“Based on our current buffer stocks and delivery time agreements, which percentage above the forecast will cause problems for us?”


Wolfgang Weber, Henkel: “If we want to add a new warehouse to our network, we can immediately see how that will impact on the cost- to-serve.”


Dirk Holbach, Henkel: “We want to further improve our service levels and strengthen our cash position. Technologies such as machine lear- ning are helping us.”


Valentin Dahlhaus, Husqvarna: “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.”


Steven Decroos, Alpro: “SAP con- tains a lot of information but we don’t always manage to extract that data and convert it into valuable information.”


of the manufacturer of detergents and cleaning products are fitted with more than 3,000 sensors which provide infor- mation about each production line’s con- sumption of water and energy and also about the capacity utilization rate and efficiency of the line. Henkel decided to install all the sensors in 2013 when the company aligned its processes with the new ISO 50001 certificate for energy management. “That’s when we opted for visibility in the energy consumption per technology and per production line,” says Wolfgang Weber, Head of Digital Transformation for Henkel Global Supply Chain. “The energy-monitoring sensors are connected to a platform that gathers and analyses all the data. We later added other applications, such as to measure the water usage, product quality and line efficiency. These insights have enabled us to take steps that will save us several million euros a year.” Weber has noticed that multiple trends are contributing to Henkel’s need for visibility. The first: changing customer expectations. Consumers are demand- ing ever-more quality from brands such


as Persil. Sustainability is also an impor- tant part of the brand experience. Besides that, shareholders expect to see gains from their investment. This means that companies not only have to better utilize their existing assets such as production lines, but must also reduce their over- all supply chain costs. “Then we have the retailers who expect us to deliver on time, in full. Our global service level is over 96%, and considerably higher in the more mature markets. We want to fur- ther improve those service levels while strengthening our cash position at the same time. In other words, we want to further reduce our stocks, which means we need to further improve our fore- casting. Companies such as E2Open are helping us with technologies like machine learning for things like demand sensing,” emphasizes Dirk Holbach, Cor- porate Senior Vice President of Supply Chain Laundry and Home Care.


Value from data


First and foremost, the E2Open tool helps to remove the human, subjective factors from the demand forecasting.


“The software analyses the historical data and matches it with the incoming orders. The human skills that we used to need to generate a forecast are now supported by algorithms. The data that we utilize for that is enriched with external data about the weather or holidays,” explains Weber, before adding that retailers are not always keen to share their data. Henkel creates visibility by combining data from different systems and sensors and analysing it aided by Cloudera and Hadoop. Weber’s team have developed various analytical tools for that purpose themselves. The results


are visualized


using Tableau’s visualization software. Each manager or department has their own dashboard showing the information that they need to perform their specific tasks. Weber calls it a ‘KPI flight deck’, which enables users to conduct ‘multi- dimensional real-time analysis’. “Imag- ine that a Henkel employee’s flight deck shows that the service level has suddenly fallen at a certain site. He can immedi- ately see which item has caused it, on which production line that item was made and the associated planning cycle.”


31


SUPPLY CHAIN MOVEMENT, No.31, Q4 2018


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