Todays Agenda Introductions Consulting Overview Consulting Environment Keystone

Today’s Agenda » » » Introductions Consulting Overview Consulting Environment Keystone Overview Small Firm versus Big Firm Keystone experience in turnaround situations WWW. THEKEYSTONEGROUP. COM September 18, 2001 2

Consulting Overview Our clients are seeing a problem once, but we see it many times… Business Issues Our Tools » Business stops growing » Interviews » Profitability is poor » Access to client personnel » Specific Problem » Data collection » Operational Issues » Analysis » Poor Manufacturing throughput » Inventory Issues » Other » Strategy WWW. THEKEYSTONEGROUP. COM » Benchmarking » Strategy » Focus » Client team » Implementation plan September 18, 2001 3

Consulting Environment The consulting environment is characterized as a high energy, dynamic setting… » » » » » High intensity and energy Client result focused Deadline focused High expectations Forefront of new business solutions Team problem solving Creative ideas and problem solving emphasis New clients, new problems, new solutions Travel / Flexibility expected WWW. THEKEYSTONEGROUP. COM September 18, 2001 4

Consulting Environment The career path is well defined but less rigid than at a larger firm… » » Analyst = Staff Consultant Associate = Associate Principal = Manager Director = Partner WWW. THEKEYSTONEGROUP. COM September 18, 2001 5

About Keystone Consulting Group Keystone is a general management consulting firm based in Chicago and founded in 1991… » Focused on middle market manufacturing and distribution companies » Keystone’s premise is to offer “Major League” consulting services to the middle market » Pragmatic vs. theoretical » Highly experienced, un-leveraged teams » “Work with” versus “tell” clients WWW. THEKEYSTONEGROUP. COM September 18, 2001 6

About Keystone Consulting Group Our marketing focus is oriented towards middle market, manufacturing and distribution companies… …we define middle market as companies with $50 M to $1 B in sales. WWW. THEKEYSTONEGROUP. COM September 18, 2001 7

Keystone vs. Other Firms Differences exist between Keystone and larger firms… Keystone Larger Firms » On the job training » Training program » Small project team » Large hierarchical project teams » Hands-on: heavy client interaction and dependence » Consulting firm team: lower client interaction dependence » Regional market focus » Wider market focus » Self-paced career progression » “Lock-step” career progression » Work directly with Senior Managers » Work with division or department management WWW. THEKEYSTONEGROUP. COM September 18, 2001 8

Analyst Project Experiences WWW. THEKEYSTONEGROUP. COM September 18, 2001 9

Analyst Experience Consumer Product Manufacturer… » Client - $300 MM consumer product manufacturer in New York - cosmetics division » Project Team - Director, Senior Associate, Analyst » Client Problem - Order Fulfillment » Solution WWW. THEKEYSTONEGROUP. COM September 18, 2001 10

Analyst Experience Analyst roles on this project were. . . » » » » Interviews Concept Development Data Analysis Site Visits Initial Conclusions Industry Research Presentation WWW. THEKEYSTONEGROUP. COM September 18, 2001 11

Analyst Experience Why Product Does Not Ship On Time ISSUES • Insufficient time to respond to changes • Errors • Bottleneck situation • Late in ordering • Missed ordering • Insufficient use of forecast/poor forecasting WWW. THEKEYSTONEGROUP. COM September 18, 2001 FIXES • Diligent weekly review • “Real time” info on missed shipments • Heightened focus on delivery targets • Scheduling review, exception report • Promo limits - number of changes • Limit overrides and changes to schedule • Prioritize vendors; review planning needs 12

Analyst Experience Automotive Supplier… » Client - $100 MM Tier 1 automotive supplier specializing in steering linkage systems » Project Team - Director, Analyst » Client Problem - Throughput, Customer Pressures » Solution - Lean Manufacturing » Results WWW. THEKEYSTONEGROUP. COM September 18, 2001 13

Analyst Experience Issues » Key customer demanding annual cost reductions » Initial attempt at Lean production went nowhere » Belief that better use of MRP system was the solution » Work force concerned that Lean equals layoffs » Piece-rate incentive system WWW. THEKEYSTONEGROUP. COM September 18, 2001 14

Analyst Experience Solutions » Implementation of Keystone’s Flow Design methodology to energize Lean efforts » Implemented a smooth flow of materials to minimize excess handling and Work-In. Process » Implemented a raw material kanban system with visual pull scheduling » Developed an incentive pay system centered around performance to plan, delivery and quality WWW. THEKEYSTONEGROUP. COM September 18, 2001 15

Analyst Experience Results » Benefits began within 6 months of project initiation » Annual cost savings of $850, 000 on $33 Million in sales How did we get those savings? » » Inventory Turns increased by 18. 2% Scrap decreased by 57% Rework decreased by 92% Labor $$ Per Unit Produced decreased by 21. 2% WWW. THEKEYSTONEGROUP. COM September 18, 2001 16

Analyst Experience Senior Analyst roles on this project were. . . » » » » » Develop / manage the project plan & budget Team Facilitator Training of Team Members & Management Interviewing Data Collection and Analysis Identifying Sources of Problems Implementing Changes Presentations to Management Conceptual Integration with Existing Systems WWW. THEKEYSTONEGROUP. COM September 18, 2001 17

Contact Us Please contact us with further questions, or to submit a resume to interview with Keystone » Sarah Austin saustin@thekeystonegroup. com » Brian Stewartbstewart@thekeystonegroup. com » Joe Zito jzito@thekeystonegroup. com » Ryan Windy rwindy@thekeystonegroup. com On Campus Interview » November 1 st WWW. THEKEYSTONEGROUP. COM September 18, 2001 18