Tegel transforms operations with RELEX supply chain solution

Tegel has announced the successful implementation of a new supply chain planning solution, RELEX, effectively transforming its operations.

The move follows decades of planning managed through complex Excel spreadsheets, which were deemed unsustainable for a business of Tegel's scale, processing over 50 million birds annually at three separate production facilities.

Arijit Saha, General Manager of Supply Chain at Tegel, highlighted the challenges faced before the implementation of RELEX. "We had a lot of data, but the quality was questionable. The planning capabilities were limited, and we had neither the time nor the tools to analyse our plans properly. It wasn't sustainable for a company our size. We needed something to help us make better business decisions—both in the short and long term," said Saha.

The introduction of RELEX coincided with a major upgrade of Tegel's Enterprise Resource Planning (ERP) system. The company invested considerable effort into capturing the processes and managing the inherent variability in the poultry supply chain, acknowledging that every bird is different.

Improving demand visibility was one of the primary aims of adopting the RELEX system. Before, Tegel needed more accurate forecasting tools to profitably manage the utilisation of all chicken parts. Saha explained, "To make a profit in our industry, you must use all parts of the chicken in the best way possible. We needed a longer planning horizon and more accurate forecasting to balance the bird better."

Tegel now generates a monthly statistical forecast through RELEX, aligning it with the company's Sales and Operations Planning (S&OP) cycle. After the monthly forecasting run, the system remains open, allowing the sales team to adjust numbers as new information emerges. This flexibility ensures that forecasts are current and reflective of market conditions.

The RELEX solution has led to streamlined internal communication and allowed Tegel to retire most of its planning spreadsheets. Now, all stakeholders work from the same set of numbers, benefiting from improved analysis and a smoother S&OP process.

"I've always said that demand planning is the key. It sets the pace for our supply chain and prepares the ground for everything else—strategically, tactically, and operationally. Thanks to the statistical forecasting capabilities of RELEX, our demand planning process is now automated. Not only does this save valuable time, but we're also getting much better forecast accuracy. The entire organisation now trusts the forecast."

The increased demand and capacity visibility have enabled the planning team to better identify shortages and manage surplus situations. This shift has allowed Tegel to work proactively with sales teams, leveraging promotions and substitutions effectively. Production line sequencing has also been optimised, increasing throughput and yields while minimising inventory, waste, and margin erosion.

With a medium to long-term view, RELEX has empowered Tegel's supply planners to make more informed decisions about future investments and capacity management. The system's simulation capabilities allow planners to evaluate various scenarios, ensuring that the company's operations remain efficient and responsive to market demands.

Additionally, the implementation of RELEX has had a positive impact on Tegel's bird-growing operations. The company now raises birds based on reliable forecasts, ensuring that all parts of the bird will be utilised.

"We didn't build our business case around saving a certain amount of money. RELEX is a tool that allows us to run the business better. If you consistently make better business decisions, the financial side will take care of itself. In our case, it certainly has."