Our goal is to connect our client’s supply chain to their business strategy, culture and environment. We do this by providing customized and cutting-edge solutions that deliver concrete and sustainable results.
The new mandate for Supply Chain
Today, Supply Chain organizations are increasingly being asked to occupy a strategic space which goes beyond just delivering a balance of cost and service level.
This shift has been motivated by both the competitive environment and the increasing demands of customers, and further accelerated by the digital revolution.
The competitive environment: We see Supply Chains leaders under pressure to deliver both resilience and sustainability, as well as perform with ever-increasing efficiency. Globalization, lower entry barriers and easy access of information to compare products and services, for example, are all contributing to a highly competitive environment. At the same time supply chains are becoming more complex and interconnected, increasing the risk of disruption, whilst sustainability concerns are changing the way actors across the network must function together.
Customer expectations: Simultaneously, the demands and expectations of customers are rising. They desire more fluid, personalized experiences delivered in a shorter amount of time; whilst society as a whole expects Supply Chains to be more sustainable and eco-friendly. This forces the Supply Chain to play a much more visible and leading role in delivering the customer value proposition.
The digital revolution: The rise of digital technologies is augmenting these pressures, whilst also acting as an enabler to address them. AI, Advanced Analytics, Blockchain and Machine Learning are unlocking new opportunities, increasing visibility, control, automation, service level and speed of decision-making, changing the way services and operating models function.
All this is happening in an ever more complex and dynamic world where scenarios and contexts change constantly and dramatically within a short period. Given these complex and interconnected challenges, the Supply Chain area must be prepared to play an active and important role in the deployment of the business strategy.
How do we help?
Over the last 25 years, we have been helping our clients determine how to achieve their goals, answering difficult questions related to:
THE ROLE OF
- What role should the supply chain play in my customer value proposition strategy?
- How do I make my Supply Chain a driver for competitiveness and a source of commercial advantage?
OPERATIONS AND PROCESS MANAGEMENT:
- How do I prepare my supply chain to be more resilient and respond more quickly to an increasingly dynamic operating environment and times of crisis?
- In the pursuit of efficiency, how do I manage trade-offs and not compromise standards such as service level, quality, compliance and sustainability?
- How do I create an end-to-end Supply Chain strategy that connects all areas inside the company seamlessly?
SUPPLY CHAIN TRANSFORMATIONS:
- What are the transformational changes required to adapt my supply chain model to meet the business strategy?
- How can I take advantage of cutting-edge tools and technological advancements to improve my operations and capabilities?
- How do I prepare my organization and people for a supply chain transformation? What aspects of cultural change, engagement and operating model need to be considered?
What makes us different?
Our successful track record is driven by combining both the technical and human elements of a solution.
Each organizations’ strategies, goals, people and contexts are different, and so we strive to develop and implement, together with our clients, fully customized solutions which are grounded in reality and technical excellence. This mantra has led us to work with multibillion dollar companies across 3 continents and resulted in us being recognized as for 3 years in a row by Inbrasc (the Brazilian Supply Chain Institute).
We believe our strength lies in bringing together two important elements of any solution:
- Cross-industry insight: We take advantage of our significant knowledge base of cross-industry benchmarks and good practices to inform and inspire resolutions for your specific issues;
- Cutting edge thinking: We embed in our solutions the latest supply chain management trends and practices on subjects such as digital, sustainability, resilience and customer-centricity.
- Living the day to day: We like to work side by side with our clients because nobody knows the culture, reality and subtleties of the operation better than the people who manage it daily;
- Company-wide connection: We make sure we combine a deep dive into the data with extensive interviews and workshops with stakeholders across the entire organization (not just supply) to build well-rounded understanding and consensus.
Whether you are just starting, or you are already measuring your sustainability impacts and acting upon these, Integration can help you from strategy definition to implementation.
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:
- 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;
- 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;
- 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.
OUR INDUSTRY EXPERIENCE
Our experience has been built through the completion of more than 600 supply chain projects. We have worked with numerous multi-billion dollar companies across industry sectors; highlights have included developing global planning processes for one of the largest food companies in the world; redesigning the entire supply model for a leading supermarket retailer and transforming the procurement operations of a multinational agribusiness, but there have been many more.
We have had the pleasure of operating across continents to support our clients with varied contexts and challenges (from M&A to down-sizing and cost-efficiency). These opportunities, carried out since our founding in 1995, have allowed us to learn the value of both the human and technical elements of solution design and implementation and build up a broad range of benchmarks and best-practices.