How does a company acquire all of the software it needs to run a digitized global supply chain with end-to-end control? One piece at a time.
Blue Diamond Growers is a marketing organization and cooperative of almond producers based in California’s Central Valley. It operates two main business lines: the sale of branded snack nuts, almond milk and global ingredients, and the supplying of almonds to other consumer packaged goods companies.
When Blue Diamond chief information officer Steve Birgfeld joined the company in 2016, it was already two years into the acquisition of software from SAP. But that was just the beginning of an engagement with the vendor that would extend to the purchase of multiple applications as part of Blue Diamond’s “digital supply chain journey.”
Integrated business planning from SAP was put into place shortly after Birgfeld’s arrival. Prior to adoption of that suite, Blue Diamond had engaged in a manual effort that required up to six hours a day to develop multiple “what-if” demand scenarios, Birgfeld says. Now, the exercise takes between 10 and 12 minutes, allowing the company to quickly shift product from one customer to another in the event of a sudden supply or delivery constraint.
Blue Diamond still engages in monthly demand planning, but with the coming of COVID-19 and its accompanying supply chain disruptions, it also needed to shift to weekly and in some cases daily cadences, Birgfeld says.
“COVID taught us that real-time planning was not a luxury item — it’s a necessity,” says David Vallejo, SAP’s global head of digital supply chain. “You need to pivot on your heels.”
Shortly after implementation of integrated business planning, Blue Diamond added supplier collaboration software from SAP unit Ariba. The application helped to streamline and automate invoice management and vendor onboarding, Birgfeld says.
Then, in 2021, Blue Diamond migrated to SAP S4/HANA, the latest iteration of the vendor’s clouded-based enterprise resource planning (ERP) suite, as well as SAP Transportation Management. The former serves as Blue Diamond’s data warehouse. With the latter, the company chose to focus initially on ocean freight, relying as well on independent software vendor project44 for enabling shipment visibility. That gave Blue Diamond the ability to inform customers of any delays in the arrival of product.
In 2023, Blue Diamond turned its attention to the management of domestic freight, prices for which were fluctuating widely and making it difficult for the shipper to get product to market on time in a cost-effective manner.
The ultimate goal, Vallejo says, lay in enabling Blue Diamond to bring together financial planning with the logistics function — two sides of the house that don’t typically share key information and planning scenarios in real time on a regular basis.
Implementation of the various modules wasn’t without its challenges. Connecting Ariba to SAP’s ERP Control Component (ECC) took time. And it was nearly five months before Blue Diamond’s planners came to completely trust the data that was coming through project44 and the SAP logistics business network. “I personally thought they would embrace it faster, because it added so much capability for them — it made their lives easier,” Birgfeld says. “They got a little scared.”
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Results to date have been impressive. Birgfeld says Blue Diamond has seen more than $1 million in savings on transportation costs with activation of the SAP modules. With improved visibility, insights and ability to plan on the fly, “our OTIF [on time, in full] saw upticks.” No longer does the company have to field multiple customer calls enquiring about the status of their shipments. “Now it’s all self-contained in the portal. Our customer service reps have direct access, instead of going through our logistics team.”
Birgfeld says Blue Diamond intends to further extend its reliance on the SAP ecosystem, to include manufacturing modules such as plant maintenance and production planning and scheduling, as well as take further advantage of the vendor’s AI capabilities.
“It’s another step in their roadmap,” Vallejo says. “They’re really taking us by our word.”
Resource Links:
Blue Diamond, https://bluediamondgrowers.com/
