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CLOUD BASED SUPPLY CHAIN OPTIMIZATION

USING OPERATIONS RESEARCH TECHNIQUES

Responsive

Resilient

Supply Chain Business Solutions

Introducing Saddle Point Business Solutions

Saddle Pointtech Business Solutions helps you in driving operational efficiency

in complex supply chains using Operations Research techniques.

Our differentiators are

• Around 200 man-years of expertise in end-to-end supply chainplanning in multiple industry verticals, with a 18 people strongexecution team.

Strong Domain Expertise

• Hands-on involvement with the business team to ensure thatthe changes proposed and accepted are implemented properlyand are used regularly

Ideas-to-Implementation

• An extensive portfolio of 20 cloud solutions based onOperations Research Techniques, Simulation and Analyticsdeveloped by our in-house OR team.

Extensive Solution Portfolio

• Owning the entire process of solution deployment and offeringplanning-as-a-service.

Planning-as-a- Service

Our Offering

Consultancy and Analytical Services

Driving operational efficiency in supply chain.

Improving the effectiveness of supply chainplanning.

Deployment of Cloud Solution for SCP

Reduced TCO through deployment of Cloudbased integrated Supply Chain Planning Suitefrom Saddle Point Technologies.

Development of Point Solutions

Developing point solutions for specific businessrequirements or customization of one of theexisting solutions from our standard portfolio.

Planning-as-a-Service

Converting your Capex to Opex by getting allyour complex supply chain planning done as aservice.

Our Expertise in End-to-End Supply Chain

Our Functional Areas of Expertise

SCP Cloud Suite

Cloud based end-to-end integrated

Supply Chain Planning and

Optimization Suite with a SaaS

offering.

Vehicle Route Planner

Generate feasible and optimal

routes based on constraints like

delivery time windows, pickup or

delivery, vehicle capacity etc.

Procurement Optimizer

Minimize total procurement cost

across all vendors by considering

volume discount and constraints

like Lot size, MOQ, Min-Max quota

Production Planner

Generate capacity and material

feasible production plans (Rule

based Heuristics) or optimal

production plans (Optimizer based)

Demand Planner

Collaborative Demand Planning

with Forecasting, Promotions

Planning, NPI and Sentiment

Analysis modules.

Workforce Optimizer

Allocate workforce optimally to

multiple projects based on

resource costs, skill-set levels,

learning curve, transition cost.

Supply Chain Optimizer

Generate a low cost fulfillment plan

by reducing supply chain costs like

production, transportation,

inventory and procurement .

Inventory Optimizer

Reduce inventory cost by

determining optimal inventory

levels based on SLAs, lead time

and demand and supply variability.

Transportation Optimizer

Minimize total transportation cost

by using fleet capacity efficiently,

consolidating loads and better

rake/truck requirement planning.

Production Scheduler

Create constrained production

schedule with make span

minimization based on job shop,

flow shop and hybrid layout.

Shift Scheduler

Generate a feasible shift schedule

by adhering to shift assignment

rules like maximum consecutive

night shifts, forbidden shifts etc.

Supply Network Designer

Find the best location for a new

plant or warehouse from a list of

candidate locations that optimizes

the supply chain.

Extensive Cloud Solutions Suite

Select Team MembersOur team is a 18 member strong team that consists of experienced managementconsultants, industry experts, OR analysts, statisticians and developers with PhDs andmasters degree in operations research, technology and business management from topranking institutes.

Some of our key members are

Vivek Pawanarkar – An IIMA alumnus with 18 years of Supply Chain Consulting experience in companies likeDeloitte Consulting and Mindtree.

He heads the consulting practice.

Ramanujam Satteluri – A NITIE alumnus with 18 years of experience in Supply Chain PackageImplementation in companies like Siemens Information Systems and Mindtree.

He heads the implementation services practice.

Arup Kar – An IIMC alumnus with 18 years of experience in Supply Chain Solution conceptualization anddevelopment in companies like Intel and Steelwedge Inc.

He heads the solutions and planning-as-a-service practice.

Supriyo Sarkar– An NIT alumnus with 21 years of experience in Operations, Supply Chain andManufacturing in companies like ICI Plc UK and Orica, Australia.

He heads our corporate training practice.

Select Solutions Delivered

Demand Forecasting solution for

Air Products - USA

Production Line Balancing solution for

St. Onge - USA

Capacity Swapping solution for

Intel AT factories

Vehicle Routing and Scheduling solution for

Sonar Technologies -Australia

Production Planning solution for

Dow Chemicals - USA

Production Scheduling solution for

St. Onge - USA

Spare Parts Planning solution for

Intel Fab - Israel

Supply Chain Alerts integrated with iPAD

for Hindustan Unilever

Warehouse Dock Scheduling solution for

St. Onge - USA

Dow Chemicals - USA

Planning time reduced from 3 days to 0.5 days

Average inventory levels were reduced from 25 days to 17 days

Food Company - UAE

Total cost of machines was reduced by 17% compared to the budgeted cost

FMCG- Sweden

Truck turnaround time reduced from 7 Hrs to 4 Hrs.

Dock throughput increased from 160T to 200T per day

Home Services - Australia

8,000 jobs and 200 vehicles were being planned everyday

13% reduction in fuel cost and 8% reduction in number of vehicles used

FMCG - Sweden

De-palletizing and Palletizing operation for creating rainbow pallets was done on a FIFO basisUnified scheduling reduced the waiting time of pallets by 4 Hrs.

Intel Fab - Israel

Spare parts inventory levels were rationalized

19% reduction in inventory levels for the same SLA were achieved

Air Products - USA

Improved forecasting accuracy from 54% to 68%

Intel AT factory - Malaysia

Sending the correct requirement to the subcontractor used to take 3 days . This was reduced to 0.5 day.

Consultancy Services Delivered

New factory and warehouse set-up for

Grindwell Norton

Process documentation of replenishment cycle for Metro Cash & Carry

Process definition for annual coal demand

for Arcelor Mittal

SKU rationalization

for

Siemens Electric

Rationalization of double stock entry

process for Metro Cash & Carry

Feasibility study for reduction of Truck TAT using e-Card readers for Calcom Cement

Supply chain metrics for

Clariant Chemicals

RFID feasibility for crates at cold storage

for Mother Dairy

Supply chain metrics for Hindustan Unilever

Package Implementations

SAP-APO implemented for Ranbaxy - India

DP, SNP & PPDS

SAP-APO implemented for Kao Corporation -

Japan

DP, SNP & PPDS

i2 implemented for Asian Paints - India

FP, RPS

APO-DP implemented for Hindustan Unilever

- India

APO-CTM implemented

for Intel (RPG Group)-USA

SAP-APO implemented for ITC - India

DP, SNP & PPDS

APO-SNP implemented for Intel (DM Group) -

Malaysia

SNP, Custom Optimizer

Saddle Point Cloud Suite implemented for 3SC Solutions - India

DP, NO, IO, VRS

SAP-APO implemented for Jindal Steel - India

DP, SNP, PPDS & GATP

Industry Standard KPI Based Planning

Integrated Solution (Social, Mobile, Analytics and Cloud)

Seamlessly Integrated Analytics, Operations Research and Maps

Easy to use, web based spreadsheet like functionality

Vehicle Routing & Scheduling

3PL & Planning Solutions Provider• Planning• Receipts• Storage• Loading • Despatch

50 shipments per day

RM availability

Vendor Collaboration

Logistics Co-ordination

Visibility

12 % - 15 % Operational Improvements for 3SC

Less # of trucksMore Return LoadsFaster Inventory turnsLess fuel costReduced manpower

Indian Case Study: 3SC, Gurgaon

Weight and Volume Constraints

Stackability

Odd packages

Loading Chart

Utilization report

3 D Optimized Result

Stuffing Optimization

Annual Procurement Planning for Arcelor Mittal, Luxembourg

Business Situation

A fortune 500 company and the world’s largest steel company, Arcelor Mittal has over 45 manufacturing sites acrossthe globe. Sourcing of Coal and Iron Ore is handled by a single company of the group with a spent of over USD 20billion per year.

Lack of integration , accountability and visibility in the in the Annual Procurement Planning process amongst themanufacturing sites and the procurement company resulted in excess procurement, mismatches and disruptions insupplies, and friction with suppliers over prices and schedules.

Solution Highlights

Defined a complete annual procurement planning process, calendared and controlled under a single program acrossall manufacturing sites and developed a web based application for consensus planning to plan and view at differentproduct and location hierarchies. The procurement plan was also constrained by production capacity.

Business Benefits

Evolution of a formal annual procurement planning process and clear responsibilities and accountability for under andexcess inventories resulted in better visibility for senior management on the high value Annual Procurement Plansagainst production plans across the enterprise and globe.

Elimination of practice of over and under ordering of Coal and Iron Ore, elimination of flash procurement and lastminute cancellation of procurement.

Dock and Loading Resource Scheduling for St. Onge, USA

Business Situation

A large FMCG company manages all its inbound and outbound logistics from a warehouse location in Sweden.Receipts and distribution of goods is done using large trucks of various capacities in a huge docking area common forboth inbound and outbound trucks.

The on time delivery KPI was not healthy as lot of time was getting wasted in waiting because of inefficient allocationof loading docks and loading resources to trucks.

Solution Highlights

Generated a feasible dock schedule using constraint programming techniques which considered constraints like dockavailability, material availability, truck availability, handling resource capacities etc. and detailed schedules for materialloading/unloading and truck dispatches were generated.

Business Benefits

Optimal allocation of dock space to all the inbound and outbound trucks resulting in smooth operations and reductionin delay of truck dispatch thereby improving the service levels.

Improved utilization of dock space and material handling resources resulting in improvement in operational efficiencyof warehouse.

Production Planning for McKesson, US

Business Situation

Mckesson, a Fortune 15 company, is a leader in health care services and is in business for more than 175 years inNorth America region. It is the largest pharmaceutical distributor in North America, distributing one-third of themedicines used every day

The company faced issues with the scheduling of packaging machines for medicine redistribution supply chain.Production Scheduling was done using Microsoft Access scheduling software which is time consuming & laborious.Moreover the solution did not have capability to consider Capacity & current loads, which resulted in InfiniteScheduling that resulted in infeasible production schedules

Solution Highlights

Implemented SAP PP for scheduling of Production Orders by considering the production capacity. Capacity levelingwas done using planning board functionality.

Business Benefits

One stop shop for finite scheduling Production Plan and better visibility of the load on production line / work centers resulted in generating feasible production plans that could be used by the shop floor thereby and minimizing the confusion and chaos in the shop floor.

Plant Capacity Optimization for St. Onge, USA

Business Situation

A food processing company was planning to start a new plant in one of its high demand markets and wanted tooptimize the machines capacities of the plant by running demand simulation for various product mix and actualproposed plant layout. The idea was to flag off the bottleneck resources and size the resources properly.

Solution Highlights

Generated an optimal production plan using Mixed Integer Programming considering constraints common in process industries like batch processing, product perishability, product specific setup times, process times, combination of both batch and discrete manufacturing processes etc.

Business Benefits

The machines used for the plant were of very high value with a huge lead time. It was therefore important to simulate it as close to the ground realities as possible. Our solution could help the client run lot of scenario analysis by taking the actual constraints into consideration thereby helping them take an informed decision.

Demand Planning for Pepsico, India

Business Situation

Pepsico, one of the largest beverages companies in the world was trying to improve its forecast accuracy for better Demand Planning from its current accuracy of 64%

Since the planning was happening in spreadsheets, lack of integration and visibility in the in the Annual Operations Planning process amongst the different sites and departments lead to less than accurate demand forecast.

Solution Highlights

An integrated web based demand planning solution was implemented for statistical forecasting and consensus planning to plan and review at different product and location hierarchies.

Business Benefits

Industry standard algorithms improved the forecasts accuracy using the best fit forecast technique to 78%.

Hierarchical planning created a consistent plan reducing the need for to-and-fro movements of spreadsheets.

Supply Chain Process Improvement for Calcom Cement, Kolkata

Business Situation

Calcom cement had commissioned 2 new cement plants and required to optimize Supply Chain activities likeplanning, execution and reporting for Procurement, Manufacturing and Distribution

Supply chain processes were driven by prevalent industry practices with little focus on Supply Chain Optimization andlegacy supply chain processes were time-consuming and obstructive to desired speed of conducting business

Solution Highlights

Integrated Supply Planning and Execution processes for Mining, RM transportation (truck/ railway), Clinker andCement Manufacturing, Storage, Sales and Distribution

Business Benefits

Tightly integrated processes throughout the supply chain that eliminated non-value added processes from thebusiness process chain

Major improvement across all main SCM KPIs On-Time-In-Full, Inventory Turnover, Inventory Coverage, TruckTurnaround Time, Credit Ageing

Sales & Distribution Planning for Mother Dairy, New Delhi

Business Situation

The leading dairy company in North India, Mother dairy, produces liquid milk & milk related products, edible oil, freshfruits & vegetables and frozen vegetables that are distributed through 14,000 retail outlets and 845 exclusive outlets

The present distribution model needed to be streamlined as the service levels to milk booths was declining anddistribution costs as a % of sales was going up.

Solution Highlights

Redesigning the Booth Distribution process with defined short term and long term plans

Implementation of a route planning and scheduling solution for optimal vehicle utilization from plants andwarehouses

Business Benefits

Drastic improvements in distribution related KPIs like Order Fulfillment (OTIF), Freshness and Working Capital cyclewith high demand visibility and better warehouse space utilization

Significant cost benefits realized due to optimized routing and better vehicle utilization

Manufacturing and Distribution Planning for HUL, Bangalore

Business Situation

HUL is the largest FMCG player in India with more than 100 brands in product groups such as home and personalcare, food, beverages and specialty chemicals , 61,000 Bills of Materials spread across product categories and 130factories

The need of the hour was a planning solution to integrate manufacturing and distribution

Solution Highlights

Implemented SAP APO with integration with SAP ECC

Business Benefits

Improved visibility and optimized operations resulting in lower supply chain costs

Prompt problem resolution in business functions like manufacturing, procurement and distribution

Forecast Variance Analysis for HUL, Bangalore

Business Situation

HUL is the largest FMCG player in India with more than 100 brands in product groups such as home and personalcare, food, beverages and specialty chemicals , 61,000 Bills of Materials spread across product categories and 130factories

HUL had implemented SAP APO as the central system to forecast sales across product and regional dimensions and itneeded analytical services to optimize the forecast variance observed in present system, explain major sales uplifts(positive or negative) using exploratory methods and to quantify and forecast promotion effects

Solution Highlights

Business analysis for analyzing promotional effect s, trend and seasonality, uplift calculation, cannibalization effectsand promotional lag and lead effects.

Statistical modeling for dispersion analysis for explaining variance and regression analysis to find contribution of eachpromotion on a product category

Business Benefits

Significant reduction in forecast variance error using COTS application

Batch Traceability in Cold Supply Chain for Mother Dairy, New Delhi

Business Situation

A leading dairy company in North India, Mother dairy, produces liquid milk & milk related products, edible oil, freshfruits & vegetables and frozen vegetables that are distributed through 14,000 retail outlets and 845 exclusive outlets

Unique nature of ice cream business involving short replenishment lead time and cold operating conditions, businessfaced challenges in accurately tracking batches to ensure quality of delivery and offer better shelf life. This situationresulted in issues with traceability of batches for milk and ice cream at warehouse causing inventory expiry and write-off

There were legal requirement for printing the exact batch number on the sales invoice and stock transfer documents,reconciliation of physical and actual stocks and managing batch recall program in case of exigency or contaminationof ice cream products in the market

Solution Highlights

Warehouse management system for faster traceability and effective batch management with barcode based trackingof receipts and dispatches to ensue accuracy of records and faster reconciliation

Business Benefits

In addition to the legal compliance requirements, real time inventory ageing & expiry information, batch informationand batch traceability information from plant to distributor improved the service levels and helped in better utilizationof the shelf space.

Supply Norms for Distributor for HUL, Bangalore

Business Situation

Hindustan Unilever Limited is the largest FMCG player in India with more than 130 manufacturing locations and 2000suppliers

The main structure of supply chain is: Supplier- Factory- Super Mother Depot- Depot- Sub Depot- RS (RedistributionStockist) – Retailers. SAP Demand Planning was used for Demand Management at depot level, while MS Excel basedcalculations were used for RS level. Demand Management results at RS level were inaccurate, time consuming andrepetitive in nature, resulting in stock outs at the RS level

Solution Highlights

Scientifically disaggregated demand estimates for each base pack (a logical grouping for an underlying SKUs or Consumer Buying Units) at Area Level into dynamic RS level stocking norms and calculated the safety stock levels.

Business Benefits

Dramatic improvement was observed in customer SLA’s by improved sales to retail

Optimization of planning process was optimized and there was substantial time reduction

Customers (RS) reported huge savings in terms of inventory. The inventory carrying costs and working capital saw a substantial reduction after RS Norms was implemented. There were huge improvements in terms of working capital reduction especially for slow moving and non moving items

Spend Monitoring & Forecasting Solution for Unilever, Asia Pacific

Business Situation

Unilever, a leader in the FMCG market needed to monitor its raw material and packing materials spend beingincurred for its various plants across Asia and AMET region

Due to various taxation issues, procurement process specific to each countries and nature of procurement contract,business users faced challenges in aligning spend on basis of common evaluation criteria which resulted indiscrepancies in spend reporting between the countries and region, leading to challenges in planning and forecastingof spend

Solution Highlights

Standardized the processes across plants and vendor for reporting spend figures , reversals due to quality issue andprevent double counting of spend in case of commodity trading between various entities

Implemented a custom solution for monitoring the spend, capturing spend incurred at 3rd party vendor locations andaccounting for delivery related cost in case of imported items. The solution was linked to other detailed planningprocesses and reporting tools for budgeting and analysis

Business Benefits

Standardized processes for spend capturing and accounting and better visibility of spend, reduced lot of discretionary spent and thereby reduced the total spend by 3%

Vehicle Routing and Scheduling Solution

There are 3 variants of the VRS solution that we have developed and implemented

VRS with pickup and delivery for E-commerce logistics providers, courier companies, grocery delivery companies, FMGC distribution companies. This variant was deployed for an FMCG major in India.

Savings in the tune of 8% was immediately realized.

Since mapping services in India don’t provide accurate distances, efforts are on to build a distance-time database for the client by taking inputs from the field. Accurate data is expected to increase the savings to around 15%.

Talks are on to deploy this for a grocery delivery company in Hyderabad where our mobile solutions for scheduling the jobs and real time tracking of delivery vehicles will also be used.

VRS for service based companies like pest control companies, carpet cleaning companies, service personnel like plumber/electrician providers. This variant was deployed for a company in Australia that provides planning-as-a-service to its customers.

The customer base consists of pest control companies, carpet cleaning companies and service personnel providers.

The solution can handle 50,000 jobs and 500 resources in each run.

Talks are on to deploy this for a food distribution company in Mumbai where our mobile solutions for scheduling the jobs and real time tracking of service boys will also be used.

VRS for food distribution companies with Frozen zone and Ambient zone requirement. Talks are on to deploy this variant for a food distribution company in Canada.


Demand Forecasting solution for

Air Products - USA

Air Products, an industrial gases company was nothappy using their existing forecasting solution as itdidn’t have aggregation/disaggregation feature, wasnot web enabled and also lacked industry standardalgorithms.

Using industry standard algorithms forforecasting could help increase the forecastingaccuracy from 54% to 68%. With better visibilityof data, the accuracy was expected to increasefurther.


Production Line Balancing solution for

St. Onge - USA

St. Onge, one of the top 3 supply chain consulting companies in the US, was helping a client set up a green field food processing company in the UAE.

•The lead time of the equipments was 18 months•The product mix was huge•It had both batch and discrete manufacturing processes•Perish-ability was to be considered

The entire production process was modeled mathematically and optimal resource sizing was done


Capacity Swapping solution for

Intel AT factories

Intel used to reserve subcontractors capacity inadvance based on the forecasts.

With better visibility of near term orders, the reservedcapacity was required to be used optimally for adifferent product mix.

The to and fro communication with the sub-contractor for using the reserved capacity used totake 3 days

Capacity swapping solution make it possible toallocate the reserved capacity to a differentproduct mix thereby reducing the planning timeto 0.5 days.


Vehicle Routing and Scheduling solution for

Sonar Technologies -Australia

Sonar Technologies, an Australian company providesvehicle routing planning services to home servicescompanies, pest control companies, industrial carpetcleaning companies etc.

The requirement was to deliver a large scale vehiclerouting and scheduling solution that could process50,000 jobs and 500 vehicles.

In production, our VRS solution is being used toplan for 8,000 jobs and 500 vehicles everyday.

A 13% reduction in fuel cost and 8% reductionin number of vehicles used has been achieved.


Production Planning solution for

Dow Chemicals - USA

The WPS division of Dow chemicals was using unconstrained production planning.

A constrained planning solution, reduced the planning time from 3 days to 0.5 days and the average inventory levels were reduced from 25 days to 17 days


Production Scheduling solution for

St. Onge - USA

An FMCG company in Sweden was de-palletizing,grouping and re-palletizing to create rainbow pallets.This was done on a FIFO basis based on the orderplacement and was not linked to the dispatchschedule.

Because of this, many finished pallets had to wait inthe docking area blocking precious docking space.

A production schedule based on the dispatchtime that was derived from the requirementtime (and not based on the ordering time)helped schedule the right pallets through thede-palletizing/palletizing line and reduced thewaiting time by 4 Hrs.


Spare Parts Planning solution for

Intel Fab - Israel

For Intel’s fabrication plant in Israel, spare partsplanning was done manually.

The spare parts consumption data was split intopreventive maintenance requirements andbreakdown maintenance requirements.

Breakdown maintenance requirements were fitted toa Poisson distribution and the parameters wereestimated.

Preventive maintenance forecast quantity wassuperimposed with the breakdown forecast to arriveat the total spare parts forecast.

An analytical framework for determining thespare parts requirement helped in reducing theaverage inventory levels by 19%, keeping theSLA the same.

Warehouse Dock Scheduling solution for

St. Onge - USA

St. Onge, one of the top 3 supply chain consultingcompanies in the US, was helping an FMCG companyin Sweden to optimize the Warehouse operations

The dispatch service level was very low as most of thetrucks were getting delayed during loading.

Utilization of loading docks was low as the waitingtime was high

Capacity utilization of loading and handling machineswas high because of unnecessary movement ofgoods

A scheduling solution was developed tostreamline the end to end loading processesand by adhering to the capacity and timingconstraints


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