American snack producer Mondelez has hired management advisor Accenture to research its cost structures, as it seeks to save €2.2 billion in three years’ time. The system is already being used by 3G Capital, owners of Heinz.
Under this system, every line item of the budget must be approved by department managers unlike the traditional budgeting system under which only the cost variance needed to be justified.
It is hoped that through this partnership with Accenture, Mondelez will be able to grow its operating margins from 12% in fiscal 2013 to 14-16% by 2016
"We've watched the work that 3G has done with AB InBev and Heinz," says Mondelez CEO Irene Rosenfeld, "and we believe they can be of great help to us."
The biggest driver of the long-term operating margin target is the reinvention of the supply chain.
Mondelez is building an integrated supply chain organization, while simultaneously restructuring the supply chain network and driving productivity improvement through Lean Six Sigma, procurement transformation and simplification.
© 2014 - European Supermarket Magazine by Enda Dowling
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