Achieving a Competitive Advantage in the F&B Industry with S&OP and S&OE

Dec 13, 2021

food and beverage manufacturing

Emerging technologies like advanced analytics and AI are transforming the world of manufacturing. This creates new opportunities in the industrial, social and environmental fields. Data is critical in this transformation, as is companies’ ability to analyse and leverage it effectively. While manufacturers are making strides in this area, most focus on satisfying individual functional needs: demand planning, supply planning, inventory optimisation, production scheduling, etc.

Although optimising the efficiency of specific tasks is always a good idea, companies need to focus on the alignment between demand planning, production planning and execution. Getting these different teams aligned is key to creating an integrated supply chain plan that supports companies in achieving their overall business goals.

The impact of agility: how to shape your organisation to compete

Historically, F&B manufacturing is a competitive and low-margin industry where there is continual pressure on manufacturers to keep prices and production costs down. However, due to F&B industry becoming smarter, manufacturers can now choose operational agility as their competitive advantage, as that is an area where significant gains are made. Selecting this strategy means:

  • It is no longer enough to have well-optimised sales planning and execution tasks and sub-processes that satisfy functional needs in isolation. Instead, the real gains come from having those workflows and sub-processes working seamlessly together, which most companies are struggling to manage.
  • Successfully orchestrating company-wide processes requires the whole organisation to work from one data source – including supplier data. The data needs to be able to flow between the various systems and be accessible to all relevant stakeholders to enable faster, more reliable results.

It’s not all down to culture

Unfortunately, many companies do not succeed with this strategy. And a lot of the time, this is not a result of company culture, siloed thinking or resistance to change; it comes down to the available tools and technology. For example, if you cannot reoptimise your production schedule in real time and automatically keep your manufacturing teams updated with the changes, it’s not because of your people and culture. Rather, it’s a matter of integrating the efforts of the sales planning and manufacturing operations teams – two groups that have traditionally focused on perfecting supply and demand in silos.

It’s about integration and real-time data

To succeed, integrating the flow of information between strategic planning systems and execution system is fundamental. This is because getting data insights across systems delivers the efficiency to make decisions quickly, making it possible to replan quickly and reschedule production around the new reality. Without integration, this becomes impossible as you cannot replan or re-execute fast enough to retain the value you were seeking when setting the strategic direction.

To sum up, successful digital integration of F&B manufacturing processes is built on and sustained by data-driven insights and analysis, enabling visibility and cross-functional collaboration across the supply chain. Ultimately, to achieve end-to-end business orchestration of all processes requires a team of people across functional (and even organisational) boundaries to be able to freely explore the financial and operational consequences of possible actions and “what if?” scenarios quickly and collectively.

Elisa IndustrIQ creates supply chain solutions that give manufacturers the agility to react to and take advantage of opportunities that make a competitive advantage.

How To Improve Resilience And Grow Your Business Sustainably

Unexpected disruptive events in manufacturing always interrupt normal production conditions and cause production loss. How resilient are your planning and manufacturing processes? Are you prepared to deal with the unexpected?

Take the quiz below to find out how your organisation stacks up in the face of crisis and get expert insights on how to make your manufacturing more resilient.