Dupont Customer Success Story - Enterprise Inventory Optimization

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Getting the right product to the right customer location at the right time is key to commercial success for any company. But with more than 6,000 product lines across 13 business units and operations in 90 countries, this is a challenging task for DuPont. The company decided to integrate its inventory management using the SAP® Enterprise Inventory Optimization application by SmartOps. As a result, it has reduced costs by cutting excess safety stock while improving customer service.

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Dupont Customer Success Story - Enterprise Inventory Optimization

  1. 1. SAP Customer Success Story | Chemicals | DuPontDuPont: Finding a Formula forSuccess with Efficient InventoryPlanning
  2. 2. SAP Customer Success Story | Chemicals | DuPontExecutive overview Company E. I. du Pont de Nemours and Company (Dupont)Company Industries Chemicals, life sciencesVision Products and ServicesWhy SAP For a range of markets including agriculture, nutrition, electronics, communications, safety and protection, home and construction, transportation, and apparelImplementation Web SiteSolution www.dupont.com SAP® SolutionsBenefits SAP® Enterprise Inventory Optimization application by SmartOpsFuture plans Getting the right product to the right customer location at the right time is key to commercial success for any company. But with more than 6,000 product lines across 13 business units and operations in 90 countries, this is a challenging task for DuPont. The company decided to integrate its inventory management using the SAP® Enterprise Inventory Optimization application by SmartOps. As a result, it has reduced costs by cutting excess safety stock while improving customer service. 2
  3. 3. SAP Customer Success Story | Chemicals | DuPontExecutive overview Innovation powered by scienceCompanyVision Based in Wilmington, Delaware, DuPont has been har- From its beginning as a manufacturer of high-grade nessing the power of science to develop innovative black powder for explosives, the company has evolvedWhy SAP products since 1802. For more than 200 years, DuPont to meet changing customer requirements by apply- has brought world-class science and engineering to ing first-class science to succeed in new markets. WithImplementation the global marketplace through innovative products, recent acquisitions enabling DuPont’s move into the materials, and services. Their market-driven innovation food and agribusiness sectors, the US$37.9 billion com- introduces thousands of new products and patent pany now employs 70,000 staff worldwide. ContinuingSolution applications every year, serving markets as diverse its rich heritage of scientific innovation, the company as agriculture, nutrition, electronics and communica- has so far been awarded over 37,500 patents.Benefits tions, safety and protection, home and construction, transportation, and apparel.Future plans Today, DuPont is partnering with others to tackle the unprecedented challenges in food, energy, and protection now facing our world. With the global population expected to approach 9 billion by 2050, DuPont is working with customers, governments, 37,500 NGOs, and thought leaders to discover solutions to Patents awarded since today’s toughest challenges. DuPont believes that 1802 together they can provide enough healthy food for people everywhere, decrease dependence on fossil fuels, and protect people and the environment for generations to come. 3
  4. 4. SAP Customer Success Story | Chemicals | DuPontExecutive overview Responding to dynamic marketsCompanyVision In the new consumer-based markets that DuPont has “We wanted to take a more scientific approach to our entered, such as food and related ingredients, it is criti- inventory planning, looking at historical data to updateWhy SAP cal to react quickly and dynamically and respond appro- safety-stock targets more regularly,” says Cathi Garito, priately to fluctuating demand. However, reliance on IT Application Specialist at DuPont. “We also wanted toImplementation manual forecasting spreadsheets meant that DuPont work in a more integrated way, looking at the supply net- had the opportunity to manage its inventory in a more work as a whole so that we don’t duplicate the amount efficient and cost-effective way. A static approach to of stock needed.”Solution demand planning could result in safety-stock levels remaining unchanged for a period of time.BenefitsFuture plans “With smarter inventory planning, we have the opportunity to improve customer service while reducing costs.” Cathi Garito, IT Application Specialist, DuPont 4
  5. 5. SAP Customer Success Story | Chemicals | DuPontExecutive overview Established SAP software infrastructureCompanyVision DuPont decided to invest in a solution that would assist SAP Enterprise Inventory Optimization integrates the decision-making process for optimized inventory with the SAP Supply Chain Management applicationWhy SAP targets across the supply chain. The new software to determine demand-driven inventory targets for would need to provide automated updates on chang- every item at every location throughout the supplyImplementation ing demand in a dynamic market. Following a detailed chain. According to Kent Ping, Senior IT Consultant at vendor review process, the company decided to imple- DuPont, the company wanted commercially available ment SAP Enterprise Inventory Optimization. software. Integration with the SAP ERP applicationSolution also was a factor in its choice of inventory optimiza- tion software.BenefitsFuture plans “We’re an established user of SAP software and wanted a solution that would integrate with our existing infrastructure. SAP Enterprise Inventory Optimization meets this requirement and enables us to view our entire supply chain at the touch of a button.” Kent Ping, Senior IT Consultant, DuPont 5
  6. 6. SAP Customer Success Story | Chemicals | DuPontExecutive overview Sharing experiences and refiningCompany processesVision So far, DuPont has deployed SAP Enterprise Inventory buy-in. “No matter how sophisticated the tools we have, Optimization across 20% of its businesses. However, project success is dependent on gaining the confidenceWhy SAP the implementation has not been without its challenges. of the people using the solution,” comments Garito. “At first, data quality was a real issue for us,” remarks With this in mind, IT staff and internal supply chainImplementation Garito. “Each business is structured differently, so we consultants worked hand in hand with the businesses had to spend a lot of time understanding data flows to to look at their processes and identify ways in which ensure we had the correct information in the correct SAP Enterprise Inventory Optimization could best workSolution format to feed into the solution.” for them.Benefits Experts from SmartOps worked closely with the DuPont As well as detailed predeployment planning sessions, project team to get the job done. “It was a very collab- DuPont also holds a monthly user group meeting where orative project, and SmartOps helped us get where we representatives of each business can raise issues andFuture plans needed to be,” confirms Garito. share successful approaches. “User feedback is helping us to speed up future implementations and refine our Another key challenge facing the company was com- processes as we continue to implement the solution municating the changes to its staff and getting their across the company,” highlights Garito. “We ensure we have the right people involved in the project.” Cathi Garito, IT Application Specialist, DuPont 6
  7. 7. SAP Customer Success Story | Chemicals | DuPontExecutive overview Multitier stock managementCompanyVision With SAP Enterprise Inventory Optimization in place, helps us to be better prepared to meet changing business units at DuPont can view a network model requirements so we can be confident that we haveWhy SAP of supply chains for over 2,000 product lines. The solu- the products we need, where we need them.” tion looks at the entire supply chain and identifies theImplementation current amount and location of each item of stock across the chain. It then calculates optimal safety- stock targets required to meet demand without run-Solution ning out of stock, while fulfilling customer serviceBenefits targets for timely delivery. By analyzing historical data, the solution continuously 2,000 updates forecasted targets, taking into account vari- Product linesFuture plans able factors such as demand and supply. According to Garito, “SAP Enterprise Inventory Optimization 7
  8. 8. SAP Customer Success Story | Chemicals | DuPontExecutive overview Continuous improvementCompanyVision DuPont has achieved significant savings thus far, and in inventory, directly attributed to reduced stock levels these savings will rise as the organization continues to through more efficient inventory management. TheWhy SAP deploy the solution across its remaining businesses. MCM Resin division has significantly improved cus- tomer service levels across its supply chain, and theImplementation “SAP Enterprise Inventory Optimization enables HPF business anticipates cutting its inventory by 5%. each business to analyze the link between inventory and customer service levels. Sometimes reposition- Another benefit of the solution is that it gives the busi-Solution ing stock to maximize revenue is the answer,” Garito nesses a holistic view of their supply chain – identifying notes. “The software helps the businesses make deci- inputs and outputs at each stock point. This enablesBenefits sions so that they are better prepared to provide excel- them to review and improve processes. “SAP Enterprise lent service to customers.” Inventory Optimization helps the businesses see their supply networks clearly and ask themselves, why areFuture plans Business units with the software in place have we doing that?” comments Garito. “They can constant- reported successes in different ways. The Packaging ly evaluate and reevaluate the way they work to improve Graphics division has benefited from an 8% reduction their supply chain processes.” 8
  9. 9. DuPont Executive overview Long-term strategy Company Vision DuPont has plans to include dashboard functionality so that business managers can view at-a-glance inven- Why SAP tory information within analytics solutions from SAP. Implementation And as DuPont’s businesses come to grips with the solution, they are identifying where the Six Sigma methodology can be applied to improve processes Solution and achieve their long-term goals. “With SAP Enter- prise Inventory Optimization, we can undertake Six Benefits Sigma activities to make improvements on an ongoing basis,” remarks Garito. “In this way, we can achieve significant advances in our operational efficiency.” Future plans She concludes: “By helping us to be more dynamic and responsive in fast-moving consumer markets, the SAP solution is helping us to be more competitive – and sustain that edge.”CMP18103 (12/08) Copyright/Trademark | Privacy | Impressum 9

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