The Barilla Case

Changes within the supply chain can disrupt the normal flow of goods and services because each change hasn’t been fully scrutinized. A firm can plan and speculate that a change with have a certain effect on the supply chain, but until those processes have been measured it is impossible to know the true cause and effect of any disruption.

During the game, I realized that wide gaps in orders of every role in the supply chain such as factory, distributor and retailer create inventory management challenges. For example, distributor records 0units between week1-week 4 compared to retailer within the same period. The retailer records 3units, 5units, 2units and 2units between weeks 1- week 4. The same applies to factory with 0units from weeks 2-4. Addressing inventory management problems requires developing an average unit level to avoid disappointing customers when demand

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

When working in the catalog industry and a customer calls in and wants to order a red sweater and you are out of red sweaters, the company might have just lost the sale if the customer does not want a substitute colored sweater. This is the part of the continuous problem that L.L. Bean, Inc. has with item forecasting and inventory management. Working in a catalog business really helps companies to capture demand, but the problem most companies have is matching demand with supply. Every sale that is generated for L.L. Bean is by customers that want a particular item and if that item is not available, they lose the sale. Customer behavior is hard to predict which affects the demand level of all the

The Costco strategy for getting into the wedding gown business is to have a set of touring trunk shows at its Western stores during the season where people are planning their weddings. Costco's typical pricing strategy is to undercut competition and make up for this with high volume sales. The company applies this strategy to the wedding gown business as well. Costco offers one of the lowest prices of any company on its wedding dresses. The company's business plan ensures that the details have been fleshed out, and that has led to the unique distribution strategy for wedding gowns.

First, we have identified if there is really an insufficiency in the amount of selling prices set by the Sales Department, in reference to Exhibit 1 of the case. We did this through identifying the maximum amount of overhead costs that the company can incur for the three products and comparing it with the total overhead costs. See Table 1 for details.

My decision is to implement the Just-in-Time Delivery system. JITD will resolve the increasing operational inefficiencies and cost penalties that have resulted from large week-to-week variations in Barilla’s distributors order patterns. In order to reduce the Bullwhip effect being experienced by Barilla, their supply chain would have to be Centralized. This solution allows Barilla to see end customer demand and eliminate costs involved with inventory, manufacturing, and transportation. JITD would allow Barilla to work directly with its distributors and create a flexible manufacturing process. By following the suggestions made in the plan of action, Barilla will succeed in influencing its distributors and Sales personnel to work together

Pietro Barilla founded Barilla in 1877 it was a small pasta and bread shop in Parma, Italy and becoming one of the biggest pasta manufacturers in the world. Barilla is a family owned company that has been passed down through four generations. They have factories throughout Italy and other countries. For many years, the pasta shop experienced significant growth and their fair share of downside. They have high-quality products that are marketed and produced in their facilities. However, with any company does not matter how small or big they have their struggles. I this paper I am going to analyze the Barilla family, the company, achievement, and challenges.

The case provides adequate information aligning to the fact that LeanFoods has an effective supply chain management. Only drawback apparent was the high priority delivery to the customer which resulted in wastage. This draw back was catered through outsourcing transportation. Justifications in support are:-

 Demand occurs continuously over time  Times between consecutive orders are stochastic but independent and identically distributed (i.i.d.)  Inventory is reviewed continuously  Supply leadtime is a fixed constant L  There is no fixed cost associated with placing an order  Orders that cannot be fulfilled immediately from on-hand inventory are backordered

MANAGING THE BULLWHIP EFFECT Joseph H. Wilck, IV Ph.D. Dual Degree, Industrial Engineering and Operations Research, College of Engineering The bullwhip effect is the inherent increase in demand fluctuation up the supply chain (i.e., away from customer). Managing the bullwhip effect is minimizing the fluctuation and variation of the demand (i.e., orders from one stage of a supply chain to the next stage of the supply chain) throughout the supply chain. This paper will offer a literature review of this topic, note the key contributions, discuss current practices for managing the bullwhip effect, and explain why it is necessary for more research to be done in the area, specifically for continuous review policies. Orders/Time

In any company order is placed with the suppliers based on the demand graph. The order is placed to fulfill the current demand and also keeping in mind any unpredictable sale, which is the safety stock. The manager next in the supply chain orders from his suppliers based on the same fundamentals and with every level the order varies exponentially, resulting in the bullwhip effect. Because the amount of safety stock contributes to this effect

Postponement Strategies: Large number of product variation makes it difficult to forecast the demand for each variety and this will affect the supply chain

• Marshall L.Fisher is the Stephen J.Heyman Professor of Operations and Information Management and co-director of the Fishman-Davidson Center for Service and Operations Management at the University of Pennsylvania’s Wharton School in Philadelphia. • His current research focuses on how to manage the supply of products with hard-to –predict demand.

Evidently, increased complexity leads to high operational costs, which need to be reduced through effective collaboration among the supply chain partners (Hudnurkar, Jakhar and Rathod). The sources of these complexities occur from either internal or external drivers or both. Therefore, understanding and measuring these complexities is becoming increasingly important from the managerial side of an organization (Ramaekers and