ALLIED EAST AFRICA LIMITED

Robert Shisoka

Hydrocarbon Management Consultancy

 ALLIED EAST AFRICA LIMITED

OVERVIEW
• 4 + 1 Strategic Intent
• Introduction
• Vision
• Mission
• Objectives
• Keys to Success
• Competitive Advantage
• Goal
• Food For Thought
• Challenges
• Opportunities
• Strategies
• Quality
• Q&A
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REALIBILITY IS FOR EVERYBODY, EVERYDAY, IN EVERYWAY, ALL THE
TIME!

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 ALLIED EAST AFRICA LIMITED

“4+1” STRATEGIC INTENTS

Profitable Growth

Operational Cost Capital

Excellence Reduction Stewardship

Organizational Capability

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 ALLIED EAST AFRICA LIMITED
INTRODUCTION
• AEAL will Aspire to be the Leading Manufacturer of New LPG
Cylinders in Sub-Saharan Africa & Also Offer LPG Cylinder
Revalidation Services.
• To Achieve This, Shareholders Invested in a State of the Art
LPG Cylinder Manufacturing & Revalidation Plant
• The Overall Strategy is Based on Continuous Improvement,
Measuring Results & Providing Feedback to Facilitate
Growth & Progress.
VISION
• Grow Profitability Through a Competitive & Sustainable LPG
Cylinder Manufacturing & Re-validation Business:
• Serve Society by Creating Jobs
• Create Products & Services that Will Touch Day to Day Life
of the Common Man
• Motivate Employees 5
 ALLIED EAST AFRICA LIMITED
• Create Value for Its Investors
MISSION
• Manufacture New Quality LPG Cylinders at Competitive
Pricing.
• Provide LPG Cylinder Re-validation Services that Offer
Clients a Solid, Value-based Proposition Backed by a 100%
Quality Commitment.
• Develop Strong Relationships with Customers in Order to be
an Indispensable Partner Rather than Just Another Vendor.
• Earn Healthy Profits for Shareholders
• Provide a Rewarding Work Environment for Employees.
OBJECTIVES
• Obtain KEBS Approval for Manufacture & Re-validation of
LPG Cylinders
• Manufacture Type Test LPG Cylinders for KEBS Conformity
Inspection. 6
 ALLIED EAST AFRICA LIMITED
• Secure KEBS Accreditation for LPG Cylinder Manufacture &
Re-validation
• Operate a Successful LPG Cylinder & Re-validation Venture.
• Develop a Marketing Plan, Sales Literature, Website,
Ecommerce & Manage Sales & Marketing to Achieve
Business Objectives.
KEYS TO SUCCESS
• Focused & Well-defined Long-range Goals Based on a
Business Plan that Allows Flexibility & Growth.
• Strong Management Staffing with Extensive Engineering &
Operations Experience.
• Targeted Services & Products Delivered with Unique
Marketing Approaches.
• Strong Marketing Efforts to Increase Brand Awareness &
Customer Acceptance.
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 ALLIED EAST AFRICA LIMITED
CORE VALUES
• To Achieve Business Objectives, Directors of AEAL Will Seek
Excellence in Their People & In the Technology Used & Will
Strive to be the Employer of Choice.
• AEAL Will Treasure the Following Corporate Values in the
People It Employs:
• Competency
• HSE
• Integrity
• Teamwork
• Commercial Trust
• Operational Excellence
• Total Customer Service
• Community Social Responsibility
• CSR Will Focus on: 8
 ALLIED EAST AFRICA LIMITED
• LPG Awareness
• Community Development in Areas of Education, Health &
Drinking Water
• ‘Educational Scholarships’ to Deserving & Meritorious
Students
• Promotion of Sports Through ‘Sports Scholarship’
COMPETITIVE ADVANTAGE
• Few Manufacturers of LPG Cylinders in Sub-Saharan Africa.
• Manufacturers are Required to Obtain Accreditation from
Standards Organizations.
• Most LPG Cylinders Manufacturers Operate at a Fraction of
Installed Capacity Due to Lack of Strategic Focus, Outdated
Equipment & Manual Processes.
• Absence of Reliable Manufacturing & Re-validation Causes
Substandard LPG Cylinders to be in Circulation, a
Development Responsible for LPG Safety Concerns. 9
 ALLIED EAST AFRICA LIMITED
• AEAL Will be a Well-organized company that Will Voluntarily
Comply with the Regulatory Framework - Both Already
Established & Ones Being Developed:
• Manufacture and/or revalidation of LPG Cylinders In-line
with Best Practices.
• Contribute to Inclusive Economic Growth by Connecting
More People to Clean Fuel, Through Local & Regional
Availability of Quality LPG Cylinders.
• The Threat of New Market Entrants in Direct Competition
with AEAL is Nominal; However, There are No Barriers that
Prevent Supply-side Overcrowding:
• There are No Economies of Scale for Quality Locally
Produced LPG Cylinders, Whose Pricing Could Disrupt
AEAL’s Planned Regional Market Penetration.
• Given the Absence of Strong Incumbents, AEAL will
Emphasis on Quality & Reliability to Leverage a Strong
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• Aspire to Have a Better Cost Position & More Flexibility
by Reducing Costs, Meet Consumer Affordability
Constraints & Remaining Profitable.
• Contribute Towards Promoting Delivery of LPG as the
Preferred Fuel Option & Lower the Cost of Switching from
Traditional Fuel Sources to LPG.
• AEAL will Re-validate LPG Cylinders:
• Sustain LPG Cylinder Safety
• Creating More Confidence in Minds of LPG Consumers
• Eliminate Sub-standard & Unsafe Cylinders from
Circulation.
• AEAL Will Export LPG Cylinders to Other Countries in East &
Central Africa:
• In the Regional Market Place, the Size of AEAL Will Not
be an Important Factor Since It Will Offer Suitable
Products that Meet/Exceed Regulatory Requirements. 11
 ALLIED EAST AFRICA LIMITED
• Exports Markets are Virgin & Manufacturing Capacity is
Estimated at 25%.
• Export Markets Will Create Market Diversification &
Optimize Production for Continued Growth.
GOAL
• Make Allied the Sub-Saharan Competitive Manufacturing
Hub of LPG Cylinders Through Total Quality Excellence
• Expanding Leadership in Our Business Through People,
Keeping Pace with Market Trends & Technology.
FOOD FOR THOUGHT
"Without Changing Our Patterns of Thought, We Will Not be
Able to Solve Problems that We Created With Our Current
Patterns of Thought.“
~ Albert Einstein

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CHALLENGES
• HSSE
• Making HSSE a Business Driver in Manufacturing Operations:
• Violation of OSHA 2007
• High Fatality & Injury Rates
• High Lost Man-days
• Occupational Illnesses
• Lack of Risk Assessments to Identify Key Risks
• Back Injuries Resulting from Manual Handling
• Failure to Protect Workforce
• Lack of Structured Environmental Plans, Policies &
Programs.
• LACK OF SOPS
• Variations in Work Performance Due to Staff Completing the
Same Work Processes in Different Ways:
• Reduced Production 13
 ALLIED EAST AFRICA LIMITED
• Poor Quality
• Increased Incidence Rejects
• MANUFACTURING PROBLEMS
• PLANT CAPACITY
• Production Falls Behind Schedule Due to Poor
Equipment Operations:
• Excessive Overtime
• Delays in Meeting Delivery Schedules
• Customer Complaints
• Backordering
• Wasted Materials
• SUBOPTIMAL PRODUCTION SCHEDULING
• Wrong Jobs are Scheduled Because of Lack of Clear
Order Priorities, Inefficient Scheduling Rules & Ever-
changing Status of Jobs:
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• Production Runs are Interrupted by Jobs Whose
Priorities Suddenly Increased
• Machine Setups are Increased
• Jobs on Schedule Fall Behind.
• LONG MANUFACTURING LEAD TIMES
• In an Attempt to Compensate for Problems 1 & 2,
Production Planners Allow Extra Time to Produce an
Order.
• Shop Becomes Overloaded
• Order Priorities Become Confused
• Excessively Long Manufacturing Lead Times.
• INEFFICIENT INVENTORY CONTROL
• At the Time that Total Inventories are Too High for Raw
Materials, Work-in-progress & Finished Products, There
are Stock-outs that Occur on Individual Items Needed
for Production. 15
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• High Total Inventories Mean High Carrying Costs, While
Raw Material Stock-outs Mean Delays in Meeting
Production Schedules.
• LOW WORK CENTER UTILIZATION.
• Problem Results in Part from Poor Scheduling
(Excessive Product Changeovers & Job Interruptions) &
From Other Factors Over Which Plant Management has
Limited Control (e.g. Strikes, Reduced Demand for
Products).
• PROCESS PLANNING NOT FOLLOWED
• Regular Planned Routing is Superseded by an Ad Hoc
Process Sequence. It Occurs, for Instance, Because of
Bottlenecks at Work Centers in the Planned Sequence:
• Longer Setups
• Improper Tooling
• Less Efficient Processes. 16
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• ERRORS IN ENGINEERING & MANUFACTURING
RECORDS
• Bills of Materials are Not Current, Route Sheets are Not
Up to Date with Respect to the Latest Engineering
Changes, Inventory Records are Inaccurate &
Production Piece Counts are Incorrect.
• QUALITY PROBLEMS
• Quality Defects are Encountered in Manufactured
Products Resulting in Rework or Scrapped Parts, Thus
Causing Delays in Shipping Schedule
• HSSE
• REVENUE GROWTH
• Increasing Concerns About The Top Line (Revenue).
• Revenue Growth Slows as Manufacturers Compete for a
Shrinking Market Share.
• Competition of Low Cost Imports 17
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• MAINTAINING PROFITS
• Concern with the Bottom Line (Profits).
• Profits are Diminished When Manufacturers are Forced to
Keep Product Prices In-line with Low-priced Imports.
• FINDING & RETAINING SKILLED LABOR
• The Manufacturing Industry has a Problem Locating, &
Retaining, Skilled Employees:
• Employability:
• Work Ethic, Attendance & Reliability are Basic
Requirements
• Requirements Lacking in Many Applicants.
• Modern Manufacturing Plant Also Looking for
Employees Who can Work as Part of a Team, Multi-task
& Work Through Minor Problems, Absence of Most
Basic Skills is Cause for Concern.
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• INDUSTRY IMAGE
• The Image Many People have of Manufacturing is One of
Toil in a Dark, Often Dirty & Potentially Dangerous
Environment.
• Assumptions are that Pay is Low & Job In-security
• TRAINING GAPS
• Lack of Skilled Training
• Manufacturing Industry Struggling with Training
Employees It Already Has.
• Getting Employees to Enroll In & Complete, Job Skill
Training has Proven Difficult.
• HANDLING COST PRESSURES
• Increasing Range of Forces Making It More Expensive to
Do Business in Traditional Markets.
• Manufacturers are Under Intense Pressure to Do More, To
Do It Quickly & To Do It For & With Less. 19
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• ENERGY
• Surges in Energy Costs have Massive Impact on Industry.
• High Cost of Power has Adverse Impact on Manufacturing
• Manufacturers have Coped with Rising Energy Costs in
Different Ways.
• RAW MATERIALS
• Previously Manufacturers Could Forecast Costs With
Reasonable Accuracy & Calculate Both Expenses & Prices
Accordingly.
• Manufacturers are Caught Between Rising Costs &
Consumers Who Reject Higher Product Prices & Shop to
Find the Best Deal for Goods.
• Prices of Raw Materials are Very Volatile. Emerging
Economies Consume Vast Amounts of Steel

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• TAXES
• Taxes Influence Every Aspect of Doing Business, as
Manufacturers Grapple with Corporate Tax, Property
Taxes, VAT, Various Licensing Taxes & Workers’
Compensation Taxes.
• Complicated Nature of Tax Regime Also Results in High
Indirect Accounting Expenses
• ADAPTING TO DIFFERENT CUSTOMER NEEDS
• Limited Ability to Anticipate What Customers Want or
Need & Speed to Market & Outsmart Competition.
• Customer Expectations have Never Been Higher.
• Customers Expect Better Service & More Information.
OPPORTUNITIES
• REGULATORY
• Voluntary Compliance with OSHA 2007 & Industrial
Safety Standards 21
 ALLIED EAST AFRICA LIMITED
• HSSE
• Best Safety Performance in Manufacturing
Operations.
• Protect Safety & Health of Employees, Customers &
Public
• Safety Management - Corporate Value
• Participation of Everyone Essential
• Measurement & Verification of HSE Standards
Fundamental to Successful Implementation
• WORKFORCE DEVELOPMENT
• Select, Place, Train & Monitor Performance of Personnel
• Develop LPG Cylinder Manufacturing Skills & Knowledge
• Strategically Identifying Future Skill Needs of Company
• CUSTOMER SERVICE
• Align Customer Service Processes with Customers Needs.
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• BE CLIENT FOCUSED
• Efficient
• Responsive
• Timely
• Proactive
• Flexible
• Innovative
• Resourceful
• Professional
• BENEFITS
• Get to Know Customer Better.
• Know What Customer Wants, When They Want It, In
What Form, Delivered a Certain Way on a Certain Day.
• Improvement in Total Customer Experience
• Ideal Customer Experience 23
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• MARKETING
• Enhance Brand Loyalty Through Differentiated Customer
Care
• Strengthen Long-term Competitiveness
• Secure New Business.
• Strengthen Marketing Competencies to Achieve
Sustainable Growth & Enhance Profitability.
• Secure Competitiveness Capable of Responding to
Rapidly Changing Business Environments Arising from
Increased Competition Among Suppliers & Distribution
Channels.
• Handle Changes in Market Environment Ahead of Others -
Solidify Position as Most Efficient LPG Cylinder
Manufacturer
• RELIABILITY
• Identify & Eliminate CHRONIC Undesirable Events for 24
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• Analyse Actual Recurring Problems
• Eliminate or Drastically Reduce Recurrence.
• Use Root Cause Analysis to Trouble Shoot Problems
• Ensure Adequate Procedures, Records & Effective
Preventive Maintenance.
• Benefits
• Successfully Realize Tremendous Costs Savings
• SUPPORT CAPABILITY
• Capacity & Capability:
• Meet/Exceed Existing Business Needs
• Seamlessly & Efficiently Integrate New Business
Portfolios
• Steward SIX Business Drivers:
WORKFORCE
• Training 25
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• Human Factors Analyses
EFFICIENCY
• Turn Around Cycle Time Reduction
• Just in Time Deliveries
• Job Pre-Planning
FACILITY PLANNING
• Inventory Control
• Inspection
• Storage
OPERATIONS
• Cost Reduction
• Process Improvement
QUALITY
• Quality Assurance (Service)
• Quality Control (Consistency of Service)
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INTERFACES
• Management Information Systems
• Electronic Networking
• Change Control
• Cost Control
STRATEGIES
• ISO 9001
• Adopting Approach that Implements More Efficient
Working Practices & Focuses on Business Objectives of
Allied to Improve Customer Satisfaction:
• Provides Senior Management with an Efficient
Management Process
• Sets Out Areas of Responsibility Across Organization
• Communicates a Positive Message to Staff &
Customers
• Identifies & Encourages More Efficient& Time Saving 27
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• Highlights Deficiencies
• Reduces Costs
• Provides Continuous Assessment & Improvement
• Marketing Opportunities
• ISO 14001
• Showing Business Partners, Regulatory Agencies &
Community that Organization is Environmentally
Responsible.
• Increasing Profits Through Potential Process Improvements
& Energy Conservation.
• Reducing Environmental Liability.
• Complying with Environmental Laws & Regulations
• Avoiding Charges or Conviction
• Streamlining Operations
• NEW MARKETS
• Opportunity to Access New Markets or Revenue Streams 28
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• IMPROVED MANUFACTURING PROCESS
• Selecting the Right Process can Significantly Improve a
Company’s Bottom Line:
• SIX SIGMA
• TQM
• LEAM MANAGEMENT
• JIT
• NEW TECHNOLOGIES & INNOVATION
• Production Innovation Including New Processes or
Equipment.
• Greater Ability to Respond to Customer Demands
• Less Waste & Downtime
• Improved Product Quality
• Improved Relationships with Suppliers & Customers.
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• ERP
• Single Piece of Software Connects Departments
Throughout Organization.
• Provides a High Level View of Manufacturing Operation
• Showing Each Department’s Position to Facilitate
Resource Allocation
• Planning of Production Schedules.
• SUPPLY CHAIN MANAGEMENT
• Software Tools that Manage Flow of Materials from
Supplier to Manufacturer.
• Manage Internal Processes& Those Between Manufacturer
& Customers.
• COMPUTERIZED MAINTENANCE MANAGEMENT
• Electronic Systems Designed to Monitor Plant &
Equipment Assets.
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• Collect Information for Accounting Purposes.
• PRODUCT DATA MANAGEMENT
• Electronic Systems that Collate Quality Assurance &
Control Data.
• MANUFACTURING EXECUTION SYSTEMS
• Software Tools Designed to Improve Factory Management
by Analyzing Factors Like Downtime & Waste.

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 QUALITY

“Quality is Never an Accident.

It is Always the Result of High Intentions,

Sincere Efforts, Intelligent Direction and
Skillful Execution.

It Represents the Wise Choice of Many

Alternatives.”

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ANY QUESTIONS?

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