SFS Is Our DNA
The Stanley Fulfillment System (SFS) is our
way of business. It's more than manufacturing or operational efficiency.
It's a mindset, innovating how all work gets done and how we deliver
value to the customer. An integral part of the culture, SFS encompasses
and continually improves all of our business processes. It synchronizes
the front end of the business with an ever-improving supply chain. It
drives all practices toward best practices. It's how we generate capital
from acquired assets to fuel further diversification and expansion.
SFS is our competitive advantage, the core of our culture of
continual improvement, and a relentless force for operational excellence
and profitable growth.
We began implementing SFS in 2007, with a focus on
accelerating our working capital turns. (Working capital turns refers to
the number of times in a year that a company is able to convert its
working capital into sales. The higher your turns, the more cash you
free up for other purposes like acquisitions, dividends and share
buybacks.) By the end of 2010, legacy Stanley had improved from 4.5 to
8.6 working capital turns. The Stanley Black & Decker combination
reverted us back to 5.7 turns. This represents a significant
opportunity. We have the knowledge and discipline to nearly double our
working capital turns over time by applying SFS to our acquired assets
and continually improving our performance across the board.
Gains in working capital turns are just a part of the power
of SFS. While reducing inventory levels dramatically, we have managed to
raise service levels and customer satisfaction. We are working toward
an ideal, what we call the "glass pipeline," connecting the entire
supply chain closely and transparently with what is happening in the
marketplace.
The discipline of SFS includes the following:
Sales & Operations Planning (S&OP)
is a dynamic and continuous unified process that links and balances
supply and demand in a manner that produces world-class fill rates while
minimizing DSI (Days Sales of Inventory).
Operational Lean is the systemic application
of lean principles in progressive steps throughout the enterprise to
optimize flow toward a pre-defined end state by eliminating waste,
increasing efficiency and driving value.
Complexity Reduction is a focused and overt
effort to eradicate costly and unnecessary complexity from our products,
supply chain and back room process and organizations. Complexity
reduction enables all other SFS elements and, when successfully
deployed, results in world-class cost, speed of execution and customer
satisfaction.
Global Supply Management focuses on
strategically leveraging the Company's scale to achieve the best
possible price and payment terms with the best possible quality, service
and delivery among all categories of spend.
Order-to-Cash Excellence is a methodical,
process-based approach that provides a user-friendly, automated and
error-proof customer experience from intent-to-purchase to shipping and
billing to payment, while minimizing cash collection cycle time and DSO
(Days Sales Outstanding).
Common Platforms are an essential component
of leveraging technology to facilitate organic growth and integration of
acquired companies. We develop standardized business processes and
system platforms to reduce costs and provide scalability.