How the best-of-breed approach bumped up against its limits

Unsurprisingly, it’s a daunting task to plan these operations efficiently while assuring product availability all over the world and minimizing costs. Historically, planning was organized with what Labeck calls a best-of-breed approach: “We have a rich history of using the best systems available in dedicated functional areas such as raw material sourcing, production planning and scheduling, pack material sourcing, distribution, and so forth. But because these systems provide inputs and outputs for each other, you inevitably create noise between them. And this has become increasingly difficult to manage due to the growing complexity within the supply chain.”

Weekly planning cycles are a thing of the past

"If you look at China, for example, this applies to almost any product. There are also huge levels of customization to be addressed, for example promotions inviting individual consumers to select four or five products to be packaged and delivered together, at a special discount. Our planning has to be at the same pace. Weekly planning cycles are a thing of the past. We’re planning in daily cycles now, or even per shift. We’re constantly doing a full review of our planning based on the latest demand info.”

Integrating functions into a single value stream

In this new reality, the old functional approach to planning has come under pressure because system interfaces have become unmanageable. “You simply don’t have the time to synchronize the different planning solutions,” explains Labeck. “I mean, production planners must have instant access to raw and pack material data, otherwise they’re navigating blind.”

These insights led P&G to develop an entirely new approach to supply chain planning centered around Supply Flow Analysts, or SFAs. Hamer explains: “The SFA concept is about integrating the previously separate planning functions into a single value stream incorporating raw material sourcing, bulk production, pack sourcing, finished goods production, and distribution to central and local DCs. And we want this value stream to be optimized as a whole, that’s why we want it to be overseen by one single person, the Supply Flow Analyst.”

Synchronizing activities to avoid excess inventory or waste

Finding the sweet spot

Kiwan explains how optimizing inventory represents a big chunk of the SFA’s work: “Our supply flow analysts focus on satisfying and maintaining the inventory positions we’ve decided are best for us, depending on the go-to-market strategy of the products and product families. 

So, OMP allows us to create reality-based production and deployment plans that consider phase-in phase-outs of products, production capacity, changeovers, transportation, lead times, and order sizes so that we can respect our inventory policies and still make sure the products are available for customers. It’s about finding the sweet spot where we can reduce costs, keep inventory as low as possible, and still secure product availability.”

About OMP

OMP helps companies facing complex planning challenges to excel, grow, and thrive by offering the best digitized supply chain planning solution on the market.

Its Unison Planning™ concept has a unique approach. It handles all supply chain planning challenges in a unified way. It’s full scope and in-depth. Unison Planning™ synchronizes all planning stages, horizons, functions, and roles. From source to deliver, from strategic to operational planning. The unique combination of services and technology boosts collaboration throughout your value chain, from forecasters to schedulers, from business leaders to technology experts.

Unison Planning™ is a cloud-based, out-of-the-box solution for industry-specific challenges. Hundreds of customers in consumer goods, life sciences, chemicals, metals and paper & packaging run it to make the right decisions at the heart of their business. Valued as a thought leader by experts as Gartner, OMP invests one out of every three dollars earned into innovation.

OMP for Consumer Goods is an industry-specific solution tailored to the consumer goods industry, and already in use at more than 250 plants.