Barilla Spa Case Report

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Executive Summary

As per our conversation last week I would like to revisit the idea originally brought to life by Brando Vitali before he was promoted to head one of our company’s new divisions overseas. In order to address the issue which will be a direct result of introduction of JIT Distribution system, I would like to present the issues and my recommendations to you before our meeting with Marconi’s executives to discuss JITD proposal. As the meeting is scheduled for the of November I would like to hear your thoughts on JITD before the end of this month so I can make appropriate changes to address any issues you might foresee as a direct result of our proposal. The decision to adopt the Just-in-Time Distribution will most likely be met with our sales and marketing team’s resistance to change. Our old-fashioned distribution system has been nurtured since the early development of our channels of distribution. Promotions and advertising were key to our success of achieving a certain level of trust within our Supply Chain both internally and externally. I recommend a staged implementation of the JITD to allow our staff to adapt to our new philosophy. Our distribution networks could become more efficient rather than being all about relationships based on pushing the product out of our facilities. It appears that our Supply Chain executives are not looking for ways to reduce waste within our distribution channels as we are not even clear on how we measure our success. Applying Lean principles to our Supply Chain is misleading to our staff as they think their job security is on the line. This is met with internal resistance that needs to be addressed before we can communicate the advantages and benefits of JITD to our external distribution networks. I believe that Vitali’s approach will fit our new Supply Chain management strategy of Just-in-Time Distribution which will allow us to ship products as needed, rather than building enormous stock to deal with volatile demand patterns. We need to break down the silos and secrecy of our distribution processes to our customers to allow for more efficient channels of distribution. A more transparent approach with fewer layers along the way will allow for a much more efficient Supply Chain. Working closely with our distributors will allow us to reduce our own inventory and manufacturing costs along the way. We also need to consider our own forecasting systems to built the trust within our channels of distribution. Scheduled monthly meeting will allow for an open dialogue between various groups that might be affected by this implementation. I believe that open lines of communication both internally and externally will contribute to the ultimate success of JITD implementation. We will have to address issues as they come up to ensure the peace of mind of those who will be affected the most. We need to be more flexible to address problems and bottle necks of our distributors as that would be crucial to success of JITD. The main idea we need to communicate across our Supply Chain is that JITD would allow us to eliminate waste and get rid of extra layers which our in the way of addressing our issue of volatile demand patters which result in stockouts.

Giorgio Maggali, MBA, SCMP
Director of Materials Management
Barilla Fresh Products Group
October 16, 2012

Barilla Spa Case Study
Issue Identification
As the decision maker in this case I believe that the main issue presented in this case study is resistance to change. To be more specific, DO’s (Organized Distributors) resistance to adopt a new Just-in-Time distribution (JITD) system which would replace the old-fashioned distribution system used by Barilla’s Supply Chain traditionally. This traditional distribution system has always been viewed as a successful one, as it worked for everyone within the channels of distribution supplying dry products to supermarket chains and independent supermarkets. There was a certain level of...
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