The need for agility was the driving force behind a change in the supply-chain planning paradigm at Dow AgroSciences. Customers require individualized service, with product sold in their own bottles and labeled accordingly.
“It’s a big challenge being able to react,” says Swanson, “having enough inventory close to the customer and getting it to him within 48 hours.”
Forecasts are by definition wrong, so the ability to adapt to real-world conditions is essential, Swanson says.
One of the company’s major concerns is dealing with the silos of information that exist within its complex supply chain. Dow AgroSciences has transitioned from multiple instances of an SAP enterprise resource planning system to an integrated application and one dataset. On top of that rest systems for forecasting and carrying out other improvements throughout the chain.
The upgrade is a two-and-a-half-year project, and the company is in step one. “There’s still a lot more to go,” says Swanson.
In implementing the RapidResponse application from Kinaxis, Dow AgroSciences sought to get all of its data into one place. As a result, it’s able to identify capacity gaps over the next five years. “It gave us time to react – to weigh cost against potential lost revenue by not having the right project,” Swanson says.
Dow forecasts out to a 10-year horizon, but can only react effectively within a five-year span. Initial implementation of the forecasting tool focused on the two- to five-year period. Swanson says the company must also take into account variables that are difficult to predict, such as long-term weather patterns.
