Galderma rolls out TXT technology to support evolving global business model

Sean Dudley
Sean Dudley
By Sean Dudley on 28 April 2014
Galderma rolls out TXT technology to support evolving global business model

International skincare company Galderma has completed a global rollout of TXT’s Sales & Operations Planning (S&OP) technology.

Galderma is a joint venture between Nestlé and L’Oréal which operates five manufacturing plants, with 5,000 employees at 33 affiliates globally.

“Pharmaceutical and Cosmetics supply chains are highly complex: they were traditionally based on producing high volumes to avoid stockouts; but high inventory levels carry significant costs and run the risk of obsolete stock,” says Sandrine Angles, supply chain manager at Galderma. “Drugs and cosmetics – much like food – have a limited shelf life too. International regulations mean a proliferation of stock keeping units to manage, and the need for stronger innovation calls for greater agility from the supply chain. In addition not only have we grown rapidly, but our business model has evolved in recent years and Galderma is moving away from its roots primarily as a drugs company, to one offering also a larger range of cosmetics.”

The company is developing some patented products, as well as an increased number of over-the-counter products. An evolved business model, which includes opening up to new geographies and more selling via major retailers and wholesalers, presented a series of new challenges. 

“Best-sellers depend on each geography and product category (aesthetics and corrective products, drugs, cosmetics); we have to avoid running out of stock, but we only want to carry the bare minimum in reserve,” says Angles.

Previously the company was reliant on hundreds of spreadsheets that were difficult to manage. It was essential to standardise planning processes and technology. Galderma selected TXT’s S&OP solution because of the flexibility and support it offered to its processes and requirements.

Galderma decided to extend the scope of the initiative to manage sales and operations planning from end-to-end. The process includes a pre S&OP phase and regular S&OP meetings. Based on Microsoft technology, TXT deployed its forecasting and replenishment technology. The TXT solution supports demand and shipment plan formulation in the pre-S&OP phase. Demand plans can be analysed to cover capacity constraints and regional variables. The solution’s simulation functionality also helps create a predictive rather than reactive supply chain, and analytical planning helps provide better visibility for staff.

“Automatic reporting and analysis are now ingrained into the planning process,” says Angles. “With just a few clicks, we get the full picture on capacity loads – as a percentage – and how much we can produce, versus how much will be required by each market.”   

The solution generates key performance indicators, helps inform decisions on priorities in case of conflicts and lack of capacity, and helps resource adjustments over a 12 to 18-month period. Galderma has also found that the solution has contributed to a 10-15% increase in forecast accuracy.

“Every decision is reflected in the system. TXT has helped us centralise our core processes – forecasting, capacity planning – and calculate inventory projections,” concludes Angles. “It’s flexible to use: whenever we need to create an additional view, it’s extremely easy. Visibility and planning have already greatly improved across our global supply chain, and we envisage increased support as the business constantly evolves.”

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