Lesaffre - Food Ingredient Distribution Efficiency across China

Lesaffre - Food Ingredient Distribution Efficiency across China

Lesaffre is the world’s leading producer and distributor of yeast. However, the company does not lead in the Chinese market and faces stiff competition in a very fragmented market. The keys to its success in China are agility and efficiency in sales, production, and supply chain.

The collaboration between Lesaffre China and System in Motion started when Lesaffre only had two factories and aimed to improve its overall efficiency to improve its market positioning.

Initial situation

At that time, Lesaffre had two deployments of the same ERP in each of its production units. Most of the sales, logistics, customer service operations were either tracked manually or duplicated in each system.

First steps

The first step to efficiency was to model, align, and centralize the ordering capture and processing. This lead to the first version of a modern Order Management System. The first benefits were getting a central view of customer orders, aligning pricing and discount strategy, streamlining order validation, and follow-up. As an added benefit, the consolidation of orders led to an aggregated view of the business and an accurate view at the customer level.

After a few years of operations, that led to great insight into Lesaffre’s key customers and its overall portfolio. The consistency of the process’s execution, the unification of master data, and the transactional data quality significantly improve the management’s decision-making process.

Building on the early successes

The next step of Lesaffre China and System in Motion’s collaboration was to cover more order management processes. To achieve the initial results, the project team had concentrated on the most common order management processes to maximize the initial project’s return. There were rarer cases to management.

The second area of expansion was to cover more of Lesaffre Business Units. These smaller B.U.s could then benefit from the initial investment and operate at the same level of control and execution.

Finally, Lesaffre China extended its operations into two more factories, resulting from acquisitions in China. The extension relied on the OMS’s flexibility, and at the same time, helped the new factories to operate with the same standard processes as the group.

One step further

A key element of improvement was connecting the OMS with Lesaffre’s logistics providers and its transportation network. The integration made it possible to follow the stock availability in each location across China, allocate orders to the right stock, and gather information on final delivery.

Initially, this extension simplified the logistic planning by bringing all the order’s related information in one location. It later appeared that there was one more step possible towards automation.

The data accumulated in the first few months of operations showed that a good percentage of the orders’ allocation followed a simple logic. As the OMS had both the information available and the means to send back allocation instruction, it made sense to automate the allocation process. The critical success factor of this phase was to identify in which cases the automatic allocation was possible.

Lesaffre distribution today

Today, Lesaffre OMS is the central piece of operational excellence. It measures the end-to-end ordering cycle, from the initial order to the delivery at the customer’s warehouse.

The OMS automates more than 70% of the orders allocating, eliminating the need for repetitive and tedious work. As a result, the number of orders delivered within Lesaffre On Time In Full commitment to its customers has increased. The OMS analytics gives all the information to identify the scenarios when the OTIF is not met and further improve its supply chain’s efficiency.

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