Nine soccer pitches full of eggs, a chain of chocolate bars that would reach around the globe and flour equivalent to the weight of a luxury liner – a company that bakes more than 146,000 tons of cookies a year needs a whole lot of ingredients. Griesson – de Beukelaer (GdB) receives deliveries from around 30 tankers every day for its cookies and snacks such as Prinzen-Rolle, Soft Cake, and TUC. The midsize enterprise, with headquarters in Polch in the German state of Rhineland Palatinate, is one of the largest bakeries in Europe, with 1,865 employees distributed over four locations.
The supply chain is just as complex as one might suspect. From raw material orders, quality control, and batch tracing through to delivery of the goods, GdB needs to take account of numerous requirements. One critical point for example is the expiration date of the ingredients and finished products. This is particularly true of the cookie assortments, as different cookie types often are produced in different plants. To ensure that all the cookies in a pack have the same expiration date, production planning in the supplying and packing plants must be coordinated.
At the same time, the interim storage and transportation times must be taken into consideration, as must the processes carried out by the partners that perform picking and logistics activities. “We have to control everything right down to the very last cookie,” says company spokesman Peter Gries of the complex interrelations. Griesson – de Beukelaer is able to master this thanks to its many years of experience and with end-to-end software support.
Since November 2006 the midsize enterprise counts on the SAP Business All-in-One industry solution Foodsprint from software vendor Cormeta AG and the planning component SAP Advanced Planning & Optimization (SAP APO) from SAP Supply Chain Management. In January 2008, GdB also started using SAP ERP Human Capital Management for payroll.
From hand to mouth
The new enterprise solution automates numerous business processes the data for which the baked goods manufacturer previously had to write down and then enter manually in its old, heterogeneous IT landscape – a tiresome business, which was even necessary for core processes such as production planning and controlling.
“Previously, we documented a lot on paper. All the employees used a form to record the relevant production parameters of their shift, for example the yield, scrap, recipe numbers, and batch information. This data then usually needed to be entered in several data processing programs, as the departments involved worked with different systems. Because of the numerous interfaces between the applications, some of which the enterprise programmed in-house, coupled with extensive manual data entry, we often found inconsistencies,” says head of IT Gerd Schäfer.
Production planning often relied on the many years of experience of the employees responsible. In view of the incomplete IT support, it was difficult to optimize setup times, capacity utilization, and stocks during planning. At the same time, planning staff needed to take account of important requirements, for example the coordinated replenishment of raw materials.
In order to avoid stoppages in production, for example, the silos must never be allowed to get completely empty. On the other hand, the supplying tanker must be able to unload its freight without waiting times, not only to avoid additional costs but also to enable the raw materials to be processed quickly. “These are huge planning requirements, which we handled to the best of our abilities, but the situation was by no means ideal,” says company spokesman Peter Gries.
Inconsistencies are a thing of the past
Today, all steps in production are mapped in the SAP Business All-in-One solution. Using this data, the SAP APO component executes planning on a largely automatic basis. Among other things, the sequence of the orders is perfectly tailored to the setup times, and therefore takes into account events such as the cleaning of a plant between the switch from milk to dark chocolate or the changing of a roller to stamp the cookies. Today, planners’ main concern is to ensure that the master data is maintained correctly, and that processes are coordinated with those in neighboring areas, such as sales planning, warehouse logistics, or purchasing.
GdB has also integrated subcontractors and logistics service providers in Foodsprint und SAP APO through interfaces, so that there are no integration gaps across enterprise boundaries. All the data can be accessed at the touch of a button and is reliable: As information no longer needs to be recorded on paper and then entered in different applications, inconsistencies are a thing of the past.
The enterprise has also been able to shorten lead times in production thanks to automated, setup-optimized planning – a huge advantage, particularly for the heavily utilized plants, because GdB usually manufactures around the clock, five days a week. The weekend is kept as reserve capacity, for example for special orders. “The surcharges mean that there are additional costs for the Saturday and Sunday shifts. We therefore try to avoid producing at these times whenever possible. Through optimized planning, we are able to save up to 30 minutes per plant every day. That is a huge step forward,” states company spokesman Gries.
An added bonus: The enterprise has been able to reduce the range of goods held in stock while retaining the same high level of delivery performance. For example, the packaging material stocks have been reduced by 20 percent and finished goods stocks by ten percent. This not only saves costs, it is also an advantage in terms of product shelf life.
The most important ingredient is competitiveness
However, cost savings are not the most important thing the baked goods manufacturer has achieved through its SAP project. GdB was more concerned with securing the enterprise’s competitiveness. “We need high-quality data. We also wanted to have more control over our processes, so that we would be able to modify them with ease if necessary. With SAP, we are well equipped for the future, because the solution will continue to grow and develop with the enterprise. You can’t survive these days without software like this,” says Gries.
Initially, though, GdB did not want to implement an SAP solution at all, as the enterprise believed the software was too complex. But an analysis of the products available on the market revealed that the preconfigured SAP Business All-in-One industry solution Foodsprint, which is tailored to the food industry, in combination with the SAP APO planning tool, was the best choice to meet company requirements. “The solution offered the functionality that we need. At the same time, we have a high degree of investment security with a large provider such as SAP,” states Gries.
Careful preparation leads to the best results
Thanks to good preparation and competent support from SAP partner Cormeta and consulting firm J&M Management Consulting AG, which implemented SAP APO, implementation and productive startup ran smoothly. “We consciously took a lot of time over the project and involved not only our IT team but also key employees from every user department, who were released from their normal duties for around two years. In this period, we had to employ temporary staff, but it was worth it,” says Schäfer. A further factor contributing to the project’s success was the long test phase of more than seven months, plus the early training of employees.
As a result, all departments were able to start work immediately once the four locations switched to the new enterprise software in a big bang process at the start of November 2006. From day one, business has been running smoothly, and the GdB plants have supplied retailers with 600 tons of baked goods – and not a cookie less.