Skilled Six Sigma Project Management Streamlines Retailer’s Promotional Process

PROJECT BACKGROUND

A leading pet supply retailer uses an advertising circular as their main promotion to consumers.  This circular contains weekly product promotions that each store has to order and have in-stock well before the weekly promotions’ distribution.  With more than 1,000 stores, variations in price points, and exclusive regional needs, the company needs to publish more than 50 versions of each circular to meet individual store’s needs.

Historically, promotions were planned by the Marketing department with insufficient cross-functional collaboration across Supply Chain, Pricing, Space Management, and Merchandizing/Product groups.  The disconnect caused unnecessary scrambling each time a new promotion was issued, resulting in hurried rework of the circulars, missed deadlines, and last-minute product substitutions.  That, in turn, led to store stock-outs, disappointed customers and, ultimately, lost revenue.

With stress building, the company knew it needed to fix its dysfunctional promotion process, and fast.  A senior manager recommended that Integrated Project Management Company, Inc. (IPM) be brought aboard to lead the effort, based on his positive experience with the firm in a previous position.

IPM’S SOLUTION

IPM recognized that using a Six Sigma framework, coupled with its own project management methodology, would allow the company to streamline promotion planning.  IPM started by defining core issues through interviewing management and other staff. But before further work could start, the IPM project manager had to quickly break down functional silos and stop the finger-pointing, which had become the norm, in order to create an open environment where people could share information and discuss issues without fear of attack.  By conducting team building exercises, keeping everyone focused on the facts, and communicating with complete transparency at all times, he was able to create the trust necessary to enable collaboration.

After the interviews, a core team of representatives from each of the five functions involved in promotion planning was identified to help address time savings and costs.  IPM created an “as is” process map that visually represented the workflows and interconnections among the functions involved based on observations of them.  This included identifying the inputs, outputs, hand-offs, triggers, activity owners, timing, bottlenecks, disconnects, rework, and constraints in the process.  Once a baseline process map was established, the team could literally see the many co-dependencies across functions and between individuals involved in planning and executing a promotion, as well as the true scope of the endeavor.

Using Six Sigma methodologies, IPM guided the team in adopting key performance metrics, which were previously lacking.  Measurable goals were established to track the strategic success of the promotion (increased sales, increased profits) and also to track the internal functioning of the planning process (deadlines met, rework required, error rate, cost).

IPM analyzed the planning process and worked with the team to identify greater efficiencies, such as ways to eliminate bottlenecks and engineer more seamless hand-offs.  IPM and the team also developed mechanisms for ensuring transparency and accountability from start to finish.

Finally, the IPM project manager helped the team develop methods to measure their performance – from meeting deadlines, decreasing error rate, and minimizing rework, to increasing sales and profits.  IPM transitioned control to the client successfully for implementation.

PROJECT RESULTS

In six weeks, IPM led the client team in developing a detailed, robust plan for implementing the new streamlined process and, thus, improving the firm’s ailing promotional process. Ultimately, the company decided to implement high-priority recommendations within 60 days and utilize the suggested performance metrics to measure progress and drive continual improvements nationally with each location’s advertising circular.

Just as important, IPM transformed a previously adversarial environment into one of collaboration and teamwork, using objective facilitation to bring the group together around a common goal.

Subsequently, company management established other cross-functional core teams to resolve issues where and when they might arise.  They adopted the methodologies, tools, and approaches that IPM introduced, including process mapping, planning, and team performance evaluations.

Realizing the value of project management IPM provided, the company is pursuing hiring its own internal project management team and business process engineers to maintain the efficiencies IPM helped create.