With its existing, outsourced ordering system, Elonen couldn’t analyze or manipulate the data to print the shipping labels based on product or delivery location. They simply came off the printer as each order arrived. Two workers were solely responsible for taking the labels from the printer, tearing them apart and sorting them by product type. Other warehouse workers would then pick up the labels as they accumulated for each item, retrieve the baked goods from the warehouse, label them, sort them and put them on pallets for shipping. Even if a single customer ordered a full pallet of chocolate cakes, each cake received a label.

“The packing station was really the bottleneck in the operations,” says Markku Breider, Director of Business Development at Houston Analytics. “So we needed to look at the whole process — from when the order was received until the items went out on the truck.”

Elonen has made an important start on its journey toward data-driven digital transformation. Immediately after implementing the IBM ILOG CPLEX solution to optimize its order management, printing, labeling and packing processes, the bakery was able to move the two workers whose sole job it was to tear off and sort labels to other, more interesting jobs in the warehouse. That tedious task had been entirely eliminated. What’s more, supply chain efficiency increased by more than 20% thanks to higher worker productivity.

Elonen expects to realize other efficiencies from the system. A new dashboard lets warehouse managers track and manage the orders as they come in, including how many pallets will be needed and when. For the first time, the bakery has visibility into future orders a day or even weeks in advance, giving it the option to pre-pack items to improve efficiency. As Jari Elonen states, “One good dashboard is better than 100 reports.”

Houston Analytics played a key role in redesigning the warehouse processes to capitalize on Elonen’s new visibility into, and ability to analyze and use, customer and order data to improve efficiency. For example, when an order large enough to fill a whole pallet comes in, Elonen can print a single label for the entire pallet, rather than for each item on it, saving significant time and effort.

“The process is much more streamlined now,” says Breider. “It’s data-driven, so it gives Elonen much more visibility and flexibility in their packing process.”

Elonen expects that this improved flexibility and efficiency will ultimately result in better delivery service to its customers. As the company grows, the streamlined packing process will be critical to meeting the increasing demand for its products.

The bakery now has a big data and analytics solution that it can use in other areas of its business. Elonen has already highlighted its key priorities for the future, and Houston Analytics helped create a roadmap of what it can do next with the data warehouse and analytics solutions.

“This also bridges to our future focus,” says Jari Elonen. “Market fragmentation drives us to better understand consumer needs so we can improve our assortment and offer what consumers in each trading area want to buy. This will also generate more value to our retail partners.”

The company has recently acquired another bakery in Finland, and Houston Analytics has already found areas where the analytics solutions can help increase the synergy between the acquired company and Elonen.

“I would say that this is the biggest benefit for Elonen,” says Breider. “Jari [Elonen] has a vision for his company. They are interested, and they trust us. Even though they don’t know everything about the technology, they can jump into data analytics.”

Raimo Elonen and his wife founded the Elonen (link resides outside of ibm.com) bakery in Jämsä, Finland, in 1966. It now employs almost 250 people across the company, from bakers to maintenance workers. The company opened state-of-the-art production facilities in 2013 and serves customers in its 10 cafés, eight in-bakery shops and through daily distribution of products throughout Finland. It expects to generate USD 47.20 million in sales in 2021.

About Houston Analytics Oy

In a world where most “data science” consists of one-off, hand-coded analyses that never go beyond the prototype stage, Houston Analytics’ (link resides outside of ibm.com) approach takes predictive analytics and world class optimization to the industrial level. Founded in Helsinki, Finland, in 2013, Houston Analytics embeds analytics seamlessly into customers’ business processes, delivering improved outcomes and increased returns one decision point at a time.