Customer Solution Case Study
/ Leading Norwegian Food and Beverage Manufacturer Gains Wide Benefits Following Bespoke Software Implementation
Overview
Country or Region:Norway
Industry:Food and Beverage
Customer Profile
Lerum is a major Norwegian food and beverage manufacturer, producing jams, juices, and beverages for some of Norway’s largest retailers as well as its own label product.
Business Situation
The Norwegian food and beverage industry is facing increasingly stringent demands from government, industry bodies, and consumers in regard to food safety. For example, consumers want to know where raw materials are sourced.
Solution
Lerum implemented Microsoft® Business Solutions–Axapta® integrated with a supply chain food and beverage module from abc | group.
Benefits
Competitive advantage
Proven technology
Systemized information storage
Peace of mind
Rigorous quality control
Tracing of raw materials
Reverse billing feature / “Our system gives us the peace of mind that we are doing all we need to do, to ensure shops and the public receive high quality produce.”
Jørn Stenehjem Information Technology Manager, Lerum
Lerum, a major Norwegian food and beverage manufacturer, is facing increasingly stringent industry standards governing the tracing and tracking of raw materials through the production process. It implemented Microsoft® Business Solutions–Axapta® (now part of Microsoft Dynamics™), integrating it with food and beverage modules designed for the industry by abc | group. Using this innovative solution Lerum has confidently met all standards, enhanced its operations, strengthened customer relations, and built a significant competitive edge.
Situation
Lerum is a major Norwegian food and beverage manufacturer, producing jams, juices, and beverages for some of Norway’s largest retailers as well as its own label product. But like other food and beverage manufacturers, it is facing increasingly stringent demands governing food safety from government, industry bodies, and consumers.
Jørn Stenehjem, Information Technology Manager, Lerum, says: “Manufacturers are held responsible if food content is not correct, a product contains material which should not be there, or stipulated guidelines are not adhered to.
“The most common and important quality standard in the Norwegian and European food and beverage industry is set by the British Retail Consortium (BRC). It provides guidance on risk analysis, critical control points, quality safety, ethical demands, environmental and packing demands, and quality and crises management and traceability. Complying with this standard, and others, is critical to the future success of our business.”
Lerum was using Microsoft® Navision XAL. This was very effective in tracking supply chain and production line processes. Lerum wanted a system that could support business growth, optimize processes, and help them trace backwards from distributors to suppliers of raw materials.
Stenehjem says: “By implementing a new ERP [Enterprise Resource Planning] system we could not only ensure compliance but could also increase our profits by cutting out paper based administrative work.”
Solution
Stenehjem says: “XAL had been very effective so we began exploring other Microsoft Business Solutions. It made sense to use a similar technology because any transition to a new ERP system would be smooth.”
Lerum decided on Microsoft Business Solutions–Axapta® combined with a software module from abc | group, designed specifically for the food and beverages industry, to optimize supply chain processes and increase service and quality. Microsoft Axapta is a multiple language and multiple currencies ERP system, and abc | group delivers modules that are specifically designed for food and beverage manufacturers and wholesalers.
Axapta and abc | group permits Lerum to easily trace the source of poor quality produce. It can also map the potential scope of any damage that might arise from inferior products reaching shelves.
Stenehjem says: “Microsoft Axapta also provides us with the opportunity to run accounts for some of our customers who we brand produce for. This includes production and production planning, storage logistics, purchase and sales/orders. We could also use it to control up to 30 machines in the production hall, and to keep track of all products through barcodes.”
Benefits
Competitive Advantage
Conforming to the BRC standards is central to the continued success of Lerum’s business. Stenehjem says: “Focusing on food safety in today’s market is a necessity. Most of Norway’s large retailers are our customers, and we need to meet the quality requirements.
“Microsoft Axapta and abc | group provided a solution, which gives us the opportunity to adjust and optimize supply chain operations. This means we can track and monitor products and we can state confidently that we are adhering to the latest standards. It gives us quite a competitive advantage over rivals because we can show that our processes are transparent and the flow of materials is traceable.”
Quality Control
The Microsoft Axapta and abc | group integration permits Lerum to trace the movement of product through production processes and supply chain. It contains industry standard Hazard Analysis and Critical Control Point (HACCP) procedures such as deviation control, document control, and crisis management modules. The solution supports product tracing at both an individual and a lot level. This extends right throughout the chain from the supplier to the end customer.
Stenehjem says: “If something reaches the market that is sub-standard, we know exactly where it is, who supplied the raw materials, and which stores it is in. We can immediately limit any potential damage and go straight to the source of the problem.”
Proven Technology Provides Confidence
The integrated solution had a history of being used by meat, fish, and beverage manufacturers. Stenehjem says: “Here was a technology that was proven in collecting documents and tracing data for several major manufacturers. This gave us great confidence that it could meet our needs.”
Systemized Information Storage
Before the Microsoft Axapta implementation, Lerum manually stored materials without any system. Stenehjem says: “Microsoft Axapta is helping us to systematize storage functions. In some cases we work on a first in, first out basis or we choose raw material according to quality. But all of this is now controlled by the ERP solution, which brought systematic order to the process.”
Reverse Billing
When processing meat and fish, the product needs to be cut and sliced, a process known as disassembling. Stenehjem says: “This process requires what is known as a reverse Bill of Material, to authenticate its quality. But this has consequences for production planning, production reporting and costing. Because the system can trace backwards, the workflow required for reverse billing is already in place.”
Peace of Mind
One of the imperatives for introducing increasingly stringent standards is a spate of incidents in which poor quality foods had an adverse affect on consumers. Stenehjem says: “This become a hot topic within the media, who ran several horror stories. This contributed to an increased demand for systems to document the whole production line process. Our system gives us the peace of mind that we are doing all we need to do, to ensure shops and the public receive high quality produce.”
Microsoft Dynamics
Microsoft Dynamics is a line of integrated, adaptable business management solutions that enables you and your people to make business decisions with greater confidence. Microsoft Dynamics works like familiar Microsoft software such as Microsoft Office, which means less of a learning curve for your people, so they can get up and running quickly and focus on what’s most important. And because it is from Microsoft, it easily works with the systems that your company already has implemented. By automating and streamlining financial, customer relationship, and supply chain processes, Microsoft Dynamics brings together people, processes, and technologies, increasing the productivity and effectiveness of your business, and helping you drive business success.
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