Unified S&OP, Cost Planning, and Sales Analysis at Syngenta

With annual sales of more than $13 billion, Syngenta – a Swiss multinational company formed in 2000 by a merger between Novartis Agribusiness and Zeneca Agrochemicals – is the world's leading specialist agribusiness group. With sales in excess of €200 million, Syngenta Italia employs around 400 people across offices, production sites, and test centers. In addition to handling agricultural chemicals and seed sales, the Group conducts research and produces maize and sugar beet seeds, partly for export. Milan is also home to the executive headquarters of the South East Europe Development Centre, one of the five research and development centers within the EMEA region.

A deep-rooted relationship

The history of Board at Syngenta goes beyond its formation in 2000. At that time, the Board Intelligent Planning Platform was already being used internally at Sandoz (subsequently acquired by Novartis) in the Agrichemicals and Plant Protection division for Sales and Expenses reporting, Consolidation Reporting, and planning support. The very first installation dates back to Version 2.0 of Board in 1994.

Planning, Costing & Sales Analysis: an integrated approach

Thanks to its flexibility and its ability to integrate evolved analysis and planning capabilities, the use of Board has gradually been extended in the company and it is now the tool of choice at a country level for Cost Planning and Sales & Operations Planning.

Of these two implementations, the latter is the company's pivotal process. This is the system that allows periodic revision of sales forecasts for the sales and marketing functions.

A key step for the extension of Board in the company occurred in 2011 when Syngenta decided to integrate the Crop and Seeds sales teams worldwide. In the words of Ezio de Nittis, IS Business Partner for Syngenta Crop Protection and Syngenta Seeds Italia:

"This organisational decision called for rapid and precise action and a major commitment in terms of data homogeneity and management, just two months from the start of our peak sales period."

This led to the need for a reporting system able to acquire data from SAP (used in Seeds) and submit integrated sales statistics for the Corn, DCF, and Vegetables areas. At that point, in view of the flexibility and time-to-solution typically guaranteed by the tool, it was decided that Board would be used manage the entire planning and forecasting support process, integrating data originating from SAP with data collected from the field.

Cost and Planning (Expenses)

"This is an operating costs budgeting process, serving more than 30 users, in which the capabilities of Board are used intensively in terms of security management and in terms of the potential for multidimensional data-entry management," explains Maridia Banfi, Business Process Analyst at Syngenta Italia.

"Each functional manager sees the expenses of their own cost center, while transverse cost managers (such as Human Resources for payroll and salaries), can consult expenses on all cost centres. Budget data is entered by the cost centre managers and the transverse expenses managers, depending on the security levels and in compliance with a grid type organisation. It's effectively a collaborative process, whereby an annual budget is defined, shared among various functions, and subjected to quarterly reviews."

Customer financial position scorecard

"One of the many applications developed is dedicated to the finance team, which uses Board for a customer solvency assessment scorecard based on the calculation of shared indices such as DSO or DPO," Maridia continues. "Finance and Credit personnel collect customers’ economic data using a set of procedures, with the aim of assigning a score to each customer to provide an indication of their financial soundness. The data collected is fed to the sales data system and the payment systems."

Sales and Operation Planning (SOP)

The Board application – called SOP internally – reads and processes sales data for statistical analysis purposes. The Sales dashboard is presented in Board's desktop client for on-site users and using the web interface for external users (agents). Each agent has a specific security profile that limits their data entry and visibility privileges to the customers, areas, and products for which they are responsible.

The planning process is divided into two separate phases in which the data is collected at different levels of aggregation:

• For the current year, sales force forecasts are collected with a high level of detail. The collected data relates to product quantity required in a specific geographical sales area, and is used to optimize the Supply Chain in terms of product stock and in relation to profitability optimization when it is not possible to cover all market demands fully.
• For the next year, up to the 27th month, Marketing personnel work on the basis of forecasts at a higher level, taking account exclusively of the product and the sales area, without additional detailed information.

Data updates are performed on the third working day of the month. At this point, responsibility for making any necessary upward or downward changes to the values lies with various company functions – such as Crop Managers, Area Managers, and Marketing Managers – in accordance with the required parameters including product by product and month by month. After this, meetings are held with Finance, Sales, and Supply Chain to decide whether or not to accept the changes. The final step is to draft the new validated plan incorporating the updates. This plan will be forwarded to the Supply Chain for any necessary production updates and to Logistics to check products currently in stock, or even for direct shipment of the product in question, if available. Maridia explains:

"The entire process takes place under the supervision of the Finance function because it is often the case that, with a supply chain featuring very long and generally fixed technical times, a series of complex decisions must be made concerning distribution of the material available in the short term in order to optimize the global profitability of the company."

One innovation introduced last year involves the monitoring of forecasts using a Forecast Accuracy process in which, with a three-month horizon, forecasts for the preceding three months are analyzed with respect to sales to assess the degree of correlation with the actual situation.

"In this process," continues Maridia, "Board supports the entire company cycle, from production to sales and delivery, providing management with constant access not just to the necessary data, but also to precise information on the data and its correlation with decisions made beforehand. The difference is evident in all meetings, where it now becomes possible to draw conclusions on the spot and share and document the decisions made in relation to future actions. Rather than just an application that supplies data, the tool provides valid support for collaborative decision-making processes."

Future projects

Ezio outlines the situation moving forward:

"Today, we've received authorization to proceed with local support of Forecasting and Planning projects for the Seeds division. The aim is to adopt the same Solution Operation Planning (SOP) approach currently used by the Crop Protection area in the coming months.”

The Benefits: Increased efficiency, greater collaboration, and user self-sufficiency

"The benefits that led us to prefer Board over alternative tools can be summarized by the statement 'Board is appreciated globally'", explains Ezio. "Among the pluses, we emphasise the following points in particular."

Speed of development and independence of the client

"The flexibility of the tool, accompanied by the support model, giving us the facility to build precisely what's needed rapidly. Syngenta can operate in complete independence for the development and management of the Board application."

Usability of data

"The facility not only to view data, but also to edit it easily. This is the plus that distinguishes Board in absolute terms, and it's a feature that the application can actually deliver, unlike in the case of alternative tools, for which it remains purely theoretical."

Clarity and consistency of data

"With Board, operations are performed on a single database containing sales data and the SOP process, all consolidated with a single reconciliation rather than via multiple cubes. This means that each process reads the same data and analysis is performed on the same database rather than on different cubes, thus guaranteeing unambiguity and normalization of information across the entire organization," says Maridia.

Collaboration

"Ability to identify with and understand the users’ needs. In meetings, for example, for practical reasons it's important for each participant to view the data from their own perspective, immediately, by means of direct interaction, ideally performed in the same dashboard. This means Board supports collaboration between co-workers, discussions become easier, and data is more readily comprehensible. Without this ability to navigate and interact with data instantly, this characteristic would be lost and discussions would become more complicated and potentially misleading.”

Ease of use

Ezio concludes by discussing the benefits derived from the simplicity of using the Board platform:

"Another key and unchangeable aspect that demonstrates the tool's ease of use is the self-sufficiency available to advanced users, who can generate the analytics and reports they need without assistance. This aspect brings three advantages: reduction of the IT workload as users don't need technical support to obtain the required results; s

elf-sufficiency as users can manage reports independently, for example, if they decide that a different report type is needed to make a meeting more productive, they can create it directly and make it available to the other users; and time savings - execution is instant. When users need a report, they can generate it on-the-fly."