Digital Transformation in Procurement: A Case Study of an Indian Multinational Paint Company
Technology Category
- Functional Applications - Enterprise Resource Planning Systems (ERP)
- Functional Applications - Inventory Management Systems
Applicable Industries
- Life Sciences
Applicable Functions
- Procurement
- Warehouse & Inventory Management
Use Cases
- Demand Planning & Forecasting
- Inventory Management
About The Customer
The customer is an Indian multinational paint company that is engaged in the business of manufacturing, selling, and distributing paints, coatings, and products related to home decor, and bath fittings. The company had been relying on manual processes for procurement, which led to errors and inefficiencies. The company also faced challenges in synchronizing tanker scheduling with inventory levels at plants and dealing with unexpected changes in purchase orders by suppliers. These challenges were impacting the company's revenue, inventory levels, and overall operational efficiency.
The Challenge
The Indian multinational paint company, engaged in manufacturing, selling, and distributing paints, coatings, and home decor products, faced significant challenges in its procurement process. The company had to manually adjust purchase requisitions daily to keep up with the fluctuating demand and supply. This manual intervention led to errors in purchase order (PO) placement concerning quantity and timing, which negatively impacted revenue and inventory levels. Additionally, the company had to synchronize tanker scheduling with the inventory levels at plants, aligning raw material with demand. There were also instances where POs would unexpectedly be cancelled or sought to be amended by suppliers, leading to potential revenue loss or delay.
The Solution
The company partnered with o9 to automate and streamline its procurement process. A Purchasing Work Bench was created to automate the entire process of monitoring coverage levels, generating and approving purchase requisitions (PRs), and integrating these with the company's ERP (SAPS/4HANA) to generate POs. The company also leveraged o9's heuristic solver to efficiently create a schedule based on matching demand, supply, and inventory levels. Furthermore, the workflow was enhanced to allow collaboration with suppliers as part of the PO approval workflow, leading to improved planning and early visibility into supplier constraints. The o9 Enterprise Knowledge Graph was used to gain visibility, utilize o9-enabled workflows for procurement to approve PRs through the appropriate hierarchy, and send them to SAP as POs. A supplier check was also enabled where suppliers could confirm their available capability.
Operational Impact
Quantitative Benefit
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