DEl MonTE FooDS

CASE STUDY
Del Monte Foods
CLIENT
PROFILE
Based in Ontario, Canada, Del Monte Foods Inc is a Fresh Pack food
processor for established brands such as Del Monte Foods and Aylmer.
Formerly part of the Kraft family, Del Monte Foods divested into its own
corporation in 2005.
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THE
CHALLENGE
After divesting from Kraft, Del Monte Foods had
one year to decide whether to stay on the Kraft
system infrastructure or to move to a new system.
The Kraft infrastructure consisted of 14 business
systems including SAP, mySAP, R/3 for sales orders,
Manugistics for production forecasting, Prism for
plant reporting, KARS for AR, GEAC for general ledger,
and GSX for EDI.
They narrowed down their search to two systems JustFoodERP powered by Microsoft Dynamics NAV
and SAP All-in-One. When Del Monte Foods started
to do comparisons, both solutions looked good. As
they dug deeper, even though it was the incumbent
solution, the fact that SAP required an IBM iSeries
platform meant that it required specialized people to
run it which made it more difficult to adopt.
Del Monte Foods did a feasibility study and found
that to keep these 14 interfaced business systems
in place it would cost $3-to-4 million per year in
licensing, maintenance and internal specialists.
This motivated the decision to find one integrated
Enterprise Resource Planning system that would
meet all of their business needs and reduce
overall costs.
Once the decision was made to go with
JustFoodERP, powered by Microsoft Dynamics NAV,
a new challenge arose. Being a Fresh Pack food
processor means that Mother Nature dictates the
packing season, which is less than 16 weeks long.
Implementation of the new system with 160
users and four facilities had to happen in less than
6 months.
With sales mainly in North America, Del Monte’s
substantial size meant that they needed an
integrated and robust business system to
support their complex operations.
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THE
SOLUTION
From the start of the project, the Del Monte Foods
management team knew that they wanted to go
with a productized solution versus a customized
solution. They didn’t want the risk of having a system
that might not be supported in the future. Both the
President and CFO of Del Monte Foods met with
the President of Microsoft Canada. This relationship
helped give Del Monte Foods a better understanding
of Microsoft’s commitment to the ERP space and a
clear sense of the strategy Microsoft is taking in tying
its infrastructure and platform products together.
Knowing that a product roadmap for Dynamics NAV
existed to 2013 and a support structure to 2020 gave
both Del Monte Foods and their largest shareholder
SunCapital confidence in their choice.
The implementation took place at three plants and
one technical centre simultaneously. All fourteen
systems were replaced and moved into three systems,
JustFoodERP plus GSX for EDI and ESSBASE for reporting.
Del Monte Foods had sophisticated users and
sophisticated requirements. As such, the first phase
of the implementation included all finance modules
including fixed assets and inter-company transaction
processing. Inventory included full lot tracking and
expiry analysis. Manufacturing included full material
planning and production scheduling. Del Monte
Foods also implemented warehouse management
at its facilities to track material movement. The
quality module was also implemented in Phase One
to ensure Del Monte Foods complied with all food
safety requirements including the need to quarantine
certain finished goods.
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In addition to the large scope and short timeframe for
go-live, the implementation had two other areas of
added stress. First, Del Monte Foods went live on the
first day of pea pack, meaning the operations would
run 24/7 for months on end with little opportunity
to take the system offline. Second, Del Monte Foods
made the business decision to change their fiscal
calendar to coincide with the pack season. Under
Kraft, Del Monte Foods operated on the calendar year.
Costs and sales for a given growing season were not
recorded in the same fiscal year making planning
and budgeting much more difficult. With the new
system implementation, Del Monte Foods changed
their year-end to coincide with the lowest points of
inventory valuation so that production costs were in
the same year as revenue.
“JustFoodERP is my fourth MS Dynamics
NAV implementation. There is a clear
difference in what you can achieve with an
out-of-the-box fit offered by a product like
JustFoodERP. Taking a product approach
versus a custom approach reduces
implementation costs, risk of failure, and
drives adoption of industry best practices.”
Kirk Southcott, IT Manager of Del Monte
THE
BENEFITS
One of the immediate benefits was a new level of
transparency of data and information. Reporting on items like
reconciliation and allocation took minutes and were in one
single place as opposed to days and a myriad of spreadsheets.
In Del Monte’s legacy system, results would take weeks to
process and disseminate to employees. Quick decisions were
difficult to make. Much of the data between 14 different
systems had to be manually massaged into a central data
warehouse creating a time lag. With JustFoodERP, employees
can have access to information in real-time. Del Monte’s
management team can react to information quickly and
make changes where productivity needs to be improved.
THE
FUTURE
Kirk Southcott, IT Manager of Del Monte Foods points out,
“With the initial goal to have everything in the plants
running on one system, the next phase will be to integrate
the Trade Promotion Management module of JustFoodERP.
Currently we use a hosted solution that has relatively low
adoption within our company.”
“By moving to JustFoodERP’s Trade Promotion Management
module, our employees will be able to support the full
process using a tool that is fully integrated to our financial
system and is easy and familiar to use. This move
will improve our trade spend management and reduce
the significant costs associated to our hosted provider
each month.”
SOLUTION SUMMARY
JustFoodERP and
Microsoft Dynamics NAV
Location: Toronto, ON
Implemented Modules:
Finance, Sales, EDI, Purchasing,
Inventory, Manufacturing, Quality,
Trade Promotion Management
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