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Due to rapidly changing business dynamics, the visibility of the end-to-end supply chain is becoming increasingly important. To improve visibility in the E2E supply chain, DS Smith has the ambition to (1) fully utilize the capabilities of their internal and external supply chain and (2) realize maximum OTIF for their downstream box plants. DS Smith has improved their mid-term planning to achieve this goal, called Sales and Operations Execution (S&OE). With S&OE, they can respond fast and agile to deviations in the supply chain. It allows them to have a process to execute the monthly IBP plan and have a clear view of supply or demand deviations. It will enable them to amend in an agile way. To make the S&OE process operational, they also needed to select a new planning tool. EyeOn provided support in the complete digital transformation journey and the development of an integrated business planning process of DS Smith.   

The deliverables for this digital transformation project were:  

• Clear communication and better service to DS Smiths’ customers  
• Robust management of the supply (both with internal resources and external suppliers)  
• End-to-end paper inventory optimization  
• Maximal margin retention when deviations occur  
• Stability in production, supply, and delivery planning (fewer rush interruptions and less firefighting)  

The approach DS Smith took to achieving these deliverables is the following:  

Define Target Operating Model 

We started by defining the future Target Operating Model, which describes how to control your supply chain and support the execution of your business strategy (find more about our standard TOM approach here). The Target Operating Model opened the door for a detailed assessment of the current readiness of DS Smith from a process, organization, and tools point of view. We worked out further details by conducting a thorough readiness assessment of the as-is situation. 

Readiness check as-is process  

Based on the Target Operating Model, we performed a readiness check to define the improvement needs in the current planning setup and made a priority roadmap based on the gap assessment. We determined separate projects to close the gaps. The projects were executed in parallel with DS Smith project teams. These steps enabled the S&OE project implementation after the finalized tool selection.   

Detailed process design  

While conducting the readiness checks, we held workshops to detail the new S&OE process. The workshops involve discussions on the structure of the new planning process, planning of specific (external) locations, modeling of capacity, translation from IBP to S&OE, monitoring and escalation management, reporting, and KPIs. These aspects were all worked out in various workshops. The detailed design was a blueprint for defining the planning tool requirements.   

Integrated business planning process: definition of requirements (incl. tool selection)  

During the discussions on the tool requirements, we defined a list of functiona

l and non-functional requirements for each detailed design area. We indicated whether all of these requirements are a must-have or a nice-to-have. Next to the functional requirements, the IT organization of DS Smith provided technical requirements. These requirements cover information security and support structure for the new planning tool. 

Since the start of the project, the IT team was involved and was aware of the process design choices made. We considered these choices in the definition of the technical requirements. 

We prepared a vendor selection based on the requirements, approached multiple vendors, and planned demo sessions. A predefined evaluation template ensured a fact-based decision-making process based on various evaluation and demo sessions. Implementation has already started.   

“EyeOn have supported our Digital Supply Chain Transformation journey since 2021 and their expertise in functional design and best practices as well as their industry knowledge have been invaluable for the success of the program. This not only includes the definition of high-level design principles but also translating them into detailed operational processes and aligning them in a cross-divisional, multi-stakeholder environment. Also, during the implementation where change management is a key task EyeOn are a great support.” (Hervé Colleaux, Delivery Lead DS Smith)

Curious about how EyeOn can help you develop an integrated business planning process? 

Contact our end-to-end transformation lead Bart Paridaen to learn how EyeOn can help you in your transformation journey and achieve next level planning capabilities. If you want further insights into the DS Smith case, contact Stijn Rutjes, the leading consultant on this project.   

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When AkzoNobel chose to introduce IBP company-wide, they realized they had neither the tools, structured approach, nor the time to step up. By partnering with EyeOn Planning Services AkzoNobel was still able to accelerate their IBP journey with immediate forecast improvements.

“I would advise companies that face similar challenges to get that outside help from EyeOn Planning Services. Especially because it allows you to focus on other things as a company and leave the expertise with the experts.” – Filip Buytaert

Learn more about Planning Services!

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When it comes to production planning, the need for balancing flexibility and stability is crucial in a wide range of industries. On the one hand, companies strive to remain flexible in order to match customer demand. On the other hand, there is a need for the leveling of production to create stability and operate efficiently. Often, manufacturers apply batch logic for their planning. It is, however, possible to step towards leveled production and to produce in line with customer demand at the same time. This simultaneously creates the stability essential in driving a virtuous circle of standard work, continuous improvement and increased performance. Production wheels can be used to realize this.

A production wheel is a method to schedule the production in a regularly repeating sequence. By integrating demand over a certain period of time and leveling production in this time period, a production wheel aims to balance the need for flexibility and the need for efficiency.

Two-step method for designing optimal production wheels

Existing methods for designing production wheels are often suboptimal and rely on manual judgement. The method developed by EyeOn, however, applies analytical models for the design and optimization of production wheels. The method consists of the following two steps:

1. Allocate all products to dedicated production lines or machines based on changeover costs. A ‘randomized variable neighborhood search’ is applied to find a good solution to this problem.
2. Develop a repeating, cyclical production plan for each production line or machine. By balancing inventory costs and changeover costs, a genetic algorithm finds high-quality production wheels.

Case study: Applying the EyeOn production wheel method in a large multinational (process industry)

We performed a case study to test the proposed methodology for designing production wheels. In a production setting with multiple machines and a broad product mix, we proved that the proposed models perform well in designing a cost-efficient production wheel. Our method decreased the quarterly costs by 10.0% compared to an earlier customized production wheel developed by EyeOn and by 39.5% in comparison with the existing production plan of the company in question.

Balancing inventory and changeover costs is key in designing production wheels. By decreasing batch sizes, the proposed method finds a better balance than the benchmark production plans. A production plan with smaller batches and more changeovers leads to higher costs of changeovers but greatly reduces inventory costs (see figure). In the end, this results in significantly lower total costs.

Conclusion

Production wheels enable you to create stability and regularity while remaining flexible towards your customers. But developing production wheels can be a complex task. Simple heuristics with manual judgements are only a first step towards a high-quality production plan. Therefore we developed this new analytical approach using optimization algorithms to best support you in developing production wheels.

For more information feel free to contact us or reach out to Dan Roozemond directly!

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Overcoming crisis with gains

The Corona crisis has dramatically changed the way companies around the world are managing their supply chains. Alongside with supply disruptions and manpower shortages, businesses encounter problems with the effectiveness of their forecasting capabilities during this turbulent period. Demand planners can’t rely on past data and, as previously, confidently use it to predict further development. Unpredictable and substantial short-term demand fluctuations overshadow the picture even more, distorting forecasting abilities and leaving supply chain departments without tools for steering the business. Business-as-usual is no longer an option for the majority of companies and they start looking for more advanced solutions.

Robust scenario analysis is the best solution for this volatile environment

EyeOn has numerous tools that go far beyond traditional history-based forecasting techniques. Our consultants have been working for years with various industries that have experienced diverse business challenges. Companies ask for our support to overcome these issues, advancing their demand planning capability to a whole new level. The level of uncertainty during the corona crisis is almost unprecedented. Our planning experts have no doubts that robust scenario analysis is the best solution for this volatile environment.

Find optimal safety stock levels and improve inventory management performance

One of our customers is a global leader in the area of dyes and specialty chemicals. The Corona wave impacted the company’s supply capabilities as well as demand potential. The traditional forecasting method that they used could not manage this level of turbulence and created a great challenge for the whole supply chain. This triggered their interest in EyeOn’s tools to improve their forecasting and inventory management practices. Our team was able to come up with the right solution in a matter of just a couple of weeks. EyeOn prepared a set of business scenarios for demand planning which incorporated various inputs from the customer as well as our deep understanding of supply chain in the process industry. It included a basic scenario and a range of additional more pessimistic or optimistic predictions based on a comprehensive analytical model. These scenarios were applied by the management as the basis for their planning. Each demand scenario included an inventory management roadmap that clearly explained how stock should be managed in each case. The approach helped to find optimal safety stock levels and improve inventory management performance. Thus, the company was able not only to maintain their forecast accuracy on a high level but also to manage their inventory in the most financially advantageous way.

Establish data-driven decision-making process

However, this was only the first step of the forecasting enhancement process. To help the customer navigate a rapidly changing environment EyeOn created a special planning solution. Anaplan supported by PowerBI served as a main integrated tool and simplified the evaluation of influence of different customers’ demand drivers. The solution combined with specially designed KPI dashboards provided insights regarding the real-time impacts of the Corona crisis and helped to reveal an accurate snapshot of the company’s day-to-day situation. The company was thus enabled to adapt its own scenario planning if the business environment changes. Under EyeOn’s supervision demand planners started to employ these new ways of working and in a couple of months the planning department was fully reinforced with the new powerful solution. Planning became the key function during the crisis period providing valuable demand and supply insight to the management team. As a result, a healthy data-driven decision-making process was established within the company. It helped them to avoid the devastating consequences of the ‘bullwhip effect’ and to keep inventory levels and working capital under control on all stages of their supply chain.

Conclusion

During a crisis, deep insight and understanding of the entire chain are key to handling it properly. EyeOn is equipped with world-class experts, cutting-edge solutions, and in-depth business knowledge. These factors help to quickly identify customer’s needs and to deliver robust solutions rapidly. During the last crisis, it became obvious that commercial survival depends on resilience and adaptability to fluctuations and disruptions. Readiness is everything.

Do you want to enhance your planning capability? We are happy to accompany you on this journey! Contact us now.

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The solution to this increasing level of uncertainty is robust scenario analysis. The EyeOn Planning Services Team helps our customer from the chemical industry with creating different demand scenarios. By combining customer’s business input, we succeeded to map the effect of potential demand changes on safety stock levels and interpreted inventory performance. Offering thus to our customer, a road map of how inventory should be managed according to each demand scenario.

The urgency agile responses is evident, however towards which direction? This is exactly where EyeOn Planning Services can make an impact; for more information explore the Planning Services website, or contact our colleague Bohdana Shumanska.

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No-touch planning, automated generation of master data, robotic process automation. On the one hand advanced automation seems and is closer than ever.

Advances in general purpose AI (think DeepMind) or focused AI (voice assistants, photo pattern recognition) make it easy to imagine the application in supply chain planning is only a matter of time. In this light, episode 47of the ‘After On’ podcast is worthwhile the listen.

Still, we struggle on a daily basis with bad master data, erroneous or time-consuming Excel files, difficult to interpret solvers and cumbersome scenario planning. Maybe an automated supply chain is just one leap to far?

Take a step back and think about the technology we use every day. What’s the last time you’ve used physical maps to navigate? Go to the library? Remember the stock traders shouting on the exchange floor? Technology slowly advances and seamlessly intertwines with daily life. 

The same holds for applications in supply chain management. We just executed a deep dive in the level of automation we apply in analyses we execute for and in applications delivered at our customers. The degree of automation in a typical project has risen to a level we would not find say 10 years ago. 

For example, more and more steps of setting up a forecasting process are automated. Manual segmentation is not required anymore. Segmentation is automated, just like many of the steps to select the best forecast approach for each category.

 

 

In our work to reduce data latency through speeding up requirements propagation, demand trend recognition and shorten planning cycles, we see ever more opportunities to automate. Take a multi node divergent supply chain with many routing choices per node, with varying lead times and yields. A detailed understanding of critical starting material requirements requires a full plan propagation, with a latency of (at least) one planning cycle. An automated ad hoc propagation using predicted lead times and material requirements – learning from past routing decisions and outcomes – delivers predicted raw material requirements with accuracy fit for planning on demand, rather than once every cycle at best.

 

 

And it can work the other way around. An analysis of supplier performance giving insight of performance against planned parameter, triggered the development of an automated update and learning loop feeding supplier management, QC lab priorities, master data management and planning.

 

 

 
Automation based learning loop for supplier management 

Any step, no matter how small, brings the no touch supply chain a little closer. At minimum it provides answers to the questions asked. In many cases, though, it triggers efforts to significantly reduce data latency and implement true automated learning loops.

Want to learn more? Ready to take the first step and implement? Feel free to reach us through our website or read the document “Data Engineering” to familiarize with the approach EyeOn takes on making improvements in this area.

In striving for success, large companies have to continuously struggle against growing internal complexity. EyeOn helps our clients manage this complexity by designing, implementing and executing excellent planning processes as a discriminating factor for this success. In order to achieve this, we develop and share knowledge about top level planning and forecasting, with constantly demonstrable return on investment for our clients.

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LogiChem is an event where directors and vice presidents of supply chain and logistics from the world’s leading chemicals manufacturers come together to maintain and boost commercial and supply chain excellence. During LogiChem in Amsterdam, the Netherlands, March 20-22 2018, EyeOn hosted an invitation-only lunch for chemical supply chain professionals.

EyeOn lunch: eye-opener on best practices IBP and APS
During this lunch, EyeOn experts, Ieke le Blanc, Stijn Rutjes and Eelco Franckaert, all demonstrated how the APS compass can improve planning systems. Unfortunately, short-term issues have a substantial impact on integrated business planning (IBP) processes whereas the focus should be on supply and demand balancing for a longer period. The three speakers demonstrated how to build a good foundation for short- to mid-term supply planning cycles. Other topics discussed were, how to properly translate IBP decisions into operations, and how to benefit the most from available APS tools. EyeOn also shared some best practices from chemical industry cases.

Your navigator: EyeOn’s APS compass
EyeOn’s APS compass handles 8 key points. These are important when setting up solid supply planning processes, and should be taken into consideration first before choosing (APS) tools:

According to participants, the presentations were an eye-opener These practical, refreshing and inspiring presentations were greeted with great enthusiasm.

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