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Partnering with SAP since 1994, Colgate-Palmolive has improved global supply chain visibility and accelerated time to market. Now using the SAP HANA platform to make crucial data available to analysts and decision makers in real time, nearly every part of Colgate-Palmolive’s global organization is supported by SAP software.
New York, New York, USA
US$16.7 billion (2011 worldwide net sales)
Service, Sales, Sustainability, Supply Chain, Information Technology
SAP CO-PA Accelerator, SAP HANA, SAP Supply Chain Management
In the early 1800s, when most soap was hand-made in the home or sold in bulk, William Colgate started selling pre-packaged bars. Today, Colgate sells products in over 200 countries and territories worldwide.
Colgate-Palmolive has become a household name around the globe by providing quality products consumers can trust. As an international corporation, the Colgate-Palmolive Company is also committed to training and nurturing its workforce on every business level by establishing trust with a philosophy of caring, improvement, teamwork, and mutual respect.
Getting the right product on shelves at the right time is a complex business. Emerging markets represent half of Colgate’s global sales and have been a very important part of the company’s growth. Colgate has been in Latin America for over 75 years and in Asia for over 50 years, and approximately 75% of Colgate-Palmolive sales come from international divisions.
Wherever they do business, the company drives growth by working closely with retail customers to share expertise while quickly introducing innovative products. They also strive to acquire and strengthen global brands, expand into new markets, and focus on customer service.
Order fulfillment rates at Colgate-Palmolive were high, but there wasn’t enough info about demand. This made it difficult to replenish stock at customer sites, especially outside North America. The company needed to shift local sourcing from a limiting regional model to an expansive global model.
Processes for handling customer orders also varied from region to region, so division heads had to look at four different regional systems to plan what they would buy and sell. And many of Colgate-Palmolive’s subsidiaries around the world maintained an informational web presence only, so customer orders had to be taken and entered manually by customer service reps and the field sales force.
Varied planning processes also meant that demand plans couldn’t be made across brand and product groups, making it difficult for sales and marketing managers to plan for promotions and deal with new or discontinued products.
Colgate-Palmolive had a top down, bottom up sales planning process.
All of the company’s data was in one place, but it took too long to access. The company needed to analyze pricing, raw materials, and volume data quickly in order to adapt it to create the most value for customers. The sheer volume of data was forcing it to consider separating business processes just so the data could be analyzed.
SAP software has helped Colgate's business processes stay organized through expansion.
— Jim Newkirk, Director of Global Supply Chain Information Technology, Colgate-Palmolive Company
SAP approached Colgate-Palmolive to pilot its new SAP HANA software. Since the profitability analysis software is such a critical part of Colgate-Palmolive’s SAP solution portfolio, it was the obvious place for a test run.
Colgate uses industry leading SAP software.
Colgate-Palmolive has cultivated a close relationship with SAP on many levels. By offering to share the best practices and pilot new solutions, the company has enjoyed deep access into SAP’s development organization. This, in turn, has led to a broader understanding of the solutions. Not only is Colgate-Palmolive running SAP, it has expanded its engagement to work with other SAP customers and prospective customers to help maximize on its SAP IT investment.
The mutual Colgate-Palmolive and SAP partnership also reduces the risks associated with each new implementation. The relationship with the SAP Consulting program has helped augment internal knowledge of SAP software by introducing new solutions and associated training.
— Michael Crowe, VP of Global IT, Colgate-Palmolive Company
Getting the SAP CO-PA Accelerator software to run with the SAP HANA software only took eight weeks from project launch to go live, with little to no disruption to users. That meant a lot of benefit without a lot of time getting there. The flexible implementation also means that the system can be applied to individuals and user groups and turned on and off as needed for individual reports.
With the SAP Supply Chain Management (SAP SCM) application, Colgate-Palmolive has transformed how it manages demand planning. Global production efforts are now aligned to meet customer demands using levels of information for orders, inventories, shipments, and vendor capabilities. Service and responsiveness to retail trade and internal customers has been enhanced to improve Colgate’s profit margins.
Increase in on-time and
To complete the customer
For Colgate-Palmolive, the SAP HANA platform has proven to be synonymous with faster, simpler reporting that provides a level of detail so deep that analysis can venture to areas never considered possible before. Reports that once took hours are ready in minutes and reports that would have never been finished are now done in 90 seconds. Sales representatives can now run reports 100x-300x faster than before, getting the info they need in real time. Now Colgate-Palmolive subsidiaries around the world can get rid of cumbersome and error-prone spreadsheets and start to bridge the data gap across the regional and divisional divide.
During more than a decade of working with SAP, Colgate has learned valuable lessons about adapting technical solutions to support business best practices. The overarching theme for many of the lessons; plan each step as the foundation for what comes next. If possible, always go global with all implementations from the start and minimize customization whenever possible.