Strategic Direction for Supply Chain Improvement - Fox's Biscuits case study

Fox's Biscuits is a highly successful part of the Northern Foods Group with plants in Kirkham and Batley in the UK.  With the help of a team of WCI consultants, it has been going through a year long supply chain improvement project, code-named project 'SLICK'.  But, crucially, Fox's didn't have to go through with this change process.  It chose to.  The driver was 'strategic direction' not 'change or die'.

The FMCG industry as a whole, but particularly food and drink manufacturing, has been put under increasing pressure from the supermarket chains who are demanding shorter lead times.  Even though Fox's had an impressive response rate, it was felt that they could improve.

"Fox's recognised that they had to change the supply chain process to support the planned growth.  They knew that they could be more cost effective and offer even better customer service.  However, they were not sure how to implement the radical changes they needed to make" says consultant, James West.

Developing the solutions involved WCI working closely with the Fox's team.  "They knew the detail of their business and we had a greater understanding of best practice.  Team-working put both sets of knowledge together and enable the Fox's team to take ownership of the solutions, having helped to create them" says James.

For example, high levels of demand at short notice as a result of retailer sales promotions have caused considerable problems in the past, particularly in production scheduling and in waste generation.  "Fox's now approach the planning-in of promotions as a business-wide management task" James West says, "and they now have the models, tools and techniques to do it properly."

"There is also a better understanding of the different control techniques needed to run different products.  Previously, every product was treated in a similar way."  As a result, their lean manufacturing techniques are keeping them at the forefront of the FMCG industry.

Because the change was driven by choice rather than crisis "the delivery of  cost savings was not the key issue" says WCI's Dave Alberts.  "Of course they were incorporated to financially justify the project, but what was more important was delivering new processes to create slicker supply chain - hence the project name."

Project Slick was designed to improve the management of demand, and to move the company's supply chain from 'push' to 'pull' using Kanban controls.  Although, not of primary importance, the annualised savings resulting from the project total more than £1.5 million.

Fox's chose WCI to help them in the transformation because "they like our approach" James says.  "We didn't come in with a prepacked solution and try to shoehorn it into their business.  Our approach involved looking at what Fox's customers wanted and then suggesting process alterations which would enable the plants to better meet the customer needs."

The successful introduction of Kanban techniques increased manufacturing efficiency and customer service and, at the same time, allowed lower levels of stockholding and administrative support.  Replenishment of Kanban products is driven directly from customer demand from the satellite RDC to the shopfloor, the shopfloor decide when to make the product and are measured on product availability as well as efficiency.

James says that the main benefits Fox's have derived from the project are improved communication along the supply chain and more informed decision making "instead od trying to optimise the performance of individual departments the company now looks at decisions from a supply chain perspective."

Day-to-day production scheduling has been devolved to the shopfloor.  Not only has this meant that there are now always the right number of people, on the right production lines making products customers require - rather than products for stock - but production flexibility has been improved, by allowing the shopfloor to adapt the realities of a factory environment.

Bill Richards, Supply Chain Director and project sponsor adds; "working with WCI has been a rewarding and revealing experience, more of our people know more about the way we run our business than at any time since the business was founded in 1853.  Driving change usually needs expert analysis and creative solutions, both of which are key aspects of WCI's work.  They also manage to combine this with a genuinely 'user friendly' approach.