FMCG is always one of the hardest-fought categories in the Awards, and this year was no exception. The site assessors warned the judges that ‘All three finalists warranted consideration, but for their performance in different areas of the supply chain, and this made the singling out of a clear winner particularly challenging’.
Seiko Optical, although part of the giant Seiko Corporation of Japan, is a young company, founded in 2004, supplying spectacle lenses to opticians and distributors in the UK and some other EMEA markets. Although most business comes from a core range of 3000 skus there are potentially two billion permutations of lens prescription, type, shape and colour, made to order in 2-8 days. (Interestingly, general manager John Conway was purchasing manager at Norville Optical when the latter won an ESCE Award in 2003).
Conway says ‘Supply chain management is all about teamwork. Although Seiko is a large corporation the European operation has under 100 employees and we need to pool our knowledge to be successful. Every day we process thousands of different product specifications, many being made to order in Japan and Europe, and our success is down to forecasting, forecasting and more forecasting’. Operations manager Peter Wiles adds ‘What I am most proud of is our achievement in using EDI. Last year, none of our orders came in by EDI – today the figure is over 75 per cent, and we use EDI right through the supply chain not only to send orders seamlessly to production sites, but to process incoming deliveries and pass order status information to our customers’. Seiko’s supply chain was judged ‘simple, yet robust and highly integrated and collaborative. They are passionate about customer service and relentless in looking for new ways to shave further hours from lead times. They already lead the way but believe there is always room for improvement’.
The second FMCG finalist was Sara Lee Branded Apparel (lingerie brands such as Dim and Playtex) in a joint entry with OM Partners, based in Levallois Perret, France. This is another story of supply chain transformation, but one carried out almost entirely within the organisation by a small team, aided by OM. Interestingly, the ceo insisted that all project-related communication should be through a web portal, ensuring high levels of transparency and buy-in. The programme, focused on improving the design chain (reducing new product time to market) and the supply chain (collaborative S&OP processes and an APS tool) had an aggressive timescale which at the time of inspection was being met. Philosophically, the supply chain goal is replacing the pushing of product through a pipeline to a more adaptive replenishment approach. Early results have been very encouraging – the new S&OP cycle has been driven down from the previous 3-4 weeks to, at times, as little as 5-6 days, which as the assessors comment, is pretty good in FMCG, and quite remarkable in the textiles/apparel business. Customer service levels have improved, and inventory reduction of 36 per cent achieved. our operations and people. By living the business core values and striving to achieve the Quality, Cost and Service excellence balance, great results have been achieved in Overall Equipment Effectiveness, inventory reduction and team performance’.
Highlights of this performance include increasing OEE from 60 to 70 per cent in the past six months, reducing processing waste by 30 per cent, all new product developments on time, on-site inventory down 66 per cent (eliminating the need for plant expansion), 99.8 per cent customer service levels, a e9.7 million reduction in transfer prices (to other group companies) and perhaps most important, they now undercut the copackers by at least 20 per cent. Above all the judges were impressed by the way this sustaining productivity increase is reflected in the transformation and empowerment of people down to shop floor level where ‘every single person exuded a genuine passion.
They had a firm understanding of what supply chain excellence looks and feels like, they also understood the adaptive concept and saw this as a key part of their success’. All three entries were ‘excellent’ in their way, but there can be only one winner and that, the judges decided, is Reckitt Benckiser Healthcare.
Shortlisted:
- Reckitt Benckiser Healthcare
- Sara Lee with OM Partners
- Seiko Europe
Winner:
- Reckitt Benckiser Healthcare
Philip Vervloesen, principal consultant at OM Partners, commends ‘The global company extent of ASCEND (Apparel Supply Chain for New European Distribution), the innovative and collaborative aspects of it, and the way that front end and back end planning teams are now integrated. It was challenging to get the full S&OP cycle operational, even more so knowing the complexity of the way brands were interacting on multibrand sites and the network of business units involved’.
Transformation of an even more business-critical nature was evinced by the entry from the Hull plant of Reckitt Benckiser Healthcare. Only a few years ago the site was in trouble: it was uncompetitive with the competition from co-packers and a real question mark hung over its future.
Now, after a e10 million upgrade, significant workforce reduction, but more crucially a complete cultural transformation which is totally ingrained, the Hull plant has become a model for other group operations. Factory Operations Manager Andy Row says ‘We see continuous improvement as endemic throughout our operations and people. By living the business core values and striving to achieve the Quality, Cost and Service excellence balance, great results have been achieved in Overall Equipment Effectiveness, inventory reduction and team performance’.
Highlights of this performance include increasing OEE from 60 to 70 per cent in the past six months, reducing processing waste by 30 per cent, all new product developments on time, on-site inventory down 66 per cent (eliminating the need for plant expansion), 99.8 per cent customer service levels, a e9.7 million reduction in transfer prices (to other group companies) and perhaps most important, they now undercut the copackers by at least 20 per cent.
Above all the judges were impressed by the way this sustaining productivity increase is reflected in the transformation and empowerment of people down to shop floor level where ‘every single person exuded a genuine passion. They had a firm understanding of what supply chain excellence looks and feels like, they also understood the adaptive concept and saw this as a key part of their success’. All three entries were ‘excellent’ in their way, but there can be only one winner and that, the judges decided, is Reckitt Benckiser Healthcare.
