Barilla JITD Program Essay

1. Diagnose the underlying causes of the difficulties that the JITD schedule was created to solve. What are the benefits and drawbacks of this program? near In Time Distribution is a unique idea that the logistics film director wanted to implement at Barilla. It was in rejoinder to the narrowificant fluctuations in gross gross gross sales demand that Barilla was experiencing from their distribution centers. Exhibit 12 in the case shows how volatile the ordering could be. It looks very unpredictable using their accepted regularity of distribution, which is causing excess inventory and stockouts. By nature, their pasta products visit waves of high and low demand. Seasonal and promotional fluctuation was making it expectant for Barilla to correctly forecast demand from their distributors. Furthermore, distributors did not shake sound forecasting methods. They simply ordered their shipments when their stock was getting low. Barilla had no minimum order quantity nor did they have standing orders with distributors. Essentially, JITD was created to better run distributors with their product to eliminate stockouts and excess inventory. Stockouts cost the company valuable sales revenue when demand cannot be met and excess inventory results in additive holding costs. The major benefit to JITD is a steady revenue watercourse after demand fluctuation is mitigated.2. What conflicts or barriers internal to Barilla does the JITD program create? What causes these conflicts? As Giorgio Maggiali, how would you deal with these? Support organizations within Barilla met the JITD proffer with resistance. Marketing and Sales departments each had separate concerns. If Barilla had an internal ruckus in production such(prenominal) as a strike, distributors would have no excess inventory and stockouts would be likely. The Sales team pointed out that promotional periods would not have a place in this new bring out chain model. Also, with a lack of inventory in the dist ributors holding area, in that respect was a concern that competitors would move in to take the home, eventually energy out Barilla. Because of the highly specialized manufacturing parameters that were required to produce Barilla products, uncompromising production lines did not allow for meeting demand that changes often. Support organizations such as Sales and Marketing also had selfish concerns.With JITD, the need for sales re rangeatives decreased to virtually nothing. After all, the forecast data that Barilla would in theory have, would essentially sell the products themselves. As thedirector of logistics, Maggiali must present a favorable business case along with his Just In Time Distribution proposal. He must show the benefits that his plan would have on each of the supporting organizations to gain their support. His proposed JITD is a complete tack in Barillas business model. For this reason, I would present this method as a case that provide increase sales revenue, d isappoint manufacturing cost, and increase quality operations. Selling his management on these three aspects will allow them to see the increased profitability that will come as a result of JITD.3. As one of Barillas customers, what would your response to JITD be? Why? As a customer of Barilla and distributor of their product, I would greatly appreciate the service that Barilla has offered to provide because I would see the opportunity that this proposed plan has the potential to offer. From saving floor space to cutting down on my lead times I would be a willing partner in their plan. I would, however, force them to sign a third-party proprietary agreement before handing over my demand and sales data. It is important that competitors not know the specifics of our operations as to keep my agonistic advantage in the marketplace.