s&op journey, innocent
DESCRIPTION
Sales & Operations Planning Amsterdam 2010TRANSCRIPT
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S&OP journey
March 2010
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agenda
• a little bit about innocent
• life before S&OP
• new ways of working
• outcome
• Q&A
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Innocent started as a group of three friends in 1999, with one idea…
the beginnings
Make life a little bit better, and a little bit easier
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This revolutionary thinking led us to our first idea…
a tale of two ideas
The amazing electric bath
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our first range
Fortunately our second idea had more merits
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our product family
and we now have a little family of chilled drinks and veg pots
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We’ve grew very rapidly up until 2007, and after a tough 2008, have returned to strong growth.
our sales
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Revenue (£M)
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agenda
• a little bit about innocent
• life before S&OP
• new ways of working
• outcome
• Q&A
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Our supply chain is built on a 3rd party modular basis with very different forecasting requirements
context – supply chain
growers blender manufacturers warehouses
packagingsuppliers
customers
store
Supply team:Horizon: 6
weeksUnit: Cases
Buckets: Daily
Fruit buys: Horizon: 18months
Unit: tonnesBuckets: annual
Demand team: Horizon: 12 months
Unit: RevenueBuckets: Monthly
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old innocent solution
We used to manage short term supply, demand and fruit buys through 3 detached processes:
Supply Team
£ ?Excel tracker in revenue & GM
Access database in cases & pallets
Excel tracker in tonnes & kg
Demand Team Fruit buys
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agenda
• a little bit about innocent
• life before S&OP
• new ways of working
• outcome
• Q&A
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project approach
Our solution-design was based on the optimum structure for people, process and IT systems, and their interaction.
system
people
process
people
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project approach
With the people approach agreed in principle we moved on to the process
system
people
process
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key parts of the process
In designing our new process, we worked through what & how we would forecast
£Both Detailed level across
4 dimensions:
4. Breakdown2. Time
3. Geography1. Product
£s or Cases Resolution Horizon Frequency
18 months Monthly cycle
Weekly light-touch
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Process overview
This thinking has developed, and whilst our process has been iterative, our current operation is below:
1. Inputs
Updates to forecast collated and signed-off by senior team
2. Forecasting
Commercial team adjust forecast accordingly
3a.Demand review
Sign-off of updated forecast
3b.Supply review
Capacity implications
3c.Fruit review
Impact on fruit contracts understood
4. S&OP meeting
Summary of performance against KPIs
Key decisions made (escalation from prior steps)
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Process overview
We also have the ability to escalate to the Board if we need to, and have a weekly process to support this monthly set-up
1. Inputs 2.
Forecasting
3a.Demand review
3b.Supply review
3c.Fruit review
4. S&OP meeting
Board
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project approach
With a good understanding of the organisation and required process we began work on finding the best IT solution to support us
system
people
process
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making the decision
The main driver of the decision was finding a system that could incorporate financial complexity with daily forecasting
volume revenue revenue (inc. promos)
contributionpotential suppliers
financial complexity
forecast type
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the innocent systems world
ERP CRM
inte
rfac
e interface
LOGs Calculator
On top of the Demantra installation we also developed a data hub to hold our master data
innocent data hub
inte
rfac
e interfacein
terf
ace interface
inte
rfac
e interface
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forecast breakdown
In order to leverage our financial forecast it was essential for us to be able to break down the forecast into constituent parts
commercial
base forecast
customer investment
media
promo
marketing
event breakdown
Financials (£/€)
final forecast
base forecast
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scenario planning
The other big driver for us was to be able to financially evaluate a range of scenarios
base forecast
Financials (£/€)
base Live Scenario 1 Scenario 2
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3 pillars
3 different elements required for complete solution
system
people
process
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agenda
• a little bit about innocent
• life before S&OP
• new ways of working
• outcome
• Q&A
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outcome
We’ve come a fair way in 2 years, and now have a stable platform to support business growth and SKU proliferation.
Whilst there’s definitely more to go after, here’s some of the highlights:
Area 2008 2010
Forecast 3 numbers One number for commercial, finance, marketing &the supply chain
Ownership Split Commercial team
Process Not clearly defined Monthly & weekly cycle
System Excel / Access
Oracle Demantra- Daily forecasting- Promotional management- Demand planning
FG waste c. 2% of NR >0.4% of Net Revenue
Fulf i lment 97% >98.5%
Forecast accuracy (3 wk lag)
c. 80% c. 93%
Bias c. 10% 0.2%
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agenda
• a little bit about innocent
• life before S&OP
• new ways of working
• outcome
• Q&A