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JP Doggett

Summary of a discussion on 11th March with members from General Mills, Atlas Copco, Corbion, Aston Martin, Unilever, Alstom, GSK focusing on an implementation of concurrent led by Ayse Gul at British American Tobacco with Alexis Rotenberg of Kinaxis.

 

What participants wanted to improve about their current planning processes

  • Visibility and responsiveness to demand and supply volatility i.e. agility
  • Scenario modelling capability including financial impacts
  • Data-driven decisions
  • Integration of planning & execution

 

Key takeaways

  • Concurrent planning isn't a monolithic process or technology but should be adapted according to the industry / supply chain archetypes (MTO, MTS etc.) and the existing levels of maturity related to data management, process centralisation & stability and collaboration with partners
  • It's vital to define exactly what is meant by 'agility' among all stakeholders. There are three types of agility:
    1. Faster decision-making, especially in response to disruption: for example, Lenovo was able to increase market share by responding faster to supply chain disruption
    2. Shorter planning cycles: no matter what your maturity or cadence now, moving to shorter cycles will bring benefits even in industries like steel-making
    3. Closing planning & execution gaps
  • You can't (re)design a process independently of the technology that will enable it...it's like having a war strategy without knowing what weapons you have available
  • Improvements can be realised at all levels of maturity:
    1. Less mature: simply connecting the data to better visualise it is a worthwhile first step
    2. More mature: breaking down internal silos in planning 
    3. High maturity: integrating supply chain partners and execution systems although this can be especially complex in organisations with multiple legacy systems in place
  • A quick win is being able to change the prioritisation of customer segments on the fly and immediately see the impacts on all horizons

 

BAT's implementation of concurrent planning

  • Started implementation in 2019 and due to complete in Q1 2022
  • Business case was stated in terms of both tangible benefits (e.g. working capital preservation including through better inventory control of higher value products) and intangible benefits (e.g. a better way of dealing with volatility and disruptions than manipulating Excel sheets)
  • All key cross-functional stakeholders including senior management spent a lot of time at the beginning to thoroughly define agility and what value they wanted to extract from concurrent planning
  • Planning is split into supply and demand teams. Supply planning is more centralised with 3 main global hubs (compared to spread over circa 100 country-based teams for demand planning) and, although more complex, had quite well established processes
  • Implementation has been phased across regions in nine deployment waves following an agile methodology where learnings from the first waves inform subsequent waves
  • Started with core planning and then expanding which could either further improving core planning or more focused on supplier collaboration
  • Already had good process at a short-term, tactical level supported by a control tower but wanted to integrate suppliers who now log in directly which enables scenario planning based on supplier data

 

Change management

  • As mentioned above, a critical first step is to thoroughly define agility among all stakeholders and have a clear understanding of what the desired improvements should be
  • Data management: BAT already had a global master data team and data stewards for governance. It took 3-4 years to establish mature processes from an already good base where the impact of different objects was well understood and different rules established according to their contexts
  • User adoption & process compliance: this was the highest priority KPI at BAT. Daily and weekly checkpoints were set to monitor adoption and compliance to understand which processes and workbooks were being used and when. This feedback helped fine-tune the processes and improve adoption
  • Don't touch: several participants mentioned analysis they had done that showed that as much as 70% of the manual touches in planning made no difference, either because they were too small or because, taken together over time, they cancelled each other out. This was a major focus for BAT who mandated a manual planning horizon of one week (instead of the typical 4-24 weeks) and compliance was reported to senior management. Once people began to see that the system helped them, process compliance reached 95%+
  • Centres of Excellence: a lot of emphasis was placed on leveraging key individuals who understood both operations and IT to help progress application support teams into truly cross-functional CoEs. Rather than a siloed approach of being referred to one application team or another, there was cross-application support and IT and subject-matter experts are able to speak the same language

 

Other insights:

  • Not everything can be captured by tools and systems - much effort has gone into supplier relationships to reinforce flexibility when required
  • It's also important to consider the timeliness and accuracy of intelligence feeding into planning systems
  • One possible outcome from taking a concurrent planning approach is redefining planning roles so that, rather than defining and demand or supply planners, they become more like 'network planners' and can structure around aptitudes for short-term or longer-term planning

See also previous discussions:

 

 

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