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In a rapidly fluctuating market, forecasting is crucial for us. We need it to help ensure we produce enough of the right products at the right time and understand the impact of various planning scenarios on our P&L.
Franco Giacomini
Vice President Consumer Europe
Freudenberg Home and Cleaning Solutions GmbH
To keep homeowners around the world supplied with the cleaning products they trust, accurate forecasting is essential for Freudenberg Home and Cleaning Solutions GmbH. In a fast-moving market that faces continuing supply chain challenges caused by the COVID-19 pandemic, planners need detailed, enterprise-wide forecasting information at their fingertips to plan effectively.
However, a highly complex forecasting process involving thousands of planning objects and time-consuming, manual report preparation was slowing down planning activities. Different localized planning approaches made it difficult to get a consolidated enterprise-wide view. Meanwhile, separate value and volume planning led to variances between financial and production plans.
To address this, the company wanted to standardize and consolidate planning and forecasting across different regions and enable more-granular planning down to an individual product and customer level. In addition, it wanted to provide planners with access to both financial and supply chain data and enable them to run simulations to better understand the profit-and-loss impact of different planning scenarios.
By helping harmonize our planning processes across multiple regions and business functions, SAP Analytics Cloud enables us to align operational planning with financial performance.
Franco Giacomini
Vice President Consumer Europe
Freudenberg Home and Cleaning Solutions GmbH
Freudenberg built an extended planning and analysis foundation that integrates its existing data warehouse with the planning capabilities in the SAP Analytics Cloud solution. The data warehouse is used to consolidate financial KPIs and sales data from the SAP ERP application and volume forecast data from the SAP Integrated Business Planning for Supply Chain (SAP IBP) solution. It then generates an automated draft plan for each sales organization, and this is pushed to SAP Analytics Cloud for further processing by financial planners. This intuitive cloud planning tool enables them to plan both values and volumes, top down and bottom up, across many product categories and regions. And information flows smoothly into the financial planning process and back out to the demand planning system, closing the loop.
In-depth forecasting data is used by the sales, finance, and marketing functions. In addition, the production department benefits from detailed production bill-of-materials (BOM) breakdowns.
By standardizing forecasting processes across its consumer products division, Freudenberg has increased planning accuracy and enabled an enterprise-wide view. Forecasts now have greater granularity, combining both operational and financial data and containing details of product volumes and raw materials required as well as sales value.
Nontechnical business users can explore data and run complex simulations on their own using intuitive tools, without help from IT. Furthermore, less time is spent on repetitive report-preparation tasks, freeing teams for higher-value work such as analysis of upcoming trends.
The ability to understand the impact of variables (for example, price or cost of goods sold, or volumes) on profitability or on the supply chain helps Freudenberg make better-informed decisions. Ultimately, faster access to forecasts gives planners the information they need when they need it, enabling Freudenberg to react quickly to meet fluctuating demand in volatile business environments and manage the increasing complexity of supply chains.
Since its initial implementation of SAP Analytics Cloud across EMEA, Freudenberg has been working on a global rollout to 51 organizations, including its professional division. In addition, the company is looking at enabling mobile connectivity to SAP Analytics Cloud to give planners fast and intuitive access to forecasting information while on the go.
Freudenberg also plans to enable predictive forecasts for simulations based on raw material and transportation costs with full integration of multilevel production BOMs for its product supply chain. Due to the success of the project, other business functions such as customer promotions and marketing have also asked to use SAP Analytics Cloud for their own processes.
With a rich heritage of innovation dating back more than 170 years, Freudenberg Home and Cleaning Solutions GmbH has operations in 32 countries. From floor cleaning systems and household cloths to rubber gloves and laundry care products, the company’s portfolio includes household brands such as Vileda, O-Cedar, Marigold, and Gala.
| Industry | Region | Company Size |
|---|---|---|
| Consumer products | Weinheim, Germany | 3,000 employees |