Procter & Gamble: Building a Smarter Supply Chain
CASE STUDY
December 2002
Procter & Gamble: Building A Smarter Supply Chain
Issue/Solution
To remain profitable, consumer products manufacturers must find ways to optimize the performance of their supply chains. They need to support marketing promotions better and avoid frustrating consumers with out-of-stock situations in the store.
Situation
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Procter & Gamble realized it needed a “consumer-driven supply network” to stay ahead in the consumer packaged goods industry. Retailing’s “first moment of truth” is a key focus area for P&G. When the shopper reaches the shelf, is the product there?
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Discoveries
• •
Links between supply chain and CRM processes are critical. Business leads, technology follows. But the technology must be proven, practical and scalable. Even with immature solutions, it is possible to get rapid payback on streamlined demand and fulfillment processes for critical products. A harmonized ERP applications backbone is a basic requirement.
•
•
Recommendations
•
Secure management support before you start redesigning your supply network. Don’t let politics condemn the initiative to failure. Leverage the value IT can bring in connecting demand and supply side business processes. Simplify your applications architecture to allow collaborative business processes and cope with changes in network alliances.
•
•
Dig Deeper
• • •
Related Research from GartnerG2 Gartner Core Research Methodology Maria Jimenez with Derek Prior
“Research has shown retailers lose 11% of sales
GartnerG2, a new service from Gartner, Inc., helps strategists guide and grow their businesses.
due to out-of-stocks, and that same-brand substitutions win back less than 25% of a manufacturer’s lost sales.”
CAS-1202-0012 © 2002 Gartner, Inc and/or its affiliates. All rights reserved. GartnerG2.com. Page 1 of 7
CASE STUDY
Procter & Gamble: Building A Smarter Supply Chain December 2002
Situation
Zeroing in on the first moment
December 2002
Procter & Gamble: Building A Smarter Supply Chain
Issue/Solution
To remain profitable, consumer products manufacturers must find ways to optimize the performance of their supply chains. They need to support marketing promotions better and avoid frustrating consumers with out-of-stock situations in the store.
Situation
•
Procter & Gamble realized it needed a “consumer-driven supply network” to stay ahead in the consumer packaged goods industry. Retailing’s “first moment of truth” is a key focus area for P&G. When the shopper reaches the shelf, is the product there?
•
Discoveries
• •
Links between supply chain and CRM processes are critical. Business leads, technology follows. But the technology must be proven, practical and scalable. Even with immature solutions, it is possible to get rapid payback on streamlined demand and fulfillment processes for critical products. A harmonized ERP applications backbone is a basic requirement.
•
•
Recommendations
•
Secure management support before you start redesigning your supply network. Don’t let politics condemn the initiative to failure. Leverage the value IT can bring in connecting demand and supply side business processes. Simplify your applications architecture to allow collaborative business processes and cope with changes in network alliances.
•
•
Dig Deeper
• • •
Related Research from GartnerG2 Gartner Core Research Methodology Maria Jimenez with Derek Prior
“Research has shown retailers lose 11% of sales
GartnerG2, a new service from Gartner, Inc., helps strategists guide and grow their businesses.
due to out-of-stocks, and that same-brand substitutions win back less than 25% of a manufacturer’s lost sales.”
CAS-1202-0012 © 2002 Gartner, Inc and/or its affiliates. All rights reserved. GartnerG2.com. Page 1 of 7
CASE STUDY
Procter & Gamble: Building A Smarter Supply Chain December 2002
Situation
Zeroing in on the first moment