"Final product flexibility means customer satisfaction. Instead of fighting to reduce complexity learn how to manage it. Use it as a customer-value added feature. The K-Method offers a new approach for managing the challenges of complex purchasing categories with high number of specifications and prices, all covered under the same underlying technology."
Industry: K-Method Consulting is specialised on FMCG and Pharma companies. This is where we have most of our experience and have already piloted the K-Method.
Function: The K-Method has its roots in the Procurement function. It will directly effect how prices are defined and call-offs are made. It will also impact Packaging Development due to its insights in Value Engineering. Furthermore, the K-Method will also support Marketing Accounting due to its ability to make cost calculations for new products without prior consulting the supplier.
Size: The size of the company does not matter so much as the complexity of a purchasing group. A purchasing group which can take an advantage of the K-Method requires at least 50 different specifications. Big FMCG companies, however, will have a couple of thousand different specifications in a purchasing group like corrugated outer cases.
Commodities: The K-Method is only applicable for purchasing groups which are driven by customer specifications. These are for FMCG typically packaging materials like labels, folding cartons, and tubes.
It is a fair to ask the question why to engage K-Method Consulting. Indeed, the theoretical know-how of the K-Method has been published in form of a text book (English Version / German Version) which is written in such a way that it is easy to read for any procurement professional.
Hence, K-Method Consulting does not see its primary role to provide the know-how of the K-Method to its clients. Rather, K-Method Consulting will use its experience with the K-Method to convince buyers and even more suppliers to apply the K-Method, as resistance from both sides is to be expected. This is for any outsider surprising as outsiders who learn about the K-Method for the first time feel immediately comfortable with this approach. They even think that the K-Method is the usual way business is done in such industries with such commodities.
Furthermore, K-Method Consulting will facilitate changing those parts of the business process affected by the introduction of the K-Method. These are especially changes of Master Data, Purchasing Records / Frame Contracts, Call-offs, and Invoice Control procedures.
Even when the K-Method is fully understood by all stakeholders of a company, and suppliers have confirmed their cooperation, as well as sufficient IT resources are on board, we believe it is worthwhile to involve K-Method Consulting. We are convinced that K-Method Consulting can complete K-Method projects at least 8 months faster than any company could when introducing the K-Method for the first time without experienced help.
We feel that this is a very relevant aspect as the K-Method will be delivering significant savings in the area of internal administration of the purchase-to-pay process and to a lower extent on the purchasing prices of material items. Hence, time is money!
We are afraid to make you aware that the clock just started now to tick.