roi calculation on a long term project at a distribution organization
TRANSCRIPT
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STRATUM CONSULTING FAST MOVING CONSUMER DURABLES INDUSTRY APRIL 2014 TO MARCH 2016
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2
Table Of Contents
Contents Slide No.
Return on Investment -‐ Summary 3
Return on Investment – Culture Framework 4
Return on Investment – People 5-‐6
Return on Investment – Processes 7 – 11
Return on Investment – Workspace 12-‐13
Account Details
Managing Partner Mr. Abhishek Jagasia
Time Invested 9 Man-‐days per Month
Start Date 1 April 2014
End Date 31 March 2015
Date of Report 15 May 2015
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Return on Investment
(28.85 Lacs) 2.19 Times
Retainer Fee Paid
(Rs.13.20 Lacs)
People Development (11.93 Lacs)
StandardizaVon of Processes (15.14 Lacs)
Workspace Management
(1.78 Lacs)
Return On Investment -‐ Summary
Note: 1. ROI projecVons have been made for the Financial Year 2015-‐16 on the basis of actual return on Investment for the F.Y. 2014-‐15. 2. Actual ROI for the F.Y.2014-‐15 is 0.85 Vmes of the retainer fees paid.
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Return On Investment – Culture Framework
Cultu
re Framew
ork
ObjecVves
Values
People ROI of Rs.11.93 lacs
Processes ROI of Rs.15.14 Lacs
CommunicaVon
Workspace ROI of Rs.1.78 Lacs
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Return On Investment
1. People Development
5
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6
Return On Investment – People Development
People
Savings in Owner’s Time Investment (Rs.1.80 Lacs)
Savings in 0.5 days per month (Sales Team Complaints,
Customer SaVsfacVon Issue, etc.)
ReducVon in Manpower Cost (Rs.8.84 Lacs)
Department Restructuring (Employee strength reduced
from 6 to 4)
Increase in Efficiency of Employees
(Rs.1.29 Lacs)
ReducVon in Month End Dispatch Days (from 9 days to 4 days) saved 20 man-‐days which were uVlized for other
acVviVes.
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2. StandardizaVon of Processes
7
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8
Return On Investment -‐ StandardizaVon of Processes
Processes
Advanced Dispatch Planning (Rs.9.08 Lacs)
Month End Dispatch Days reduced from 9 days to 4 days
ReducVon in Overhead Costs (Rs.4.62 Lacs)
IdenVfied areas of cost savings & set processes for the same
LiquidaVon of Stock / Scrap (Rs.1.44 Lacs)
Conducted Stock Audit Exercise and idenVfied non-‐moving stocks that can be
scrapped or sold
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StandardizaVon of Processes – Advanced Dispatch Planning
Processes -‐ Advanced Dispatch Planning
Faster Financial RealisaVon (4.44 Lacs)
Faster delivery of goods to customers ensures faster
financial realisaVon thereby resulVng in savings in interest
cost
ReducVon in Month End Dispatch Cost (Rs.3.15 Lacs)
Clubbing of dispatches resulVng into full-‐capacity uVlizaVon of vehicles
ReducVon in Transport Cost (1.48 Lacs)
Savings through rate-‐negoVaVon with transporters
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StandardizaVon of Processes – ReducVon in Overhead Cost
Processes – ReducVon in Overhead Costs
ReducVon in Overhead Expenses (3.74 Lacs)
Secng up of processes for idenVfied areas of savings in
costs and tracking on a monthly basis
Savings in Fuel Cost (Rs.0.48 Lacs)
CessaVon of obsolete (owned) vehicle usage
Savings in Vehicle Maintenance Cost
(0.40 Lacs)
CessaVon of obsolete (owned) vehicle usage
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StandardizaVon of Processes – LiquidaVon of Stocks
Processes – LiquidaVon
Faster LiquidaVon of Stocks (0.68 Lacs)
Conducted stock audit exercise and idenVfied non-‐moving stocks
that can be sold
Scrap Sale (Rs.0.77 Lacs)
IdenVficaVon of obsolete stocks to be scrapped
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12
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Return On Investment – Workspace Management
Workspace
ReducVon in No. of Warehouse
(Rs. 1.78 Lacs)
Space Planning & Management
Savings in Rent and Other Related Fixed Costs
ReducVon in Pick & Pack Cycle Time
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