Hershey ERP Results Come to Fruition As CPG Reports Supply Chain, Workforce Wins
The Hershey Company reports significant progress across its supply chain, marketing, and workforce operations thanks to series of tech investments, and it's optimistic about the upcoming benefits of its longtime ERP implementation.
The unification of the company's commercial teams was executed in part to support a series of acquisitions, including SkinnyPop, Dot’s, and Pirate’s Booty. Data visualization within the company’s supply chain, meanwhile, has further improved line efficiency and pinpointed maintenance needs before they happen.
“This has essentially unlocked about $150 million of what was previously trapped capacity,” said CEO Michele Buck during the Consumer Analyst Group of New York (CAGNY) conference this week.
The increased capacity has in turn introduced opportunities for efficiency and allowed Hershey to invest more in R&D and innovation.
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Artificial intelligence is also being used to elevate quality control, while robotics are leveraged to more efficiently transport products across facilities.
Supply chain-related efforts are being supported by Deepak Bhatia, the company’s new chief data and technology officer, who joined Hershey from Amazon.
“He has deep technology skills, and importantly, he also understands running a supply chain business like ours,” said Buck.
Data and Connectivity at the Center
Hershey will see another rush of advancement as a result of its S/4 ERP implementation this upcoming quarter. Several years in the making, results have “finally come to fruition," said Buck.
Following a pilot implementation in Mexico in Q3 last year within the company’s salty segment, a wide-scale U.S. and international launch will soon follow.
“That will serve as a platform off of which we can drive even more automation and efficiency and digital end-to-end connectivity across our system,” said Buck.
Hershey expects the new ERP to help it better evaluate opportunities and challenges, identify redundancies, implement increased connectivity, and use automation to solve problems more efficiently.
Media Spend and Talent Get AI Lift
AI has also made its way into Hershey’s marketing strategies, helping to inform media spend opportunities during key promotional seasons.
“We can actually track seasonal sell-through at a market-by-market basis and then we can algorithmically increase our media in those markets where sell-through is falling behind,” said Buck. “That’s been a big benefit for us in improving the efficiency of media.”
In the workforce, Hershey is using AI to identify optimal candidacy matches as well as develop pay equity strategies across the enterprise.
Buck said the company has leveraged data and tech to optimize hiring. “If we look at our manufacturing employees, we’ve been able to use that to optimize staffing of lines, how we run the lines, make sure that staffing is going to equal the production we need and to optimize overtime.”
