The bold goals of Unilever and their impact on the supply chain

Posted by Martin Verwijmeren on Sep 7, 2015 3:18:02 AM

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Unilever wants to half its environmental Impact by 2020 while doubling its Revenue!

An interview with Neil Humphrey, SVP Supply Chain Europe Unilever



What is Top of Supply Chain Europe’s Agenda right now?

“Creating a new strategy, extending the scope of our supply chain and integrating it back into the heart of the business.

That´s the number one challenge that I have at the moment. Since I took on the role, Unilever has communicated some very bold statements about our corporate and supply chain targets. We now face the challenge of delivering them.

In order to do this, I need to integrate what we are doing in the supply chain with the rest of the business. We need to bring in marketing to support us on portfolio complexity, bring in sales to support us in improving our Customer Service processes for example, and we need to continue to work closely with our customers and suppliers on issues like waste and sustainable sourcing.”

 

Tell us more about the Connect to Win Strategy

“The Connect to Win strategy is built on two pillars.

The first one, which we call Win on Shelf, is focused on serving our customers and covers availability and quality, including how the S&OP process works to ensure availability.

The second pillar is about Winning Product Portfolios: how does our supply chain deliver the product portfolios that the markets need to win. In other words, products that they can market to consumers or customers at the right price points in order to gain market share.

This second pillar covers cost competitiveness as one of its key areas – no good supply chain should ever be happy with its cost position – but we have changed our focus here considerably.

Whereas we used to focus on delivering savings year on year, we now talk about cost and competitive cost. That may sound like semantics, but that’s a big mind-set change. Why focus just on savings, when what matters to our business is the costs we see in our P&L. Every year we now demonstrate how many base points of cost improvement our colleagues across the business see from the supply chain. We measure the improvement in production costs, in distribution costs and in what we call ‘supply chain indirects’. The result is an output focused on cost competitiveness.”

 

Is it your Goal to beat the Competition solely on Cost?

“No. Our goal isn’t necessarily to be cheaper than competition, but we must add more value than they do. We have classified innovations with different lead times so we can respond more quickly depending on the consumer and business needs. We have also looked to other industries for ideas in this area.

We have spent some time looking at the automobile industry, at Fiat, for example, and we are now sponsors of the F1 and have been to visit the Lotus Formula 1 facility. We are starting to share ideas, and the innovations in this field are fascinating – the speed with which the Formula 1 industry can innovate is just unthinkable for us. However, we are developing fast-track processes that will help us speed up innovation, even if they won’t enable us to redesign the wing of a car in a weekend like they can in F1.

I think we could be even more challenging as a supply chain. There is a lot of room for growth and we could, or perhaps even should, be more involved in R&D much earlier in the process.”

Download the full interview below.

SCM article interview with Unilever

Topics: Supply Chain Trends

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