One of the largest grocery chains in Brazil, with over 50,000 SKUs and 300+ stores had suffered from out-of-stock problems for nearly a decade. The company had been dealing with a stark contrast between either severe OOS inventory or excess inventory.

Through completion of a comprehensive diagnosis of the causes of out-of-stock and overstock, it was clear the client required a complete turnaround of their Supply Chain, with a focus on inventory and breakdown for both FMCG and non-food goods.

With this in mind, we implemented a new organizational structure, a set of new inventory policies per channel (Direct store x Cross Docking and Stock) and re-designed supply routines/processes. With a strong focus on change management, we ensured the new methodology was tested in some pilot categories for 4 months, allowing for time to embed the new ways of working and to address any unforeseen problems.

We also introduced a new vendor relationship reward program which fostered better relationships between this retailer and industry suppliers, which today is highly known and recognized in the Brazilian market.

The work resulted in a -70% out-of-stock rate reduction, achieving the lowest historical rate ever, and reducing inventory levels at the same time (-5%), resulting in a significant increase in margin, and ultimately delivering the company’s annual target results.

A cement manufacturer with revenues surpassing $3 billion wanted to review its entire logistic model, redefining the logistic service which it offered to its clients and reviewing the network design and transportation strategy. Moreover, they wanted to implement these changes fast and to capture results in the short-term.

We worked across two angles of analysis (i) focusing on internal improvements and (ii) meeting the market needs.

As the competition in the Cement Industry is typically regional, we organized the market analysis in each region the company competed. We did extensive service level research with their clients to understand what they wanted and what the company’s differentials should be in terms of logistics service level.

Simultaneously, we modelled and optimized the company’s network looking for efficiency while reflecting these changes in the logistic service level. We analyzed how the changes in the transportation strategy could affect their network.

Finally, we supported the company in the implementation of the recommendations, focusing on how to capture the benefits in a short period.

The project delivered important service level improvements to clients as well as efficiency gains for the organization. Our client saw record On Time and In Full (OTIF) delivery levels, a reduction in order lead time and positive uptake of their new logistics service, which was seen as differentiated from the competition.

Furthermore, logistics costs reduced ~6% (in an already optimized network) and time to load vehicles dropped 50% in their largest factory. Through the training of the organization’s teams in tools and methods, they were also able to pursue further improvement post project closure.

A Global Food Company with revenues exceeding $10B needed to evaluate the manufacturing footprint of one of its categories in North America.

This category, in particular, had experienced no growth in recent years and shifting consumer demands had built up pressures on capacity, creating constraints for some product lines and idleness for others. Simultaneously, commodities prices and forex changes had harmed profitability whilst competitors had realized important network improvements driving a competitive advantage over our client.

Several attempts to solve this problem had been made in the past, but without driving significant improvements. Integration was hired to help find a financially viable optimization solution.

We first aimed to establish the status quo of (1) the clients’ operation, (2) the competition and (3) the market:

1. We visited the clients manufacturing sites to understand the current capacity capabilities and issues, as well as the possibility of technology conversion for both food production and packaging;
2. This was coupled with a benchmark analysis of competitors’ network to understand what was driving the competitive advantage over the company – food processing technology, footprint, portfolio, distribution, etc. – and estimated the level of cost advantage competition had;
3. Finally, we analyzed the category’s demand for the next 5 years and where the main capacity gaps would appear, to set the potential footprint solutions to explore in the optimization.

Considering the budget constraints, we worked closely with the leadership to develop a phased and scenario-dependent roadmap. This meant the ‘no-regret’ initiatives would be the first to implement whilst volume-constrained adjustments could be left as later steps.

Through the analysis, we gave our client visibility of where its competitors had cost advantages over it and which network capabilities had driven these allowing the leadership to have an informed view of where they might also target their efforts.

The project identified a potential 10% reduction in total network costs across material sourcing, production and transportation which could be realized in 3 evolution steps that distributed the savings and investment needs over a 5-year timeframe.

The initiatives and technology requirements were shown also from a plant perspective to clearly outline how these changes affected the different product lines.

Our client, a multinational food manufacturing company with >USD 20Bi of revenue and operations in over 150 countries was struggling to balance supply from farms and slaughterhouses with the final demand from the customers, sales channels and different countries.

The supply chain was long and highly complex with pressures across the network. We were dealing with a supply of perishable goods, with strict quality standards and complex chain of production, which had to be matched with a highly volatile demand in local and global markets.

To address this challenge, we worked alongside more than 120 stakeholders to understand the processes and complexities of this industry to develop a solution which reflected and mitigated them in their S&OP process.

The design was developed through multi-part and cross-functional workshops which involved a truly global network of stakeholders. It was presented and ratified at the highest level of the business leadership, and we took a leading role in designing its implementation across operations.

The process became the most important driver of day to day tactical decisions in the company, creating room for the agility and flexibility which was highly sought after. It was considered an industry-leading benchmark during the company’s M&A with its biggest competitor and it was taken as the best-practice way of working going forward after the merger.

A global business specialized in health insurance and hospital management with >USD 200Bi in revenue contracted Integration to help them in redesigning their purchasing area and associated processes.

The main challenges to overcome included:

• Supply team under prepared to carry out the transformation intended and having low credibility with user groups and top management;
• Lack of a structured supply chain area with key functions fragmented throughout the company (e.g. planning and logistic executed by user areas);
• Strategic sourcing applied to a few categories and knowledge centralized in a few people;
• Scarce application of advanced sourcing techniques and methodologies.

We worked closely with the client team and C-suite sponsors to address their needs through both capability development and technical solutions. From a human side, this involved empowering the procurement team, training more than 20 people throughout the project with on-the-job coaching and also helping with the selection and hiring of key people for the new Supply Chain area (going beyond our scope).

Technically, we achieved a complete restructuring of the supply chain areas (supplies, planning and logistics) coupled with the development of a new organization model to increase centralization and thereby improve visibility, governance, standardization and planning. With this new architecture in place, we were then able to implement several strategic sourcing projects (for more than 20 categories), shifting the role of the purchasing area from being transactional to strategic.

The procurement area was able to significantly expand its role with +95% of purchases being centralized. Furthermore, we saw important efficiency savings, with a 15% reduction in costs for categories targeted by the project and reduction of inventory levels by more than 5 days for pilot hospitals (17%), whilst maintaining the same service level.