Published on the 06/08/2020 | Written by Heather Wright

Kiwi consortium takes on up to $160m DX project…

Zespri has inked a deal which sees Deloitte leading a Kiwi-based consortium which includes Zag and Sysdoc, for the kiwifruit cooperative’s $160 million Horizon digital transformation programme.

Deloitte will be the design and implementation partner for the ambitious four-year programme, which is Zespri’s largest-ever investment in processes and systems, designed to ‘fundamentally overhaul the foundations of the business’.

The project was borne out of the need to replace key finance and supply chain systems, with some of Zespri’s systems now 20 years old and designed to support ‘a much smaller industry, fewer varities and a smaller market footprint’.

“The Horizon Programme will help to deliver greater operating efficiency and effectiveness for decades to come.”

Horizon is focused on modernising Zespri’s systems and process across finance, grower enablement, supply chain, sales processes and systems and digitisation of sales and operations planning processes and systems.

It’s a big project, with a big budget – Zespri chair Bruce Cameron says the programme is expected to cost around $30 million to $40 million per year.

“To put this in context, Zespri spends around $10 million to $15 million on an annual basis to maintain our existing digital systems,” he says in an email to growers and shareholders.

“Modernising the processes and internal systems that enable us to get our premium Zespri Kiwifruit to customers and consumers in over 50 countries worldwide is crucial to being able to continue delivering strong returns to our growers and communities,” he says.

“Beyond mitigating a number of risks, the investment will help sustain our industry’s strong growth trajectory and enable Zespri to become more agile and efficient,” the company said in its annual report.

Zespri says the Horizon programme provides the opportunity to digitise the Zespri system, bring transformational change and support integrated business.

Among the plans are increased abilities to capture real time data in its global supply chain management to draw insights and make better decisions.

“This includes areas such as track and trace, freight planning and forecasting and in our tactical choices on storage locations to meet future demand.

“It will allow more proactive management of fruit in the supply chain for quality issues. Ultimately, there will be value for growers from streamlined, efficient processes underpinned by robust data and scalable systems,” the company’s annual report says.

Improved ability to measure sustainability performance is also expected, aiding the company with inspection and reporting requirements.

Growers are also expected to benefit, with the report noting that the current online tools were designed more than a decade ago – and the increasing burden on growers in terms of compliance data requirements.

“Today, we’re acutely aware of the need to better harness data form the orchard, such as crop count results and yield, water use, fertiliser input and environmental performance.

“We need solutions to help consolidate, simplify, automate and disseminate this information. We have an opportunity… to reduce as much as possible the burden on growers to meet the ever-growing list of compliance data requirements. But more than that, better information services will provide access for growers to quality tools and insights that enable improved operations and productivity.”

Gareth Glover, consortium lead and Deloitte Technology Partner says the consortium will draw on global experts and industry expertise from other parts of the world, but will ‘stay grounded in who we are – a consortium of local practitioners who are invested in the success of one of our nation’s most iconic brands’.

“The Horizon Programme will help to deliver greater operating efficiency and effectiveness for decades to come,” Cameron says. “It is a significant investment for Zespri and the industry but is being funded within the limits of our current funding model and through prudent financial discipline and economies of scale.

Zag CEO Nick Mulcahy says: ‘“Zag is excited to bring our SAP S/4HANA and supply chain expertise to the team Deloitte have put together to work with Zespri on this program. We’re looking forward to joining two other award-winning organisations with leading capabilities in business transformation to support Zespri’s goals.”

The appointment of Deloitte follows a competitive tender process. High level design is expected to start this year, with the first release of systems and solutions in 2021.

Says Cameron: “This is a project that will define the future of Zespri and it will have a considerable impact on both the industry, and the New Zealand economy.”