A major consumer goods manufacturer with a top 10 global food brands portfolio needed to focus strategic investments toward its most profitable products and markets. To operationalize its growth strategy in key regions, UMT applied Enterprise Portfolio Management capabilities to this Client’s CAPEX planning, forecasting, and tracking creating a solution which allowed them to improve margins through a focus on both profit enhancements and cost reductions.

1. Case Study: Capital Portfolio Management
Global Consumer Goods
Company Transforms Capital
Planning and Management to
Control $1B Capital Project
Portfolio
A major consumer goods manufacturer with a top 10 global food
brands portfolio needed to focus strategic investments toward its
most profitable products and markets. To operationalize its
growth strategy in key regions, UMT applied Enterprise Portfolio
Management capabilities to this Client’s CAPEX planning,
forecasting, and tracking creating a solution which allowed them
to improve margins through a focus on both profit
enhancements and cost reductions.
Capital Project
Portfolio Management
is becoming more
relevant due to
organizational
changes such as
mergers and
acquisitions,
consolidations and
divestitures as well as
CHALLENGE
the current
Channeling capital spend effectively and efficiently is key to creating a competitive
advantage in any manufacturing organization, including this Client. The Client was
struggling to promptly allocate and phase out capital expenditures for the timely
acquisition of new and the upgrade of existing physical assets supporting the
manufacturing of key products in growth markets. Often, over 25% of the annual
project budget was spent in the last quarter of the year. In many cases funding
was left on the table unspent preventing many strategic projects and initiatives
from being successfully executed and leading to lost profit opportunities and
market opportunities explored. The annual CAPEX planning and budget
aggregation of project capital data bottom-up from plant to regional to corporate
level often took months of full-time work from Plant Engineers and Financial
Controllers. Similarly, the month-end actual spend consolidation and comparison
against forecasts was a lengthy process lasting over two weeks and was not able
to effectively support the Client’s financial goals to maintain less than 10%
forecast variance globally. Specifically, the Client was experiencing the following
business issues:
challenging financing

globalized
competition
No standardized process to aggregate spreadsheet-based capital forecast
from plant to product category or region level as part of annual planning or to
support management decision making.

environment and
No single source of real-time standardized data on CAPEX budgeting,
forecasting and tracking across 100s of plants, 50 countries, 5 regions for
global portfolio reviews.
www.umt.com

2. ABOUT THE CLIENT
The Client is a major consumer goods
manufacturer making some of the
best-known snack brands in the
world. The Client has reinvented its
business multiple times over the
years and operates by introducing
significant strategic and
organizational changes on an ongoing
basis.
 Everything the Client does is
focused around investments in
Power Brands and Priority Markets
to drive revenue growth.

No timely global visibility into the share of profit-enhancing vs. profitsustaining projects in the annual budget.

Manual collection of financials into multiple forms across multiple plants and
duplicate work for Engineering and Finance.

Poor cash flow visibility for decision makers.

Incomplete / faulty financial data analysis.
SOLUTION
UMT worked with stakeholders from Global Engineering, Supply Chain,
Manufacturing, Capital Finance, and Information Systems to analyze the Client’s
business goals from multiple angles and prioritize capabilities in a manner that
provides optimal value for all impacted Client groups and directly addresses the
challenge at hand.
 Expand gross margins by pricing to
offset higher input costs,
optimizing product mix and
generating productivity savings.
 Leverage shared services to
provide the fuel for greater
investment in quality, marketing,
and innovation to perpetuate the
strategic cycle.
ABOUT UMT CONSULTING
UMT is a recognized provider of
Project Portfolio & Integrated
Portfolio Management solutions and
management consulting best
practices. For over two decades UMT
has helped Global 2000 companies
gain transparency across their
business and technology asset
portfolios, rationalize costs,
collaborate to make smarter
investment decisions and improve
project success rates to maximize
ROI. UMT is Microsoft's Worldwide
PPM Partner of the Year 2013 and
has been twice named a Gartner Cool
Vendor in PPM and is positioned as a
Visionary in Gartner's Integrated IT
Portfolio Analysis Magic Quadrant.
UMT has offices in New York,
Bellevue, Boston, Chicago, Dallas,
Houston, San Francisco, Los Angeles,
Philadelphia, Reston, the United
Kingdom, and Romania.
UMT’s solution combined Enterprise Portfolio Management with CAPEX
management capabilities to provide the Client with a standardized annual global
CAPEX process capturing detailed project information and fully integrate it into
the Client’s business operating model.
RESULTS
The solution designed by UMT enabled the Client to fully transform and
modernize their CAPEX management and decision making process at a global
scale. It is used exclusively during the Client’s annual budgeting process and helps
them organize and align their CAPEX investments to those profit enhancing or
profit sustaining projects with maximum impact on the bottom line. The Client is
now able to strategically plan their future capital investments and yield
competitive advantages by adding capacity, improving quality or supporting
innovation. The UMT solution helped the client meet the following manufacturing
objectives:

Reduce operating costs and boost productivity by automating or improving
the utilization of equipment.

Replace or upgrade obsolete or worn out assets in a timely manner without
disrupting the production of growth brands.

Staying compliant with quality, environmental sustainability and safety
standards and regulations.

Increase manufacturing capacity to effectively support commercial growth;

Enter new ventures and explore untapped market opportunities in a timely
manner.
Currently, the solution is live in four Regions and 34 countries and houses the
roughly $1bil USD 2013 global capital budget.
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