three shifts, seven days a week.
Combined annual output is just under 55 million m2 and
total variable costs (mostly raw materials) average
about 1.3 Euros/ m2. Storage and distribution of the product is very costly because from production through
packaging, storage and delivery to the customer, rolls of
Pell-Q must be refrigerated to keep the plastic sheet on
the roll from bonding and losing definition, rendering
the product unusable by the customer.
Long cycle times make production scheduling difficult.
The scheduled number of rolls in a batch production
run is computed as a combination of firm orders received from Pellton sales agents and forecasts of demand
over the time until the next production run. Rush
orders for material not in stock can sometimes be
accommodated by delivering oversize (i.e. a roll wider
than required) or by disrupting the production schedule. Given the product variety, long leadtimes, and high
forecast uncertainty, stockouts are frequent and often
result in the cannibalization of oversize rolls from the
customers inventory or substitution of a competitors
product. To counter these problems, Pellton realized
that there could be great benefits in a closer partnership
in the supply chain linking them and some of their key
customers. Jackman succinctly summarized the opportunity at a Pellton strategic planning retreat:
Partnerships with our key customers will be critical to
our success. Better information will allow us to reduce
inventory costs, and, as a preferred supplier, we will
gain a larger share of their business.

Supply Chain Forum

An International Journal

Vol. 2 - N1 - 2001

Building a Partnership: Pellton and Process


Redesign
Although relations between Basco and Pellton had long
been somewhat adversarial, senior management in both
firms realized by the early 1990s that more of a partnership was needed to jointly achieve the efficiency improvements demanded by the downstream customers, the
auto assemblers. The first step toward greater cooperation was a long-term commercial agreement in which
Basco exchanged volume commitments for price
concessions from Pellton. Despite a warmer relationship at the top levels of the two organizations, mistrust
remained at the operating level and in the supply chain.
In 1993, Pellton approached Basco with the idea of joint
supply-chain improvement projects to reduce cost and
improve service. Initial discussions with Basco made it
clear that cost reduction was Bascos overriding
concern. The objective of the first joint workshop was
defined as finding ways to reduce the cost of supplying
Pell-Q.
The first workshop
In early 1994 20 people from Pellton and Basco participated in the projects first workshop at which Pelltons
commercial director illustrated the complexity of the
supply chain linking the two organizations by showing
that a single Basco plant received more than sixty Pell-Q
SKUs. A skeptical Denhoeve, logistics manager for
Basco, responded we don't take all that, I don't believe
it. No specific improvement plans were developed in
the first workshop, but the group concluded that Pellton
would draw up a list of project proposals for cost reduction before the follow-up workshop in two months.
SKU Rationalization
Subsequently, Denhoeve studied the SKU issue and
found, to his surprise, that Pellton's commercial director had not exaggerated. This convinced him that collaboration and SKU rationalization would be beneficial.
SKU rationalization had indeed been identified as a
major opportunity for joint cost reduction: rather than
supplying Pell-Q in 1cm width increments, Pellton would
supply only a more limited variety of widths, e.g. in 5cm
width increments. These new sizes would be called
standard sizes. We already frequently have to deliver
oversize if we dont have the right size in stock,
Jackman realized. With standard sizes we would never
have to keep those intermediate sizes in stock at all. The
standard sizes would have sufficiently high volume to
build to forecast; all other sizes would be made only to
firm order. This would significantly reduce the number
of SKUs in stock, thereby allowing substantial supply
chain inventory reductions, improved delivery service
to Basco, and more stable production schedules for
Pellton. According to Jackman: this should reduce our
inventory levels by 75%. Although Pellton agreed to
compensate Basco for additional waste and scrap incurred by stocking a limited set of sizes, they deferred a
decision about details of the compensation, including
the possibility of consignment stock to reduce Bascos
inventory cost.

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PELLTON INTERNATIONAL: DEVELOPING A SUPPLY-CHAIN PARTNERSHIP

The second workshop


At the second workshop a steering team including
Jackman the Pellton logistics manager and Watkins the
Basco purchasing director was formed to oversee progress on inventory cost reductions. Jackman became
the project champion within Pellton. The team set three
priorities: SKU rationalization, improving and integrating forecasting and ordering systems, and implementing JIT deliveries and consigned stock where possible.
The latter was included both as an incentive to Basco to
cooperate with the SKU rationalization and for single
ownership of inventory to eliminate unnecessary duplication. The new standard sizes were set at 71, 76, 81,
etc., based on a minimization of excess trim at Basco.
To make the whole thing work, Jackman realized,
cycle time reduction in our plant will be critical.
Internal reorganization of production at Pellton, including a better allocation of products to plants worldwide, led to a 70% cycle time reduction in Maastricht.

Slow Implementation, Eventual Success


How shall we share the benefits?
The team predicted a 75% inventory reduction within
the supply chain. Although the implicit assumption was
that both sides should gain, no explicit mechanisms for
benefit sharing had been discussed. When Jackman raised the issue, Watkins responded for Basco by saying
let's focus on opportunities first and make sure there
are benefits to share; well talk about sharing later. The
team agreed to complete implementation at the selected
Basco sites within six months.
During subsequent meetings, the Pellton team learned
that logistics processes vary enormously between sites
within Basco, and often a disconnect exists between
Pell-Q ordering and production planning and sales.
They also learned that Bascos central purchasing group
had no direct authority over individual plants and, therefore, was unable to impose new procedures by fiat on
tindividual plants. Eventually, the team decided to
implement SKU rationalization at all sites by the end of
the year but to work on improving forecasting accuracy
on a site-by-site basis. Pellton proposed that consigned
stock would only be implemented when an improvement in forecasting had been demonstrated, as an incentive to cooperation by the individual Basco sites.
Implementation delayed.
By December 1994, the team decided to start with a
three-month pilot of SKU rationalization and consignment at Basco in Antwerp, Belgium. To Pellton, it was
still unclear exactly who was in charge at Basco.
Jackman recalled that certainly in our early meetings
with Basco, it was difficult to tell how much authority
the logistics manager, Denhoeve, had to implement
changes. The first meetings we had at Basco Belgium,
we weren't even allowed out of the conference room, I
don't know what he was afraid of.
Implementation almost derailed.
After learning that the Basco Antwerp plant manager
Watermans had not been involved in the project, the
Pellton sales representative visited him to explain the

Supply Chain Forum

An International Journal

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pilot projects taking place and their implication for


Basco. With a noticeable lack of enthusiasm, Watermans
agreed to study the project. However, the next day he
voiced strong opposition to the Basco steering team
members who, in turn, were upset that Pellton had
contacted Watermans directly without involving them.
After some diplomacy from both sides, the storm abated, but Pelltons sales representative concluded, we
underestimated the complexity of Basco internal communication and politics. In the future, we must work
through the purchasing director on everything.
Consigned stock.
As the pilot program started in 1995, the team reduced
the SKU count with standard sizes, and Pellton assumed
ownership of the Pell-Q inventory at Basco Belgium.
After three months, the team evaluated the program and
found that the level of consignment stock had not
decreased. (Exhibit 3 contains the data showed during
the evaluation meeting). Although target inventory
levels for Basco Belgium were set at two weeks, they
actually varied from 2.9 to 29.2 weeks coverage. If they
forecast 30 rolls of 76cm of formulation S1 for the
coming two weeks, thats what we deliver; but sometimes theyll suddenly need 30 rolls of S2 instead, so we
get a rush order for those, and the others just sit there
unused for months, explained Jackman. And, with
consignment stock in place, Basco has little incentive to
reduce forecast accuracy. Pellton recognized the
absence of incentives but had let the issue slip. They
presumed, though, that it was also a matter of Basco
Belgium having to gain confidence in Pellton's ability to
deliver reliably and responsively before feeling happy
with a much lower stock. What Id like to know, mused
Jackman, is how much of that variability is caused by
their customers, and how much is created within Basco
Belgium.
Putting the roll-out on hold.
In a joint evaluation meeting in July 1995, Pellton stated that
they were not prepared to implement consigned stock at
the other sites until stock at Basco Belgium had decreased.
Upon hearing the stock levels, plant manager Watermans
exclaimed, that's ridiculous, we don't need that much
stock; were only three hours by truck from Maastricht. He
vowed to make an effort to bring stock down.
Exhibit 3 - Forecast Accuracy during Pilot

Standard sizes
STANDARD
SIZE

FORECAST
ACCURACY

AVG SQM
INVENTORY

WEEKS
COVERAGE

81
86
91
96
101
106
TOTAL

163%
45%
62%
58%
N.A.
50%
69%

17.452
27.068
19.996
32.876
260
10.646
108.299

2.9
29.2
3.5
3.1
0
4.8
4.2

Forecast accuracy = Actual usage / Forecast usage


Target inventory level at Basco Belgium = 2 weeks
This table is taken from the slide presented during the meeting in July 1995
in which the pilot was evaluated.

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PELLTON INTERNATIONAL: DEVELOPING A SUPPLY-CHAIN PARTNERSHIP

Mapping the current process.


The steering team decided to map out the information
flows in the chain from Basco Belgiums customers back
to Pellton, in order to design a better, more integrated
planning and forecasting process making use of electronic data interchange (EDI). Jackman pulled an IT project
manager into the team. In September 1995, the team visited the Basco Belgium and German sites to do brown
paper mapping exercises of the information flows. The
Basco team members (even including the plant manager) were remarkably open, and the Pellton team learned a lot about Bascos physical process and planning
procedures.
Designing the future process.
The planning systems within Basco were largely manual
and paper-based; weekly information would be aggregated by month before being sent to Pellton, who would
then guess at how to disaggregate it to plan weekly deliveries. The team met again a month later to design the
new integrated planning and forecasting system. The
key changes were that Pellton would receive all relevant
information in the form of forecasts or updates as quickly and in as much detail as possible, and that the Basco
sites would get more visibility on the amount of Pell-Q
stock available to them. Pellton stated that it would like
to see all EDI orders from Bascos customers, but the
Basco team members explained that that information
would not help Pellton plan production and would also
reveal too much about the market and their share of
Bascos consumption. Although Basco had sophistica-

ted EDI links with their automotive customers, nothing


similar was in place with suppliers, nor did it seem
important to their IT staff. Even simply setting up e-mail
connections for easier communication within the team
was difficult.
Success at last ...
By November 1995, the team was pleased to observe
that stock levels at Basco Belgium had decreased to the
target level. Basco still wanted to prepare the ground
carefully for the roll-out to the other sites, and, two
months later, with all sites now represented, the decision was finally taken to roll the project out to the remaining sites. The latter were generally enthusiastic about
the prospect, no doubt partly due to the strong advocacy by Watermans, the plant manager. The Basco managing director said they were extremely pleased with
their cooperation with Pellton and that the relationship
between them had improved enormously.

The Perdirelli project


As it became clear that the Basco Belgium project would
be successful, Jackman initiated discussions with
Perdirelli to follow a similar process. In an internal
Pellton memo, he said, There should be substantial
benefits from SKU rationalization there too; especially if
we can help Perdirelli to switch from the Grade S2/P formulation which we make only for them to the standard
Grade S2 formulation.

COMMENTS ON THE CASE STUDY


Pierre Baumgartner
Logistics Manager, UsinorAuto
ISLI, Bordeaux Business School, CPIM

The automotive industry has traditionally been characterised by


partnership arrangements (technical, logistical ). Pellton is somewhat unusual in this respect, inasmuch as this time it is the rank 2
rather than the rank 1 supplier
who has initiated the development plan. The latter is usually
deemed to be more in tune with
the carmakers JIT requirements.
Pelltons approach constitutes a
break both from previous management principles as well as " kaizen" in implementation. The firm
has progressively begun to deal
with its logistical problems.
However, until now its solutions
have sometimes been either
incomplete or else poorly adapted.

SKU rationalisation
SKU rationalisation lies at the
heart of the solutions that Pellton

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An International Journal

has been implementing. Any process that is intended to narrow the


range of spare parts must be motivating both for the supplier and
also for its client. Many parts cause
major constraints in functions such
as planning, manufacturing, storage, management... However it is
not possible to systematically
implement this process. Unlike
Usinor, Pellton has an opportunity
to really drive SKU rationalisation.
After all, steel is not a commodity
per se; it is developped in response
to clients specifications for each
car part (mechanical properties
such as drawability, yield stress,
elongation, tensile strength ). At
a commercial level, one element of
differentiation is the "product" or
more specifically "steel solution".
This really is a competitive advantage for Usinor. Major investments
have been made to improve the
product range : 50% of current
steel products did not exist 5 years
ago.
In Pelltons case, SKU rationalisation enables the resolution of
many forecasting difficulties (since

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aggregation allows for a reduction


in the number of items), manufacturing problems (one production
batch instead of several previous
runs), storage issues (fewer SKU,
less volume to store), shortage
problems
Nevertheless, it should be noted
that clients procurement policies
may change. Moreover, Basco may
well be interested in buying
sheets, or ready-to-use forms, instead of rolls, much as carmakers
currently do with their steel
orders, requesting sheets or blanks
and not coils. The impact on the
SKU could be significant.

Improving the reliability of


customer ordering
Pellton has been facing real forecasting problems: erratic demand
and insufficiently reliable forecasts. SKU rationalisation is an answer
to
these
problems.
Furthermore, Pellton has now
obtained that its clients transmit

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PELLTON INTERNATIONAL: DEVELOPING A SUPPLY-CHAIN PARTNERSHIP

their own forecasting information


with the same frequency and accuracy as Basco receives from the carmaker. From now on, like most
rank 1 automotive suppliers,
Pellton will not be order-driven,
but will instead work according to
its information flow. It will regularly be receiving requirements
over 2 or 3 monthes, and those
requirements are regularly updated by the client.
To move even further in this direction, it is also possible to negotiate
with the client a commitment that
is based on forecasted volumes,
and/or to organise a system of
controlled flexibility over the period concerned. This can be obtained because Basco's material
requirements are comprised of a
"dependant demand", i.e. they
are calculated on the basis of the
carmakers needs, which are supposed to vary little.
Of course, as the volume of information and frequency of exchange
increases, EDI solutions will need
to be applied.
In addition, it will be necessary to
verify the validity of the information. For example, Usinor consolidates all of its clients forecasts,
and verify if they match with information
available
on
final
consumption (car registration
data, new cars launches).

Manufacturing problems
By reducing the number of items
that need to be produced, Pellton
simplifies its planning process, and
production batches recur with
greater frequency. Nevertheless,
there is no industrial flexibility
approach (Smed) that would
lead to significant improvements
in inventory volumes and in responsiveness. Given that Pellton
works three shifts and seven days a
week, capacity issues are crucial.
Storage concerns
Above and beyond SKU rationalisation, and in order to reduce
inventory levels, Pellton has chosen to only have standard products
on hand, and to produce specific
items only on order. This means
that Pellton still has a problem
with non-standard items. From a

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An International Journal

commercial point of view, the


opposite method would have been
more efficient : standard products
are manufactured frequently, with
high stock levels becoming unnecessary. On the other hand, specific
items are not produced very often,
and manufacturing lead times are
assumed to be very long. In order
to rapidly respond to customer
demands for those products, a
minimum level of stocks is necessary. At the very least, forecast-based
production must be anticipated.

Chain can often be very beneficial,


whatever the elements comprising
a companys improvement targets
(simplification, information sharing, storage optimisation, lead
time reduction). More than an
opportunity, what is derived from
the carmaker is a trend. A firm can
either be subjected to this process,
or else it can be the driver behind
it.

The optimal way to situate the


inventory stockpiles as close as
possible to the client is to set up
consigned stock inside of the
client's plant. This also avoids
double stocking, and creates a
situation in which the supplier
supports the financial cost of storage. The minor impact on inventory levels that Pellton has detected stem from the short term
variations in Basco's demand.
Usinor uses this system with some
clients. But because products are
delivered according to customer
orders, it is logical that the client
be automatically invoiced after a
certain time has elapsed if no
consumption has taken place. In
return, Usinor commits itself to
maintaining stock levels between
the upper and the lower limits
agreed upon with the client. In
some cases, although the inventory belongs to Usinor, the client
(and not Usinor) is the one who
will be integrating the inventory
levels into its requirement calculations.
Delivery frequencies
Consigned stocks are useful when
the physical distance between the
client and its supplier is significant,
or when the time between the
requisition order and the client's
consumption is short. With Pellton,
which is located at a distance of 3
hours from Basco, an assessment
of increased delivery frequencies
should have been performed before any consigned stock implementation.

Conclusion
The Pellton case shows that close
partnerships along the Supply

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Usinor has become the world's


leading steel manufacturer, with
15 billions Euros in sales and an
annual production of nearly 21
million tonnes of raw steel. The
Groups automotive activities
have been combined into a
single business unit called Usinor
Auto. The automotive sector is
the Groups largest market.

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PELLTON INTERNATIONAL: DEVELOPING A SUPPLY-CHAIN PARTNERSHIP

Andrew Leahy
Solution Development Director,
Exel Automotive

Looking at the case study from the


viewpoint of establishing a WinWin supplier/customer partnership identifies clearly the benefits
for supply chain cost reductions of
doing so and the investment of
time required, and also what the
Pellton logistics team are learning
about the approach along the
way.
The development of a successful
partnership with Perdirelli should
take very strong account of the
lessons learned (through formal
review) with Basco and also consider and understand the differences that could occur this time
with Perdirelli to help anticipate
problems this time, and also structure effectively the next project.
We have summarised these in
three areas:

Organisational differences
Although it can be assumed that
the same cost reduction imperative exists with Perdirelli, clearly no
guarantee exists that Perdirelli
desire a partnership approach, a
certain degree of cultural alignment, and low management turnover in both organisations are
pre-requisites for a successful partnership. Some companies or their
individual managers simply prefer
or the traditional adversarial or
playing Poker with their suppliers!
The communication problems tensions experienced during the development of the Basco partnership
and the subsequent recovery are
important foundations for a successful partnership also seen
within classic project team
dynamics: Forming->Storming->
Norming.
The Pellton team have learned
vital lessons about assumptions
made of the Basco organisation
and learning how process differences and central vs local organisational politics can take time
to understand. The benefit of a
partner can be that it can act as a
neutral , facilitating fact-based discussion and analysis.

Supply Chain Forum

An International Journal

Technical Process differences


It would seem possible that the
degree of change required from
the Perdirelli side to deliver the
benefit of switching to a standard
S2 formulation will be a more difficult proposal to implement than
purely the SKU rationalisation that
was successful with Basco.
As such the benefits to Perdirelli
may need to be differently structured with the establishment of clearer and quantifiable target savings
being made in the early stages of
the project, in the Basco case
focussing on a firmer commitment
to targets on scrap at the time may
have forced both sides to review
and further optimise the roll sizes.
An effective partnership should
also commit to a process of measured continuous improvement
requiring sharing of information
on both sides, the earlier this is
established then the easier it is to
quantify both the immediate
benefits and to see when initiatives are not working.

An example is with the Project


Sponsor. It was unclear to Pellton
who the Project Sponsor was from
Basco, and critically whether the
team they were dealing with had
authority to implement decisions
agreed, particularly across all
Basco sites. Partnerships must
work and joint projects owned
at the local level. Once the plant
managers were involved the project had a local sponsor who could
make things happen.
Account Management
Consideration within this small
market place should also be given
to the Basco reaction to creating a
replicated cost reduction process
with
their
competitors.
Anticipation of this through the
Pellton sales team and pro-active
development of further initiatives
with Basco on a continuous improvement cycle will help considerably.

Lessons learned
Pilot projects entry and exit
criteria
The Basco project included the successful use of pilots that developed into the use of success criteria,
for example
The introduction of consignment
stock can only occur when inventory levels reach an agreed target.
We would see these as important
in establishing into the next
phases.
It is our view that these points provide effective gateways or project
milestones that are visible and
require commitment and discipline
from both sides to achieve.
Project Management
There was little evidence of a clear
project process from Pellton. A
project-managed approach to the
Perdirelli opportunity would significantly improve the probability of
success. We have learned consistently that the investment in effective project management will deliver the objectives required for
Pellton, to meet customer and
Pellton requirements, on time and
to budget.

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