Supply Chain Visibility: How Kimberly-Clark Cleaned Up Order Bunching
When Kimberly-Clark sought to improve its fulfillment capabilities for both its retailers and consumers, it had a fairly specific pain point to solve: order bunching.
Occurring as a result of order loads stacking up on certain days of the week, order bunching can have negative, far-reaching ramifications on everything from on-time delivery to labor. For Kimberly-Clark, which counts such brands as Kleenex, Cottonelle, Huggies, and Kotex in its portfolio, the issue was impacting 10 major North American distribution centers that, along with its production plants, ship between 900-1,100 truckload shipments each day.
As with many consumer goods companies, Kimberly-Clark was trying to manage the trend of lighter weekend workloads and Monday-Wednesday spikes, Scott DeGroot, Kimberly-Clark VP of global logistics, tells CGT.
Upon emerging from the COVID demand roller coaster about 18 months ago, the company saw transport demand patterns beginning to normalize and identified it as the right moment to lean into the challenge, from both a process and a technology standpoint.
Process Probe
Recognizing early on that simply layering new technology atop their current processes wouldn’t cut it, they did a deep dive into their operations to see what changes were required. As a result, they discovered a serious need to increase their end-to-end supply chain visibility.
“We started thinking, ‘Well, it’s easy enough for our transport and distribution team just to move orders around,’” says DeGroot. “But they didn't have the ability to do that without understanding, first, do we have the right stock in place, and on the right days, or what the customer's ability was to take a different delivery day.”
DeGroot and team uncovered challenges within their planning systems for stock allocation and distribution: Trying to correctly allocate stock, transport, and distribution capacity at the right time meant looking into multiple systems and attempting an educated guess.
The company partnered with ProvisionAI to become the first end user of the supply chain solution provider’s AI-enabled tool to automate the distribution planning and deployment process, as well as improve scheduling. In addition to connecting disparate systems, leveraging AI in supply chain this way provides recommendations that Kimberly-Clark can execute more efficiently to further solve supply chain visibility challenges.
The No. 27 publicly owned consumer goods company also has increased visibility into where they may be underutilizing the cubic intensity of their trailers, enabling customer service and distribution teams to take proactive measures.
After an initial pilot, Kimberly-Clark fully deployed the platform across all North American operations; as a result of both the process improvements and new technology, it’s reduced variability daily by 40%, particularly in locations where production plants are shipping to its distribution centers.
This in turn has substantially improved on-time delivery and customer service performance, and reduced North American distribution costs by several million dollars, according to DeGroot.
Lookback, Looking Ahead
While DeGroot said Kimberly-Clark was equipped with sufficient capabilities to manage the technical ramifications and impacts of the deployment, it was the earlier process work that really ensured the team had the required visibility into the end-to-end supply chain.
As delivery pieces shift, employees are able to better anticipate potential problems arising from each adjustment, including ensuring that any deployment move aligns with inventory targets and lead times.
Critical to this success was ensuring that everyone impacted down the chain of command, from leadership to those at the distribution SKU level, understood why these changes were occurring, how it impacted their role, and what they needed to do to adjust their process.
“It’s an interconnected, end-to-end supply chain. … It's the socialization issues. You think the group that you're impacting is X, but it's really X times five or six.”
Kimberly-Clark continues to invest substantially in end-to-end supply chain digitization, says DeGroot, in both its backbone systems, such as its ERP, and its connected capabilities.
This includes onboarding more digital procurement methodology and supplier visibility methodology; a new concurrent planning ecosystem for supply chain response to demand planning; real-time, always-on manufacturing; and warehousing execution systems.
It’s also putting resources toward physical automation and activities within its warehouses and manufacturing sites for additional supply chain efficiency that will ultimately support a more responsive supply chain.
“It’s important for us to do that as fulfilling our commitment to our consumers,” he notes. “Ultimately, consumers care about getting the things that they want on time and at the right price.”
