Health & Hygiene
Multinational consumer packaged goods company partners with Aera to improve forecasting and supply chain performance
A major multinational company that operates as three business units of health, hygiene, and nutrition with a relentless pursuit for a cleaner and healthier world. With revenue amounting to US$50 billion and a strong presence in 190 countries, its product range comprises cleaning agents, skincare, personal care, nutrition, and healthcare.
Business Need
To eliminate waste and non-value-add work while enabling new hires to perform at the same level on day one.
Results
- Improved forecast as much as a 1000 basis points
- Reduced service issues by 87%, previously attributed to bad forecasts
- Increased long term visibility <25% MAD with a two-month lag
- Reduction in weeks of cover to three weeks
- Improved new hire onboarding
The Challenges
The global company faced a talent retention problem that was affecting their product forecasts — a global workforce switching jobs more frequently meant institutional knowledge was not being retained and new hires were not able to seamlessly step into vacant roles.
In addition, with commodity and transportation costs rising, as well as SKUs proliferating to meet the demand for greater personalization, the need to eliminate waste and non-value-add work while enabling new hires to perform at the same level day one became crucial.
The Solution
Aera Decision Cloud — Aera Touchless Demand Forecasting Skill
Aera Crawlers — JDE, SAP, Nielsen, Siebel, JDBC, and flat files
Partnering with Aera, the company embarked on its Decision Intelligence journey. It started segmenting its SKUs by revenue, volume, volatility, and other measures. Parts of the portfolio, like top sellers, special orders, and new products which lacked historic data were more closely managed by experienced planners using Aera’s recommendations as an augmentation. The remaining 40% of the SKUs were segmented into touchless forecasting — planning was fully handed over to Aera to run.
The Aera Touchless Forecasting Skills utilized a set of 20 algorithms, choosing best fits to generate high quality, error-free forecasts. Regular governance meetings were held to decide which way given SKUs can be managed with products moving from managed to touchless and back as needed.
Through Decision Intelligence, the company enabled forecast accuracy improvement, knowledge retention, and automation opportunities.
“I truly believe that it's not so much about an exciting new thing anymore, it's almost like a point of survival. In about three to five years, I believe this will become as ubiquitous as an ERP today, and we enjoy the first-mover advantage with what we did with Aera.”
-CIO, North America
Results
Planners were able to focus on much smaller part of the portfolio and rely on Aera for an increasingly larger share. This resulted in improved accuracy of the forecast on the machine-driven side, as well as on the human one as they had more time to have quality discussions with one another. With Decision Intelligence in place, the company targets to eventually have 70% of its SKUs running on touchless forecast, with little to no manual interference.
In addition, since its institutional knowledge is now available and utilized with Aera, new hires can hit the ground running with confidence based on the recommendations Aera offers.
Moving forward, the company has plans to deploy this same model to other areas of its business to gain more opportunities in supply chain, promotions, pricing, and marketing.