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tems organization. Don Kosanka, OC s chief information officer, explains: The IS folks that we have are really not the technical folks you find in typical IS organizations. They have a really good understanding of the business processes that we operate, and their value comes in helping figure out where technology can enable each process to become more efficient, precise, or accurate. We outsource the more routine technical skill sets required to operate the IT infrastructure. Kosanka is an example of the shift in thinking at OC. As he says, When I first joined the firm 25 years ago, fresh out of college, I thought technology was the important driver. After a few years here, I shifted my view to process. Now I see the equally critical importance of people. Without every employee s buy-in, you can t execute the process or realize the value in the technology. So you might say I ve moved to a much more integrated approach. What s especially different about today s perspective on the role of technology, says Kosanka, is that we actually try to solve our process challenges without technology, if possible, and use technology when it s required and when it actually enhances the project so [that] it justifies the investment. Kosanka has used IT to take costs out of the supply chain. Our total investment in IT over the last seven years has dropped every year, and as a percentage of sales it has dropped even faster, he says. While we ve decreased the amount spent in the infrastructure, we ve been maintaining or growing our investment in applications to help the business units operate their processes better. Basically, we ve done a good job of managing our costs to get higher performance for lower costs. We now have just a handful of major systems that we use. OC achieved these gains primarily by outsourcing many operational aspects of the IT infrastructure, from help-desk and data-center operations to network management. Now the organization looks at technology very differently from even seven years ago. Ressner refers to the common set of technology and process elements as an enterprisewide toolkit. Flexibility comes from using that toolkit and recognizing the unique characteristics of a particular market segment or customer. Without having the process and IT foundation in place that we have today, it would be difficult, if not impossible, and certainly much more expensive, to customize an approach.
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As it builds better partnerships with distributors and retailers, OC has developed a new perspective on its suppliers. We have a point of view that
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our suppliers are as important to us as our customers, so just as we want to be our customers best supplier, we want to be our suppliers best customer, explains David Johns. We are trying to make our systems, our processes, etc., as transparent as possible with our suppliers and our customers, by eliminating as many inefficiencies as possible in our dealings and taking the costs out of our shared supply chains. The company has established programs and metrics for vendor relationship management and supplier development. Although its sourcing organization is separate from the supply chain solutions organization, the two departments leverage resources in support of common goals. For example, both groups collaborated on creating a portal structure that would facilitate interaction with vendors.
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We want to be our customers best supplier and our suppliers best customer, says David Johns.
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OC also has developed project review boards to help enforce the alignment and integration of key business processes, such as customer operations, materials management, sourcing, production, research and development, IT, and logistics. Each has representation from the three functional areas of technology, process, and operations to jointly assess and monitor IFO benefits, working capital savings, return on net assets (RONA), supply chain performance metrics, and overall allocation of people and capital resources for approved initiatives. A new stage gated approach ensures that before resources are assigned to specific projects, each has to pass a stringent test for business value. This is another one of the building blocks to OC s one company mantra these days. Currently in the process of coming out of a financial restructuring process, it is reinventing its processes and internal organizations to give customers the experience of a single company that is poised for the increased competitiveness of the future.
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