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Q&A
Beyond its portfolio of leading brands, how is DPS planning to sustain growth?
Our leading brands have always given DPS a competitive advantage, and the past few years have been focused
on increasing investment behind them. The growth we’ve achieved has been solid, and we’ll keep the momentum
going by staying focused on our customers and taking full advantage of our integrated business model.
To do this, we’re embedding a mindset of rapid continuous improvement (RCI) across the organization.
What is RCI?
RCI is about excelling at delivering customer value and improving productivity by eliminating all non-value-adding
activities, thereby enhancing growth opportunities.
RCI begins with consumer insights and extends through every process, including innovation, marketing, sales,
manufacturing, distribution and administrative activities. While our RCI capabilities, which are based on the
fundamentals of Lean and Six Sigma improvement methodologies, are very early in their development, we are
encouraged by some recent successes.
How will RCI work?
The mistake many companies make is turning RCI into a project or a program. RCI must simply become
the way we do business at DPS. It’s now integrated into our companywide Call to ACTION. We are engaging
everyone from employees to business partners, and our senior executives are taking a very active role.
This journey began in our supply chain, where a few years ago we had a successful improvement program
led by a core group of Lean Six Sigma professionals. We’ve significantly expanded this group to enhance
and strengthen our capabilities. Just about every location and function within DPS will house a full-time
RCI professional.
Why do you think RCI will give DPS a competitive advantage?
RCI should enable us to free up additional resources
—
people, time and money
—
to invest in growing our
business. It should also enable us to improve on all dimensions of customer value, further strengthening
relationships with retailers, bottling partners and distributors.
What does RCI mean for shareholders?
Financially, RCI is about cash. Customers really don’t care how much inventory you have, how many warehouses
you use to store it, or how many miles you transport it. Customers do care about suppliers delivering quality products
where and when they want them. It’s that simple.
We believe that the traditional business model for achieving this can be improved substantially, thereby improving
financial returns and freeing up additional cash. DPS expects to achieve $150 million in productivity savings from
improvements in operating costs, working capital and capital spending over the next three years.
Marty Ellen:
RAPID CONTINUOUS IMPROVEMENT
Marty Ellen joined DPS as chief financial officer in April 2010 and
brings more than 25 years of broad financial experience with companies
in the franchising, manufacturing and beverage industries. In the Q&A
below, he discusses the role of rapid continuous improvement (RCI) in
the future of DPS.
DR PEPPER SNAPPLE GROUP 2010 ANNUAL REPORT
10