HUL leverages AI, ML, data for a smarter supply chain

Thomas K Thomas Chennai/Mumbai | Updated on August 30, 2021

Sanjiv Mehta

Chairman Sanjiv Mehta says company’s three biggest assets are people, brands and data

The country’s largest FMCG company, Hindustan Unilever Ltd (HUL), is reconfiguring its entire supply chain to enable just-in-time delivery of products by using new digital technologies, including machine learning, artificial intelligence and data analytics. This will enable HUL to customise products available at millions of stores based on the customers in the vicinity.

“We want to be the most intelligent consumer goods enterprise. A grocery store in South Mumbai should be having a completely different assortment of products compared to a store in Dahisar. In the past, the algorithms were based on what you sold. Now, the algorithms are based on who are the consumers living in the vicinity, what would be the living standard measure and what are the product categories they’ve adopted. We would be able to customise the assortment in each of the millions of stores,” Sanjiv Mehta, Chairman and Managing Director, HUL, told BusinessLine in an interview.

Real-time information

HUL is deploying data and technology to feed real-time information to its entire supply chain, including factories and fulfilment centres to be able to do precision marketing, depending on where the demand is. “The value chain, which was linear in nature – plan, source, make, market and deliver – is now becoming more circular,” Mehta explained. “Our vision would be that what you sell today, we manufacture tomorrow. That’s the vision, it will take some time for us to reach there, but we are progressing towards that,” he added.

HUL has also started measuring closely the days between sales rounds. Earlier, the company would have longer runs because that’s what brought in efficiency. But longer runs would also mean that there will be store inventory. “If you look at how you optimise your supply chain, on one axis there could be capacity; on the other, there could be inventory; and on the third axis, there could be information. If you have information closest to the consumer, then you could optimise on the other two axes. You need lesser inventory and lesser capacity and you could still ensure a very high rate of fulfillment,” Mehta said.

The digital strategy

The seeds of the digital strategy were sown by Mehta a few years ago under the Reimagine HUL programme. One such digital tool is called Livewire that enables business heads to take real-time decisions by slicing, dicing and analysing multiple, disparate data points. The other example is the Shikhar app where a retailer can place an order even when a salesman is not able to visit him or her. “Pre-pandemic, it used to take us a lot of effort to convince retailers to adopt the digital app. Post-pandemic or after the beginning of the pandemic, this has certainly accelerated with more than half-a-million outlets adopting it,” Mehta said.

At the core of Mehta’s strategy is data. HUL has hundreds of experiments running in the company today that use tech platforms like artificial neural networks, machine learning and artificial intelligence. “We will have machine intelligence complement human intelligence increasingly. For a company, which reaches nine out of 10 households in the country, we have got thousands of SKU, millions of stores and the quantum of information we have is massive. In the past, we used to say that the two biggest assets we have are our people and our brands. Now, we have added data to it. So, it’s people, brands and data. That’s what will define HUL of the future,” Mehta said.

Published on August 29, 2021

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