Barilla manufacturing case study

Supply Chain Coordination Describe Burial’s manufacturing and distribution operations. Manufacturing: Barilla has 25 plants, including large flour mills, pasta plants, and fresh bread, as well as plants producing specialty products. Raw materials, in the manufacturing process, were transformed to packaged pasta on fully-automated 120 meter long production lines. The plants were specialized by the type of pasta they would produce, with the primary distinction based on the composition of the pasta, e. G.

Rye or fresh pasta, pasta with or without eggs and spinach. Also, even within the same family of pasta products, individual products were assigned to plants based on the size and shape of the pasta. The manufacturing process at Barilla was very precise, and required tight heat and humidity specifications In the pasta dry process, so as to keep the changeover cost low and quality high. Distribution: Barilla divided its products into “ dry” and “ fresh” product categories and maintained a different distribution system for the two categories.

The GO, DO and the Internally owned regional warehouses (for Signora Maria shops) held a two-week supply Tort Barbell’s array products I en Toweling Teller (Hogue 1) snows an Illustration of Burial’s distribution system for dry products: Figure 1: Barilla Distribution Network for Dry Products What is the problem faced by Barilla? What do you think are the factors causing this problem? Burial’s pasta supply chain suffers from classic bullwhip-effect problem. It has been experiencing large amounts of variability in demand resulting in operational inefficiency and increased manufacturing, inventory, and distribution costs.

The underlying factors of the fluctuating demand include Burial’s sales strategy relying heavily on the use of promotions in the form of price, transportation and volume discounts; sales representatives being rewarded based on the amount of product sold to distributors, which led to sales representatives trying to push product to the distributors during promotions, decreasing the ability to accurately forecast sales; he distributors having full control over their orders leading to gaming behaviors; and the lack of a computer forecasting system at the distributor level.

The marketing people also feared a reduction in responsibilities as trade remissions would be difficult to run with a CITED strategy.

There were also concerns about inability to adjust shipments quickly to stock outs, lack of infrastructure to Enola Jell I D, vague cost Detentes, Ana Increased competitor Snell space at distributors. I think Magical should demonstrate that CITED benefits not Just Barilla, but also the distributors. He should run experiments at one or more distributor sites and prove his case. Also, Magical should encourage the marketing and sales people to look at the overall benefit to the supply chain.

For this purposes, I would either reduce the varieties of products being offered which will reduce the need to have so many different inventories and SKU for both customers and Barilla. I could also try implementing the Just-Len-Time (lean production) approach for Barilla manufacturing processes – processes which are internal and Barilla has full control Barilla Dry Product Factories CDC Internally Owned Regional Warehouse Super Market Chains Independent Supermarkets Signora 65% 35% Marl snoops