Supply Chain Analyst
BARILLA SpA (A)
SUPPLY CHAIN MANAGEMENT – MODULE ONE
Table of Content Contents
Title Page 1
Table of Content 2
Executive Summary 3
Issue(s) Identification 4
Environmental And Root Cause Analysis 5
Recommendations 7
Implementation 8
Monitor and Control 9
Conclusion 9
Exhibits 10
Executive Summary
Barilla SpA,(A) is the largest producer of pasta in the world, making 35% of all pasta sold in Italy and 22% of all pasta sold in Europe. The product line of Barilla is divided into the dry product category (representing 75% of Barilla’s sales), and fresh product category (representing 25% of Barilla’s sales). Their supply chain and manufacturing process is heavily vertical integrated.
Fluctuating demand became a major problem for the corporation in the 1980s, with order for the dry product swinging wildly from week to week (refer to Exhibit 12), straining the corporation’s manufacturing and logistics operations. Worse still, increased costs in the distribution channel brought about the critical problem of thinning margins in profit for both Barilla, and the retailers.
To address the aforementioned problems, the Just-In-Time Distribution (JITD) program was conceived to address order-fulfillment and meet the demand needs customers. It is envisaged that the proposed JITD system will not only increase the inventory flow between plants and distribution centre, but shall also meet demand needs.
However, the implementation of the JITD has not been successful so far. There have been major resistance to the program roll-out, with concerns raised by both internal staff, and external distributor and retailers. It is pertinent that Barilla address the concerns of both distributors and the concerns/fear of internal sales representatives, list out the benefit that the JITD program would deliver as an overall.
Moreover, Barilla shall need to better forecast
SUPPLY CHAIN MANAGEMENT – MODULE ONE
Table of Content Contents
Title Page 1
Table of Content 2
Executive Summary 3
Issue(s) Identification 4
Environmental And Root Cause Analysis 5
Recommendations 7
Implementation 8
Monitor and Control 9
Conclusion 9
Exhibits 10
Executive Summary
Barilla SpA,(A) is the largest producer of pasta in the world, making 35% of all pasta sold in Italy and 22% of all pasta sold in Europe. The product line of Barilla is divided into the dry product category (representing 75% of Barilla’s sales), and fresh product category (representing 25% of Barilla’s sales). Their supply chain and manufacturing process is heavily vertical integrated.
Fluctuating demand became a major problem for the corporation in the 1980s, with order for the dry product swinging wildly from week to week (refer to Exhibit 12), straining the corporation’s manufacturing and logistics operations. Worse still, increased costs in the distribution channel brought about the critical problem of thinning margins in profit for both Barilla, and the retailers.
To address the aforementioned problems, the Just-In-Time Distribution (JITD) program was conceived to address order-fulfillment and meet the demand needs customers. It is envisaged that the proposed JITD system will not only increase the inventory flow between plants and distribution centre, but shall also meet demand needs.
However, the implementation of the JITD has not been successful so far. There have been major resistance to the program roll-out, with concerns raised by both internal staff, and external distributor and retailers. It is pertinent that Barilla address the concerns of both distributors and the concerns/fear of internal sales representatives, list out the benefit that the JITD program would deliver as an overall.
Moreover, Barilla shall need to better forecast