Barilla’s manufacturing Essay

Manufacturing samphire has 25 plants, including huge flour mills, alimentary paste plants, and cherubic bread, as well as plants producing specialty productions. Raw materials, in the manufacturing process, were transformed to packaged alimentary paste on fully-automated 120 meter consider open production lines. The plants were specialized by the type of pasta they would produce, with the primary billet based on the composition of the pasta, e.g. prohibitionist or fresh pasta, pasta with or with come forth eggs and spinach. Also, even within the same family of pasta products, one-on-one products were assigned to plants based on the size and shape of the pasta. The manufacturing process at glasswort was very precise, and required tight heat and humidity specifications in the pasta juiceless process, so as to keep the change all over represent low and quality high. scatteringkali divided its products into change and fresh product categories and maintained a different scatt ering corpse for the twain categories. The dry products category includes dry pasta and longer ledge-life bakery products, whereas, the fresh products category includes fresh pasta products (with 21-day shelf life) and fresh bread (with one-day shelf life). saltwort had two central distribution centers (CDC) to which the products shipped from the plants. The fresh products were then purchased from these CDCs by independent agents who then channeled the products through 70 regional w atomic number 18houses fit(p) throughout Italy.From the CDCs approximately 65% of the dry products went to the supermarkets, 70% of these (65% of dry products) went to super market chains, whereas, the stay 30% went to independent super markets. The remaining 35% of dry products were distributed from the CDCs to Barillas internally owned regional warehouses, which then distributed them to smallindependent shops Signora Maria Shops.Dry products bound for supermarket chains were distributed from th e CDC to the chains own distribution organization, known as Grande Distribuzione (GD). While those destined for independent supermarkets were distributed from the CDC to a distributor known as Distribuzione Organizzata (DO), which acted as a centralized buying organization for a titanic number of independent supermarkets. The CDCs held a months inventory for dry products, and 3 days for fresh products. The GD, DO and the internally owned regional warehouses (for Signora Maria shops) held a two-week supply for Barillas dry products. The pursuance figure (Figure 1) shows an illustration of Barillas distribution system for dry productsFigure 1 Barillas Distribution Network for Dry ProductsWhat is the conundrum go about by Barilla? What do you think are the factors causing this problem?Barillas pasta supply chain suffers from classic bullwhip-effect problem. It has been experiencing large amounts of variability in demand resulting in operational inefficiency and increased manufactur ing, inventory, and distribution costs. The underlying factors of the fluctuating demand include Barillas gross revenue strategy relying heavily on the use of promotions in the form of price, loony toons and volume discounts gross sales representatives being rewarded based on the amount of product sold to distributors, which led to sales representatives trying to push product to the distributors during promotions, fall the ability to accurately forecast sales the distributors having full control over their orders leading to gaming behaviors and the miss of a computer forecasting system at the distributor level.Describe the solution proposed by Brando Vitali. Why do you think this would help alleviate the problem?Brando Vitali suggested the implementation of a Just-In-Time Distribution(JITD) strategy, which is essentially the Vendor Management Inventory (VMI) strategy. Barilla exit be in charge of the channel between the CDCs and the distributor and decide on the timing and size of shipments to its distributors. Thus, unlike traditional supply chains in which distributors place orders and manufacturers try to satisfy these orders as much as possible, in JITD Barillas own logistics organization would specify the appropriate delivery quantities those that get out much(prenominal) in effect meet the end customers needs to that degree would withal more evenly distribute the workload on Barillas manufacturing and logistics system. If implemented, Barilla can make better delivery decisions and remediate its demand forecasts, be more effective in meeting end-customers needs, and more evenly distribute the workload on its manufacturing and logistics systems. Also, the inventory levels at CDCs will also be reduced.What conflicts or barriers internal to Barilla does the JITD program pee? What causes these conflicts? How should Giorgio Maggiali deal with these internal conflicts?The main resistance internal to Barilla was from the sales and marketing function s, which Barilla, until now, has relied upon for its success. The sales representatives feared reduction in both(prenominal) their responsibilities and bonuses due to a flatted sales level. The marketing battalion also feared a reduction in responsibilities as trade promotions would be difficult to run with a JITD strategy. on that point were also concerns about inability to ad provided shipments quickly to stock outs, lack of infrastructure to handle JITD, vague cost benefits, and increased competitor shelf space at distributors.I think Maggiali should demonstrate that JITD benefits not just Barilla, but also the distributors. He should run experiments at one or more distributor sites and prove his case. Also, Maggiali should encourage the marketing and sales people to look at the overall benefit to the supply chain. By acquire the top management involved, by effectively advocating the benefits for the entire supply chain, and by removing the obstacles of sales incentives and r educed responsibility, Maggiali can effectively deal with this problem and gain JITD implemented.How do you think a regular(prenominal) Barilla customer would suffice to JITD? Why? How would you convince the customer that the JITD program was worth trying? If you are not able to sway the customer, what alternatives would you suggest to combat some of the difficulties that Barillas operating system faces?I think a typical Barilla customer, if explained to properly, should be able to comprehend the benefits associated with JITD for the entire supply chain. I would convince the customer by mentioning the benefits of the JITD in removing the bullwhip effect. I would point out the fact that they would actually be reducing their costs significantly because Barilla would be responsible for monitoring and replenishing their inventories when levels are low. Moreover, the reduced inventory levels would also save them the cost for both inventories and space.If however, I am not able to conv ince the customers, I will try other modes, in my capability, to effectively respond to the fluctuating demand. For this purposes, I would either reduce the varieties of products being offered which will reduce the need to have so many different inventories and SKU for both customers and Barilla. I could also try implementing the Just-In-Time (lean production) approach for Barillas manufacturing processes processes which are internal and Barilla has full control over.