What is Discount What can we learn from

What is Discount What can we learn from ALDI and BIM? © Institute for Simplicity, Dieter Brandes & Nils Brandes

Why is simple so difficult? © Institute for Simplicity, Dieter Brandes & Nils Brandes

Jetzt auf türkisch © Institute for Simplicity, Dieter Brandes & Nils Brandes

1995 22 6. 800. 000 3. 627 20. 000 5. 500. 000 10. 000 © Institute for Simplicity, Dieter Brandes & Nils Brandes

Complexity Institute for Simplicity, Dieter Brandes & Nils Brandes

1. work 2. efficient © Institute for Simplicity, Dieter Brandes & Nils Brandes

complex simple Institute for Simplicity, Dieter Brandes & Nils Brandes 71

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The Complexity Curve Complexity (cost) ´ Number of components Number of options Number of items Number of employees Number of suppliers Number of customers Number of rules Number of. . . Elements © Institute for Simplicity, Dieter Brandes & Nils Brandes

- 1 - Avoid Complexity © Institute for Simplicity, Dieter Brandes & Nils Brandes

1. limited Assortment 2. daily consumption 3. easy to handle 4. best Quality 5. lowest price © Institute for Simplicity, Dieter Brandes & Nils Brandes

600 © Institute for Simplicity, Dieter Brandes & Nils Brandes

“Wenn uns bei der Kalkulation etwas beschäftigt, dann nur, wie billig wir eine Ware verkaufen können und nicht, welchen höchsten Verkaufspreis wir erzielen können“ – Karl Albrecht, 1953 © Institute for Simplicity, Dieter Brandes & Nils Brandes

Different Types 6 24 Customer looked 40 % 60 % Customer bought 30 % (15) 3% © Institute for Simplicity, Dieter Brandes & Nils Brandes (2)

ALDI versus Wal Mart Items 120. 000 Sales ww Bil. USD 450 Sales/Item Mil. USD 3, 75 1. 800 80 44 © Institute for Simplicity, Dieter Brandes & Nils Brandes

- 2 - Reduce Complexity © Institute for Simplicity, Dieter Brandes & Nils Brandes

HAYIR! © Institute for Simplicity, Dieter Brandes & Nils Brandes

Market Research Marketing Public Relations, Interviews ! HAYIR Fancy offices, expensive company cars Staff Departments Budgets Data Warehouse Controlling Consultants © Institute for Simplicity, Dieter Brandes & Nils Brandes 1

-3 Manage Complexity © Institute for Simplicity, Dieter Brandes & Nils Brandes

Autonomy and Responsibility © Institute for Simplicity, Dieter Brandes & Nils Brandes

Delegation and Decentralization © Institute for Simplicity, Dieter Brandes & Nils Brandes

CEO CPO CFO Category Managers Accounting COO . . . Internal Auditor IT as much decentralized as possible – central only when necessary and reasonable General Manager Sales Manager District Manager Accounting Administration Manager Regional Purchaser Property Manager Logistics Manager Personal IT Receiving Department Inner Transportation and Picking Store Manager © Institute for Simplicity, Dieter Brandes & Nils Brandes Dispatching / Truck Fleet

© Institute for Simplicity, Dieter Brandes & Nils Brandes

Trust and Control © © Institute for Simplicity, Dieter Brandes & & Nils Brandes 1

Trial & Error © Institute for Simplicity, Dieter Brandes & Nils Brandes

Optimize Maximize and Minimize © Institute for Simplicity, Dieter Brandes & Nils Brandes

Real / actual numbers instead of plans and budgets Less (data) ist more Just enough is more © Institute for Simplicity, Dieter Brandes & Nils Brandes

Continuous improvements © Institute for Simplicity, Dieter Brandes & Nils Brandes

現地現物 © Institute for Simplicity, Dieter Brandes & Nils Brandes 1

現地現物 Genchi genbutsu © Institute for Simplicity, Dieter Brandes & Nils Brandes

“Continuous improvements are better than delayed perfection“ — Mark Twain © Institute for Simplicity, Dieter Brandes & Nils Brandes

Small is beautiful © Institute for Simplicity, Dieter Brandes & Nils Brandes 1

Details © Institute for Simplicity, Dieter Brandes & Nils Brandes

© Institute for Simplicity, Dieter Brandes & Nils Brandes 341