Integrated SAP stack ensures agility and sustainability in a challenging market
Being able to respond quickly to disruptions and highly fluctuating market conditions without losing sight of sustainability. This sounds like a difficult task, but for the world’s largest plant-based consumer products company Upfield it is an important condition for success. To achieve this, the company migrated various solutions to an integrated range of modern SAP solutions, with SAP S/4HANA as the basis.
Upfield started operating as a independent company in 2018. Although the company is new, the brands are not. The company is particularly specialised in plant based margarines, creams, cheese and spreads and markets brands such as Blue Band, Proactiv, Becel and Lätta. It has a clear mission: to make people healthier and happier with nutritious and delicious, natural, plant-based food that is good for you and for our planet.
The company operates in a challenging market that is highly sensitive to economic and social indicators. The corona crisis and the war in Ukraine, the world’s largest producer of sunflower oil, recently made that abundantly clear. “Disruptions in the supply chain such as the scarcity of sunflower oil have a direct impact on our recipes, but also on matters such as transport, production processes and communication with our suppliers,” says Anand Mathew, Platform Lead Supply Chain Applications at Upfield.
Under a magnifying glass
“At the same time, all those links need to remain sustainable, dealing with CO2 and methane emissions and keeping our packaging free of plastic. That is a complex puzzle, in which Upfield cannot afford to make any mistakes, according to Mathew. “We are under a magnifying glass. If we don’t live up to our mission statements, the result is negative publicity and direct impact on brand value and sales”
Upfield’s old IT infrastructure was not suitable for coordinating all those things in the supply chain. The company decided to replace the various systems with an integrated set of SAP solutions, with SAP S4/HANA as the backbone.
On top of that, the company uses SAP Product Lifecycle Management (PLM), among others, to manage 2,500 recipes and 4,000 ingredient specifications. The planning of the supply chain is done via SAP Integrated Business Planning (IBP). The company uses this solution for, among other things, managing supply and demand and sales & operations planning (S&OP). “And that for 200 users in all 60+ different countries in which we operate. As a result, we can run our S&OP processes from the data in IBP.”
Fast supplier changes
Due to market developments, the company regularly needs to be able to change suppliers quickly without jeopardising its sustainability objectives. According to Mathew, they leverage SAP Ariba solutions and SAP Business Network for this purpose. “SAP Ariba enables us to quickly select suitable suppliers, including for our plastic-free materials. We use the network for supplier selection and contract management, among other things, both for direct and indirect procurement.”
Upfield also leans on modern SAP technology for its global logistics processes. The company uses SAP Transportation Management (TM) in tandem with SAP Business Network for Logistics for carrier tendering, cross docking, freight settlement, etc.
“We use SAP TM to calculate transport movements, plan shipments and optimise routes. The resulting freight orders are passed on to the carrier. There, our carriers can either log directly into the carrier tenant to accept or reject the freight order or use the booking functionality to specify time windows for dock booking. Overall, SAP Business Network for Logistics provides better communication with our carriers,” says Mathew.
Upfield can closely manage the life cycle of each product thanks to the tight integration. “At each stage, each system has to be coordinated to avoid the risk of obsolescence,” he says. “And we cut obsolescence cost thanks to a synchronized end to end process,” Mathew adds.
“The main benefit is the integrated planning capability that we have across our supply chain. SAP S/4HANA and the supply chain solutions have helped us to be more agile. We can now respond much faster to disruptions.”