Customer Segmentation 

Segmentation and Service Model

Objectives

Customer segmentation serves as a critical input for the below topics:

• Adapt servicing models by segment in light of customer needs and their strategic interest for Solvay
• Optimize resources allocation (front line and support functions) and cost-to-serve 
• Define optimal channel mix (e.g. use of distribution) to serve our customers, in particular long tail customers 
• Develop relevant baseline, KPIs and dashboards to monitor these initiatives

Service Model creates value through:

• Increase efficiency of the organization through the standardization of internal rules and priorities
• Define optimal service level to serve our customers (Standard or Premium) for each segment
• Help prioritize customers supply in times of allocation as part of S&OP
• Develop relevant baseline, KPIs and dashboards to monitor these initiatives

Definitions

Segmentation enables us to group customers in different segments according to their relevance and growth potential; Segments are divided into 8 categories.

GBU specific thresholds (quantitative) have been defined to define Critical and Standard accounts:

Service Models then focus on developing a set of standardized rules of how to serve, prioritize and manage these segments in different functional areas such as Supply Chain, Marketing and Sales, R&I… (click on the link below to see concrete GBU examples)

Implementation and best practices

Customer Segmentation

We define customer segments following a 7 steps process (duration ~6-12 weeks)

→ For further details on how to integrate these segment in Solvay’s systems follow the How-to guide (link here)

Service Model

We define Service Models following a 3 steps process (duration ~7-9 weeks)

→ For further details on how to integrate these segment in Solvay’s systems follow the How-to guide (link here)

Main KPIs

Assessment of Customer Segmentation and Service level

KPI related to Customer Segmentation

Once customer segmentation has been performed at a given GBU, you should meet the below indicators:

• 97%+ of the GBU sales and contribution margin is mapped to the different segments
• 90%+ of frontline FTE time can be allocated between segments to assess the frontline resource intensity of each segment and help indication resource allocation optimization options

KPI related to Service Level

Monthly maintenance and KPI tracking through the Service Levels page of the Customer 360 Dashboard (SC related elements) - Click here for more details

Responsible by GBU

Minimum requirements

Segmentation:

97%+ of the GBU sales and contribution margin is mapped to the different segments

90%+ of frontline FTE time allocated between segments

Key Documents

• Playbook
• Specialty Polymers
• Novecare
• Technology Solutions
• Aroma
• Peroxides

Key Trainings:

Key contacts

Roberta Narvone

Wolf Sanner

Linked pages:

• Distribution Management
• Long Tail Management
• E-commerce