Ready, steady, go

Own-label ethnic ready meals producer S&A Foods believes closer collaboration will provide the best way of improving the service it offers to its key retail customer, Asda this year.

The move follows the implementation of advanced planning and scheduling (AP&S) software systems over the past two-and-a-half years, designed to match production to demand. However, because accurate forecasting remains an issue, current supply chain activities are being focused on overcoming deficiencies in this area - and S&A believes that people rather than IT forecasting systems will ultimately provide the best solution to the problem.

As a chilled short shelf-life producer, the constraints between manufacture of products such as curries and filling operations have historically been an issue for S&A Foods.

Problem solving

Since installing Infor's AP&S system, however, many of problems of medium and short-term planning - such as the sequencing of manufacture and filling - have now been resolved. These include considerations such as the correct scheduling of products containing allergens so as to avoid cross-contamination.

The Infor AP&S system has been integrated with S&A's enterprise resource planning (ERP) system. This top level Business Planning and Control System (BPCS) is used for operations such as accounts handling and order receipt processing, together with materials requirement planning (MRP) - ordering and raw material stockholding and such-like.

However, supply chain manager Sue Fitzgerald admits there is cope for more long-term development: "I don't think we are using as much of it as we could. It's got a lot of potential that we are not fully utilising."

Another area yet to be developed is the capability for "as near as possible" real-time production reporting from the company's manufacturing execution system (MES), which forms part of the software. "It's not because the system isn't capable of doing it," says Fitzgerald. "We haven't [yet] developed the full solution that we could."

Fitzgerald adds: "One of the objectives for this year is to look at the system again and see what we are actually doing with it and what advantages we are not fully achieving from it ... There is probably a lot more to be got out of it."

Complexities of chilled production

The challenges facing S&A include managing a complex manufacturing process. This involves around 10 different sauces and 20 products; a situation complicated by batch capacity constraints, short order lead times and changing business environment.

To improve customer service and meet requirements for maximum in-store shelf-life of products, S&A moved from five-day production with a Saturday morning overtime shift to seven-day working in July last year. "I'm really glad we had the system when we did that because it enabled us to check out that we could really do that," says Fitzgerald.

S&A is also considering bringing the storage of finished products back in house this year to reduce costs. In the past this had been outsourced because of space restrictions at the company's factory in Derby. But, by better use of the space, S&A believes it might now be possible to accommodate stock on-site.

Although perceived wisdom has traditionally been to reduce inventory levels wherever possible to reduce waste and costs, according to Fitzgerald, this year S&A will investigate how it can use the system together with its own market experience to adjust stockholding levels to accommodate fluctuations in demand.

Flexible stockholding

"We don't get the orders in time to make to order," remarks Fitzgerald. "So we have stockholding parameters that we flex around. But I don't think we are using that as much as we could do and we are still a bit too rigid. We are looking to flex our stockholding a lot more than we currently do to allow us to react to the changes from customers."

She adds: "The way we have done it in the past is to drive [stock levels] down but what that does is make us more reactive on the production front and perhaps we have gone a bit too far ... I don't think we have got the balance quite right yet."

IT systems provide useful tools but, ultimately, to get more accurate forecasts and the demand and supply balance right, it's all about people and good communication.

Fitzgerald adds: "What we've decided to do this year is rather than look at systems for forecasting we are going to do a lot more collaboration with customers instead ... What we really need to do is work with people." FM