Ardo UK Limited, has been a Kent based subsidiary of the Ardo Group since 1994 and supplies high quality frozen fruit and vegetables to over 400 key customers in the Retail and Food Services sector including Tesco, Sainsbury, Morrisons, Whitbread, Wetherspoons, and Aldi. The Belgian based, family run Ardo group is a key player in Europe with 14 processing units in 8 countries and has a turnover over £300 million. When Ardo UK needed to move to a modern, flexible production scheduling system to work seamlessly with its other proven business systems, it put its trust in Preactor scheduling technology.
The Challenge On one level, Ardo’s business model is relatively simple. Bulk frozen goods are received at the company’s Headcorn packing site from the relevant Ardo growing/freezing centres worldwide. Here they are mixed and packed accordingly, before being sent to the administration/sales site at Charing where they are placed in cold storage prior to distribution. However, as Ardo’s Production Planner Patricia Speakman explains, there are a number of major complications. “Our first challenge is the scale of business we do. We typically process over 400 orders a week which equates to 110,000 cases, 85% of which are full pallets with the rest being individual case pick. This means our Headcorn facility is receiving a 20 tonne lorry load every hour from our 3 primary sites in Europe, resulting in over 100 tonnes of packing being handled every day, with the finished products then being transported back to Charing.” Another complication comes from the variety of products that Ardo packs and their reliance on dedicated packing lines. Ardo has five packing lines which between them can handle straight packing of individual products right up to mixed packing of 6 items into either bags or punnets. As Patricia elaborates, “Balancing the load level on each line and maximising each resource is therefore central to our planning requirements. One of our lines is dedicated to multi-packing, another can handle multi or single packing but only up to 4 items, another is oriented to larger products such as broccoli, cauliflower while another deals primarily with particulates such as peas and rice. While there is a degree of interchangeability, we need to minimise disruption, avoid wasteful changeover times, and keep the lines flowing as smoothly as possible. Clear and accurate planning is central to this.”
Storage and space issues can also be critical considerations, especially given the seasonal nature of many of the vegetables and fruit Ardo supplies. Sweetcorn for instance has a growing season between June and September but Ardo will need to store enough for the coming year, in this case up to 700 tonnes during a very tightly defined time period. Patricia highlights a related issue. “Some materials come from much further afield and take variable lengths of time to arrive. China for example takes 12 weeks, the US takes 4. We have to factor in when shipments are supposed to arrive but also be able to deal with world reality that with delivery times this long, goods may arrive early or late, both of which can create not just production issues but also storage issues. That’s not even taking into account the economic instability of some supplying regions and the very real prospect that at times, entire crops may be wiped out by disease or freak weather conditions.”
Other challenges that Ardo faces include the inherent variation of customer demand, itself influenced by unexpected weather conditions, product mentions in the media and such like. While historical product sales forecasts provide a relatively accurate pattern, sales forecasts from individual account managers may prove to be less accurate, for a variety of reasons. Patricia again, “Add to this the fact that Ardo has to buy its packaging materials significantly in advance and the complexities of the planning process become even more pronounced. We regularly have to pre-order 2-3 million sleeves 3 months in advance although we don’t have to specify designs until nearer delivery time. Film is bought on a group basis but again is still done so 12 weeks in advance so it’s important we get our planning right.”
Prior to investing in Preactor, Ardo had been using a combination of spreadsheets and an antiquated manual board. Ingredients were written by hand on one side of the board before individual columns of products and orders were added. The totals were then manually calculated before being typed into a spreadsheet from which a Plan was produced which could be issued to the packing plant. The Coldstore Warehouse at the time was also run entirely on a manual T-card system which added to the difficulties, invariably relying on the manual confirmation of the location and stock levels of a particular product.
“The most amazing thing,” comments Patricia “is not that it actually worked at all, but that it worked quite well after a fashion. It was however completely prone to human error at every stage, took great quantities of time to produce, and provided very little in terms of the visibility and flexibility we now completely take for granted with Preactor. In many ways, it’s only since we’ve been using Preactor that people have been able to see just how hard work the old way of doing things actually was.”
The Solution The decision to invest in a much more efficient, powerful and flexible production planning solution was part of the Ardo’s ongoing drive to improve efficiency on a group wide basis. Part of Patricia’s role when she joined the company in 2000 was to help source such a solution, as she had had previous experience using Manugistics and SAP. This also coincided with the company’s investment in a Ramesys solution (now New Look) for its MRP/ERP and a Vendor Management System called Complete with a requirement that any suitable planning system would have to be able to work seamlessly with both. The choice quickly came down to between Manugistics and Preactor with Preactor ultimately being chosen for a number of reasons, as Patricia explains. “Manugistics and Preactor were the only real considerations because they both offered very similar levels of functionality and performance, both of which met our criteria in full. Ultimately, Preactor was simply considerably less expensive than Manugistics to do the same job, while also providing a solid upgrade route should we ever need it.”
Implementation Implementation began in Autumn 2001 and was a close team effort involving resource from Ardo and Preactor reseller Kudos Solutions. “Kudos were wonderful to work with,” comments Patricia. “They provided training both on-site and off-site and were invaluable during the entire setup. We would tell them what we wanted; they would say what we could and could not do but then also offered us different ways of achieving the results we ultimately wanted. Everything went very smoothly, including the go-live in April 2002.”
Overcoming Cultural Resistance In fact, the only real issue Ardo had with the implementation came in the form of internal cultural resistance to change but this was overcome within the first two weeks of going live when Preactor was being run in parallel with the old manual system. For the first time in the company’s history, a whole week’s plan could be issued to the production teams and this had a dramatic impact, as Patricia elaborates. “No one had ever seen anything like it. Not only could everyone see at a glance what was happening and where, in the present, people could also see what lay ahead. T his actually enabled the production staff to channel their experience into making positive suggestions about how to fine tune the schedule and brought them much more into the actual process while giving them increased independence and responsibility. In a very real way, Preactor has helped to create a very positive relationship between the planning and production sides of the business.”
Further BenefitsPlanning is now unrecognisable compared to the old manual days prior to Ardo’s investment in manufacturing IT including Preactor. Orders are received on a daily basis via EDI access to Ardo’s complete system on a typical ‘order day 1/deliver day 3’ basis. Stock levels and goods in/out is handled by New Look with Preactor being used to generate a weekly schedule and individual daily plans on a three day rolling basis. Each day there is a planning meeting at 12.30pm to discuss the plan for 3 days time which is then finalised. From this finalised plan, all the Bill of Materials (BOM) requirements are generated, with each system being updated accordingly.
In addition to helping overcome the initial resistance to change, the other benefits of Preactor were quickly seen. “Even just the ease of using the system makes my job so much simpler,” comments Patricia. She continues, “Nothing is hidden from you, everything is very visible and reflects the logical way that planning has to work. In that sense it’s a very intuitive system to use which makes it that much easier to make it work harder for you. Because of that, I now have much more time to concentrate on other areas of the planning process and ensuring we are getting the best possible use of our packing and storage capacity. A lot of this time I can use to maintain the positive relationship with the production personnel and ensure that everyone genuinely believes that they are able to bring their best to their job.”
The system has also brought levels of flexibility that were simply impossible before. Patricia again, “We now have the ability to run ‘What If’’ scenarios which are invaluable should be have a problem with a delivery or on a production line. We know instantly the impact of an event on the entire plan and from that use Preactor to judge how best to react.” T his ‘What If’ capacity also helps Ardo plan for customer promotions, advise customers on the best times for such promotions as well as providing critical wider business information when it comes to deciding whether to accept increased orders or not. The information from Preactor is even proving to be strategically important in helping Ardo plan for a major company expansion in the short-medium term.
Future Plans As for the future, Patricia can see the potential additional automation that Preactor 400 APS will bring to the company, especially in terms of communication with New Look and Complete when the planned company expansion is complete. She concludes her comments on the value of Preactor by emphasising the proven benefits of the system to the entire company. “As a professional planner I need the right tools to do the job. Preactor is that tool and has proved itself to everyone with the entire company benefiting from the way it has helped us work more efficiently together. The production team especially have got so much out of it; we could not imagine doing our jobs now without it.