APC 2014 Annual Report Download - page 36

1OVERVIEW OF THE GROUP’S STRATEGY, MARKETS AND BUSINESSES
ORGANIZATIONAL SIMPLICITY AND EFFICIENCY
The segmented response to customer needs
For the supply chain, this approach aims to synchronize suppliers
and plants through distribution centers and carriers to improve
In2012, Schneider Electric launched the «Tailored Supply Chain» service to customers. Many programs have been launched in order
program as part of the company program Connect, with the aim to to offer new features and improve the responsiveness in relation to
better align the supply chain set-up with the needs and behaviors market demand supported by new technologies.
of each customer segment (distributors, partners, panel
Supply chain optimization will benefit from the flow model,
builders,etc.).
combined with the integration of the IT systems of our logistics
Six initiatives were defined to support the transformation of the partners with cloud technology. Similarly, a partnership with Kinaxis
supply chain: will enable the «digitization» of industrial planning and extend the
purchasing: step up purchasing to drive proactive planning of
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scope. This technology facilitates interaction loops between the
procurement; different functions and improves our responsiveness to customers
as well as significantly reducing the value of fixed assets in
optimization of the industrial operation: manage the
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inventory. Finally, the development of new features tailored to each
operation of critical components to improve lead-time to customer segment on our targeted computer systems (of the
customers (suppliers, factories, logistics); supply chain) will be supported by a strengthened IT convergence
supply chain flow redesign: reduce lead-time through
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plan.
optimization of plant and distribution center footprint and flow
This digitization of the supply chain fully meets the priorities of the
design;
Group’s industrial strategy targeting first customer satisfaction
transportation rationalization: increase partnerships with
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while reducing costs for increasing responsiveness and reducing
selected carriers to improve customer service; capital employed.
industrial planning: build best-in-class planning process by
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A key competitive advantage for our customers
customer segment;
IT capability: align information systems strategy with this
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segmentation. All of these efforts to improve the supply chain have been
This approach required a more dynamic industrial strategy around recognized well outside the company. In September2014 Gartner,
how we serve our clients, how to configure our products, a leading IT research and advisory firm, ranked Schneider Electric’s
equipment and services for our customers and how to deliver to supply chain 22nd in Europe and 67th worldwide, an improvement
those customers, while at the same time, simplifying the way we of 34 places in two years.
work and therefore focusing on creating value for our customers by The Group’s aim for the next few years is to turn this into a
streamlining our decision-making processes and competitive advantage through customer recognition that we offer
organizationalstructure. the best logistics solutions. The new 2015-2020 company
This led to the announcement of a new Industrial Organization program aims to drastically improve the capacity and response
for2013, structured around eight regions (Europe, CIS, China, speed of the supply chain while strengthening economic and
India, Pacific, Asia, North America, South America) which groups ecological efficiency in order to even better serve our customers by
all of Schneider Electric industrial activities together in these providing them with a customized logistics response that meets
regions. In addition, this also led to the verticalization of all their expectations while ensuring sustainability.
Purchasing activities to simplify and unify its contact with suppliers.
The digitization of the supply chain
In 2013, Schneider Electric put emphasis on digitization as a way
to accelerate and intensify its transformation.
Purchasing: selection and internationalization 6.4
Purchasing corresponds to around 50% of revenue and plays a includes multinationals as well as small, medium and intermediate
crucial role in the Group’s technical and business performance. As sized companies.
part of its program to optimize Purchasing, the Group has sought Suppliers are selected for the quality of their products and
to source a significant portion of its purchases from the services, their adherence to delivery deadlines, their
top-performing suppliers («recommended» suppliers) and aims to competitiveness, their expertise, their innovative capacity and their
increase local sourcing in the new economies to more than50%. commitment to corporate social responsibility (CSR). As a
Schneider Electric primarily purchases prefabricated components, signatory to the United Nations’ Global Compact and in view of its
raw materials (silver, copper, aluminum, steel and plastics), recommendation of ISO26000 to its principal suppliers, Schneider
electronic and electrical products and services. The supplier list Electric encourages its suppliers to join this sustainable
development process and its continuous improvement.
34 2014 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC