Danone Aqua Indonesia Creates a Consistent Flow
Danone Aqua Indonesia is the market-leading beverage company in Indonesia and No. 1 water producer in the world in terms of volume. The company produces over 13 billion liters of water every year, sold to more than 2 million sales points across the market (more than 17,000 islands in the country) through modern trade and general trade channels.
The trading process involves high complexities with several limitations to support tracking and approval of trade promotion activities. To integrate and systemize the process of approval and payment in managing the high volume of trade promotions, the company decided to implement an integrated trade promotion management (TPM) solution.
“Today, traditional trade holds a majority share of the retail landscape across Southeast Asian markets, but that share is eroding. Modern trade is taking off in emerging markets as consumers evolve, regulatory barriers come down and multinational retailers seek new, high-growth markets,” explains Nichol Hutapea, business planning director, Danone Waters Indonesia (AQUA).
However, Indonesia remains a challenging market for Danone. There are close to 100 different distributors and depots delivering products to tens of thousands of direct and indirect clients. There are a lot of ‘hybrid’ distribution models where customers are delivered direct in some regions, and through distributors in others. There is also complex finance integration when dealing with local branches and retailers make it very challenging to reconcile activities and vendor invoices.
“To overcome these, we had to build flexible customer hierarchies to deal with high complexity and the rapid evolution of route-to-market and supply chain,” says Hutapea.
Aligning with corporate governance to ensure an end-to-end robust and integrated business process in trading term management, Danone worked with UpClear on a consistent TPM process.
Hutapea adds, “With BluePlanner, we implemented a decentralized model where regions create activities that are then approved centrally.”
The solution now provides an integrated and holistic approach to the operational side of account planning with greater control and visibility on trade spend. Since the adoption of the solution, there has been a 50 percent reduction in user administrative tasks with minimum risk of human errors when dealing with accruals and payments. In addition, BluePlanner Analytics helps in creating profitability reports by regions and customers, providing visibility into more accurate allocation in terms of promo by SKUs, and giving the ability to track backdated promos. One of the most important underlying factors for the implementation was the involvement of the project champions who were selected from key business leaders. They were invited in various stages of the project such as workshops, prototype, walkthroughs and key user training. Hutapea offers advice for other companies looking to tackle a similar implementation: “Adopt a regional model focused on capability and value; share best practices. Identify a clear sponsor and project lead. Work with a partner, not a vendor; build an effective relationship. Choose a flexible, intuitive solution, which offers high configurability. An agile methodology is vital in order to avoid tunnel projects.”
The trading process involves high complexities with several limitations to support tracking and approval of trade promotion activities. To integrate and systemize the process of approval and payment in managing the high volume of trade promotions, the company decided to implement an integrated trade promotion management (TPM) solution.
“Today, traditional trade holds a majority share of the retail landscape across Southeast Asian markets, but that share is eroding. Modern trade is taking off in emerging markets as consumers evolve, regulatory barriers come down and multinational retailers seek new, high-growth markets,” explains Nichol Hutapea, business planning director, Danone Waters Indonesia (AQUA).
However, Indonesia remains a challenging market for Danone. There are close to 100 different distributors and depots delivering products to tens of thousands of direct and indirect clients. There are a lot of ‘hybrid’ distribution models where customers are delivered direct in some regions, and through distributors in others. There is also complex finance integration when dealing with local branches and retailers make it very challenging to reconcile activities and vendor invoices.
“To overcome these, we had to build flexible customer hierarchies to deal with high complexity and the rapid evolution of route-to-market and supply chain,” says Hutapea.
Aligning with corporate governance to ensure an end-to-end robust and integrated business process in trading term management, Danone worked with UpClear on a consistent TPM process.
Hutapea adds, “With BluePlanner, we implemented a decentralized model where regions create activities that are then approved centrally.”
The solution now provides an integrated and holistic approach to the operational side of account planning with greater control and visibility on trade spend. Since the adoption of the solution, there has been a 50 percent reduction in user administrative tasks with minimum risk of human errors when dealing with accruals and payments. In addition, BluePlanner Analytics helps in creating profitability reports by regions and customers, providing visibility into more accurate allocation in terms of promo by SKUs, and giving the ability to track backdated promos. One of the most important underlying factors for the implementation was the involvement of the project champions who were selected from key business leaders. They were invited in various stages of the project such as workshops, prototype, walkthroughs and key user training. Hutapea offers advice for other companies looking to tackle a similar implementation: “Adopt a regional model focused on capability and value; share best practices. Identify a clear sponsor and project lead. Work with a partner, not a vendor; build an effective relationship. Choose a flexible, intuitive solution, which offers high configurability. An agile methodology is vital in order to avoid tunnel projects.”