Food & Beverage
SITUATION
Premier North American ice cream manufacturer faced increased competition and needed help to create a more efficient, demand-driven operation.
DRIVER GOAL
- Achieve peak period customer service levels (April-August) of 98%.
- Reduce inventory levels by 10% by year end.
- Reduce landed costs by 2.5%.
RESULT
- Achieved customer fill rate of 96% and on track to achieve 98%.
- Reduced inventories by 10% with an additional 10-15% projected by year end.
- Reduced landed costs by 3%.
Case Study
Create a Demand-Driven & Efficient Operation
Issue
One of the premier North American ice cream manufacturers facing increased competition enlisted The Highland Group to develop a reliable demand forecasting model, analyze its product portfolio and pricing, and implement production, resource and inventory planning systems to create a more efficient, demand-driven operation.
Highland Approach
The Highland Group’s analytical professionals conducted a Discovery and Design process that identified and detailed the key issues, the specific approach required to achieve the desired results and the projected benefits. Teams assigned to prioritized projects redesigned critical processes.
Actions Taken
- Developed and implemented an enhanced production planning and inventory control process that supported more accurate forecasting and inventory planning.
- Developed and implemented a project rationalization and prioritization process that focused resources on critical projects, including those related to the enterprise resource planning system, production planning, capacity optimization and scheduling.
- Reengineered the equipment utilization, maintenance, changeover/set-up, sanitation and scheduling processes.
- Developed labor efficiency models for direct and indirect labor.
- Re-architected the distribution model to optimize inventory positioning, movement efficiency and transportation channels.
- Conducted a SKU rationalization determining profit contribution, consumer demand, pricing, channel and portfolio breadth and content.
