best-in-class to both our customers and our employees and fuelling profitable growth .” Avaya ’ s supply chain has delivered undeniable results .
Recently recognised by Aberdeen , Avaya exceeded industry benchmark best-in-class performance on all 11 metrics it tracks externally . The company has reduced supply chain expense by $ 125mn per year , equivalent to a 50 % reduction , and driving down expense to only 3.8 % of revenue versus 4.4 %.
Similarly , Avaya has reduced its cash tied up in net inventory by 94 % to $ 181mn . That ’ s resulted in a 224 % improvement in inventory turns from 5.8 up to 13.0 turns .
Simultaneously , customer satisfaction and on-time shipments are at a record best , with 97 % on-time in 2017 compared to 78 % in 2010 . This has driven optimal revenue recognition , cash to cash cycle , and reduced quarter end and weekly average unshipped hardware revenue by 95 % to less than 0.5 % of revenue .
Avaya ’ s supply chain transformation is well documented with tremendous results to move from ‘ worst-in-class ’ to best-in-class . It ’ s been achieved by a great team immersed in the right culture , delivering continuous process improvements , and leveraging strategic partnerships . Not surprisingly , the Avaya leadership team has more transformation planned for the future .
“ With a very large data company like ours , global standardisation continues to be an absolute mandate ,” Green acknowledges . “ We have opportunities to push this efficiency model and partnership model across the rest of the company . We ’ re actually spending a lot of our time driving the cultural and operational success we ’ ve had in supply chain to other organisations . That ’ s a pretty unusual story if you ’ ve got a supply chain team that ’ s helping shape the rest of your company in very cool , strategic ways .” www . gigabitmagazine . com 137