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Client team

  • European Region of this global FMCG business with revenues in excess of €15 billion.
  • A team with expertise in Supply Chain, Procurement to Payables and Order to Cash with data mining ability and cash forecasting capability.

Project aims

  • Period end performance recorded a significant gap in cash flow delivery, all three working capital areas contributing.
  • Recent Regional reporting and operational consolidation was fresh and in development.
  • The client wanted confirmation and testing of cash gap causes, a health check on planned initiatives and a review of TWC cash forecasting.

What we did - our role and activities

    Role

    • Conduct a high level appraisal of total working capital performance, operations and initiatives. Give guidance on policy and identify further potential.

    Activities and Deliverables

    • 5 week analysis covering high level processes and key functions across all working capital areas.
    • Covered Regional Supply Chain Company and outsourced Collections and Payables.
    • Reviewed and tested TWC cash forecasting methodology.
    • Examined TWC metrics, data sources and suitability of output.
    • Held interviews and meetings with senior process leaders and appraised plans for next initiatives.
    • Completed an assessment of TWC management objectives, delivery approach and execution methodology.

Successes

  • Presentation to the European Board.

Results

  • Confirmed the TWC movement and cause.
  • Confirmed the impact of gaps in metrics for working capital performance .
  • Guidance on initiatives and future activities to improve performance.
  • Proposed revised metrics and calculations to avoid future gaps.
  • Confirmed opportunity for further €1 billion of improvement.

 

Follow up and review of progress and outcome

  • In excess of €1 billion TWC reduction achieved.
  • TWC now on track following recommended actions.
  • Cash forecasting accuracy increased.
  • Expectations for negative NWC exceeded.