Optimization Producer Prospective:

1. Optimization Producer Prospective: Greg Towner Vice President of Operations Kuert Concrete

2. Greg Towner & Kuert Concrete • Operations Manager for Kuert Concrete, Inc. • Ready Mix producer in Northern Indiana • Kuert Concrete is honored to be one of the oldest continuously-run central mixed concrete plants in not only Indiana, but in the entire United States • 1925: • Central mixed concrete startedin South Bend by the George Hoffman Co. John Kuert of the Kuert Contracting Co. was employed as manager of Hoffman's central mix plant. • June 24, 1927 • The Company was incorporated as Kuert Concrete, Inc. Optimization Producer Perspective - Kuert Concrete

3. Kuert Concrete - Operations • Operating four plants in the middle of Northern Indiana • Serving surrounding counties including Michigan • All four plants optimized • South Bend Plant • 300 yard/hour central mix plant • 18 front discharge trucks • Three Other Plants • 120 yard/hr dry batch plants • Between 3-8 trucks stationed • Fleet of 47 trucks when live with optimization 4 years ago • Reduced to 37 trucks today • Economic conditions influencing decrease in fleet Optimization Producer Perspective - Kuert Concrete

4. Dispatch Today • Central dispatch office located in South Bend • 3 employees in dispatch • 1 shipper • 2 order takers • Plant managers act as batchmen and also handle some overflow order taking responsibilities Optimization Producer Perspective - Kuert Concrete

5. Organizational Changes • Originally using Plant dispatch • Plant manager & dispatcher at each location • Felt compelled to move to central dispatch • Left plant manager at each location • Three dispatchers moved to central • Huge culture shock for us and our customers that is just now beginning to dissipate • Asked one of our dispatchers to take on a role of championing the optimization process • Few changes in location but otherwise same roles as before • Order takers more involved in managing the orders than before. • Information has to be accurate in terms of scheduling so that when all is said and done the customer is happy and doesn’t realize that his order hopefully was serviced at the lowest material and delivery cost possible at the time. Optimization Producer Perspective - Kuert Concrete

6. What Lead to Optimization • Had been examining productivity and material costs looking for ways to save through efficiency improvements • Frustrating time because we could see that the savings were potentially there but could not put an effective plan in place • First introduced to Optimization at the Customer Conference 5 years ago…it seemed to be our answer • Spent better part of a year discussing and investigating before we decided to install optimization Optimization Producer Perspective - Kuert Concrete

7. Challenges Faced • Most difficult challenge (and continues to be) • Getting customers to give us complete and firm orders in advance • Last minute changes have a negative impact on a schedule • Some challenges remain with or without Optimization • Optimization brought one new challenge • Getting order takers and shipper to manage their orders and delivery resources in a timely manner • That doesn’t sound like much but it is key to the daily success of optimization. Optimization Producer Perspective - Kuert Concrete

8. Performance Metrics Market volumes have decreased 15%-25% since implementation Optimization Producer Perspective - Kuert Concrete

9. Financial Impact • Very hard to quantify savings solely attributable to Optimization • Went live with optimization in late spring of 2010 • Did not feel comfortable with our measurements until August • At that time, material and delivery costs were about $1.00/yard lower than they were before optimization • In 2011, costs for both material and delivery increased • Different jobs, different mix requirements, volumes were lower, etc. • Costs about what we expected • KPI’s were still higher than pre optimization • Believe resulting costs were lower than they would have been without optimization • In 2012, same variables plus lost two dispatchers • We survived! • Our KPI’s remained close to our goals • 2013 looks to be more of the same Optimization Producer Perspective - Kuert Concrete

10. ROI Analysis • After the first year we knew that it would be very difficult to significantly reduce our costs again so our goal was and is to not give back any of the gains that we have made • ROI is an inexact science • Being somewhat conservative, we believe that full payback was close to 2 years Optimization Producer Perspective - Kuert Concrete

11. What Would We Do Different? • We would invest in Optimization again • If starting over… • We would be much more deliberate during the setup phase • In spite of the warnings from every CAI employee regarding how in depth this part of the implementation was, we still completely underestimated the scope • Consequently had several months of tweaking after go live Optimization Producer Perspective - Kuert Concrete

12. Please Complete Your Evaluation • Be sure to circle the session you are evaluating on the back of your card • Optimization Track • OPT-003 – Session Code • “Optimization Producer Perspective” • All breakout session materials can be accessed at:www.commandalkon.com/cc2013/update/index.htm • Thank You! Optimization Producer Perspective - Kuert Concrete

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