Many Supply Chain Consultancies employ smart solution engineers, analysts, and technology specialists who live and breathe detail. They’ll spend months developing great outcomes and building 90-slide presentations covering network strategy, inventory optimisation, DC design, transport models, and cost-to-serve analysis.
However, they walk into the boardroom to present a business case worth $50 million, $150 million, or sometimes close to a billion dollars, and they have a very short window and an audience short on time to convey all these details.
Arthur Dardoumbas, Executive Director at ThreeSixty Supply Chain Group, learned this lesson early in his career from his General Manager of Development & Solutions at a Global 3PL Logistics provider.
“Even at the higher level of capex, boards would say you’ve got half an hour, which means to make the biggest impact you should only have five slides. Anything more, put it in the appendix for the finance or M&A specialists to review,” Arthur says.
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That directive stuck, shaping how he approaches every boardroom presentation since. The skill of distilling complexity into clarity can be just as valuable as the technical expertise behind the supply chain transformation.
The commercial answer
C-level executives and boards have internal teams and paid consultants to do the detail. They trust the work has been done. What they need is the commercial answer – will this transformation deliver the return and business value they’re looking for?
Arthur frames it around what he calls the balanced solution, where technical, operational, and commercial elements must align. “But in the end, commercial hurdles outweigh the other factors that the C-level care about,” Arthur says. “Is it going to give me the return?”
He’s witnessed too many consultants who don’t sell automation equipment nonetheless leave meetings with automation as the answer.
“Automation alone isn’t the solution,” he says. “It’s appropriate solution, systems and capital to provide the commercial return. That appropriate capital might not be automation – it might not need to be because it doesn’t give you the operational balance, which will kill the business.”
Automation companies often promote three-year paybacks, but Arthur points out they’re only calculating the automated components – predominantly storage and picking. “What about inbound? What about bulk storage, replenishment, returns, transport, dispatch? What about all these other tasks that also need some sort of commercial return?”
The question becomes: how do you turn months of analysis into a business case that wins approval?
ThreeSixty’s framework is simple but effective:
1. An executive summary that could be standalone for approval.
2. The commercials that support it.
3.The technical answer
4. The operational answer backing up the commercials.
5. A recommendation and outcome.
“That’s all a board wants to see,” Arthur explains. “But now you’ve got 90 slides to turn into five.”
Using this approach, ThreeSixty has turned seven projects into board-approved business cases over the past 12 to 18 months. All seven are now in execution and delivery.
“It’s successful for the customer because their business partner has presented the transformation in a way that resonates with their board,” Arthur explains. “We always have to do the work of the discovery phase, the data analysis, understanding operations and creating a commercial baseline because then we can stand behind the recommendation. Anytime a CEO or CFO or board asks us a question on those five slides, it’s a question you can only answer if you’ve done the fastidious detail.”
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How to break down costs
Australia presents specific challenges that shape every commercial justification. We have some of the highest property costs per square metre globally, especially in Sydney, where vacancy is also extremely low, and our labour rates in our industry are also extremely high. These two cost centres represent roughly 70 per cent of a typical supply chain P&L – 60 per cent labour, 10 per cent rent. The harsh commercial reality is that labour reduction often provides the largest financial justification for transformation projects.
Property can become an emotional decision in Australia because of supply and demand challenges. “From a financial perspective, property typically represents only around 10 per cent of the P&L, yet it can carry more weight in decision-making because it represents the physical home of the operation – the roof over the business’s head.”
Then there’s inventory and working capital – a major benefit that often gets overlooked in commercial evaluations. A supply chain transformation might improve inventory holding and therefore working capital, reducing stock levels from $100 million to $60 million through network optimisation. Despite freeing up $40 million in working capital, this improvement doesn’t typically factor into payback calculations. “No CFO says thanks, here’s your payback, because it doesn’t fall into the commercial framework,” Arthur notes. The benefit is real, but it doesn’t fit neatly into the standard business case structure that boards use to evaluate projects.
Sometimes the best option isn’t the right option. The two-year payback for large capital isn’t always what the business needs, as it has a very large capital outlay – the four-year payback for half the capital might be the better choice. A hybrid approach combining some automation with manual processes can deliver strong returns while requiring significantly less capital outlay upfront.
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The meetings and presentation before the presentation
Insufficient stakeholder management is one of the most critical errors consultancies make. Presenting to a board for the first time without prior engagement almost guarantees failure. Engage with C-level executives well before the formal presentation – proactively seek alignment and buy-in about the project’s direction, challenges, risks, and recommendations.
“What we do with our customers at C-level is have informal catch-ups away from an office, away from a boardroom,” Arthur explains. “You need to be open about what’s going on, what they’re going to see, the hurdles, the roadblocks, the risks before we present. So when they get in a room, the five slides aren’t a surprise. If they’re seeing it for the first time, they’re going to have more questions than answers and they’ll normally turn it away.”
Overall, the transformation of over 100 slides into five isn’t about losing detail. The detail still exists and must still be done to answer board questions with confidence.
Boards have trusted consultants to do the work. What they need is the answer: will this deliver the return? And they need it in half an hour, on five slides.
Cejay is a Content Producer for Supply Chain Channel, Australia's learning ecosystem created to fill the need for information, networking, case studies and empowerment for everyone in the supply chain sector.
