If you were to slice Andrew Shaw down the middle, like a stick of seaside rock he would have Nestlé running all the way through him. This would not be surprising as the head of demand & supply planning for the food manufacturing behemoth has worked at the company for more than 20 years.
However, before the conversation with Shaw can really get going, it quickly becomes obvious the manufacturing sector has a different set of references from that of the waste management industry. Expressions like ‘total performance management’, the acronym DMAIC (define, measure, analyse, improve, control), ‘value chain’ and ‘lean principles’ litter the discussion. Fortunately, Shaw is only too happy to stop and explain what they all mean. And luckily for me, there are familiar references such as ‘closed loop’ and ‘best practice’; thus demonstrating there is not too great a language barrier between the worlds of logistics and waste management.
“We have a number of closed loop operations at our manufacturing facilities so the packaging material goes back to the supplier,” says Shaw, whose team works across confectionery, beverages and food.
He goes on to explain that when it comes to the waste hierarchy, Nestlé’s focus is on prevention and stopping waste from occurring in the first instance.
Total performance management
“We have a number of tools and initiatives. This includes total performance management (TPM), which helps reduce variability in the manufacturing operation by reducing breakdowns, increasing efficiency and cutting down the number of defects. Indeed, we have a number of initiatives running in the UK that help us drive waste out of the operation. Essentially, the philosophy at Nestlé is root cause elimination.”
Driving waste out at every level of an operation is something that everyone understands, whether from a manufacturing or a waste management perspective. Nestlé has set itself the goal in the UK of achieving zero waste to landfill from each of its 13 factories by the end of 2015. Shaw states confidently that the business is on track to achieve this aim.
Creating Shared Value
Mixed plastics is also a challenge for the company. According to its Creating Shared Value report, which focuses on the group’s sustainability, environmental and social impact, in the UK and Ireland 92% of the packaging used for its products is recyclable, while the rest is made of mixed plastics. In 2013, Nestlé partnered with Enval, the recycling and environmental tech specialist, to support the construction of the first commercial-scale plant for Enval’s material recovery technology. “We are committed to reducing the weight, volume and environmental impact of our packaging and use recycled materials where possible,” states the company.
Indeed, Nestlé is reported to have been the first major UK confectioner to offer an entire Easter egg range with packaging that is 100% recyclable.
To help the group achieve more of these laudable aims, Nestlé has a business model supported by Nestlé Continuous Excellence. This is a continuous improvement initiative based on lean and TPM principles that cascades all the way down from senior executives to employees on the manufacturing floor.
“We use advanced problem-solving tools and analysis to tackle inefficiency and waste instead of the usual sticking-plasters approach. The aim is to get to the root cause of a problem and to implement solutions to prevent the problem reoccurring,” explains the head of demand & supply planning. But it’s not just reducing waste in the production process Shaw is interested in – he admits to a growing interest in food waste, and in particular to the relationship between Nestlé and FareShare, the charity that provides surplus food to local centres where meals are made.
Tackling food poverty
“Working with FareShare is a win-win for Nestlé as it provides us with an environmentally friendly solution for dealing with unused food and allows us to help tackle the issue of food poverty,” says Shaw. “By ensuring good food is not wasted, we turn an environmental problem into a solution, helping to feed thousands of vulnerable people every day. Driving down our waste by donating food fit for consumption, that may otherwise enter the waste stream, to FareShare helps us reach our ‘zero waste to landfill’ goal.”
Shaw says he was inspired further by FareShare’s Surplus Food Summit, held in London in July.
“The great thing about the event was showcasing the positive things along with the opportunities that are out there. I saw more manufacturers coming on board with FareShare as well as helping them understand that the donation of surplus food then becomes part of a routine. It felt as though it was the start of a positive journey.” Shaw pauses before adding: “The fresh food producers have got a big challenge ahead of them so it would be amazing if they could use the network created at the conference to overcome some of the issues.”
Other initiatives undertaken by Nestlé’s operation in the UK include the Pathfinder project launched in 2013 in partnership with WRAP. The aim was to identify waste hot spots and opportunities for waste prevention along the chocolate crumb supply chain. In case you are wondering what that is, chocolate crumb is milk that has been condensed and dried and added with sugar and cocoa mass. It is then added to cocoa and cocoa butter to make milk chocolate.
Driving out unnecessary waste
“Our aim was to reduce waste along the UK chocolate crumb chain by 5% by 2014,” recalls Shaw. The work began with a detailed analysis spanning dairy farm to manufacturing to customer till, with the aim of making recommendations for waste reduction projects along the supply chain in 2013/14.
Shaw’s contribution to driving out unnecessary waste in the UK arm of the group, whether it is in wasteful practices or processes, is a strategic one.
“I and my team take a problem-solving approach to supply chain. It’s about the approach we take in understanding the strategy and direction across our business and adding value to what we do. There are key performance indicators and measures in place. When the measures turn red, it is a trigger, it tells us something has gone wrong, we then apply the problem-solving tools. There are daily and weekly reviews to drive performance in the right direction, and if we have a problem we tackle it. If it doesn’t go away, we apply different tools.
“The important thing is that everyone has a clear line of sight between their personal objectives and the strategic direction that the business is taking. Everyone knows what role they are playing in helping to deliver business objectives and they can see the level of contribution they are making. My job is to work with my team to set the strategy in demand and supply planning. We cannot do our roles without a detailed understanding of the manufacturing operation and the commercial elements of the category businesses. We are the cog in the middle bringing the two together.”
‘Creating Shared Value’ is an expression that also crops up a lot in Shaw’s conversation.
However, he points out: “We can’t do this on our own so we work with our external partners to deliver more value. It is part of our CSV objective – reducing material usage and energy, e.g. water and electricity – and has been a focus for a long time. Technology has helped and the other thing that’s changed has been the external environment; people are now more aware of recycling and its impact on the environment.”
Inviting in external agencies
He continues: “To some people, the supply chain sits within the walls of the business, and while we can manage the supply chain, we are always keen to invite external agencies to come in and advise us. Love Food and Hate Waste are helping to educate our own people. They’ve come into factories and are able to give advice and help us to work through potential options. We’re also planning to work with FareShare on resource efficiency and are inviting them to do waste walks in some of our factories so we can see if we can do more when it comes to donating surplus food.”
As an aside, Shaw points out that a good way to review the production process and identify waste reduction opportunities is to walk it backwards. “If you walk it forwards, you expect to see the process a certain way, but if you walk the process backwards your mind is challenged, you see things differently.”
One of the advantages for Nestlé UK & Ireland, says Shaw, is that while the group is a global company, “it doesn’t feel big as our focus is on the UK & Ireland market”, enabling the senior leadership team to operate like a local business. Having said that, Shaw adds: “If we find something that has a positive impact on performance, I am able to share that right across the business so that it can benefit all parts of the organisation.”
Andrew Shaw’s CV
Andrew Shaw has worked for Nestlé for over 20 years. He joined in 1991 following a three-year spell in retail buying. He started with Nestlé in KitKat manufacturing, and after two years moved into the supply chain, where he has been ever since.
Shaw has worked in both market and European businesses for Nestlé across seven different product categories. This has given him a broad breadth of experience across the full value chain. He has also worked in the company’s head office in Vevey, Switzerland, implementing best practice in demand and supply planning. He is currently the head of demand and supply planning for Nestlé UK and also manages the operational relationship with FareShare.