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Slide Notes

1. Sell it to the sales staff for incentives and personal growth but make sure they push Barilla as a brand and not individual SKU's

2. New sales metrics due to new way of managing ordering. Instead of spikey huge orders followed by dismal ones, incentives can go to keeping orders at higher longer lasting order levels. Barilla could incentivize sales staff for keeping order levels up over longer periods of time.

3. Start selling JITD to distributors and retailers as the key to less inventory carrying, higher reliability, and less stock-outs.

4. Sales people could actually do what they were hired for. They coul finally promote and Barilla products and educate distributors and retailers. They wouldn't need to be an operational tweaker to keep customers happy. The new efficient system would take care of them.
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Barilla SPA

Published on Nov 22, 2015

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PRESENTATION OUTLINE

PROPOSED PATH FORWARD - SALES

  • Sales - no silos - all SKU's
  • Forget quotas/period
  • Selling low inventory & low stockout
  • How about we do what we were hired for?!
1. Sell it to the sales staff for incentives and personal growth but make sure they push Barilla as a brand and not individual SKU's

2. New sales metrics due to new way of managing ordering. Instead of spikey huge orders followed by dismal ones, incentives can go to keeping orders at higher longer lasting order levels. Barilla could incentivize sales staff for keeping order levels up over longer periods of time.

3. Start selling JITD to distributors and retailers as the key to less inventory carrying, higher reliability, and less stock-outs.

4. Sales people could actually do what they were hired for. They coul finally promote and Barilla products and educate distributors and retailers. They wouldn't need to be an operational tweaker to keep customers happy. The new efficient system would take care of them.

PROPOSED PATH FORWARD - DISTRIBUTORS

  • Contracting a higher service level
  • Failure could happen - offers
  • Smooth - "Every day low pricing"
1. The distributor path is less clear. We aren't sure if the buyers would become redundant since JITD is performing this functioning on several fronts. Strong contracts would need to be written to ensure acceptable inventory levels, certain service levels and delivery options if service fails. Direct shipment to stores would be a great incentive to ease the distributor's mind.

2. Failure at some point is inevitable. Rebates and expediting during these times helps to keep people interested. Expediting can go back to being once in a while instead of normal operating procedures.

3. If suppliers are saving and there is less of a need to offer discounted promotions to rid inventory, the savings need to be passed to the distributors to even further enhance the good faith relationship and show the success of JITD. Promotions can be planned out well in advance to make sure that they are well operated for the future.


4.

What would we do?

  • require the modeling
  • Any PC?
  • POS data 1-2 years
  • Compare data
  • Contracts, drop ship, volume discount
1. See the computer modeling that in turn would show its predictions on our inventory to see what kind of changes are expected and if they are worth the adoption.

2. What are the minimum requirements for a PC and operating system? not all stores and distributors have advanced systems to manage and analyze inventory and ordering. We can't just invest in better systems if JITD can't pay for them. POS data from 1-2 years back would really help us when comparing our numbers and figuring the savings in inventory, the strength of order reliability and the customer being able to count on us.

3. We must negotiate strong contracts that consider less planning by us where we most likely do not achieve truck load discounting. Demand stockout drop shipments to stores and we have to convince our buyers with data and our plan so we can move forward

Conclusion

  • It could have worked
  • Trust beyond sales
  • Next - Barilla owned depots
  • Assist stores for data
1. It definitely could have worked. Sufficient supply with comparable demand supports JITD well. The needed information was readily available and easy to navigate withe the 1990 computers that were available.

2. Barilla and its distrubotrs would have needed to change their operational style. Maintaining relationships based on superior trust to ensure that the predicted and stated high service levels are real and not sales fluff. Barilla would need to go inside and insure its own employees (buyers) that they wouldn't be expended from the move to a new system.

3. moving further to other customers, we would stay away from trying to improve the speed of fresh products as the case states that Barilla distributions centers only stocked 3 days of the products. This would be a much more sophisticated area to work in. Barilla should start using JITD in their own depots if they don't currently and immediately decrease wait time for orders with the stores they support. The depots could supply headquarters with all of their ordering information which would tie closely with the smaller store POS data.

4. Push product to smaller stores and supermarkets. 35%of product comes through these chains. Great place to develop more advanced ordering and planning. They likely don't have computer modeling. Barilla could work with these stores to develop better inventory managment and improving service levels. This could increase brand loyalty in stores and distributors as Barilla continues to show great interest in their customers' welfare.