A single source of truth for supply chain planning

Time is of the essence in the life science research and clinical diagnostics markets. Fast access to the most current equipment and technologies can be essential to making potentially life-saving diagnoses and breakthrough discoveries.

Bio-Rad Laboratories, Inc., is well aware of the urgency underlying its customers’ needs for state-of-the-art products and services. With manufacturing and distribution locations across the globe, the 70-year-old provider of life science and clinical diagnostic products places top priority on delivering its high-quality solutions in a timely way.

In life science research, those solutions include instruments, embedded software and reagents for biopharma, academic and government research in such areas as genomics, proteomics and cell biology. And in clinical diagnostics, Bio-Rad’s products and technologies enable hospital, public health and commercial labs to perform testing, monitoring and treatment of diseases, protection of blood supplies and clinical quality controls.

To thrive within such ever-evolving, fast-paced markets, Bio-Rad must always stay one step ahead of the game. “What makes Bio-Rad unique is our commitment to innovation,” says Andres Ospina, the company’s Senior Manager of Global Supply Chain Planning. “We stay very close to the megatrends in healthcare, working with the labs to capture information about needs within the industry and how we can fulfill them.”

In 2021, the company was ready to embrace the next step in its technological evolution: a modernization of its sales and operations planning processes. At the time, Bio-Rad did much of its demand and supply planning using spreadsheet templates that had little-to-no uniformity across functions or geographic locations. Planners had to navigate multiple systems to generate makeshift forecasts and revenue reports, spending long hours manually evaluating data and often recreating the same spreadsheets month after month.

A unified supply chain planning platform had the potential to be a game changer. Not only could it enable the Bio-Rad to increase its forecasting accuracy, but it could also help eliminate silos and open up communication across the company. With a global view of customer supply and demand, the company could greatly improve operational and process efficiency, reporting capabilities and inventory management.

Fortunately, senior leaders were familiar with the benefits such a platform could provide and were, in fact, leading the charge toward adoption. To that end, the company developed a preliminary strategy, documenting requirements and evaluating cloud-based platforms to accommodate Bio-Rad’s global structure.

A cloud-based platform with out-of-the-box capabilities was key to accommodating the company’s global structure and to minimizing training and staffing needs. Bio-Rad also sought a partner to help plan, develop and implement its sales and operations planning platform.

Bio-Rad chose IBM Consulting™ to assist with the strategy and implementation of its new sales and operations planning platform. Not only was IBM a longtime collaborator but it also had deep, cross-industry experience in supply chain management processes and platforms.

For its sales and operations planning platforms, Bio-Rad selected the RapidResponse platform from IBM Business Partner Kinaxis Inc. The cloud-based platform had an excellent reputation as well as life science planning capabilities that included shelf-life planning—essential for reducing the amount of scrap due to product expiration.

Throughout the process, the three companies worked together as one team. Bio-Rad provided the business and organizational knowledge, Kinaxis the platform expertise and IBM the strategic guidance and implementation collaboration.

To build upon Bio-Rad’s initial strategy, IBM facilitated a series of workshops with company leaders, planners, developers and other stakeholders. The goal was to identify and clarify requirements and to help translate business objectives into tangible results using the Kinaxis platform. In the process the team gathered user input to define the core capabilities the first iteration of the solution would provide.

“IBM brought in case studies and ideas and helped us strategize and navigate the peaks and valleys that go along with the journey,” says Ospina. “Because it’s not easy, right? We’re talking about change management. We’re talking about people with different degrees of embracing the new platform.”

The team started with demand planning in April of 2021. “We’re a demand-driven organization,” say Ospina. “We needed to know what our customers wanted and to have an environment that captured inputs from both business and technological perspectives. We needed that information to get forecasting under control so we could be strategic rather than reactive.”

Using the Agile methodology, the team worked in sprints to achieve the milestones it had set for itself, using an iterative approach to development that included internal and user testing. Along the way, it gathered feedback from key stakeholders, adding user stories to those Bio-Rad had already collected, for a total of more than 75 each for demand and supply planning.

The team went live with demand planning core functionality in October 2021 and continued to refine the implementation through the beginning of 2022. Next up was supply planning. “We used a similar process to the one we used for demand planning,” says Steven Caron, Associate IT Director at Bio-Rad. “There were several headwinds working against us on the supply planning front. The build was much more complex and had many additional requirements.”

“In June 2022 we ran a big workshop with supply chain leaders from Europe to ensure our decisions around the new system had worldwide backing,” says Ospina. “We showed them the draft of the project blueprint, then incorporated their feedback into our plan. IBM was there side-by-side with us, capturing detailed requirements and clarifying questions.”

“Coming out of the pandemic, there were enormous disruptions in the supply chain,” he continues. “Planners had to work around material shortages, seeking out alternative suppliers and building plans around the availability of products. IBM was a great partner through all of it—during both the easier and more challenging moments.” Fortunately, the team was able to apply lessons learned during the demand planning phase and launched the supply planning functionality in April of 2022.

With the demand and supply planning functions up and running in its new platform, Bio-Rad is already seeing the benefits. “Everyone is working in one system for demand planning, supply planning, procurement and manufacturing,” says Ospina. “It’s a lot more stable than the previous system. And we have traction with everybody working together in the system and more to come.”

Caron agrees. “There’s clear buy-in from our supply chain, commercial and finance teams, as well as from our executives,” he says. “Now we can generate a forecast for Bio-Rad that shows both the units we are going to manufacture and deliver, and the revenue we’ll collect. The reporting and slicing and dicing that we can do is quite impressive. We’re able to perform what-if scenario planning that we really could not do before.”

He continues: “We’ve also made significant improvements in how we forecast our sales build materials. We have challenging requirements around consignment sales models that have both revenue and non-revenue proportions to them.”

While the company has made great progress, the work has just begun. “We now have core functionality,” says Ospina. “But in the process of achieving that, we temporarily left behind some areas like component planning for manufacturing. We’re working with IBM to do an assessment and determine next steps in our roadmap. So the strategic alliance continues.”

“Working with IBM, we have a clearly defined and prioritized backlog of continuous improvements to add value to our business users,” adds Caron. “We have a monthly cadence for delivering those improvements. When we face challenges, IBM helps analyze the situation and recommends options for the best solutions for our needs.”

“IBM has been the engine of the project,” concludes Ospina. “With IBM we have the sense of a machine continuing to move forward. It really is centered on engagement, coordination with the development teams and being able to hit those targets.”

Founded in 1952, Bio-Rad (link resides outside of ibm.com) develops, manufactures and markets products for the life science research and clinical diagnostic markets. The company is headquartered in Hercules, California, and has manufacturing and distribution locations in the Americas, Europe and Asia. Its diverse customers include hospitals, academic and research institutions, public health and commercial laboratories and the biotechnology and pharmaceutical industries, among others.

Founded in 1984, IBM Business Partner Kinaxis (link resides outside of ibm.com) is a supply chain management and sales and operations planning software company. The company is headquartered in Ottawa, Canada. Kinaxis RapidResponse is the company’s planning software that helps build business processes in the areas of sales operations, demand, supply, inventory and production planning.