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Case Study: Effective Deduction Management

Situation

To address the growing concerns of its membership with regard to effectively managing deductions, the National Confectioner’s Association (NCA) retained Dechert-Hampe & Co. (DHC) to research and analyze the issue within the industry, make recommendations, and assist the Association in implementing a program to assist its members.

Solution

DHC conducted NCA member surveys and trade interviews to determine the scope and major issues surrounding deductions. Next, it conducted NCA member share groups to identify the nature and causes of deductions. A subcommittee of the NCA Trade Relations Committee, facilitated by DHC, identified action steps for addressing the issues and implemented the following:

  • Development of a Resource Guide offering a listing of products and services to assist members in the management of deductions
  • Development of standards and definitions for classifying and measuring deductions
  • Development of a tool for tracking and reporting deductions
  • Development of materials and seminars to educate the industry on standards and definitions, measurement processes, the deductions tracking tool, and management action based on objective data
  • Creation of an industry database for benchmarking purposes

After sufficient information results from the industry database, the NCA conducted best practices seminars to address the most critical issues associated with effective deduction management.

Results

DHC helped the association members dimensionalize the problem of effectively managing deductions and identify root causes. By creating standards, definitions and measurement processes, NCA members were able to implement management action to address key issues. The tracking and reporting allowed members to measure their progress and benchmark their results.

Over 123 NCA members attended seminars to learn how to implement the NCA tools, including software designed to feed the NCA industry database. Best practices seminars were introduced based on the industry database results and trends. The NCA and its members are confident that the long-term results will be a reduction in the number and dollar volume of unauthorized deductions across the confectionery industry as well as improved deductions management within member organizations.


© COPYRIGHT 2017 Dechert-Hampe Co.

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