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Optimizing the Working Capital Requirement

Description

The working capital requirement, or WCR, makes a crucial contribution to the performance of a company. Reducing the WCR:

  • releases funds that can be used to create new products and/or acquire new manufacturing or sales resources,
  • reduces debt (especially in leveraged operations).

There are a number of means of optimizing the WCR. The assignments that we have already accomplished have taught us that companies usually perform well in terms of their accounts receivable and accounts payable (plus the capex, when it comes to their need for cash), but that they have difficulty in understanding the importance of reducing their stocks.

In order to make a quantum performance leap in this field, it is necessary to address the complete value chain. Even if the various levers clearly depend on the sector of activity, they do, in fact, impact almost all of the processes related to operations:

  • Supplier performance: how can suppliers be made more punctual, more flexible and, in general, more respectful of their commitments (quality, etc.)? How can more collaborative ways of working be put in place? Should a stock consignment strategy be developed with suppliers?
  • Manufacturing: how can flows be made even tighter and how can production teams be motivated to meet deadlines and cut production cycles or repair TAT? How can manufacturing get it right the first time around? How can the reliability and availability of the means of production be guaranteed?
  • Supply Chain Planning:how can uncertainty be limited, how can the anticipation and management of risk be improved to make sure that the offer matches the demand (procurement, production, distribution, etc.), how can stocks be better located and sized? How can the right service rate targets be set?
  • Logistics:how can we build a more efficient distribution network, that is more reliable and more reactive to an uncertain demand? How can flows be accelerated (milk runs, cross-docks, etc.)?
  • Research and Development:how can development cycles be cut in engineering to order activities? How can we design products that are easier to manufacture (internally or externally) and to repair?
  • Information systems: how can we make the best use of the available tools or develop them in order to support the actions to be taken and facilitate the sharing of information, collaboration and decision-taking?

Thanks to its position and its expertise, Argon Consulting can help is customers with their plans to optimize their working capital requirement.

Argon Consulting can provide input in the diagnostic phase:

  • identify and validate the levers to be used,
  • facilitate the alignment of players with the target processes and roles and responsibilities,
  • set ambitious targets and make sure that they are accepted by management, which then supports commitment,
  • define the required action plan.

…and in the implementation phase:

  • put the organization under pressure,
  • control the change program and keep track of gains through a benefits tracking system in order to remain permanently focused on results,
  • execute the actions required to achieve the business target and the gains,
  • support the human dimension of the change process.
Team

Fabrice Bonneau –  Managing Director

Before becoming Managing Director of Argon Consulting, Fabrice was in charge of the Manufacturing Distribution Retail sector at Capgemini Consulting, and a member of the management committee. Before that, he was one of the founders of PEA Consulting.  Fabrice has worked on numerous performance improvement (cost cutting, stock reductions, improvement of service) and supply chain change and manufacturing projects. He has also managed supply chain strategy, governance and organization projects, manufacturing system projects, supply chain planning (forecasting, planning, stock optimization) projects and information system master plan projects, in all the manufacturing and retail sectors. Fabrice is a graduate of the Ponts & Chaussées engineering school and a qualified mathematician. Fabrice is also President of the Industrial Engineering department of the Ponts & Chaussées engineering school.

Fabrice Corbière – Associate Director

Fabrice Corbière has more than 20 years of experience in supply chain consulting. He has worked on almost 40 supply chain change projects, from the definition of the strategy to change management support. The reduction of the working capital requirement is a priority in many projects. Fabrice has already managed this type of assignment in the general and specialized distribution sectors, the healthcare sector, for aerospace and automotive manufacturers and equipment suppliers, in the luxury goods sector and the process industry. Before joining Argon Consulting, Fabrice was an Associate Director with PEA Consulting, then with Cap Gemini Consulting, where he was in charge of the supply chain practice. Fabrice is a graduate of Centrale Paris.

Nicolas Gelle – Associate Director

Nicolas Gellé has 16 years of experience in consulting, in particular in the fields of strategy, manufacturing or logistics master plans, the reconfiguration of supply chain processes and organizational changes, and in restructuring and working hours reorganization projects, performance, outsourcing and activity transfer plans and the design of warehouses and industrial sites. Before joining Argon Consulting, Nicolas was in charge of the manufacturing entity at Valtech Axelboss, of which he was one of the founders. He was also Supply Chain Director at Moulinex. Nicolas started his career with Ouroumoff and CSC Peat Marwick.  Nicolas is a graduate of Centrale Lille.

Thierry L. –  Director

Thierry L.has 12 years of experience both in supply chain consulting (PEA Consulting and Capgemini Consulting), but also in operations with Arcelor. Thierry has already managed major results-oriented change projects that resulted in significant stock reductions of 28% and 15% respectively. Thierry has been able to rely on his broad experience of supply chain planning, from the diagnostic phase, through to the design of the target and implementation support, in the complete range of processes (service offer, forecasting, S&OP, DRP, deployment, MPS, scheduling, stock management, logistics strategy, supplier performance, etc.). Thierry is a graduate of Ecole Polytechnique and of Institut National Agronomique Paris-Grignon.

Mathieu de N. –  Director

Mathieu de N. is a Director in the supply chain and manufacturing practice. Over the last few years, Mathieu has acquired outstanding expertise in the issues of logistics strategy, logistics and supply chain performance and industrial planning. He helped the Michelin and Valeo groups to draw up and deploy their stock reduction programs. Mathieu is a graduate of Mines Paris.

Donatien M. – Senior Manager

Donatien M. is specialized in supply chain. He has worked with both manufacturers and distributors on issues of logistics strategy and industrial planning and scheduling and operational improvement programs. He has managed numerous strategic and operational stock optimization projects. Donatien is a graduate of Centrale Paris in industrial engineering, production management and logistics.

Luigi C. - Senior Manager

Luigi C. is a Senior Manager at Argon Consulting. He has 12 years of experience in Supply Chain. He worked on several projects of inventory optimization in various sectors: Luxury, Automotive, Industry. Before joining Argon Consulting, Luigi was Manager at Capgemini Consulting. Luigi is a graduate of LUISS Guido Carli Business school in Rome.

Danielle P. - Manager

Danielle P. is a manager in the supply chain practice. She has worked on numerous operational performance improvement projects aiming at reducing costs and optimizing working capital, in France and abroad. In particular, she implemented her expertise in the fields of shipbuilding, in the automotive industry (inventory reduction programs), cateringand retail (productivity increase) Danielle is a graduate of Mines Paris.

Florian S. - Manager

Florian S. worked on several projects of inventory optimization to reduce the working capital. Through these assignments, he worked in various industries (Luxury, aeronautics,...). He has implemented both technical skills of stock sizing and contributed operationally to implement  new stock policy rules .  Florian is a graduate of Ponts et Chaussées.

Eric P. - Manager

Eric has worked on many performance improvement assignments (logistics and supply chain) as well as transformation assignments, in particular stock reduction assignments in different industries (food-processing, cosmetic, automotive). He has also worked on Supply Chain process improvement issues. He worked in particular for Valeo, PFDC and Euralis. Eric is a graduate of Centrale Paris and of Technical University of Munich (TUM) in production management.