Hapag-Lloyd AG
Hapag-Lloyd's goal was to find an efficient solution for corporate planning that, in particular, integrates operational sub-plans and streamlines the planning process. The aim was also to reduce the workload on employees and increase automation and flexibility.
Together, we were able to map the planning processes in a software-supported corporate planning system in such an integrated manner that today not only complex planning in the area of logistics can be carried out in a distributed manner and close to the operational business, but also the most important revenue and cost drivers can be controlled directly.
The Hapag-Lloyd Company
With an EBIT of €1.315 billion (2020), Hapag-Lloyd is one of the world’s largest liner shipping companies . The company has a clear mission: “Number one for quality.”
This commitment is also reflected in the company’s dedication to meticulous planning of its global operations. Hapag-Lloyd is a leading provider in the Transatlantic, Middle East, Latin America, and Intra-American trade lanes and is distinguished by one of the world’s largest and most modern reefer fleets.
Through a driver-based, integrated, and globally distributed corporate planning system, Hapag-Lloyd aims to maintain its strategic focus on high reliability and quality and to continue to evolve.
The facts at a glance:
✓ Enterprise-wide solution
✓ Process standardization
✓ Greater data transparency
✓ Better control over data
✓ A single environment for planning
✓ More detailed operational planning
✓ Greater user-friendliness
The challenge of the project
The challenge of integrated corporate planning at Hapag-Lloyd still lies in the closely interlinked sub-planning processes within the group. From the allocation of vessel capacity to the planning of global sales volumes and the associated direct costs of containers, all the way through to overhead costs, the individual planning steps are highly interdependent and require extensive coordination. The existing solution in Excel and other tools therefore led in the past to a great deal of manual and time-consuming work and a high risk of errors. Changes to assumptions and adjustments to the planning could only be made at the aggregate level.
A particular challenge in this project is the direct container-related costs (CRC), especially terminal and transportation costs. In this planning, costs are projected for every single data point of a voyage. The starting point is the upstream volume planning, which includes an annual transport volume of 12.0 million TEU (standard containers) and 121 liner services that provide fast and reliable connections between more than 600 ports on all continents worldwide.
Due to its extensive combination logic, this sub-planning process generates a large volume of highly complex data points; as a result, it was previously planned on a local and regional basis using standard costs. However, the previous approach did not allow for greater transparency into the origin and control of costs on a global scale, as incurred costs could not be directly linked to volumes and regional cost drivers.
Implementing the project with the goal in mind
Hapag-Lloyd’s goal was to implement an efficient solution for corporate planning that, in particular, integrates operational sub-plans and accelerates the planning process. The solution was also intended to reduce the workload on employees and increase automation and flexibility. It was particularly important to Hapag-Lloyd that the new solution be highly user-friendly and that the design of the planning screens could be customized to match Hapag-Lloyd’s look and feel, in order to achieve the highest possible level of employee buy-in.
After reviewing and selecting vendors, including the execution of a proof of concept, Hapag-Lloyd ultimately chose the Board planning platform and celver as its partner for implementing the solution. “Our focus was on operational planning. Most tools on the market, however, focus solely on financial planning. Our choice of Board and the experts at celver as our implementation partner was influenced not least by our existing strong collaboration on analytical projects with Qlik,” said Merle Schmidt-Brunn. In the weeks that followed, the planning process was analyzed in workshops and the future planning process was defined.
Hapag-Lloyd’s solution now consists of a comprehensive capacity, sales, and cost planning system with approximately 450 users. The annual budget planning, which culminates in a strategic five-year plan, serves as the basis for further updates as part of the forecasts conducted three to four times a year. The individual planning steps are linked via a workflow and integrated through sub-plan integration. Thanks to this integration, the underlying calculation logic, and the incorporation of historical data, planners can generally rely on suggested values when entering their planning data.
Data integration and preparation were therefore also key components of the project. This involved first harmonizing and consolidating various legacy systems with differing levels of detail in order to ultimately arrive at a detailed planning solution that included the necessary actual data. Throughout the project, it became clear once again that an agile approach, retrospectives, and strong collaboration offer significant advantages when dealing with complex issues.
The new Cargo Related Costs (CRC) planning, which plays a key role in integrated corporate planning, uses globally projected container volumes and their distribution across routes as input. This network planning model enables Hapag-Lloyd to adjust and simulate costs using a wide range of parameters, thereby determining global or local effects on routes and in ports through planning.
The project successfully achieved its goal of standardizing processes and creating a “one-system-for-planning” environment. This ensured global data transparency (single point of truth) and control over the data at all times.
The project has already made progress toward the goal of reducing the global planning cycle by two weeks, but further phases of expansion and refinements to the planning process are still needed to achieve “Pace & Perfection.”
The new planning environment, with its focus on operational planning, also has a direct impact on end users beyond the planning process itself. Since the operational logic—and especially the level of detail in the data—is closely aligned with the planners’ day-to-day work, the information is also used for operational control through plan-versus-actual comparisons.
Your contact person
