Case Studies

Planning Optimization for SAP Implementation & Vertical Integration

2 minute read

The Client

Multinational food processor

The Challenge

The company acquired an existing coffee distributor’s facility to vertically integrate their coffee business.

However, the existing plant was relying heavily on spreadsheets for their planning and needed strategy, process, and implementation support to prepare for and execute an SAP go-live.

The Solution

Catena Solutions’ Supply Chain Consultant provided vital insight to the company’s supply chain planning team and helped prepare for the SAP go-live. Our consultant:

  • Led master data setup and governance
  • Acted as a key member of the Sales, Inventory & Operations Planning (SIOP) process to change inventory from Made to Order to Made to Stock
  • Established safety stock levels by item and velocity code by item (A-D)
  • Implemented Days of Supply (DOS) / Days on Hand (DOH) for all A and B SKUs
  • Reviewed the sales plan and adjusted for seasonality and limited time offerings
  • Created monthly distressed inventory processes to identify expired, short-dated, or heavy DOH at the item level
  • Researched and validated demonstrated productivity rates by line, item, and carton size
  • Determined Operational Equipment Effectiveness (OEE) and theoretical maximum rates
  • Developed Rough Cut Capacity Plan (RCCP) for 24-month rolling calendar
  • Determined production capacity by line and line groupings
  • Created a production and staffing plan by line / shift
  • Oversaw the execution of the sales and execution plan
  • Developed production line material sequencing by line (carton, flavor, ingredients, and allergens)

The consultant also analyzed and incorporated process improvements within the facility beyond the project scope including:

  • SKU rationalization for the 30% of items that didn’t have a minimum order quantity, which was causing production inefficiencies and additional changeovers, rendering these items unprofitable.
  • Transitioning to a closed loop plastic pallet system for raw item receipts. This entailed moving materials to a dump or blend process once the empty pallet was returned to receiving.

The Benefit

  • Prepared and led the supply chain planning team in SAP-APO and ECC integration and successful go-live in the new facility
  • Saved the company $220,000 in distressed inventory expenses
  • Drove case fill rate from 95.5% to 98%, which positively impacted customer service
  • Mitigated risk of potential nonconforming wood pallets and quality issues, which will lead to a significant reduction in broken wood pallets

Additionally, our consultant received recognition from the Vice President of Supply Chain for project execution.

Facing any similar challenges? Contact us to discuss how Catena Solutions can help.

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