Life Sciences : Implementation of Supply Chain IS teams and processes

Deployment of Supply Chain processes, teams and information system
Case study

Approach and methodology

After the initial diagnostic, the target operating principles were defined and shared with the customer.

The principles of the target consist in :

  • Deploying an s&op process with the corresponding tools
  • Switching the subsidiaries from a procurement plan-based approach to a sales plan, with negotiations between central office and the subsidiaries of their target stock levels in order to guarantee zero stock outages
  • Setting up a distribution plan that identifies the production requirements based on stocks and stock targets in the distribution network and the sales forecasts of the subsidiaries
  • Setting up a macro-planning system for the output of the factories that is negotiated between central office and each factory
  • Setting up a central team tasked with controlling subsidiary forecasts, preparing the s&op, the distribution plan and the collaborative schedule with the factories

The major difficulties consisted in :

  • Convincing management that these new practices would bring the expected improvements, and are not just on paper
  • Managing the change process in the subsidiaries, from the subsidiary procurement plans to the subsidiary sales forecasts
  • And above all, convincing the factory managers and implementing the change with their teams

A project approach consisting of several steps was drawn up. Initially, to demonstrate the effectiveness without making any massive investments in a market APS solution, we decided to build a prototype of the new processes :

  • Covering a limited scope (one plant, a few subsidiaries)
  • Covering the monthly data entry process and weekly balancing executed by the subsidiaries, the calculation of the subsidiaries – factory distribution plan and interaction with the factory schedules (by exchanging plans: net production requirements with infinite factory capacity, factory production commitments)

The IT department developed and deployed this prototype based on our specifications, so that the new processes could be tested for 6 months. The tracking benefits within the scope of the project produced results beyond those estimated by the business case used to develop the prototype. In the next step, the customer decided to invest in a solution available on the open market.
The target processes were defined on the basis of the trial period of the prototype, the specific characteristics of other product/market segments and the capabilities of the APS solutions available on the market. Consequently, the selection process was rapid.

The pilot was prepared in just 4 months. It covered the initial scope of the prototype, plus a few extra product/market segments.The pilot construction phase provided an opportunity to arbitrate between a number of key points, and in particular :

  • The mode of cooperation between the central office and factory teams :
    • Nature of the cooperation: transmission of production orders for finished products vs. The demand plan and the weekly factory stock targets
    • Level of modeling of manufacturing constraints: should central scheduling take account of the size of semi-finished campaigns and the bottleneck capacities of the semi-finished production workshops, or leave the factory to check this, which would run the risk of lengthening the scheduling cycles?
  • But also, the processes and interaction between central office and the distribution subsidiaries :
    • Opportunity to make statistical forecasts, and in which product-market segments?
    • What is the role of central office in the preparation of the sales forecasts drawn up by the subsidiaries?

Alongside this technical work, two essential change management projects were conducted :
1) The deployment strategy was defined in a number of dimensions (products/markets, processes covered, teams involved), with certain populations subjected to a group change process, while others are subjected to several waves of process changes as the plan progresses
2) Change is managed in the factories, since the move towards the target may result in a loss of room for maneuver in the schedules

The ramp-up of the pilot is a critical stage of the project, since a number of issues must be addressed before even envisaging the deployment:

  • The acquisition of new skills by the central users, in the realms of control principles and the use of the tools. Specific long-term coaching is provided, along with special prioritization tools (e.G. Filtering of alerts escalated by the drp)
  • The technical stabilization of the tool and, above all, the interfaces with the legacy systems (factory cpms and existing erp for factory – subsidiary transfers)
  • Command of the aps settings, and the creation of a database administrator function

Once the ramp-up of the pilot was stabilized, the third phase consisted in building the complete S&OP process:

  • In terms of tools (demand data and consolidation of the capacity and stock data)
  • In terms of processes (pre-s&op demand, pre-s&op capacity, work on scenarios, arbitration in s&op meetings)
  • In terms of the chairing of meetings: quality of preparations, quality of the arbitration, timekeeping, attendance of key players
  • In terms of the operational application of the arbitration decided by the s&op meetings, and producing and handing over a deployment kit for all the associated dimensions to the customer’s project teams :
    • Change management: awareness, training, operational support, coaching, operational check list for each new job position, etc
    • Modeling and settings (distribution network, manufacturing capacities, etc.)

Finally, the deployment plan was aligned with the Group’s other flagship projects, in order to concentrate the efforts demanded of each factory over time.


The project’s main achievement is to have profoundly changed the company’s culture, on a number of levels, to a more collaboration-oriented model, and to have increased the maturity of the supply chain.

These achievements have resulted in a significant improvement in economic performance, in particular with regards to the absolute control of risks of stockouts, the reduction of working capital requirements and of manufacturing surcharges.