Case Code : CLOM013
Publication date : 2006
Subject : Operations
Industry : FMCG
Teaching Note : Available
Length : 06 Pages
Price : Rs. 100
Current Exchange Rates
INR 100.00 = USD ($),
= GBP (£),
= EURO (€)
Currency data courtesy coinmill.com
INR is INDIAN RUPEES (Rs.)
To download this case click on the button below, and select the case from the list of available cases:
Procter & Gamble, Wal-Mart, 3M, Demand, Logistics, Supply chain, Purchase rate, Distributors, Retailers, Channel members, Replenishment, Point-Of-Sale data, Vendor-Managed Inventory, Out-of-stock rate, Just-in-time, SAP system, Supplier portal, Promotional offer, Consumer demand, Demand signaling, Inventory level
* This caselet is intended for use only in class discussions.
** More comprehensive case studies are priced at Rs.200 to Rs.700 (US $5 to US $16) per copy.
The caselet provides an insight into the concept of the bullwhip effect. It examines the reasons that led P&G to shelve its old supply chain model and revamp it to ensure supply chain efficiencies. The caselet describes the various initiatives undertaken by P&G to increase accuracy of demand forecasts. P&G also provided up-to-date information to suppliers so that they could plan their production and deliver materials on a just-in-time basis.
In the early 1990s P&G faced a problem of extreme demand variations for one of its best-selling brands - Pampers diapers. The logistics executives at P&G examined the order rates for Pampers across the supply chain. Though the purchase rate remained more or less steady at the consumer end, the logistics executives found that the variation of orders increased from the retailer level to the distributor level up the supply chain...
Questions for Discussion:
1. What steps did P&G take to reduce the impact of the bullwhip effect? In what other ways, according to you, can P&G reduce the bullwhip effect across its supply chain?
2. Coordination between the various stages of the supply chain increases overall profits and moderates the bullwhip effect. What are the basic obstacles in supply chain coordination and how can P&G ensure this coordination?