�A single service solution for

your document management

needs�

• providing document and data management since 1989

• privately owned SME company with 250 employees

• combined customer base of 4000 customers across all industry sectors

• proven track record across all sector and industry types including Government, Public and SME

• competitors generally global

About Us

Filestores

• secure and confidential off-site records management solutions for customers

• online records/information hosting

Shred-It

on-site destruction of customers records

Paper and electronic

electronic recycling

• Environmentally recycling outdated

computer and electronic equipment

Current Customers

Why Change

Key business challenges

• increasing costs

• decreasing revenue/margin pressures

• increasing competition

There is a profit problem

Reaction :Cut Costs!

Target areas of excess spending

Cut the budgets

Constrain development & de-motivate staff

Process performance fails

Customer perception suffers

Sales Fall

The Business Shrinks!

The Cost Cutting Spiral

Why Lean ?

Strategic change program (DI) responding to the changing market place

improved workflow and exceptional customer service

Implementation through “Lean System” (CI)developing people and processes

strong cultural fit

€

Time

Sales

Resources / Costs

Definition

Lean is a path to profitable growth

driven by

the provision of exceptional Customer Value at the lowest

possible cost

enabled by

the ruthless and relentless elimination of Waste

The 5 lean principles

1

identify customer value

2

identify how

customer

value is created

3

ensure process flows –

remove blockages

4

Ensure process delivers

when customer

wants

5

Develop further to delight

the customer

The Customer Offer

Product

Service

Financing

Brand and Image

The value of our offer to the market place –

more than just product or service

Payment Terms

Staff training

Brand Equity “Trust”

Organisation Structure

Silo Business Units / Silo Functions(blockages/wastes)

Culture of Silo KPI (Not Value Stream KPIs)

Silo targets/results drive Behaviours(Culture)

BU1

Operation,Sales &

Marketing KPIs

Finance (KPIs) ITHR

BU2

Operation,Sales &

Marketing KPIs

BU3

Operation,Sales &

Marketing KPIs

BU4

Operation,Sales &

Marketing KPIs

No end-to-end KPIsto drive Customer Value

“Not Value Stream”

How did we start?

• project selection was key

– credible /deliver business value &

measurable

– people involved able to influence and

shape solutions

• senior team involvement key

• people based project

• “order winning to cash in the bank”

process

• touch all business functions Improvement Opportunity

Improvement Opportunity

TimeTime

Short termgains made

Lost and repeated results due to no sustainability

Results could be lost entirelyif organizational structure not

aligned to support and education level of all employees not increased.

Improvement leveled off and eventually stopped due to lack of realizing “true”lean opportunity

Greater, sustainedresults achieved

Awareness, education, organisation structurecreated to support lean

Kaizen Blitz vs. Lean Management

Source: C. Craycraft, Whirlpool

We are not “doing lean”

We are improving our business

What did we do?

• Two team were set up

• Shred It

• Filestores

– cross functional teams from Sales, Operations and Accounts

– visualise and understand how we managed the customer, team focused on improving existing processes

– ALIN then we ENGAGE around a common goal of customer satisfaction

– Tools and techniques were minimal ,power of the team to solve problems

The Lean Business Model

Align

Engage

The key challengeWhat is customer value?

The business needs to generate cash

The customers do Not like our invoicesAnd do not pay

Internally we have high levels of rework

We need to improve our Invoice quality and

timing

We need to reduce ourDebtors days

The target:-•We need to reduce debtor days to under 50 and ensure all invoices are raised within 2 days

Why?•This will “provoke”necessay improvements that will benefit both the business and the customer

How did we start?Visualise the value stream

• cross functional team look at each revenue stream-

• issues with silos –break down barriers

• visioning the end gave us benefits we started to see people sharing problems, understanding inter and intra process waste

• This was completed for both income streams

yes yes

no

yes no no

yes

no

no

yes

no

yes

no

yes

yes

no

yes

yes

Purge customer process

C ustomer re ques ts a

purge

N ew

cu stomer?

In stru ct to pay bi l l and

cas h o n compl et i on

30 day

d ebt?Ty pe A?

A ct ive accou nt?

Pa ss to ac cou nts to

chas e d ebt

T reat a s n ew cu stomer Ty pe A?

C redit check ok?

Offer inv oi ce paymen t

I de nt ify quan ti ty loc at ion

a nd type of b usi nes s

Wi th in

scop e?

Mi nimum

purge ?

Ha nd ove r to sal es re p

Iss ue verbal or e ma il q uote

A ccept?

Sche dul e wo rk

C ontact customer

C arry out p urge

Ha nd ove r to sal es re p

Ha nd ove r to sal es re p

Ha nd ove r to sal es re p

A ccep t?

Next stepsMake it flow

• set problem statements / brainstormed solutions around the issues we identified in the end to end diagnostic.

• drive flow (no rework) via removal of wastes, unevenness and overburden

What level of debt is managed

Size and nature of business is

changing

€

Account profitabilityPlanned versus actual costs

• examine the profitability of key accounts within our business and the “breakeven point”

• great information to drive improvement further as we extend scope around Order to cash

Overall All Process Sunk Cost 31/8/2010Monthly trading CostMethod of costing

4 week month

1 Hire of c rates 3,996 1,486 1756 a month

50c a crate

2 Drop off c rates to Hospital - - A s part of retrieval process

3 St James put F/S Barcode on every fi le - - no cost

4 St James put F/S Barcode on every crate - - no cost

5 F/S Collec ts crates from James H ospital 450 - D one for a 4 w eek period

250 250 1.5 hours a day

6 F/S scan crate 4,500 - 6 hrs a day for 10 weeks employee €15 per hour

7 F/S scan fi les in cr ate, both James Hospital code and F/S - - part of above

8 Everyday fi les are pulled from cr ates to be delivered to James 675 450 1.5 hrs a day

s ince week 2

9 Delivery of fi les to James Hospital 250 E very day, 30 mins

10 Crates are taken up s tairs - - N on value added

11 Files are prepared for scanning activ ities inc ludeJoe 3,910 1,955 4 employees, preparing on

remove s taplesSamantha 443 1,772 average 5 crates each a week

remove c l ipsJames 1,502 Joe, S amantha, James and A udrey 20 hrs a w eek

insert barcoded fi le dividersAudrey 1,238 751 s td 37.5 hrs a w eek

re fi le back section of fi le

12 Files are taken to scanning room 2 employees scanning on average

MRN number is tyed into scanner (7 digits )Jennifer C 1,351 2 crates each a day - 10K - 12K per

Jennifer B 1,351 day per person

Brian 900 122K pages per w eek

13 Scan every thing

14 File storage 1,842 921 Indefinately 743 crates on s ite

4 times the s ize of a std box

15 Shredding of fi les 200 20 crates a week are scanned, €2.5 per crate shredding

Non Pr ocess Costs

Martin Finn 10% 1,030 515 Edward Hanrahan 4,000 IT support 1,000 1,000 Darren Walsh 30% 650 325 Lyndsey Power 10% 262 262

Stephen Mackey 10% 2,948 1,600 Overhead allocation 1,000 500 Light, heat, rent, repairs and maintence, group overhead

Total C osts 29,093 16,441

Income July 1,417

August 10,348

Prepar e 112K sheets per week 17,472

Total Income 11,764 17,472

Trading deficit 17,329- 1,031 16,298-

Margin -147% 6%

Projected break even

Revenue

Time

Set upRun

Decline

Actual break even

Continuous improvementDashboards

• built continuous improvement dashboards focusing on financial, process, customer and learning KPI’s

• We maintain action plans and issues list to drive improvement and sustainability of improvement

Shr ed- It Lean O rd er to Cash

Fi nancial KPI 's

No. M easure Descri pt ion Pr ocess O wner Tar get Jun J ul Aug Sep Oct Nov D ec J an

1D ebtor Days

Avg. No. Of days ou tst anding debt Cal cul at ed by Cr edi t Cont rol

Depar t mentTH 47 49 47 48 49

2Cash Coll ecti on

Invoi ces paidCal cul at ed by Cr edi t Cont rol

Depar t mentTH 70% 60% 66 % 65% 62%

3Cash on Com plet i on Sales

New Pur ge - value paid at t im e of ser vice

deli veryTo be r ecorded by cash col lect ion LF 7, 985 TBC 4,2 28 3, 541 6,331

4 V al ue o f Bad Debt s TH 0 0 3,8 89 777 2,512

5Cr edi t Not es Rai sed

Num ber of credi t not es r aised f or a given

mont hExt ract ed f r om Exchequ er TH 0 16 15 13 16

6 Cr edi t Not e Val ue Value of credi t not es r aised f or a given m ont h Ext ract ed f r om Exchequ er TH 0 10, 102 2,2 40 3, 495 8,765

7Revenue - Pur ge, Actual vs

Bu dgetActual Pur ge Revenue V B udgeted Revenue

Ext ract ed f r om Mon thl y Revenue

Repor t sLF 100% 106.1% 130% 76.21% 10 9.31%

8 Revenue - Aut o, Act ual vs

Bu dgetActual Aut o Revenue V Budgeted Revenue Ext ract ed f r om Mon thl y Revenue

Repor t sLF 100% 79. 3% 79 % 77.72% 73. 52%

9Revenue Per Tr uck Per Day

A ct ual V Budget

Actual r evenue per tr uck per day V Budget

revenue tr uck per day

Ext ract ed f r om Mon thl y Revenue

Repor t sLF

100%

( €1,310)87. 8% 97 %

99. 4%

€1 ,302. 29

10 8.65%

€1, 4233. 13

10Bi ll ing Rati o

Mi nut es wor ked vs mi nutes bil led (Gol d

Standar d M easur ement )Ext ract ed f r om Shredcom LF 52 46% 54 % 46% 57. 14%

C ust om er

Focus KPI' s

No. M easure Descri pt ion Pr ocess O wner Tar get Jun J ul Aug Sep Oct Nov D ec J an

11 N o. New Aut o Cust omer s

Num ber of new auto accounts si gned up in a

given m ont h

Fr om Sales Repo rt s - t ar get ed sal es

m easur em ent AM cG 36 15. 5 15 .5 15.5 17. 5

12 N o. Of Di rect D ebit s % of cust om ers on di rect debi t Ext ract ed f r om Exchequ er TH 20% 12% 12 % 12% 13%

13O n t im e r epor t

Num ber of custom er s servi ced on ti me. ( Gol d

Standar d M easur ement )Ext ract ed f r om Shredcom LF 98 76 81 .8 83.3 81. 8

14 Q U Logged No. Of Q uali ty Updat es RaisedExt ract ed f r om QU Dat abase on

P: \dr i ve RM N/ A 6 8 4 1

15 Q U R esol ved No. Of Q uali ty Updat es Closed Ext ract ed f r om QU Dat abase on

P: \dr i veRM N/ A 14 7 6 0

16 Q U A verage Reso lut ion Tim e

No. Of w or ki ng days t aken f or ro ot cause

analys is , cor rect ive and pr eventi ve m easures

to be i mpl emen ted.

Ext ract ed f r om QU Dat abase on

P: \dr i veRM 5 54 15 22 0

I nt ernal

P rocess KPI 's

No. M easure Descri pt ion Pr ocess O wner Tar get Jun J ul Aug Sep Oct Nov D ec J an

17N o of I nvoices r et urn ed wi t h no

PO No o f Invoi ces ret ur ned w it h no PO

Pr ocess to be devel oped t hr ough t he

l ean pr ocess TH 0% 0% 0% 0% 0%

18do cket s r ewor ked

Any docket t hat needs t o be am endedTo be r ecorded on checkl is t by bi ll ing

adm ini st r atorLF 110 TBC TBC 19 11 1

19A ccount s not cont act ed

No. Of cust omer s not cont act ed by cr edi t

contr oll er . Capaci t y Planni ng

Cal cul at ed by Cr edi t Cont rol

Depar t ment

SMcM

& TH400 429 597 548 39 9

20 t ot al no. Of i nvoices per m ont h tot al no. Of i nvoices per mont h Ext ract ed f r om Shredcom TW N/ A 2331 2265 2296 2209

21

N o. Of Act ive Auto accounts

Inf or mat ional : The t ot al n umber of aut o

account s act ive that m ont h. Capacit y Pl anningExt ract ed f r om Shredcom TH N/ A 1733 1736 1717 1720

22 Reconci li ati on of Shr edcom and

Exchequer

Reconcili at ion of number of dockets and value

to be up and r unni ng by t he st ar t of August

2010

Pr oject under t aken by Shan e

M cMahon - t o be com plet ed by end

J uly

SMcM 100% TBC 99.9% 99. 9% 98%

Lear ning &

G row t h

No. M easure Descri pt ion Pr ocess O wner Tar get Jun J ul Aug Sep Oct Nov D ec J an

23 % pr ocesses defi ned by s tandar d

w or k

Process f low , all i denti fi ed pr ocesses

document ed w it hi n over all or der t o cash

process

Pr oject : Gap analys is , any pr ocesses

not def ined need t o be docum ented .RM 100% TBC TBC TBC 33%

24 % peopl e w or ki ng t o st andar d

w or k

rel evant s taf f indent i fi ed and tr ained against

requi r ed s t an dard pro cesses

Pr oject : Staf f t o be tr ai ned against al l

docum ented pr ocessesRM 100% TBC TBC TBC TBC

Stable and standard workPerformance management

• platform of stability for our people

• framework to drive improvement across the workforce

Policy –DMG level

FilestoresFilestores60 people 16 60 people 16 functionsfunctions

S.O.P.S.O.P.Sales and Sales and accounts accounts

need moreneed more

Training Training

ManualManual

Training MatrixTraining Matrix

Shred itShred it41 people 14 job titles41 people 14 job titles

S.O.P.S.O.P.Sales and Sales and

accounts need accounts need

moremore

Training ManualTraining Manual

Training MatrixTraining Matrix

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Compete

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Performanc

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managemen

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Role definition

Job Description

Reporting structu re

Review

“when”

KPI

“measur

e”

Pr ocedu r

e

“how”

Activity

“what”

Purpose

Job description

Reporting structu re

Review

“when”

KPI

“measur

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Pr ocedu r

e

“how”

Activity

“what”

Purpose

Job description

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=Documentation exists for High frequency demand

X

X

High Medium and Low

Frequency activity

High Medium and Low

Frequency activity

So where are we now?

• identified customer value

• mapped our processes and understood the value stream

• starting to improve flow and align our processes to demand

• need to drive stability and secure our gains to date

• developed improvement systems

• have engagement • We have generated €300K of benefits

What are the next steps

• Drive improvement from the KPI’s

• Assess existing KPI’s across the business

• Integrate improvement activity into the day

job

• Create greater diagnostic skills across the

business-more lean champions

• Expand the scope of activity across the

organisation

Thank You