The German consumer goods company Henkel operates globally with leading innovations, brands and technologies in three business areas: Adhesive Technologies, Beauty Care and Laundry & Home Care. With a global workforce of more than 52,000 people, in 2019 the group reported sales of more than 20 billion euros and adjusted operating profit of more than 3.2 billion euros.
The company’s business is guided by a strategic framework with a clear focus on purposeful growth. Creating superior value for customers and consumers to outgrow markets, reinforcing leadership in sustainability, and empowering employees through a collaborative culture are crucial for this strategy. With a strong foundation and company culture, Henkel wants to leverage innovation, digitalisation and sustainability.
The digital transformation journey is an integral part on the company’s strategic agenda. Not only the digital upskilling of its employees, but also the optimisation of business processes along the entire value chain are shaping Henkel’s transformation journey. Dirk Holbach, Chief Supply Chain Officer for Henkel Laundry & Home Care, is responsible for leveraging digital in the supply chain and believes this transformation is a continuous process. “In 2013, we began with our lighthouse project, Digital Backbone,” he explains. “With this investment, we were able to connect all 33 Laundry & Home Care factories globally through a standardised approach.”
Delivering growth through its digital global supply chain is only one key pillar in the company’s transformation journey. “Everything we do in supply chain and operations is embedded in our purposeful growth agenda,” says Holbach. Digital Backbone is a unique cloud-based data platform that helps to enhance the growing customer and consumer expectations on service and sustainability, while achieving double-digit cost and inventory reductions. It collects data from production sites around the world, as well as from every stage in the value chain. Local data is standardised and entered into global web-based interfaces, where it is analysed in real time and provides valuable insights into potential efficiency improvements. This allows production teams to track and trace resources and adapt to changes in demand as soon as they occur. More than 4,000 sensors in 33 production sites collect data in real time around the world, which has helped Henkel to increase production efficiency while reducing the amount of energy. “Henkel wants to become a climate-positive company by 2040 and as sustainability leaders we want to pioneer new solutions for a sustainable development of our productions,” says Holbach. “We learned that digitalisation and sustainability go hand in hand.”
Through AI, advanced analytics and smart factory concepts, Henkel is on the right track towards Industry 4.0. The team’s strong efforts don’t just pay off in benefits for sustainability, product quality and costs –they are also recognised by external consultants as extraordinary. At the beginning of 2020, Henkel was designated a 4th Industrial Revolution Lighthouse by the World Economic Forum and McKinsey for one of its state-of-the-art Laundry & Home Care factories. The company has prevailed over 1,000 productions and belongs to a global network of the most innovative production facilities worldwide. The company recently received the Factory of the Year award by A.T. Kearney for the best production network, while Dirk Holbach has been recognized as No. 1 Supply Chain Executive in Europe by Supply Chain Movement for successfully leading the entire supply chain unit for the Laundry & Home Care business unit and being one of the most influential and visionary leaders in the area.
