Peak performance drives powerful growth

This S&P 500 manufacturer has aggressively grown its automotive division and recently set its sights on an even higher peak of performance: doubling revenues every three years. However, the early history of M&A-powered growth without an integration plan left the company with disparate technology platforms, data-quality issues, and no ability to communicate across regional operating units in Asia, Europe, and North America. Continuing to operate as separate business units meant that enterprise-wide functions and processes were not standardized and a massive amount of work was being completed via inefficient, labor-intensive processes. The organization was not operating under a scalable growth model and the operational inefficiencies threatened future growth goals.

The company had grown in the midst of its challenges, so if these issues were rectified, what could they accomplish? Asking this question led the organization to bring in KPMG to complete a top-to-bottom technology and operational overhaul of its automotive division to drive a single entity mindset, standardize processes, deliver one source of data truth, and prime their organization to support its ambitious revenue growth strategy. To support our client’s ascent, we brought our “art of the possible” thinking and embarked on a multiyear transformational journey to digitally integrate global operations into a powerful whole.

With our help, the automotive division has incorporated the “art of the possible” thinking into an advanced-practice operating model for its supply chain, finance, manufacturing, sales and marketing, sourcing and procurement, product engineering, and program management business processes. We successfully supported our client’s revenue goals and provided specific business outcomes including:

• a foundation for scalable growth in place via the implementation of globally consistent business processes and technology platforms

• integrated supply chain planning through internal and external suppliers

• globally standardized product engineering and design processes, and PLM integrated with ERP and other business systems

• enterprise-wide data governance in place, based upon standardized and automated data, as a foundation to support rapid reporting and analytics, eliminating the painstaking manual efforts to compile cross-functional, cross-plant, and cross-region information.

KPMG combined supply chain, finance transformation, and automotive sector insight to design and implement an enterprise-wide transformation of the company’s automotive operations around the world. The KPMG team:

• assessed the company’s current-state automotive data practices, business processes, and technology platform against industry performance benchmarks

• established a multiyear implementation roadmap designed to realize improvements and capture savings. Thirty discrete initiatives were clustered and sequenced under four major work streams: integrated business planning and analytics, enterprise resource planning (ERP), product lifecycle management, and data mapping and controls

• delivered a thorough business case with defined key performance indicators—to prioritize investments, leverage early investment-recoupment opportunities, and secure buy-in from critical stakeholders

• commenced the global transformation journey by preparing the organization for program execution and establishing a governance structure

• designed a future state global operating model designed around selected technologies and integrating 10 major business processes: plan-to-perform, plan-to-produce, plan-to-stock, order-to-cash, govern-to-control, record-to-report, source-to-pay, concept-to-product, acquire-to-retire, and prospect-to-order

• helped the company maximize its technology investments by leveraging our experience with digital solution providers such as Microsoft (for Dynamics 365) and Oracle (Hyperion Planning).

Successful transformation requires the right efforts, in the right order

The sequencing of a complex implementation roadmap was one of the most significant contributors to this project’s success. The roadmap optimizes the early benefits and cumulative impact of specific initiatives, calculates for ripple effects between them, and anticipates shifts in priority during the life of the project.

Midsize companies need transformation journey advisors, too

This company had not worked with a Big Four firm before. Using tested methodologies and prebuilt components, and drawing upon the insight of our automotive, supply chain, and finance transformation specialists, our client was able to take advantage of the scale and breadth of KPMG, in the configuration best suited to its needs.

Visionary companies welcome lessons learned from other leaders

During the current-state assessment and target operating model design phases of the project, KPMG was able to bring benchmarked perspectives to the automotive industry and function-specific questions to help company leadership shape its business transformation vision.