Presentation on theme: "SUPPLY CHAIN CAPABILITY and the “First Moment of Truth”"— Presentation transcript:
1 SUPPLY CHAIN CAPABILITY and the “First Moment of Truth” South Carolina International Trade ConferenceMay 30, 2007
2 AGENDA P&G… Brief introduction First Moment of Truth Logistics affect on the FMOTHow P&G ensures logistics excellence… and “wins” at FMOT
3 IN THE BEGINNING…William Procter ( )James Gamble ( )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.
4 P&G AT A GLANCE… ~$75,000,000,000 in sales $4B logistics spend 275,000+ TEUs3500 lanes (~25% touch U.S.)Over 500 whses… 45+MM sq. ft.Selling in 160 countries, Mfg. in 90135,000 employees
5 MAJOR ACQUISITIONS: 1957 – Charmin Paper 1991 – Max Factor 1967 – Folgers Coffee1982 – Norwich Eaton1985 – Richardson- Vicks1989 – Noxell/Cover Girl1990 – Old Spice1991 – Max Factor1991 – Max Factor1994 – Giorgio Beverly Hills1997 – Tambrands1999 – Iams2001 – Clairol2003 – WellaGillette
6 But most of all… we’re a company of Brands But most of all… we’re a company of 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” bothLogistics affects the 1st… giving an opportunity to win at the 2nd!
10 What does “FMOT” mean to logistics professionals? It’s what we do… move product at the right time/price/conditionWhy is P&G successful?Supply chain coordination/collaborationInnovation/technologyLogistics sourcingTrainingThis is the common 10 point selection criteria used within the U.S. in the choosing of 3PLs. The 10th point (MBEs) is U.S.-centric. The other points can be used in any region.The importance placed on each of these is dependent on the situation, geography, needs, available suppliers, etc.
11 Coordination/Collaboration Matrix organizationGBUs, MDOs, GBS, Corp. FunctionsHorizontal Process NetworksEnd-to-End supply chain managementTotal delivered costs… raw material to shelfBusiness continuity planning
13 Logistics Sourcing Supplier relationship management Not done casually or quicklyTakes resources, time, commitmentPrinciples, Values, PurposeBest total value“Fits” (strategic, operational, chemistry) *Selection technology* Logistics Outsourcing, A Management Guide Clifford F. Lynch
14 Training Hire at entry level and promote from within Critical focus on training & developmentInternal “colleges”, external opportunitiesFormal qualification for advancementCenters of Expertise“Success Drivers”Purpose/Values/PrinciplesSuccess of P&G and employees is inseparableRelationships don’t happen over-night…Relationships won’t continue if there is not some mutual advantage for them…Building a truly good relationship with a 3PL, or an individual, takes time and effort“Fits” are covered on the next slide…
15 In Conclusion…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.Systems/processes are in place to ensure we move cargo to the shelf with excellence… to win at the First Moment of Truth!
17 PURPOSE 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.
18 VALUES PRINCIPLES Leadership Ownership Integrity Passion for winning TrustRespect for all individualsInterest of P&G & employees are inseparableStrategically focusedInnovation is the cornerstone of successExternally focusedValue personal masterySeek to be the bestMutual interdependency is a way of lifeVALUESPRINCIPLES