Kraft Heinz and Microsoft Join Forces to Accelerate Supply Chain Innovation as Part of Digital Transformation

By Chantal Polsonetti

Category:
Acquisition or Partnership

The Kraft Heinz Company and Microsoft Corp. announced they are joining forces to develop solutions designed to accelerate supply chain innovation  for the consumer goods giant’s transformation and enable a Supply Chain Innovationmore resilient supply chain. The initiative is one of Kraft Heinz’s largest technology investments to date and a key driver of the company’s ambitious AGILE@SCALE approach.

With Microsoft Azure as its preferred cloud platform, Kraft Heinz will migrate the majority of its global datacenter assets to Azure and its enterprise resource planning (ERP) software to SAP on Azure. Through this transformation, Kraft Heinz expects to reimagine its day-to-day operations, create a more collaborative supply chain, and enhance consumer experiences by using real-time predictive analytics to improve inventory transparency and anticipate consumer and channel demand. At the same time, the efficiencies created through the adoption of digital tools from Microsoft are expected to allow the food and beverage leader to continually reinvest into its business.

Extreme pressures on end-to-end supply chains during the past two years have exposed the need for more connected and collaborative networks between suppliers, buyers, retailers and other parties along the value chain. As part of its desire to better address supply chain disruptions, Kraft Heinz is leaning heavily into a digitized approach to shift the company to a more predictive strategy and rapid response model.

A primary example of how the companies will collaborate is the creation of a “Supply Chain Control Tower” for Kraft Heinz. By serving as air traffic control across the company’s full product portfolio, the Control Tower will provide real-time visibility into plant operations and automation of its supply chain distribution across Kraft Heinz’s 85 product categories. This innovation — powered by Azure’s AI, IoT and data analytics capabilities — enables the company to get its products in the hands of its more than 2,500 U.S. retailer and food service customers and millions of consumers as fast and cost-effective as possible.

Furthermore, Kraft Heinz will create “digital twins” for its 34 owned manufacturing facilities in North America to help test and perfect solutions and processes before applying them on the plant floor. For example, the technology, fueled by Azure Digital Twins, will help predict outcomes that identify optimal product capacity and reduce mechanical interruptions by proactively addressing issues before they occur, with the goal of ensuring the products that reach retail shelves and consumer hands are the highest possible quality.

Finally, as part of the collaboration, Kraft Heinz and Microsoft will create a joint Digital Innovation Office to co-engineer new solutions that will help the company reimagine digital manufacturing and drive efficiencies with the help of hybrid experiences powered by Microsoft AI, machine learning and IoT.

Engage with ARC Advisory Group