Research Preview July 2, 2024

Welcome to the Operations Metaverse

Unilever's Path to 100% Digital

Over the course of a four-year automation transformation, Unilever has redefined operations, bringing new technical, creative, problem-solving, and collaboration opportunities at all levels, while delivering significant improvements across the board. For this report, Unilever pulled back the curtain on how they’ve done it so the entire supply chain community can benefit from its learnings.

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Matt Davis
Strategy

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I think perhaps what we’re building here is… kind of an operations metaverse.”

It was at this point in our interviews with the Unilever Customer Operations (CO) team that we realized we were onto something truly unique.

At Zero100, we are in constant pursuit of real stories that bring to life the how of cutting-edge digital supply chain innovations. When we come across a great story, we dive deep into it. In this report, we share the details of Unilever’s four-year transformation journey to create a new (perhaps first-of-its-kind) integrated operations capability that broadens and redefines the traditional supply chain remit.

Driven by the CO organization under the leadership of Juan Carlos Parada, Global Head of Customer Operations, Unilever has built a value chain, business process, organization, and tech stack that extends from demand creation, planning, and fulfillment through to customer service and claims.

The results? Significant improvements to service levels, cost efficiencies, inventory reduction, speed, and, ultimately, growth.. But perhaps most importantly, the efforts have also had a profound impact on the people leading and participating in the transformation. It has redefined operations, bringing new technical, creative, problem-solving, and collaboration opportunities at all levels.

So, How’d They Do It?

As you might imagine, distilling four years of work led by thousands to a few focus areas means that we’ll miss many of the heroics we uncovered in this research process. However, when we look at the bigger picture, there are four standout approaches that offer lessons for all leading a digital transformation effort.

ONE

Lift Out and Rebuild

Unilever has undergone several interconnected organizational changes to help build its new end-to-end.

The company’s journey to create the new CO function was part of a business-wide reorganization in 2022, which saw Unilever transition from a complex matrix structure to a more agile operating model centered around five Business Groups.

Crucially, this model is also founded on leveraging the strength of “One Unilever” through a digital- and technology-enabled Business Operations team. The CO organization operates within this as the operational “run engine” of the business.

Though the CO team created would have previously been siloed into separate supply chain, commercial planning/sales, and financial functions, the new network was designed with one question at the center: what would it take to improve value for the customer. The new remit and internal structure now empower one team to fully manage the order-to-cash cycle, with no artificial barriers between processes, people, and systems.

TWO

Recruit and Develop New Skills

Building a new organization with fresh digital solutions requires rethinking the skills needed to run the new system. Analyzing more than four million job posts from 250 of the Fortune 500, we found that Unilever is a leader in bringing customer-obsessed capabilities into supply chain and leads the pack on requiring digital skills and indicators of customer obsession as it builds for the future.

In the early days of this transformation, Unilever led with a strong talent message: existing roles could move into “cool” jobs, inventing new ways of working end-to-end across commercial and supply chain boundaries. The dull, automatable work would be designed out, enriching roles from planning to logistics.

To support the building of diverse career pathways, Unilever introduced its “Shape Your Own Adventure” program. The program introduced “skills hives” – a matrix of skills and roles across supply chain, technology, and data teams – which define both which skills are critical for each role and how to develop them by giving clearer direction and better-quality upskilling. Though the CO team created would have previously been siloed into separate supply chain, commercial planning/sales, and financial functions, the new network was designed with one question at the center: what would it take to improve value for the customer? The new remit and internal structure now empower one team to fully manage the order-to-cash cycle, with no artificial barriers between processes, people, and systems.

THREE

Fuse Operations and Technology

By effectively blending IT and supply chain teams, Unilever estimates that it has been able to accelerate the autonomous operations journey from a seven-year timeline down to four.

It all came down to three simple principles:

Pioneering: The CO team started with a vision to build an integrated process and technology that ran from demand shaping through to claims. At every stage of this value chain, the team looked for waste (unnecessary tasks) with a mental model of “from automation to autonomy.” It’s from this pioneering mindset that the phrase “operations metaverse” was coined.

Collaboration: This one word truly defines Unilever’s approach with partners. From the beginning of the program, it brought tech and service provider partners into the same environment, requiring all to work together – including with the in-house tech developed by Unilever’s Global Business Services team – to design solutions.

Scaling: The third principle is about the magnitude of the transformation and the speed at which it can be achieved. Unilever disrupted the norm of tech deployments by developing rollout processes to launch globally all at once rather than sequentially by geography.

Scaling: The third principle is about the magnitude of the transformation
and the speed at which it can be achieved. Unilever disrupted the norm of
tech deployments by developing rollout processes to launch globally all at
once rather than sequentially by geography.

FOUR

Old Ideas, New Mindsets

One of the biggest initiatives powering the metaverse idea has been a breakthrough in customer connectivity. Unilever’s solution for modern trade, SKY, connects customer point-of-sale (POS) data and stock information to the supply system with an AI overlay that assesses and replans in real time and at a scale that was previously unattainable. As Juan Carlos said, it truly creates “one supply chain” across the ecosystem of trading partners.

As we learned more about SKY, our research team asked, “Isn’t this just CPFR on tech steroids?” It’s that and more. The elusive collaborative, planning, forecasting, and replenishment (CPFR) is now possible… and lives in SKY.

The takeaway? Some of the long-held ideas in supply chain are now possible because of the developments in quantum, cloud, and AI… along with, of course, maturation in retail and consumer products operations. It may be time to dust off a few old playbooks and approach the legacy concepts with a digital mindset.

Combining proprietary Zero100 data, interviews from the ecosystem of those who have led this transformation at Unilever, and case examples of new tech solutions in action, this report outlines the specific methods, tech solutions, and partnering opportunities to guide your own reinvention.

To access the full report, visit members.zero100.com.

If you are not a Zero100 member, please email hello@zero100.com to inquire about membership and report access.