By Ankit Tiwari, Director, Supply Chain Consulting, Tata Consultancy Services
Most companies strive to be “customer centric” but few consider how their supply chain can contribute to their customer focus. The fact is, your supply chain – that part of your business that makes and delivers products – plays a huge role in your customers’ experience.
A case in point is Hach, a leading water quality instrument and reagents manufacturer based in Colorado. Hach’s customers include local and regional municipalities, water-processing authorities, and other organizations in dozens of countries around the world.
Addressing a complex global network
From the factory to the end customer, Hach’s supply chain can be five to seven levels deep. “Our supply chain is long and very complex,” says Nate Barrett, Senior Manager, Order Manager, North and Latin America, with Hach. “Sometimes we can lose visibility into the direct connection to some of our customers. This was the single biggest challenge we were trying to combat.”
Adding to the complexity, each of Hach’s warehouses and distributors around the globe created its own demand and supply chain plans and followed different planning cadences and processes. As a result, information wasn’t consistently shared across the entire supply chain, and getting a consolidated view of the company’s supply chain was time consuming.
Poor visibility into customer demand and product availability can create distribution bottlenecks that leave the customer waiting. For example, Hach was sometimes challenged to distinguish between an end-customer eager to take delivery of a product and a warehouse simply putting in buffer stock. To make sure customers weren’t disappointed, the company had to spend more on air freight and expediting fees. “Anytime it’s just reactive, that drives costs,” Nate told us. “This was money the company didn’t need to be spending.”
Bringing visibility in the cloud
Simply put, Hach needed a way to bring greater visibility and rationality to its supply chain operation. That’s when it teamed with Tata Consultancy Services (TCS) to help implement a modern cloud-based demand planning and supply chain management system. “TCS knew about our business,” Nate says. “They are helping us take that journey from reactive to proactive planning.”
Hach and TCS chose to pursue a new solution using Oracle Supply Chain Management Cloud applications for demand management and supply chain planning, including Oracle Planning Central Cloud. The cloud solution will largely replace the company’s on-premises ERP applications previously used for demand management and planning.
In workshops Hach saw first-hand what Oracle Planning Central could do to streamline planning operations and then modeled their supply chain to show how information flows from one place to another. Hach liked what it saw. Says Nate: “Planning Central is way more sophisticated than our legacy on-prem ERP.”
With operations spanning continents, Hach chose to introduce the cloud solution region by region, starting with its North American manufacturing operations, followed by sites in Asia, Europe and potentially South and Central America. Eventually the supply chain planning platform will encompass dozens of countries and thousands of products.
Standardization drives scalability
Focused on providing industry-leading best practices around demand management and supply chain planning, we helped Hach think through critical strategy and design decisions in order to harmonize operational data and eliminate discrepancies across disparate sites.
Early in the project, we advised the company to minimize customizations and adopt many of the industry-standard processes embedded in the solution’s core. Standardization would help Hach scale the platform because it wouldn’t need to build customized logic for every unique situation.
Using visual project management techniques to map out the project plan, assess the potential risks involved, and mitigate them upfront, we designed and ran a series of scenarios to gauge how well the new system would respond to changing supply and demand conditions in the real world.
The tests helped fine tune the cloud solution to maximize its accuracy and usefulness. “We kept ourselves flexible to adjust the path forward,” explains Michelle Brehmer, project manager at Hach. “Sometimes we thought we needed to take a left but discovered during the pilot that it was better to take a right.”
Transforming the customer experience
This month Hach goes live with the first phase of its Oracle Cloud platform. The company is now poised to reap the benefits of a more tightly integrated and transparent supply chain.
The Oracle SCM Cloud solution will provide Hach with the long-run ability to develop a single, global sales and operations planning (S&OP) process to drive profitability, optimize the customer experience, and drive enterprise productivity.
“Connecting a true demand plan into a supply chain creates more stability in our supply chain and allows us to make better decisions,” Nate says. “Now we can really see where customers are potentially going to have a problem and avert it ahead of time.”
Hach expects the new planning platform to make it easier to manage its increasingly complex compliance requirements, including new product labeling mandates that fall under the Globally Harmonized System of Classification and Labelling of Chemicals – or GHS. The strict standards call for country-specific product labeling – and that will require more accurate inventory planning.
The company also hopes to replace more of its home-grown applications with capabilities within the Oracle solution, saving money and boosting its reporting capabilities. Hach’s customers – from municipalities to beverage companies – will also benefit as the company leverages its new cloud-based planning system to better fulfill their needs. “We should really see significant improvement in customer experience,” Nate says.
Visit Oracle’s Modern Business Experience conference in Las Vegas, March 19-21, to hear from Hach and TCS, and learn more about how to utilize cloud capabilities to plan, monitor and respond to customer demand with a cloud-based global supply chain.