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South Carolina International Trade Conference May 30, 2007 SUPPLY CHAIN CAPABILITY and the “First Moment of Truth” SUPPLY CHAIN CAPABILITY and the “First.

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Presentation on theme: "South Carolina International Trade Conference May 30, 2007 SUPPLY CHAIN CAPABILITY and the “First Moment of Truth” SUPPLY CHAIN CAPABILITY and the “First."— Presentation transcript:

1 South Carolina International Trade Conference May 30, 2007 SUPPLY CHAIN CAPABILITY and the “First Moment of Truth” SUPPLY CHAIN CAPABILITY and the “First Moment of Truth”

2 AGENDA P&G… Brief introduction First Moment of Truth Logistics affect on the FMOT How P&G ensures logistics excellence… and “wins” at FMOT

3 Two brothers-in-law… one made soap, the other candles. Common raw material… tallow. Father-in-law suggested partnership. April 12, 1837… William Procter & James Gamble formalized their business by pledging $3597 each. William Procter ( ) James Gamble ( ) IN THE BEGINNING …

4 P&G AT A GLANCE…  ~$75,000,000,000 in sales  $4B logistics spend  275,000+ TEUs  3500 lanes (~25% touch U.S.)  Over 500 whses… 45+MM sq. ft.  Selling in 160 countries, Mfg. in 90  135,000 employees

5 MAJOR ACQUISITIONS:  1957 – Charmin Paper  1967 – Folgers Coffee  1982 – Norwich Eaton  1985 – Richardson- Vicks  1989 – Noxell/Cover Girl  1990 – Old Spice  1991 – Max Factor  1994 – Giorgio Beverly Hills  1997 – Tambrands  1999 – Iams  2001 – Clairol  2003 – Wella  Gillette

6 But most of all… we’re a company of Brands

7 21 - BILLION $ BRANDS …

8 Rather than talk external processes, I’ll focus on P&G’s attempt to ensure a successful end result… or what all people in P&G know as the…  First Moment of Truth

9 WHAT IS THE FMOT?  Two “moments of truth”…  When the consumer BUYS.  When the consumer TRIES. Need to “win” both Logistics affects the 1 st … giving an opportunity to win at the 2 nd !

10 What does “FMOT” mean to logistics professionals? What does “FMOT” mean to logistics professionals? It’s what we do… move product at the right time/price/condition Why is P&G successful? Why is P&G successful? Supply chain coordination/collaboration Innovation/technology Logistics sourcing Training

11 Coordination/Collaboration  Matrix organization  GBUs, MDOs, GBS, Corp. Functions  Horizontal Process Networks  End-to-End supply chain management  Total delivered costs… raw material to shelf  Business continuity planning

12  “CarrierConnect”  Internal development/external acquisition… shipment forecasting, scheduling, routing guide compliance, tracking/tracing, etc.  Distribution Center/Warehouse technology  Picking, automation, contract innovation, etc.  Other cross-border applications  Container GPS, duties, free trade agreements, etc.  Global order management platform  Global Analytics  Externally Linked Solutions  Draw on supplier capabilities & explore alternativesInnovation/Technology

13  Supplier relationship management  Not done casually or quickly  Takes resources, time, commitment  Principles, Values, Purpose  Best total value  “Fits” (strategic, operational, chemistry) *  Selection technology * Logistics Outsourcing, A Management Guide - Clifford F. Lynch Logistics Sourcing

14 Training  Hire at entry level and promote from within  Critical focus on training & development  Internal “ colleges ”, external opportunities  Formal qualification for advancement  Centers of Expertise  “ Success Drivers ”  Purpose/Values/Principles  Success of P&G and employees is inseparable

15  P&G’s “Wall Street” commitments, require bottom line growth of $4B-$5B/yr.  Most don’t initially think of successful logistics as a requirement for this.  But the power of doing logistics right… the first time… is recognized & rewarded in P&G. First Moment of Truth  Systems/processes are in place to ensure we move cargo to the shelf with excellence… to win at the First Moment of Truth! In Conclusion…

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17 We will provide branded products and services of superior quality and value that improve the lives of the world's consumers. As a result, consumers will reward us with leadership sales, profit, and value creation, allowing our people, our shareholders, and the communities in which we live and work to prosper. PURPOSE

18 1.Leadership 2.Ownership 3.Integrity 4.Passion for winning 5.Trust 1.Respect for all individuals 2.Interest of P&G & employees are inseparable 3.Strategically focused 4.Innovation is the cornerstone of success 5.Externally focused 6.Value personal mastery 7.Seek to be the best 8.Mutual interdependency is a way of life VALUES PRINCIPLES

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