Supply Chain IoT Use Case: A digitized floricultural business ensures a reliable delivery - and satisfied customers.
IoT for SMB

IoT: planting the seeds of success

A wholesale grower in North Rhine-Westphalia has built its success on speed and a high-performance, high-quality supply chain. For support, it has turned to a T-Systems solution that translates IoT technology into real-life benefits.
Author: Sven Hansel
Photos: Norbert Ittermann, Herbert von Danwitz, iStockphoto
Podcast
Where the IoT blooms flowers
Podcast: Open Telekom Cloud
It’s 7:30 in the morning in late May in Tönisvorst, Germany. One corner of this small town houses a heavenly smelling, but extremely busy work environment. Two workers adroitly stuff delicate seedlings into flowerpots that have been mechanically filled with peat. In a few minutes, they manage to fill an entire pallet’s worth of pots. At the next station, three workers roll 2,500 mature impatiens plants into a waiting truck. The moment it trundles out of the parking bay, the trio move on to their next task. Walking amid this hustle and bustle is CEO Herbert von Danwitz. One moment, he’s murmuring an encouraging word to a packer; another, he’s crumbling potting soil between a pair of practiced fingers. All while answering an incessantly ringing cell phone. Sometimes, the caller wants “3,400 items to Venlo;” other times, “2,300 plants to Cologne”. This buzzing enterprise has nothing in common with the sunrooms shown in Hollywood movies in which aging, elaborately made-up divas delicately snip at their roses while Chopin plays softly in the background. This is hard, focused work. “Our industry now runs on a 24-hour schedule,” says von Danwitz.

Three workers roll 2,500 mature impatiens plants into a waiting truck.
Customer supply chains set the pace

The business, established in 1952, but now owned and operated by the second generation of the family, brings color into German households from a 26,000 square meter facility in Tönisvorst and a 32,000 square meter site in the Netherlands. Today, roughly 30 employees aim to execute the company founder’s credo: “Satisfied customers come from quality, expertise and delivery reliability.”
Delivering on this promise, however, demands a concerted effort from the floricultural firm. “Gone are the days when nurseries would roll up in a truck and pick up a couple of pallets. Today, our business is all about bulk orders from large discount chains, hardware stores and grocery retailers,” says von Danwitz. In other words, notes the CEO, “their supply chains set the pace.”
By 11:45 a.m., it’s clear what von Danwitz means by the “pace”. Small details such as RFID chips under the carts reveal a heavy reliance on industrial-scale logistics processes – real “flower power”. Right now, employees are preparing an entire truck for a regular customer in Cologne. And the order didn’t come in a few weeks ago, either. “Some mornings, we’ll get an order for 4,000 plants that have to be in Cologne by 7:30 a.m. the next day,” mentions von Danwitz. His telling gaze and emphasis on the words “have to” speak volumes. He explains that they dispatched a truck used to haul other suppliers’ perishable goods, such as lettuce or fruit. He adds that customers would be “very displeased” if the truck left with an empty pallet position because his employees hadn’t finished packing the plants on time – and not just on efficiency grounds, either. Interrupting the supply chain is a huge no- no in his industry. “Delivery reliability is what matters most to today’s customers. If you miss two or three deliveries, they’ll stop calling,” concludes von Danwitz.
“Delivery reliability is what matters most to today’s customers,” concludes von Danwitz.
„Sometimes we receive an order in the morning for 4,000 plants, which must be in Cologne the next day by 7:30 a.m..“
HERBERT VON DANWITZ,
CEO Horticulture von Danwitz

Turning variables into constants

These conditions leave no room for maudlin romanticism in modern-day greenhouses. Technology has long been a process driver. A fully automated irrigation system collects rain water and distributes it among hundreds of thousands of flowerpots. Plant growth is calculated by computers; the staff horticulturalist incorporates weather data – “Has the spring been sunny or overcast?” – into his planning calculations. Von Danwitz even controls the air-conditioning systems with a cell phone app. “We have the tools to convert a lot of variables, like weather conditions, into constants. But there’s one variable we can’t change, and that’s labor,” stresses the CEO.
Two workers adroitly stuff delicate seedlings into flowerpots that have been mechanically filled with peat.
Like most companies, the North Rhine-Westphalian business faces a shortage of skilled staff members: from trained truck operators to horticulturalists. Even seasonal workers, a mainstay in his industry, have to be recruited from all over Europe. In peak months, von Danwitz has up to 40 seasonal employees working for his company, all earning minimum wage. Obviously, some people will get unexpectedly sick, prove to be incompetent or turn out to be just plain unreliable. And these hiccups can produce the very supply chain problems that the flower supplier simply cannot have.

Black, red and gold for impulse shoppers

At 2:23 p.m., von Danwitz answers the umpteenth call on his cell phone. The purchasing agent for a chain of hardware stores is absolutely taken with the entrepreneur’s latest idea: flowerpots filled with black, red and gold petunias – the perfect plant for the World Cup in soccer. She immediately orders several thousand. Von Danwitz leaps into action – it’s time to move swiftly and precisely since the supply chain has to deliver. Still, to make sure everything works smoothly, he now uses a smart IoT solution from T-Systems to track efficiency and performance in his production processes.
In a few minutes, the workers at the floricultural firm von Danwitz manage to fill an entire pallet’s worth with seedlings.
His reasoning is simple: when these kinds of calls come in, his biggest question is, “What’s the current human resources situation in our processes?” That’s a challenge in a 26,000 square meter facility since it increases the already relentless time pressure even more.
Now, though, with each new work order, the employees pick up a small box with a QR code and a smartphone and scan an NFC tag associated with the order. They repeat this process whenever they go on break and once again after they’ve filled the order. The information is automatically routed through the cellular network to a cloud-based IoT platform that collects, analyzes and processes the performance and production data. Von Danwitz can then simply pull up a dashboard on his office computer or smartphone and get exactly the information he needs: How many flowerpots are already loaded onto pallets and ready to ship? What are the KPIs for the individual teams? How efficiently was a particular flower cultivar readied for shipment? What team got done early and is ready to help out at another station? “All this data helps tremendously in keeping our supply chain running smoothly,” explains von Danwitz.
Walking amid this hustle and bustle is CEO Herbert von Danwitz.

Continuity of workload

The IoT solution also provides information for future planning. With it, the wholesale grower can track how efficiently a particular flower cultivar was readied for shipment and adjust the cost calculations accordingly. It also allows the company to optimize larger processes, notes the CEO. “We’ve started to irrigate all our plants while our employees are on break. That’s an idea we got from data analysis.”
Von Danwitz even controls the air-conditioning systems with a cell phone app.
One of the platform’s main benefits for the North Rhine-Westphalian company is that it helps maintain a certain continuity in its work processes. “I want my people to always give 100 percent, not 110 percent. Under no circumstances do I want them to work under constant stress. Then, we’d only be increasing our reject rate, not delivering the quality that our customers expect from us,” explains von Danwitz. “I want my people to look forward to coming to work.
That’s a universal sentiment. “And that’s why we believe our platform has a lot to offer in many different industries,” says Ralf Konrad, the product manager for the T-Systems solution. Indeed, the IoT platform is better and more accurate at conducting competitive analyses, supporting process integration, identifying innovation requirements and tracking cost trends, current shipments and actual production conditions than old-fashioned manual methods. Its clean design means customers don’t have to make major technical preparations or engage in any programming, either. The dashboards come pre-configured, as do certain alarms, such as when a company runs the risk of missing a production target. “Our solution can help any organization that does a lot of loading and unloading or has a complex or sensitive supply chain,” says Konrad. From Tier 1 automotive suppliers to craft enterprises working on large projects to slaughterhouses, there’s always a way to optimize the flow of goods. Partly because the solution keeps up with current technology.
For the World Cup, the horticultural company Danwitz supplied a German hardware store chain with black/red/gold petunias.
For the World Cup, the horticultural company Danwitz supplied a German hardware store chain with black/red/gold petunias in appropriately colored flowerpots.

Digital visibility into the value chain

The platform is open by design and interoperates with any end-user device. This openness extends to connectivity, too: the solution supports all communication protocols and transmission channels. It’s built on the powerful Microsoft Azure cloud platform and features interfaces for easily integrating Salesforce, SAP, manufacturing execution software (MES) and other solutions.
All labor-intensive businesses can leverage the solution to gain digital visibility into their supply chains. Production status checks can be conducted on the fly and automatically forwarded to customers – which is the kind of digital reporting that large companies in particular are increasingly demanding from their suppliers. The extra visibility supports cost-cutting and gives executives more leeway when scheduling and managing teams. Greater inventory visibility can also help in identifying hidden opportunities to generate more revenue, such as by selling off remainders. That improves customer satisfaction and rewards employees for their performance.
At the the floricultural firm von Danwitz, a powerful cloud platform provides digital visibility within the value chain.
It’s 6:12 p.m., and von Danwitz takes another call from a customer. He just got his first order for the Advent season: poinsettias for several hundred grocery stores in a major chain. “By early summer, we know exactly how many plants we need to have loaded on the pallets by the first Sunday of Advent. But with the new IoT solution, I’m far more confident that everything will go smoothly,” says von Danwitz before whirling into action again. A Dutch supplier is on the phone; this time, the call is about vegetable seedlings for balconies. In a few weeks’ time, this latest hot trend may appear on his employees’ smartphones as a new item to be scanned in.

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