Reduction of Net Working Capital (NWC) is well known for its positive influence on other KPIs like EBIT and profit. In addition, it can be used as an indicator for speed in your organization.
If you want to reduce NWC, you have to change your current processes because they were never designed to perform on this new levels.
Typically, Net Working Capital consist of:
Assets
- Inventories
- Receivables
- Other current assets
Liabilities
- Accounts payable
- Prepayments received
- Other current liabilities
With an Organizational Footprint you can analyze and benchmark current processes to understand their behavior thoroughly. This analysis is a good basis to adapt processes or define new process variants and together with management, process owners, and SAP specialist you can get your processes to the next level.
Since we did this analysis for many different companies, we can offer some indications of what you can expect from a particular process. We can also give hints and best (next) practice on how to get there.