IKEA’s Peter Grimvall about IKEA’s digital journey in building a competence centre for supply chain network design.
Peter Grimvall, Distribution Network Design Manager at IKEA, was one of the speakers at the Supply Chain Conference 7 September, sharing his experiences from building up IKEA’s competence centre for network design.
In his presentation Peter Grimvall focused on some milestones in the process, and we also got a chat with him about IKEA’s challenges and digitalization journey.
The purpose of a competence centre for network design, is to meet the challenges that come with growing sales and development of e-commerce and its demand for new services. A vital key in this work is to involve the stakeholders, and also to empower the competence centre to speed up the digitalization journey.
– Working close to the stakeholders is very important for us, to create a common agenda. We have 3 meetings per year involving all decision-makers in IKEA, where we also invite franchisees and suppliers which is very appreciated. After those meetings the competence centre has a clear mandate to change the structure or invest in a new DC. This also shortens the time from design to decision, says Peter Grimvall.
– The result is that we with limited resources and in a relatively short time can visualize the potential networks and work on our expansion plans, which also helps us to show our stakeholders where we create value.
The impact of digitalization goes beyond technological solutions – it also has implications for planning and measuring of results. Traditional instruments might not always fit new ways of working.
– For us it’s not always useful to work with traditional KPI’s and business planning. Our work is more of an assignment-based continuum where it’s important to work on the biggest potential, instead of serving the one who asks first, says Peter Grimvall.
Peter also emphasizes that you shouldn’t focus too much on tools and technology, especially not in the initial phase of your digitalization journey:
– You can do a lot without all these tools, like starting with Excel or a database. And it’s important to do that first, since this will make the optimization much easier. We have had great help from Optilon and LLamasoft to classify our different potential projects in a ”network design complexity”, where we have learned in which order to do different projects, says Peter Grimvall.
Peter Grimvall is convinced that IKEA’s competence centre will create value in the digitalization journey, even if all areas has not been explored up until today:
– That’s why we want to explore the competence and technology and actually let the competence lead the way. For instance, how can we use the experience from optimizing the network structure in other areas like inventory management? In the end, the biggest challenge is the entirety; to understand how to combine different trends and technologies and make them work together to be successful – with supply chain and in your whole digital transformation.
See Peter Grimvall’s full presentation in the post The supply chain network we want!