The matter is further complicated by the long lead times that it takes for Barilla to fulfill an order from the distributor, which was usually between 8 and 14 days from when the order is received. Incentives for Barilla sales representatives were based on achieving sales targets set for each canvass period.
This will not only result in better performance in terms of time and money but also promote trust and good relations among all the partners in the supply chain. More essays like this: Based on the forecast, desired service levels, a details analysis will have to be done to decide on the optimum quantity to be ordered Sales person should be providing Barilla spa bullwhip effect portable device by which information at distributors warehouse can be collected by them.
The implementation of the program will eventually improve the planning procedures for Barilla and enable the company to provide exceptional service to its customers at low costs. Maggiali might be more successful in persuading customer to at least try the JITD program by making their customer understand the benefits of the program.
Finally, a stakeholder consortium based on a real-time vendor managed inventory system is suggested.
The internal distribution process is extremely time consuming as it is and adding the JITD system might only prolong the process with little to show to the distributors. High inventory levels maintained at each level of the supply chain; frequent stockouts at the distribution level; demand variability exaggeration up the chain, and aggravated by constant sales promotions, Full Truck Load FTL and other volume incentives; and a lack of information on which to forecast demand.
Also, the sales representatives are most likely receiving much of their compensation through commission on their sales. The amplification of demand fluctuation along the upper stream of the supply chain is known as bullwhip effect. JITD will enable Barilla to increase the visibility of inventory and demand across the whole pasta supply chain.
Barilla will require its distributers to provide daily sales data so Barilla could utilize the data to anticipate future demand and arrange production schedule accordingly. Monitor and Control The key points shat should be measured for a particular includes number of stock outs at DC, inventory levels at DC, How often plant schedule has to be adjusted due orders, client satisfaction.
Therefore, it benefits the distributors through releasing their inventories space and cost. The greater number of trucks, etc. Furthermore, the excess costs will also be decreased by the demand management, i.
The distributors, nor the retailers, have any forecasting system in place to give them a glimpse at demand. Distributors place orders to Barilla based on retailers orders and the space available to stock inventory. This data has to be collected for Barilla every day, process and keep as historical data to show improvements.
After analyzing the issues mentioned above that the company has faced due to the variation in demand patterns that has created bullwhip effect. The result, it incurred the highest stockout rate about 8. The JITD proposal met with significant resistance within Barilla, particularly from the sales organization.
The solution discuss in details what are the benefits and disadvantages of such an approach and deals in detail with the specific problems in the case. Implementing a good JIT program could solve bullwhip faced by the barilla.
Using JITD will help these retailers understand their selling patterns as it offloads some of the demand estimation up the supply chain, which will eliminate the need for tedious forecasting.
The essential feature of JITD Program should be elimination of promotion, reducing the demand variability. Carelli to help with the issue and put pressure on Mrs. Carelli and the cooperation from Mrs.
The parties should join hands, and the idea of a collaboration of work should be promoted. Typically they have less shelf space to start with.The bullwhip effect occurs when the demand order variabilities in the supply chain are amplified as they move up the chain.
The concept is created to help supply chain. BARILLA SPA Case Solution,BARILLA SPA Case Analysis, BARILLA SPA Case Study Solution, QUESTION 1 The bullwhip effect is basically the fluctuation or distortion in the information that is supplied within a supply chain.
In the case of Barilla.
Barilla SpA, an Italian manufacturer that sells to its retailers largely through third -party distributors, experienced widely fluctuating demand patterns from its distributors during the late s. Barilla SPA Operations & supply chain management Case study 1 Is there any evidence that Barilla faces the bullwhip effect?
If so, what causes of the bullwhip effect are present? Barilla has two products lines, “dry products representing 75% of sales” and “fresh products representing 25% of sales”. Barilla Spa Case Words | 5 Pages.
Barilla SPA Operations & supply chain management Case study 1 Is there any evidence that Barilla faces the bullwhip effect?
Barilla SpA was the world’s largest pasta producer during the ’s and held a significant market share in Italy and Europe. They produced dry pasta, fresh pasta and bakery items at several factories throughout Italy. the ever increasing Bullwhip Effect, MY DECISION is to implement a Just in Time Distribution System (JITD), with a.Download