DeLavalSuccess Story

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DeLaval has over 125 years of innovation and experience in the dairy business, supporting dairy farmers in managing their farms their way. The Sustainable Dairy Farming initiative is contributing to the production of more quality food, for more people, with less impact on the environment. The Smart Farming strategy aims at influencing and shaping the future of dairy farming today. The goal is to accelerate the transition from milking management to global farm profitability management by harnessing emerging decision tools and automation technologies for better quality milk and profits.

• Purchasing and parts movement decisions were not accurately recorded in SAP
• Lead times between plants confused the overall lead times
• Inventory accuracy was questionable and incorrect
• Excess stock caused warehouse challenges and tied up working capital unnecessarily
• Stock-outs created customer dissatisfaction and lost sales
• Inventory averages were higher than needed creating large amounts of dead stock
• Customer service levels were challenged due to stock-outs and unreliable lead times
• Lack of trust in system caused high manual activity and users working outside the system
• Business rules and master data did not align with current procurement functions
• Inaccuracies in forecasts due to a rapidly changing marketplace
• Challenging internal workaround for internal Stock Transport Orders
• Improper use of Safety Stock as a Re-Order Point

SOLUTIONS

• Reveal oVo® in Germany followed by oVo® in the United States
• Education on specific subject areas along the supply chain, with a focus on information maturity within the system
• One on one sessions with management and executives
• Data groups and priorities set within the supply chain, targeting low hanging fruit
• PAT’s (process aligned teams) established to meet daily and deal with supply chain challenges identified through the oVo® process
• Assistance in setting KPI’s and aligning with strategic business performance measures
• Educated Buyers & Managers on valuable SAP tools to uncover, analyze, and pro-actively manage inventory and service levels
• Created List of Highest Average Inventory, Highest Dead Inventory and Top Movers and Shakers using standard SAP tools to begin change
• Unpacked business issues that attributed to inventory and customer service issues relating to, outdated Information, user behavior, business rules and configuration issues
• Implemented new MRP strategies and analysis methods to drive inventories down
• Adjusted Re-Order Point and Safety Stock improving Customer Service

BENEFITS

• Inventory reduction approaching 20%
• Reduction in exceptions of over 65%
• Overdue Elements down over 50%
• Customer Service Measurement Implemented
• Simplification and standardization of procurement process
• Alignment of KPI’s to business objectives