A.T.kearney_Case Mind Benderzz 2

7/24/2019 A.T.kearney_Case Mind Benderzz 2

1/10

October 27, 2013

World Spirits Strategic Profitability

Assessment

Erica Zhiyi Pei

Mudit Gupta

Raghavendra Kandubai

ara iantian !e


2/10

2"## Kearney

Agenda

$ntroduction

$n%ight%

Propo%ed vi%ion and &i%%ion %tate&ent

Reco&&endation%

'e(t %tep%


3/10

3"## Kearney

A.T. Kearney wants to help World Spirits establish a newvision and mission and regain its profitability

)ituation*

+ or-d )pirit% ha% had an incredib-e gro.th over the pa%t one decade

/ he gro.th ha% been pri&ari-y ue-ed by a -ot o acui%ition%

o&p-ication*

+ he proitabi-ity o or-d )pirit% i% deteriorating

ue%tion%*

+ !o. can or-d )pirit% regain it% proitabi-ity4

+ !o. can or-d )pirit% e%tab-i%h a ne. vi%ion and &i%%ion %tate&ent to in%pire

the e&p-oyee%4

$ntroduction $n%ight%Propo%ed vi%ion

and &i%%ion

Reco&&endation% 'e(t %tep%


4/10

5"## Kearney

Profits of World Spirits have been decreasing due to asteeper increase in the selling and warehousing expenses

relative to the increase in revenues

)a-e% revenue increa%ed by 63 Gro%% proit increa%ed by 63

Po%itive trend%8

Operating e(pen%e% increa%ed by 107 'et proit decrea%e by 67

'egative trend%8

)e--ing e(pen%e% have increa%ed by 97 arehou%ing e(pen%e% have increa%ed by 10:

Rea%on% or the negative trend%8

8 o&pari%on bet.een 200; and 2012

$ntroduction $n%ight%Propo%ed vi%ion

and &i%%ion

Reco&&endation% 'e(t %tep%


5/10

;"## Kearney

Selling and warehousing costs are increasing at a muchfaster rate than what can be offset by the gross profit

$-

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$1,900

$380$285

$3$123 $134

$3,100

$620 $589

$5

$230 $281

$ (Millions)

Introduction Insights

Proposed vision

and mission

ecommendatio

ns !e"t steps


6/10

6"## Kearney

Several factors contribute to increase in sellingand warehousing expenses

#upp% chain ine&ciencies 'ac( o) saes data )rom the regiona groups at *ead+uarters issed saes opportunities due to ac( o) inventor% 'ost prot due to so. moving products

easons )or increase in seinge"penses

*igh so. moving inventor% eves compared to )ast moving /soete inventor% o) more than 2 %ears 'ac( o) )orecasting in)ormation

easons )or increase in .arehousinge"penses

Introduction InsightsProposed vision

and mission

ecommendatio

ns

!e"t steps


7/10

7"## Kearney

Through a revised vision and mission statementwe strive to attain higher protability and

uniformity in organization Proposed vision

Proposed mission statement

nited )tate%#?


8/109"## Kearney

The recommendations can be broen down intostrategic pillars that would help achieve the

proposed vision Integration o) regiona o&ces .ith head+uartersthrough uni)orm I in)rastructure ata transparenc% et.een saes and supp% chain Incentives to regiona managers )or adopting ne.proposas

Integrated/perations

Increasing saes in the )astest gro.ing accountsocused #aes

aintaining ust in time inventor% ccess to rea time data through the integrated Iin)rastructure

7etter )orecasting and etter data capture

eduction o)operating e"penses


and mission

ecommendatio

ns

!e"t steps


9/10:"## Kearney

The recommendations will better the forecasting!negotiating power! inventory management and

reduce warehousing costs! with few associatedriss

7enets

Increased saes )orecastingcapaiities

#tronger negotiating po.er .ith thesuppiers

ecreased .arehousing costs

7etter inventor% management

is(s

!on-compiance o) regionamanagers ma% ead to higher costso) integration

aintaining ust in time inventor%might ead to some sma amount o)missed saes

ecreased autonom% o) the regiona

managers might aect their moraenegative%


and mission

ecommendatio

ns

!e"t steps


10/1010" Kearney

"ext steps

:earne% can .or( .ith ;ord #pirits to identi)% the states.here ;ord #pirits can negotiate a etter contract, )or instancein the states .here ;ord #pirits has the argest mar(et shareand the suppier is imited % reguation to se direct% toretaiers

:earne% can identi)% ne. and emerging customer segments

:earne% can .or( to identi)% the present e&cienc% o) saes

)orce and hep restructure it


and missionecommendatio

ns!e"t steps

Documents

A.T.kearney_Case Mind Benderzz 2