Chobani has enjoyed a steady growth trajectory ever since its first container of yogurt hit store shelves in 2007. Its product line has expanded beyond the flagship Greek yogurt, and the company, based in Norwich, New York, has earned raves for its innovative, progressive approach. But in 2017, Parag Agrawal, Chobani's chief information officer, knew the business had to confront a looming impediment to further growth: its outdated technology systems.
Chobani's tech infrastructure--including its enterprise resource planning (ERP) software, which helped the company administer critical operations such as supply chain management, finance, HR, and customer relationship--was a patchwork of different platforms and subsystems. As the company's operational needs grew, new software and hardware components were tacked on to the existing systems. The technology helped support Chobani's growth, but at an increasing cost. "It was becoming a painful procedure for us to even maintain those systems," Agrawal says.
Agrawal and other leaders at the company knew it was time to consider a major overhaul. Like any big change initiative, that process would pose challenges that Agrawal and his team would have to overcome. But those challenges were largely outweighed by the benefits. "We knew that if we wanted to scale up, go into different markets and diversify our products, we needed a new system," Agrawal says.
A DIGITAL WISH LIST
Agrawal and his colleagues knew what they wanted from a new system: one that could become a one-stop shop for all of its business processes and have connected transactions to navigate across the end-to-end process easily. It should also maintain information digitally so employees wouldn't have to print out emails and order records. Most of all, they wanted it to work seamlessly across the company, from the manufacturing floor to accounts receivable. "We wanted one unified and connected system that would be the source of all the data that we have," he says.
They found a match in SAP's high-end ERP system, S/4HANA. One key selling point was the ability to scale that system to meet Chobani's ever-changing needs. Unlike the old patchwork arrangement, SAP's solutions are designed to interact seamlessly with one another, allowing Agrawal to take a more modular approach. For instance, if Chobani decides to move into a new market, Agrawal could easily configure the SAP system to meet those needs. "Things move fast at Chobani," he says. "We wanted to make sure that if the business goes in a particular direction, the technology will be able to support that."
MAKING DATA WORK
Chobani's S/4HANA ERP system went live in July 2019. That represented the first of a multiphase plan to replace the company's legacy systems. Agrawal expects it will take a few years for Chobani to complete the transition. Since debuting the ERP system, Chobani has added other SAP platforms, including SAP Analytics Cloud, a powerful business-intelligence tool that Agrawal says will allow the company to quickly make sense of huge volumes of operational data. "We have a lot of visions around these data capabilities," he says. "We're very excited about it."
Quickly slicing and dicing massive amounts of data can help provide valuable insights across different process, allowing Chobani to better track its key performance indicators. And that's just scratching the surface. Agrawal expects that a few years from now, Chobani will be able to take advantage of predictive analytics to provide more accurate sales forecasts and maximize manufacturing productivity. For instance, the company may be able to use historical maintenance data to pinpoint when a machine on the factory floor is about to break. "Instead of doing reactive maintenance, you start doing proactive maintenance that keeps the machine running," he says.
Chobani's success clearly lies in the products it puts on store shelves. But as the company has matured, it has needed to rely more on efficiency and smart management to continue growing. Agrawal says the old technology systems may have continued to support Chobani's progress, but more than likely they would have been a limiting factor. "As a young and growing company, we didn't always have the standardized processes in place," he says. "But once you get to the size where Chobani is today, you need those standard processes and best practices. And SAP is helping us put those into place."