Ultriva Newsletter

C-Suite Leadership News - August 27, 2015

Posted by Cindy McGowan on Sep 3, 2015 10:53:00 AM

Manufacturing C-Suite Leadership News
 

Volume I, Issue 3
August 27, 2015
Intellectuals solve problems, geniuses prevent them.
Albert Einstein

 

Industrial Manufacturing M&A Activity on a Steady Climb in Q2 2015 According to PwC US
Merger and acquisition (M&A) activity in the industrial manufacturing industry maintained a strong pace in the second quarter of 2015, with a robust pipeline of deals coming to market in the second half, according to Assembling Value, a quarterly analysis of global deal activity in the industrial manufacturing industry by PwC US. The number of transactions recorded in the second quarter (worth more than $50 million), increased to 66, compared to 59 deals in the previous quarter and 62 deals in the second quarter of 2014. With $28.2 billion in announced deals, second quarter totals exceeded the $20.5 billion raised in the first quarter this year but were well below the near-record $60.4 billion set in the same quarter last year. In addition, the second quarter easily exceeded the five-year median of $19.9 billion.
 
U.S. acquirers remain interested in M&A as an opportunity to source new technologies, investing in advances in automation, efficiency, machine communication, and next generation robotics or acquiring niche capabilities in these areas. According to PwC, strategic activity in the second quarter, accounting for 64 percent of deal activity, covered a diverse range of end markets including filtration, industrial air and gas, electrical components, and auto parts and equipment. Industrial manufacturers remain focused on portfolio enhancement and strategic alignment, keeping an eye on economies of scale and operating efficiencies in core businesses. The need for 100% supply chain visibility is greater due to M&A activity. Manufacturers need to know what is received from suppliers. They must be able to track such shipments through the entire set of processes, from billing through customer shipment, including order location, the status of a customer's order, acceptance, and plan for ultimate shipment. This level of total visibility requires access to real-time replenishment data across a manufacturer's entire supply chain. Learn more:  bit.ly/1DVqBoT.  

 

C-level Executives Looking at VMI - Vendor Managed Inventory
 
Based on a recent Gatepoint Research survey of executives from a number of sectors, including manufacturing, retail, and telecommunications, there is a paradox in the industry. In spite of an increased interest in inventory programs that aim to reduce costs and improve customer service levels, companies are facing challenges in establishing their own vendor managed inventory (VMI) programs.
  
Key survey results highlighted this trend. VMI is not employed at all by nearly 30 percent of survey respondents. The opportunity for implementing a VMI program is clear: 36 percent of those surveyed stated that their organization has too much cash tied up in inventory, and 29 percent said that they have too much excess and/or obsolete inventory. Only 33 percent felt that inventory levels reflected optimized cost and service levels.   The financial benefits of lean management solutions include higher order fulfillment rates and improved customer service levels, inventory savings of 20% - 50% of value, freight charge reductions from 3.5% to 5% of volume, and visibility into the cost and impacts of decisions. Learn more: bit.ly/1MtJna2. 
Productivity Loss Simply Unacceptable
 
Productivity loss is a form of impact that often puts the bottom line at risk for what otherwise could be a profitable endeavor for stakeholders. While project impacts often results in delays to the project, they can also result in loss of productivity. Working with productivity losses can be challenging since onset may be difficult to detect; root cause is even more difficult to ascertain. These difficulties bring unique challenges for both -- the party attempting to establish a claim for additional costs and the party having to defend against what is often real evidence of cost over-runs, with only anecdotal evidence to support causation.  Lean Suite addresses head-on the complex set of challenges faced by organizations committed to achieving:
  • Seamless migration to pull-based replenishment.
  • 100% visibility up and down the supply chain.
  • Complete supply-chain communication and collaboration.
  • Actionable business intelligence for all aspects of supply chain operations.
Learn more:  bit.ly/1MtJna2. 

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Topics: Ultriva Sponsored News, C Suite Leadership

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