- ROI achieved within 18 months
- Better capex forecasting and decision making
- Annual savings of around £500,000
- 15—20% improvement in production efficiency
- Supports ongoing supply chain and business process improvements
Chilling out on advanced planning
2 mins read
SK Chilled Foods, based in Middlesbrough, is flouting the generally accepted rules around what comes first in IT – and rolling out an advanced planning and scheduling system (APS) before implementing ERP. Its Workplace APS will work with the firm's departmental Excel spreadsheets – planning its people and shifts throughout production.
Why APS? Mike Hepworth, SK's planning and logistics director: "We had to be able to schedule our factories better to improve efficiency, take out cost and underpin growth. In terms of production efficiency I'm expecting around 15–20% improvement from that: we'll get ROI certainly within 18 months. But I believe we'll also see longer-range savings. For example, we'll be able to make better capex spending decisions... In a year that could save us £500,000."
SK runs three factories, turns over £30m and employs 700. It produces 90% chilled and the rest frozen foods for the deli counters at retailers like Asda, the Co-op, Safeway and Morrisons. The plants are a mix of extremes: relatively highly automated lines side by side with very labour intensive manufacturing – all subject to considerable change. "We're virtually contract producers," says Hepworth. "You've got to be very, very flexible in this kind of business."
Prior to its APS, scheduling was on spreadsheets that were just getting too big and unwieldy. "We needed a system sophisticated and flexible enough to take us into the future – we're potentially so complicated we needed something more advanced than MRPII – an optimising machine. But it also had to be compatible with as many systems as possible since we didn't know which business system we would go with, or when."
And hence the Workplace APS, which has replaced the main planning spreadsheet and is providing work-to lists as well as feedback for purchasing. "We're not getting everything we can out of it yet," admits Hepworth. "We've still got to get change-over times, yields and run rates buttoned down."
But he adds that there's been great value in the journey of implementing APS over and above the more obvious efficiency gains.
"The journey is very important: you find yourself asking what might be dumb questions, but then getting odd answers; then you dig further and find out how things are really done, and what the system should really look like. So getting the numbers and data might be a bit of a problem but it's definitely worth the effort."
Says Hepworth: "We're now in the 21st century; spreadsheets have worked, but you can't carry on like that. You need the visibility and sophistication to be sure you never run out of raw materials or packaging, you don't over-stock, you don't miss something… We're a growing company, and we want to make sure we use the right technology to sustain that – so that we have the same number of people, while IT handles the extra work."
Key benefits
