Home Depot plots IT, supply chain improvements

Home Depot plots IT, supply chain improvements

Summary: Home Depot plans to invest an additional $900 million on logistics and $500 million on technology between 2007 and 2010 to improve its supply chain. The returns could be impressive, according to executives speaking at Home Depot's analyst meeting.

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TOPICS: SAP
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Home Depot plans to invest an additional $900 million on logistics and $500 million on technology between 2007 and 2010 to improve its supply chain.

The returns could be impressive, according to executives speaking at Home Depot's analyst meeting. For instance, every one-tenth improvement in inventory turns means an additional $200 million in cash.  Home Depot needs  to improve its supply chain since it's competing with Lowe's and facing a housing downturn.

In a presentation, Mark Holifield, vice president of supply chain, said Home Depot would focus on inventory management. On the technology front in 2007 Home Depot will:

  • Implement supply chain analytics;
  • Install improved demand forecasting tools;
  • Improve central replenishment;
  • And improve merchandise financial planning processes.

Home Depot is also looking to implement a customer delivery tracking system in 2007 to better track deliveries. The general idea is to be able to track deliveries, orders and their status across the company between 2008 and 2010.

On the logistics front in 2007, Home Depot is looking to improve central distribution, cut lead time from order to delivery, manage freight and coordinate suppliers better. For 2008 to 2010, Home Depot is looking to consolidate logistics platforms and get better visibility as products move from supplier to the shelves.

It's safe to say that many of those aforementioned projects will involve SAP. Home Depot is powered by SAP for the most part.

Another observation from the analyst meeting: Notably absent from Home Depot's presentation roster was CIO Bob DeRodes. in previous years, DeRodes presented at Home Depot analyst meetings.

DeRodes still has a bio on Home Depot's site so his absence may just indicate the company's major IT rebuilding is downshifting a bit. Indeed, Home Depot's technology investment for 2007 lags previous years where the company spent $1 billion or so.

Topic: SAP

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  • SAP-Couldn't Have come up with a better acronym

    Home Depot would focus on inventory management.
    On the technology front in 2007 Home Depot will:

    Implement supply chain analytics;
    Install improved demand forecasting tools;
    Improve central replenishment;
    And improve merchandise financial planning processes.
    ---------
    my comment:
    Why not leave the ordering up
    to the inventory management associates???

    CAR DOESN"T WORK!!!
    It either under orders or over orders...
    even with correct count changes..
    and making a supplemental car order
    takes 3 times as long to do..
    as a regular order on the M.O...

    Considering there is now no real easy
    way to track a "sales history" per SKU
    Per Vendor..because the CAR vendors have been removed
    from the MO cart..

    so each individual SKU has to
    be logged into the "walk"
    to view its history..

    Stop using the "metrics"
    to bash us over the head
    with..on "sales lost"...

    Stop tying all our money up in buying office deals
    that don't sell to the consumer very well..making
    us "over inventory" in merchandise we can't sell!!
    and allow us to order what we need to sell
    on a regular basis..instead of the delicate balancing
    act we have to walk every day..
    cutting our essential orders to make up for them.

    Try calling Tech support lately?
    Andy from India will gladly put you on hold
    while he trys to figure out what you are talking about..

    I could go on..
    but nobody is listening..anyway..
    or are they??
    sendmeanemail007