by Guru Ananthanarayanan, Country Head, India Region, Blue Yonder
Next-Gen Supply Chain Planning solutions from Blue Yonder help leading paint manufacturers achieve an array of customer satisfaction, business and financial results
While every industry is complex, paint manufacturing is especially challenging for a number of reasons. Companies must offer hundreds or thousands of product SKUs, as well as custom made-to-order (MTO) formulations. They rely on owned production facilities, alongside a network of contract manufacturers, to meet widely varying demand, including seasonal variations.
To balance product availability and fulfillment with profitability, paint manufacturers must strategically assign production loads across the manufacturing network, incorporating variables such as demand volumes, inventory, capacity and material availability, logistics and warehouse operations, accounting for production runs and changeovers, and environmental requirements. These capabilities have been severely tested by the Covid-19 pandemic, which has driven consumers toward DIY and home improvement initiatives globally.
If manufacturers guess wrong, the results can be expensive and far-reaching. On one hand, companies can lose sales and customer loyalty from stock outs. On the other hand, they can be left with excess inventory and production cost overruns.
With years of experience supporting the world’s leading paint companies, Blue Yonder understands these challenges. Supply chain solutions from Blue Yonder enable managing complexity and drive impressive results for several paint companies, including Asian Paints.In an integrated network, upstream decisions from manufacturers impact retailers like Wickes and independent retailers globally in meeting dynamic consumer demands, profitably.
Mastering a Complex Market via Real-time Scenario Planning
Blue Yonder’s Luminate™ Planning solutions predict and sense demand signals, assessing market opportunities, analyze production capacities, raw material and transportation availability; apply optimization techniques against layered business objectives. The result is an executable, network-wide constrained master plan and production schedule. As conditions inevitably change, the plan adapts in agile fashion, powered by guided real-time scenario planning and stakeholder collaboration playbooks, driving outputs that maximize service levels, lower delivered costs, protect margins, and drive optimal asset utilization.
Fueled by artificial intelligence (AI) and automation, optimization engines continuously keep results on track, no matter the level of market volatility. Network planners can accurately predict the results of various actions and make decisions with confidence.
With pre-built dashboards, graphical workbenches and analytics, planners can easily review scenarios across multiple metrics, slice and dice outcomes across various dimensions, evaluate trade-offs of and ensure that outcomes reflect strategic goals. Planners are more empowered, more productive and more effective. Blue Yonder’s solutions automate routine decisions and makes planning flexible and agile.
The extreme speed and responsiveness enabled by Blue Yonder helps paint companies stay ahead of competition by making accurate, profitable decisions quickly and confidently. Typical results of a Blue Yonder implementation may include a 1 to 3% revenue increase, 20 to 30% logistics expense reduction and 10 to 20% inventory reduction.
A Case in Point: Blue Yonder and Asian Paints
Asian Paints, India’s largest paint company and Asia’sNo. 3 paint supplier has delivered measurable results with Blue Yonder. Founded in 1942, Asian Paints operates in 15 countries, has 26 paint manufacturing facilities around the world, servicing consumers in over 60 countries. It partnered with Blue Yonder to implementan end-to-end supply chain planning solution with the goal of improving service levels, asset productivity, overall production planning and safety-stock planning.
Via a complex worldwide supply network, it offers over 1,600 standard paint products and many custom paint formulations, intelligently orchestrating network demand planning, manufacturing and distribution, responding to rapidly changing and highly seasonal demand.
Since rolling out the capabilities, Asian Paints has reduced finished goods inventory levels from 56 days to 30 days. The company also saved over $700,000 by reducing unnecessary production. Asian Paints’ service level exceeds 90% for SKU sales at the location level, with leaner manufacturing operations and reduced inventory.
The company has dramatically improved its debt-to-asset ratio and used its stronger cash-flow position to pursue an aggressive growth strategy. With a market share of 39% in 2020, today Asian Paints’ sales are more than triple its closest competitor in India.
With decorative paint sales in India growing dramatically during the Covid-19 pandemic ― including an increase of 32% in the last quarter of 2020 alone — Asian Paints is positioned to sense and respond to demand shifts profitably.
“Today, disruption is almost constant, and the velocity of market signals is continuously increasing,” says Harish Lade, Vice President of Supply Chain, Asian Paints. “In this environment, the traditional cycle of planning and execution has collapsed. We can’t afford to plan and then wait for results. Instead, we’re moving into a ‘real-time zone’ where these activities are happening simultaneously based on current signals. Fortunately, Blue Yonder technology supports that shift. We’re partnering with Blue Yonder to create an autonomous planning-execution engine that will drive our entire supply chain, creating a planning environment that’s as close to real-time as we can achieve.”
Blue Yonder: Enabling supply chains deliver demonstrable business results
Asian Paints implementation is an impressive example of what Blue Yonder’s solutions can accomplish. Blue Yonder serves over 3,000 customers, including leaders in the worldwide consumer and process industries.
“Supply chain organizations have now established a permanent seat in the corporate boardroom. Therefore, every decision must connect business strategy, financial plan and operations model,” says Shri Hariharan, Global Consumer Industries Leader, Blue Yonder. “Blue Yonder’s industry-use-case-driven solutions enable product supply organizations to consistently deliver, measure and improve Operational Total Shareholder Returns (OTSR). Persona-driven workflows allow network planners to base decisions off impact to OTSR KPI – namely, service as measured by the customer, revenue growth, margin, cost to serve, and working capital alongside sustainability and greenhouse metrics.”
By calibrating segmented supply chains, their uniqueness, value propositions and enabling rapid trade-off assessment, Luminate Planning’s SaaS platform enables purpose-built industry cloud solutions that enables speed, visibility and automation to propel supply chains at the speed of consumer decisions.
Blue Yonder incorporate AI, automation, advanced algorithms, data science, and analytics – creating a powerful capability that’s unmatched in the supply chain solutions marketplace, augmentingplanners to manage business complexity and make optimal decisions every time.
By balancing service goals with financial targets, Blue Yonder delivers a spectrum of benefits to the world’s paint companies that reflect the art and science of optimized supply chain planning.
Follow