DESCRIPTION
Working Capital Management (WCM) refers to the administration of an organization's short-term assets and liabilities to ensure its ongoing operational efficiency and financial stability. Effective WCM is crucial for maintaining liquidity, optimizing cash flow, and ensuring the organization can meet its short-term obligations while investing in growth opportunities.
There are numerous benefits to effective WCM, including:
• Enhanced liquidity and financial stability
• Reduced operational costs
• Improved profitability and ROI
• Stronger supplier and customer relationships
Effective WCM requires a comprehensive Working Capital Management Strategy. This presentation introduces an approach to WCM Strategy based on 8 core pillars:
1. Short-term Cash Flow Management
2. Inventory Management
3. Demand Forecasting and Sales & Operations Planning (S&OP)
4. Asset Optimization
5. Accounts Receivable Management
6. Accounts Payable Management
7. Supplier Management
8. Working Capital Performance Management
This framework is focused on the 4th pillar, Asset Optimization. Asset Optimization focuses on maximizing the value derived from an organization's assets, including machinery, equipment, and technology.
This presentation breaks down a detailed 5-phase methodology to Asset Optimization:
1. Current Asset Utilization Assessment
2. Setting Optimization Goals
3. Optimization Strategy Development
4. Efficiency Improvement Implementation
5. Performance Monitoring and Measurement
It also covers Asset Management Strategies.
This PPT presentation is an excerpt from a more in-depth presentation on Working Capital Management Strategy.
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Source: Best Practices in Enterprise Asset Management, Working Capital Management PowerPoint Slides: Working Capital Management: Asset Optimization PowerPoint (PPTX) Presentation, LearnPPT Consulting
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