Situation
A Fortune 500 specialty retailer sought to modernize its financial planning process, which had grown inflexible and unwieldy. While effective during a prior recession, the quarterly planning cycle no longer met the needs of a growing, dynamic business. The goal was a transformation to a faster, more flexible monthly planning model.
Challenge
The retailer faced several obstacles:
- Rigid processes: Traditional methods were incapable of adapting to changing business dynamics.
- Inconsistent assumptions: Redundancies and misalignment plagued interdepartmental collaboration.
- Operational inefficiency: Excessive time and manual effort delayed financial decision-making.
- Metric overload: Operators were burdened with irrelevant KPIs, detracting from impactful contributions.
Approach
Mu Sigma employed its Creative Destruction methodology to overhaul the planning framework:
- Conducted design thinking workshops, fostering cross-departmental collaboration and uncovering inefficiencies.
- Identified critical flaws, such as focus loss through hierarchical layers and outdated processes, as key transformation targets.
- Leveraged the Art of Problem Solving System (AoPSS) ontology to map and guide the overhaul.
The new system integrated advanced technology with human expertise, including:
- Machine learning and automation for faster and smarter planning cycles.
- Real-time collaborative tools, streamlining decision-making across departments.
- Modular solutions, adaptable to changing requirements without overhauling entire systems.
- Optimized metrics and streamlined processes to drastically reduce manual effort and cycle time.
The transformation was strategically phased over two years to mitigate operational risks and deliver incremental value.
Impact
- 80% reduction in work hours, from 23,000 to 9,000 person-hours.
- 65% reduction in cycle time, cutting the process from 42 weeks to just 15 weeks.
- $2.5 million in cost savings, reflecting efficiency and agility gains.
Business Impact
-
80%
reduction in work hours, from 23,000 to 9,000 hours
-
65%
reduction in cycle time, from 42 weeks to 15 weeks
Let’s move from data to decisions together. Talk to us.
The firm's name is derived from the statistical terms "Mu" and "Sigma," which symbolize a
probability distribution's mean and standard deviation, respectively.
