From cows to consumers

By upgrading its mobile computing platform, Almarai is putting the final piece of its IT jigsaw in place. Once complete, it will allow the dairy company to improve forecasting and reduce wastage.

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By  Matthew Southwell Published  March 24, 2003

I|~||~||~|Almarai is putting in place the final piece of its information technology jigsaw with the upgrade of its mobile computing platform and handheld technology. Due to go live during the first quarter of 2004, the rollout of the Intermec Technologies 700 Series will not only improve forecasting and reduce wastage for the dairy company, but also allow Almarai to effectively control its supply chain from the cows’ udders to the consumer.

“The upgrade lays the groundwork for the final piece of the jigsaw because it will allow Almarai to roll out the SAP Mobile engine — something that the previous Intermec hardware would not allow us to do. By deploying the mobility engine we will be able to evolve our software and improve the flow of information throughout the organisation,” says Claude Tonna-Barthet, business systems manager at Almarai Company.

“Such an integrated system strategy will cement the organisational integration, from the cows’ udders to the consumer, through the provision of timely management information,” he adds.

The Saudi-based company has been using mobile technology since 1994, when it rolled out the first generation of the Intermec Handheld Sales Terminals and an early version of the accompanying Routepower 32 Software. However, the existing solution has reached the end of its natural life and the company now needs the additional information the new hardware and software can provide.

“It is time to upgrade to the more user friendly touchpad mobile terminals, which will allow Almarai to develop the software further to allow promotional and historical information to be immediately available to each salesman,” says Tonna-Barthet.

“In addition, handheld terminals are also being rolled out to the merchandisers, which will allow them to collect information on competitors’ activities on the spot. This will allow Almarai to react more effectively to market movements,” he adds.

The existing Intermec solution allows Almarai to plot each salesman’s route, sales, stock levels and credit & cash sales. Given that each salesman completes in excess of 30 calls per day, and that the dairy has upwards of 20,000 customers across the Kingdom and the Gulf countries, the ability to plan routes minutely is essential to ensuring optimal sales force performance.

“However, the most powerful benefit of this software is that it provides up to the minute information, which enables sales supervisors to have daily conversations with each salesman to review the salesman’s performance and then improve the accuracy of the order forecasts, which thereby helps increase sales and reduce wastage,” explains Tonna-Barthet.

||**||II|~||~||~|This information is fed into SAP R/3, which Almarai implemented last year. Live since October, the enterprise resource planning (ERP) suite allows the dairy company to control its supply chain more effectively, as it keeps track of the daily sales information and forecasts collected by the sales force.
“Once the orders for the day have been approved by the sales supervisors, they are downloaded from the handheld terminals [to the] local depots’ Sales and Accounting System (SARAS). These are then passed on a daily basis to the SAP system,” explains Tonna-Barthet.

“SAP improves the efficiency of the supply chain by automating the planning, manufacturing [and] financial processes, which converts orders into the products to be sent out to the customers,” he continues.

There are also plans to tie Almarai’s inhouse developed Dairy Herd Management System (DHMS) to the ERP application, which will give the company a more granular view of its supply chain and allow it to evaluate the performance of individual cows and in turn boost production.

“The systems strategy will be to integrate this application [the DHMS] to the automated milking systems and thence to integrate [it with] the SAP financial systems. The overall objective being to provide the farmers with timely performance on the individual cows, which will allow them to ensure that the necessary supply of milk to satisfy demand is achieved and that the cost of that supply is constantly known,” explains Tonna-Barthet.

The centralisation of Almarai’s IT, which has underpinned the implementation of SAP R/3 and the planned Intermec upgrade, necessitated an overhaul of the dairy company’s hardware and the creation of a resilient telecommunications network. Without such an infrastructure, the company would have been unable to draw together its business critical information from around the region.

“Almarai has over 32 sites, which are scattered throughout the Kingdom of Saudi Arabia and Gulf countries… To ensure the level of integration required, it was necessary to implement a resilient Wide Area Network (WAN) infrastructure to ensure constant connectivity to all the manufacturing sites [and] to the head office,” says Tonna-Barthet.

Constant connectivity has been assured by the deployment of satellites, leased lines and a number of virtual private networks (VPNs). Almarai also replaced its legacy Local Area Networks (LANs), which used equipment from various vendors, with a total Cisco solution. “With this upgrade Almarai now believes it has one of the most up-to-date and efficient infrastructures in the Kingdom of Saudi Arabia,” comments Tonna-Barthet.

Moving forward, Almarai’s overhauled IT infrastructure will allow the dairy company to keep a check on its ever-expanding business. The network and handheld devices will ensure that its disparate workforce is always contactable, its HP/Compaq Unix servers will ensure it has a scalable computing environment to grow effectively, and SAP will enable it to keep a tight rein on its supply chain and collect the business data that will form the basis of future business decisions.

As Tonna-Barthet says, “Almarai is facing the new millennium with optimism as it seeks to implement its five year expansion strategy based on organic growth and new product introduction... However, the only way to manage the complexity this brings is to improve our levels of integration and cross-functional processes, which is where technology is key.” ||**||

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