of 150,000. We have to be fast and flex- ible.” Husqvarna has been investing heavily in supply chain integration, including to harmonize master data and standardize processes and systems with its customers and suppliers. The company has imple- mented sales & operations planning (S&OP), for which it mainly gathered the necessary data manually. “Historical data at that. We were constantly looking in the rear-view mirror, but that didn’t give us a clear view of the seasonal peak that lay ahead. That’s why we implemented the Logility software – initially for demand planning, and then later for supply plan- ning and supplier forecasting,” explains Dahlhaus.
Electrification 30
Husqvarna’s need for supply chain vis- ibility has grown strongly over recent years too, as a result of the customer trend towards electrically powered robot- ized gardening equipment. This trend calls for a horizontally integrated supply chain rather than a vertically integrated one. Dahlhaus: “We produce our motors ourselves, which entails sourcing alu- minium in order to make cylinders. But robotic lawnmowers have electrical com- ponents which we buy from suppliers who also sell to other, much bigger com- panies than us. For example, an impor- tant manufacturer of lithium batteries is only focused on the automotive sector and is no longer interested in serving our industry, so we can’t make three-to- five year agreements with companies like that. That means we have to collaborate much more intensively with other bat- tery manufacturers to safeguard the long- term supply of batteries, including in the case of future growth.” The Logility software helps Husqvarna to gain greater visibility of the future demand, based mainly on analysis of the sales figures from the past two to three years and supplemented by mar- ket knowledge. “Besides that, we have around a hundred thousand ‘connected’ products being used out in the field that are continuously generating data.
of weather and climate change into our demand planning. I’m convinced that adding that information would provide visibility into patterns to help us to better predict seasonal peaks. We’re currently investigating how we can utilize not only weather-related information and public data about customer behaviour, but also information from social media.”
Cost-to-serve
Husqvarna has insight into the cost- to-serve per sales channel and at item level, but not yet at customer level. “We measure various KPIs per sales chan- nel and segment and differentiate per sales channel, but not yet per customer. Our top priority is to meet the needs of major retail partners and to develop partnerships with online players such as Amazon. Apart from that, we’re more focused on modularizing our products than on further supply chain differentia- tion. Modularization enables us to adapt products in the final phase of the chain. A robotic mower for the German market might require software in a different lan- guage than one for the French market, for example. Modularization helps to sig- nificantly reduce supply chain complex- ity.”
Dahlhaus is less interested in visibility at operational level. “Operational visibility at item level is more relevant for com- panies that are playing the cost game. We’re more focused on identifying oppor- tunities. Which customers or markets could make a positive contribution to our profit? Take the market for robot mowers, for instance. We have 50% market share in Europe. The question now is who will gain control of the North American mar- ket. This all depends on which manufac- turer can offer a safe and simple solution that delivers perfect results. How can a fast, responsive supply chain support that? Those are the key questions for a company like Husqvarna which is striv- ing for market leadership.”
We’re keen to obtain valuable informa- tion from them for forecasting and plan- ning, but we don’t yet factor the influence
Thousands of sensors
In contrast, operational visibility is very important for Henkel. The factories
SUPPLY CHAIN MOVEMENT, No.31, Q4 2018
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