Executive Summary: In 1998 Giorgio Maggiali director of Logistics was planning to implement JITD program at Barilla one of the most popular pasta brand in Italy and Europe with annual sales of 19.94 Billion UD.
JITD distribution ideas was developed to meet and exceed the demand supply of Brailla brand fresh and dry products by streamlining a forecast based supply management system. Barilla’s total product range comprises of 75% dry and 25 % for fresh products having 21 days and 12-18 months of shelf lives respectively.
Barilla’s has two main distribution centres CDC, northern distribution in Pedignano and Southern Distribution in outskirts of Naples. Fresh products moved quickly through distribution centre and only three days’
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Tools:
• Utilization of sales force to provide convenience customer and end user
• A prototype should be developed to test and fine tune this process
• Capitalize market strength and build relationship with chain stores.
Definition: A can-do attitude is required along with convincing tangible benchmarks.
Implementation
• Internal atmosphere should be change to support this initiative.
• A top down approach
• Protect the interest of sales force.
• A lucrative program to adapt.
Monitor & Control
• Float the program information along all the potential buyers with convincing tangible results. This should not take more than a month.
• An implementation of prototype would allow Barilla supply chian to fine tune their process based on different product SKUs. Tentative time frame would be 3-6 months.
• An easy adaptable system should be developed and offer to customer (distributors) to implement within next 3
Riordan Manufacturing is a multi location multi million dollar company that is looking to take advantage of a piece of software that is a state of the art sophisticated information system. Riordan would like to integrate its old information and use it to implement the new system and just have one system take care of everything. Since the corporation already has a similar system in place, this technology should be easily done with the new system. This new system should be very cost efficient and the process
The new sales force will also have to be able to; create new working relationships, develop new business, create a personal atmosphere for customers, and promote new business. After the sales force creates new business, the team must be able to retain these newly established customers. They will have to create small, obtainable, measurable goals for themselves in order to create and sustain new business. The salespeople will have a sales quota of thirty units per month and the commission will go up in increments of ten percent after
Moreover, by all this alternatives the company will get efficient and on time delivery to customers which increase the customer satisfaction too.
It is expected that during a period of four months, the company will sell about 333 lbs. to each of the thirty stores in Jalisco. These stores mainly focus on selling quality products and food, the customers are middle to high class, and most of them are educated about
Of course, I won’t say that this estimate of three weeks is as certain as our other time estimates. All we need is a change of staff at the Agency and we are in trouble. But once we have both the specifications and the approval, you can immediately start on developing the production processing system (g).”
The big-bang or cut over approach requires the good skilled personnel, and also training for the new systems, working processes and running, maintenance the new system. The productivity was reported a reduction in the first month after the new system running, but improves gradually in the later months. The accounting reports can be done in two or three day, rather than two to three weeks when using the old systems. Also, with the new system, sharing and collaboration helps reduce inventory, as much as 25%, and also increase the fulfillment ratio from 80% to 95%, service quality has improved to
Barilla’s products are divided into Fresh products and Dry products. The demand for these two distinct kinds of products is quite different, and the order, shipment and delivery methods for them are also various.
Enabling the SMS, Financial Viability, Cost, Technical Support Offerings, Overall functionality, Architecture Compatibility, Platform Portability, Web functionality ?to go?, Manufacturing Experience, Training approach
* Thorough market survey – The company structured its R&D division and outsourced the market survey to Nielson Bases. The survey took into consideration both- the market potential as well as behavioral considerations.
One of the underlying causes of the difficulties that the JITD program was created to solve was the effects of inconsistent demand that came from Barilla’s distributors. The extreme demand variation strained Barillas manufacturing and logistics, and made very hard for Barilla to meet that demand. For example, as noted on the case “the specific sequence of pasta production necessitated by the tight heat and humidity specifications in the tunnel kiln made it difficult to quickly produce a particular pasta that had been sold out due
distributors would have to submit their Stock Keeping Unit (SKU) so that Barilla can control it.
The current process: In 1990s a development process was entailed which is 60-month-long. Two major prototyping
Organisations are now faced with new and improved ways to provide basic services to customers and a major challenge for managers is to locate the most appropriate technology innovations for their business.
As the new technology and fast evolution of software, keeping information system efficiency became a challenge. On the enterprise side, the company’ operation, inventory, and logistics systems are the key to success. On the customer side, the high quality and satisfied experience from the user interface is very important. Moreover, the establish and develop a new technology is costly and different.
The Modern Trade channel in Mexico reached a market share in value terms of 33.1% (Barilla, 2016c). The strategic position of the central American state enabled Barilla to reach one of the most potential countries: Brazil. In this territory Barilla reached a 5% market share, an increase of 1% from last year, and opted for a dedicated packaging layout catching the Brazilian growing interest in the “Made in Italy” food products, especially in Brazilian metropolis (i.e. San Paolo’s market share rose to 19%, a 3% increase from 2014) (Barilla, 2016c).