Investing in ERP: Food manufacturer optimizes business processes with ERP software
When you’re selling to the national chain of Boston Pizza restaurants, the reputation of your food products has to be solid. It also has to meet the franchising requirements for consistent quality, taste and look of food items sold across all locations.
As one of Boston Pizza’s suppliers, Edmonton, Alta.-based Kitchen Partners Limited (KPL) meets the grade with its products that include frozen entrees, fresh and frozen soups and sauces, dips and dressings, cooked ground beef crumble for toppings on pizzas and taco salads, and made-to-order food based on customer recipes or the development of new ones. All of its products are private labelled, about 40 per cent frozen, and sold to major retailers — such as Sobeys and Costco — across Canada, as well as the Boston Pizza chain of restaurants.
Close to 90 employees at KPL work in stirred foods, assembled foods and veggie processing teams at the company’s plant in Alberta where, says Daren Hawrish, vice-president of finance, “everyone works in the quality assurance department.”
Known as Floron Food Services from 1984 to 2006, the renamed Kitchen Partners Ltd. made a decision in 2008 to discontinue the distribution arm of the business to focus just on food manufacturing. The decision paid off: KPL has since grown five-fold, running at 40 per cent compound growth each year.
Explosion in requirement for BOMs
All that growth meant data, processes and procedures were getting out of hand, notes Hawrish.
“We experienced an exponential explosion in the requirement for BOM (bill of materials) when we got to the point where we were manufacturing 100 custom food items…It was too unwieldy to do everything in Excel, and we had duplication of efforts in data entry,” he says.
In addition, the company was starting another stirred food line to increase production capacity.
The “most glaring need for us was to have MRP (materials resource planning) and MPS (master production schedule),” says Hawrish. “We wanted to reduce the amount of materials kept in our facility.”
KPL has a somewhat unique business requirement in that the company pushes product to offsite storage. With its legacy business software, that created challenges around production lot numbers being reassigned after getting to storage. The former software system included lot tracing, but only for finished goods. KPL wanted to optimize tracing on the inputs side as well. Rotation of fresh produce is a major issue at the company, and the team wanted to move from hand-written to machine-written (barcode) labels to minimize human error.
Power of industry peer testimonial
Brandy Zukowski, supply chain manager at KPL, led the charge to find the right ERP software and implementation partner. About 15 ERP vendors responded. The team narrowed it down to two, and invited both companies to KPL’s plant to pilot their software with actual data. They selected JustFoodERP, software built for the food industry on the technology platform of Microsoft ERP.
Zukowski and Hawrish visited a JustFoodERP customer, Texan food manufacturer CF Chefs, where “they put it to us: ‘We looked at lots of companies. You can burn a bunch of time and energy looking, or go with JustFoodERP,’ which is what they strongly recommended,” says Hawrish. “I cannot emphasize enough the power of that testimonial.”
Push transactional work to the floor
The selection of the new ERP system reflected organizational changes, says Hawrish.
“We made a conscious business decision to get as close to real-time information as possible, and we wanted to push a lot of the transactional work down to the floor, with terminals in the warehouse for the receivers to see data live, and lead hands and supervisors entering data themselves.” He adds, “I’m an optimist; I believe that, if given the right tools and the reason why they’re doing something, employees do it better.”
The KPL implementation team involved leads from each area of business so they’d have ownership, know what was going on, and be a big part of the configuration to make sure the system works for all processes, says Zukowski.
“We learned from JustFoodERP not to fret too much about setup because, as we go through implementation, we would learn how some of our processes might need to change to become best practices,” she says.
The first phase of KPL’s ERP implementation included financials, product development and quality management, and electronic data interchange (EDI), which is mandatory for doing business with larger customers like Costco.
Up the game on tracing of inputs
“When we went live, I was very careful to make sure everyone understood there are two parts,” notes Hawrish. “One is the implementation, the other is that we made a business decision to up our game on the tracing of inputs.”
Lot traceability and mock recalls have significantly improved as a result, he says, and so has inventory accuracy on finished goods.
“With MRP functionality now, we have just the right amount of materials stored,” he says.
When it comes to the offsite storage of product, Hawrish says, wherein the company’s old software couldn’t maintain the linkage between production lot numbers and offsite storage numbers, the ERP system makes it simple to map each production lot to its corresponding storage lot. As well, using the new system to print pallet labels has given KPL clarity and easy reference for its production order numbers.
Since KPL does much of its own produce preparation — chopping carrots, mushrooms and other perishable items — “now we have an even clearer understanding about our yields…With the new system, everything is down to the receiving date assigned,” says Hawrish.
Employees are also using the “Suggest Lot” feature on all production orders within the JustFoodERP system.
“This feature will say you have half a case of celery left over from this date, use that first,” Hawrish explains.
Enter nutritional data into ERP
As a custom shop, KPL often gets a recipe or is asked by a customer to match an existing product, working with the customer’s chef. Because of this, product development features, such as translating recipes into a BOM, are a critical aspect for KPL production.
As well, KPL’s product development manager, a Master of Food Science, is able to enter all nutritional data directly into the ERP system — a large savings in time and reduction in error compared to the employee working offline and then someone else having to enter the data into the system.
KPL is currently working on the next phase of the ERP implementation — specifically, the addition of JF Floor, the web interface to JustFoodERP that allows for mobile warehouse management, from receiving to putting away goods, moving and counting inventory. KPL is also working on the implementation of JF Plant — an application that connects directly to the ERP system for immediate consumption and output activity tracking. JF Plant displays valuable business data — production schedule, batch ticket, job report, etc. — on the screen of any web-enabled device, with security features that allow employees to view assigned lists relevant to their work.
KPL continues to grow its business, in large part due to the continued investment in software technology to automate data, processes and procedures.
Jeff Clark, president of Kitchen Partners Limited, says the ERP system has been nothing short of “transformative” to
“JustFoodERP has streamlined many of our processes and increased our access to critical information.
We look forward to building on the solid foundation with further software modules and applications in the years to come.”
This article originally appeared in the June 2014 issue of Manufacturing AUTOMATION.
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