Several years ago, Michelin moved to transform its sales and operations planning (S&OP) systems to deal with what it perceived to be “several challenges it was facing.” The firm’s supply chain complexity had increased substantially and had become more difficult to manage due to scarce capacity, a growing portfolio of tyre types and a significant increase in parts.
Additionally, the tyre market in which the company operates had also become increasingly volatile and competitive, as well as impacted by seasonal demand.
Putting the rubber to the road
After analysis of its existing S&OP processes, Michelin realised it needed to replace its legacy tools and systems. The result was the Sharp S&OP project which kicked off in January 2018 worldwide across Michelin business units. The project uses the JDA S&OP solution at its core.
Legacy tools and processes used by the Michelin business units were heterogeneous. It deemed that they lacked the flexibility necessary to support its S&OP transformation. “Our previous S&OP capabilities relied on multiple non-interfaced software applications. This resulted in many data issues and inefficiencies, and insufficient confidence in the plan,” said Ali Abdessamad, business process leader for mid-term supply chain processes, Michelin.
Anthony Caumond, enterprise architect for supply chain, Michelin, added: “Michelin continues to invest in supply chain innovations – such as information systems, logistics and digital services – to improve customer service. We selected JDA as a natural extension of our broad JDA footprint, so we can standardise on a single, end-to-end supply chain solution globally.”
This is a major win for JDA. Michelin operates in more than 170 countries and runs 68 production plants in 17 different countries. In addition to the Michelin brand, the company owns a portfolio including BFGoodrich, Kleber, Tigar, Riken, Kormoran, and the Uniroyal brand.
Michelin is betting hard on the results of the Sharp S&OP Project. “We believe the Sharp S&OP project, supported by JDA will increase significantly visibility into future risks and constraints, thanks to scenarios shared across the organisation,” explains Pascal Zammit, senior vice president, Global Supply Chain for Michelin group. “Eventually, Sharp S&OP will help us drive better performance in the future.”
Michelin deployed an ‘agile implementation approach’ to the roll out of the project. This saw the company deliver what it calls ‘a sequence of three-week sprints’ of designing, constructing, testing and validating of the solution. This methodology enabled the team to learn and mature quickly in their use of the JDA solution.
What does it mean?
Michelin is leveraging JDA’s S&OP software to effectively support an organisation-wide transformation, realising the following results:
• Greater collaboration with operations team
• Increased confidence in the quality of the supply chain plan
• Increased efficiency of the planning organisation
• Improved decision making, resulting from scenario analysis
• Minimised supply chain risks