Control of a new business model with driver-based planning
Greetings from the kitchen: A mix of driver-based approach and new methods not only increases the efficiency and accuracy of planning, But the increased transparency also ensures a great increase in acceptance and as a result: exceeded targets.
Steering a new business model with more drivers and interdisciplinary dependencies
In the midst of the pandemic, BLANCO was undergoing a profound transformation – from a pure manufacturer of high-quality kitchen equipment to a system provider.
This created challenges for the controlling department: BLANCO Controlling had already seen the functional limits of the spreadsheet solutions approaching. How could the new business model, with its significantly larger number of drivers and interdisciplinary dependencies, still be mapped, let alone controlled, using traditional methods? Finally, the controlling structure was also put to the test.
Washed with all the waters. And what is it cooked with?
As a manufacturer of premium products for the water area in the kitchen, BLANCO is, one could say, adept at all things digitizing. But even the best digital chefs cook only with data. And their complexity had become too high to manage with traditional spreadsheets.
Fabian List, Group Controller at BLANCO, puts it this way: “Every single material was planned in every market. For a long time, that still worked well in the classic structure. Now it has become too elaborate.” After all, one also wanted to see into the future. The driver-based approach was the missing ingredient.But how complicated, you might ask at this point, can such a business with kitchen components such as faucets, sinks, waste systems or water filters be?
It’s not complicated – when looking from a bird’s eye view. That being said, it is surprisingly complex. This becomes clear when looking into the technical side of things. Then you realize, for example, that material costs are key business drivers and that they are made up of a number of components. That business can (and must) be structured by region, by product and product group, by prestige class, and by distribution channel. Added to this are the much-cited VUCA times: Freight costs (and times), exchange rates and material supply chains fluctuate not insignificantly. The uncertainties for purchasing, logistics and production are immense. Thus, numerous dimensions and categories come together to create a multidimensional data cube. Too much for the “old Excel world”.
An additional key challenge is the issue of sustainability. At BLANCO, says Matthias von Daacke, Managing Director and Head of Global Controlling, sustainability is central: Not only because high demands are placed on kitchen equipment, but also because the family-owned company sets itself high moral standards. Social commitment and long-term economic goals must be in line with the vision for growth. The topic of sustainability therefore always had to be taken into account and had to be centrally integrated into corporate management.
And there was another item on the list of requirements: implementation and compliance had to be as seamless as possible for the IT department. At best, a new planning solution should be able to be integrated, set up and used on a self-service basis.Let’s go: We have already prepared the worktop and finely diced the data.
Finely cubed data and driver-based planning
With Valsight, BLANCO’s controlling team – led by Matthias von Daacke – created the technological basis for the shift to an agile controlling organization and was thus able to significantly increase its impact – in the middle of the pandemic.
The Valsight Partner CTcon Management Consultants supported the re-design of the planning processes and the implementation of the new methods, which quickly became the new standard.
In order to provide the required flexibility and data handling that BLANCO Controlling needs, the Multi-year planning from an Excel world that had become confusing to the driver-based approach.
Thus, significantly higher flexibility for the model calculations was achieved. Instead of spending several hours or days calculating possible scenarios, as was the case before, this can now be done “live in the meeting, at the push of a button”.
In the words of Matthias von Daacke: “Valsight gives us different perspectives on our data cube and allows us in the planning phase to switch individual measures on and off during a live meeting and to view and evaluate the effects in seconds – at the push of a button – even for multi-year planning.”
A proof of concept as a greeting from the digitization kitchen
A first impact served Proof-of-Concept (POC): proof that Valsight would be able to make a difference in BLANCO Controlling. On a small scale and with a radical self-service approach, the Valsight team, together with Group Controller Fabian List, set up an initially limited model in the Valsight suite, which was refined by the BLANCO Controller:inside. This was the correct approach, as List confirms, “I always start with a very small model and then scale it up.”But it turned out that something fundamental was missing: a process that would ensure the right data basis.
The roll-out or: Community cooking evenings revive business
The driver-based approach seemed set. But how should it be rolled out now? CTcon’s experts for digitalization and change management did two things: In a detailed workshop, the premises that formed the basis for the calculations of BLANCO’s controlling were first examined in detail.
Then it was off to the World Café, a method that, when applied to controlling, is known as campus planning. Roughly speaking, this is an interdisciplinary business game that helps to take the technical input from all relevant areas (product view, regional view, etc.) into the planning round – so that controlling does not operate in the proverbial ivory tower, disconnected from value creation. This method was convincing thanks to its holistic nature and the fact that it could provide a suitable framework for cross-cutting issues as well.
The thus redesigned planning process had to function remotely due to the pandemic – and it did! Even though they are very much looking forward to a “reunion in real life,” Matthias von Daacke says: “Accompanied by the system, the colleagues from the regional and product teams were able to quickly agree on the optimal routes.”In the Webinar,Matthias von Daacke explains the procedure in detail.
Finishing & Cleaning Up!
BLANCO successfully maps strategic planning with Valsight. And it has found a way to cheat the growing market volatility: The advantages of the agility and flexibility gained are not nullified by the now broader planning process, but complemented because overarching issues have found their place.
The Valsight approach of thinking not only from the desired outcome, but also from the influencing factors, has ensured increased identification and thus increased commitment throughout the organization. As a result, sales and profitability targets were achieved well ahead of schedule in some cases.
Thanks to the POC approach, the use case could be tested with very limited deployment – when it proved successful, the roll-out could take place.
The planning method itself has also changed: “Where there was previously highly complex planning,” says Group Controller Fabian List, “there is now planning in clusters, aggregated to quality segments. “This reduces the level of detail enormously and makes planning lean and agile – yet precise enough.”
Perhaps the most interesting sense of achievement: the results achieved through the interplay of method and tool – the campus planning round is conducted along Valsight logic – increased transparency did not provide increased pressure on contributors, as one might well expect from transparency initiatives. On the contrary, by creating a common (better yet: shared) understanding of the premises and the driver model, an unprecedented level of acceptance was achieved. Instead of introducing tacit “range buffers” into the planning, as is sometimes the case, realistic targets were introduced from all sides at a thoroughly ambitious level. They were nevertheless surpassed.
And the biggest gain? Matthias von Daacke: “We have calculated scenarios in fractions of a second, where previously people would have taken a day to do this work. That was one of our biggest wins and massively increased the acceptance of the driver-based approach.”