Reference no: EM131567302
Please respond to the below posts
Post 1
Let me first start off by saying I was surprised to read how P&G used to have five different billing processes and logistics processes! Being in the field of logistics, that makes my eyes go crossed reading that they used to operate this way. Thank goodness they revamped their supply chain process! Being traditional doesn't guarantee success, as shown P&G gained many benefits by going into a streamlined logistics process. First off, their customers could now bundle their orders and get volume discounts, which really boosts the customer experience (Bozarth & Handfield, 2016). Transportation costs dropped as now less trucking companies had to be used since orders could be loaded trucks full of all kinds of P&G products. Less invoicing reduced costs for customers as well. P&G mapping out their old process on paper really put in perspective how chaotic their business plan for their supply chain was and proved they needed to change it. In theory (traditional view/old P&G model) it sounds as if P&G were trying to stay organized by dividing their different product categories separately on orders. But after breaking down the process, it looks very busy and not efficient at all. Plus, the customers were not getting discounts and they had to wait for separate products to come into different trucks. The amount of invoices the poor businesses had to invoice and sign off on per delivery must really have cut down after P&G remodeled their supply chain. I think they could influence other businesses to do the same thing for higher supply chain efficiency.
Post 2
Since Proctor & Gamble (P&G) is one of the largest goods firms, organized around 5 business sectors at the time, the direct customers of P&G had to deal with all 5 billing and logistics processes separately (Bozarth & Handfield, 2016). This create problems for the customers of P&G. P&G rectified this issue by changing their flow so that the customers would only have one billing invoice and one delivery for every sector of product ordered. This correction in the P&G business process improved profitability, improved transportation costs and shipped to the customers with litter error.
The traditional functional prospective may have blinded P&G to the problems of the old system because as the authors stated, "to the folks of P&G, it made sense." By dividing all five sectors of product, P&G was able to develop products, pricing and promotion, as well as supply chain strategies separate of one another (Bozarth & Handfield, 2016). P&G had to change this process because it was beginning to affect the flow for its customers.