Supply Chain Excellence
Panasonic Consumer Electronics is a subsidiary of Matsushita Electric Industrial Co. Ltd. -- one of the world's largest producers of consumer electronics. Brands include Panasonic, National and Technics with subsidiaries that market Quasar, Victor and JVC. The company is known for its cutting-edge products, like TVs, DVRs and camcorders. While the trend for consumers replacing analog technology with digital made both Panasonic and its customers happy, it resulted in major supply chain issues.
Rapidly changing features caused an increase in new product introduction; retailers could not be competitive with outdated equipment. Panasonic says it heard concerns from its top three customers within three months and the company considered it a "major wakeup call." Panasonic's customers looked to it for a reliable supply chain management system to reduce inventory and lead time -- quite a challenge considering forecasting at that time was done through spreadsheets. However, the company knew that in order to gain market share, it would have to take on the challenge successfully. Panasonic decided to take a bold initiative to redefine its collaborative relationship with key retail partners, which account for the bulk of sales.
SUPPLY CHAIN REVAMP
The company chose i2 Supply Chain Management because it was an integrated and end-to-end solution. As part of the initiative, i2 was asked to come up with a new process for channel management, and i2 consultants designed a completely new supply chain planning and fulfillment strategy for Panasonic that gave the consumer electronics maker much deeper visibility into retail supply chains. The process utilized distribution center/store level point-of-sale (POS) trends for forecasting and replenishment. Before the implementation, Panasonic only had historical information on what was shipped out versus back orders. Now the data is based on true demand
The company chose i2 Supply Chain Management because it was an integrated and end-to-end solution. As part of the initiative, i2 was asked to come up with a new process for channel management, and i2 consultants designed a completely new supply chain planning and fulfillment strategy for Panasonic that gave the consumer electronics maker much deeper visibility into retail supply chains. The process utilized distribution center/store level point-of-sale (POS) trends for forecasting and replenishment. Before the implementation, Panasonic only had historical information on what was shipped out versus back orders. Now the data is based on true demand
In addition, Panasonic completely redefined its logistics strategy for key partners, setting up a competency center in India for working closely with Panasonic and its channel partners for analyzing forecasts, replenishment and promotional data. This provided detailed analysis back to all parties as part of a well defined collaboration process. As a result of the analysis provided by this outsourced planning service and the close coordination between Panasonic sales, merchandising, marketing and retailers, the supply chain performance improved tremendously.
SIGNIFICANT RESULTS
On time delivery increased to 84 percent; in-stock percentages stand at 90 percent. The inventory imbalances within the retail channels were corrected with the close alignment of retail inventory with POS. The inventory variance, which was very common at different times of the year, almost completely faded away to flat weeks of supply closely tracking to the target inventory levels. Understanding seasonality greatly helps Panasonic in planning and production.
On time delivery increased to 84 percent; in-stock percentages stand at 90 percent. The inventory imbalances within the retail channels were corrected with the close alignment of retail inventory with POS. The inventory variance, which was very common at different times of the year, almost completely faded away to flat weeks of supply closely tracking to the target inventory levels. Understanding seasonality greatly helps Panasonic in planning and production.
Panasonic achieved a Tier 1 status with some of its retail channel partners, and in turn, sales have increased from these existing customers and enhanced loyalty has been achieved, which the company considers critical in its marketplace.
THE WINNER IS . . .
In light of the outcome here, it is easy to see why Panasonic won the Consumer Goods Technology award for Supply Chain Excellence. Mary Calandriello, manager, supply chain strategic initiatives, Panasonic Consumer Electronics, says, "By driving our business on point-of-sale information, we were able to dramatically reduce inventory from 17 weeks to four weeks. We had the right product in the right place at the right time. Panasonic is honored to be recognized by CGTfor this achievement with this prestigious award."
In light of the outcome here, it is easy to see why Panasonic won the Consumer Goods Technology award for Supply Chain Excellence. Mary Calandriello, manager, supply chain strategic initiatives, Panasonic Consumer Electronics, says, "By driving our business on point-of-sale information, we were able to dramatically reduce inventory from 17 weeks to four weeks. We had the right product in the right place at the right time. Panasonic is honored to be recognized by CGTfor this achievement with this prestigious award."
OUTSTANDING ACHIEVEMENT AWARDS
Brown Shoe Company
Brown Shoe Company is one of the leading consumer-driven footwear companies with revenues of $2.3 billion; operates nearly 1,300 (Famous Footwear) retail shoe stores throughout the United States and Canada; is the No. 2 wholesale supplier of women's fashion shoes to U.S. department stores. The company also markets and supplies branded, private label and licensed footwear to mass-merchandisers, independent and specialty stores. Brown Shoe was challenged with creating a corporate-level, consensus-based forecasting process to synchronize customer demand with factory operations. Brian Minnix, VP retail planning & analysis for Brown Shoe says,"Through a series of initiatives, we recently implemented upgrades to our supply chain, assisted by partnerships with firms like Logility, which will enable us to capture information about our consumer's purchases, and then apply that information to our sourcing and inventory management processes. This will help us better ensure the shoes our consumer wants will be available when and where she wants them. Additionally, a more streamlined supply chain enables us to deliver trend-right shoes closer to season so shoppers can always find the latest fashion." The successful implementation of Logility Voyager POS led to 80 percent forecast accuracy at the size/width level. Minnix says, " We continually seek ways to better serve our consumers, and earning CGT magazine's recognition for supply chain excellence lets us know we are doing just that."
Brown Shoe Company is one of the leading consumer-driven footwear companies with revenues of $2.3 billion; operates nearly 1,300 (Famous Footwear) retail shoe stores throughout the United States and Canada; is the No. 2 wholesale supplier of women's fashion shoes to U.S. department stores. The company also markets and supplies branded, private label and licensed footwear to mass-merchandisers, independent and specialty stores. Brown Shoe was challenged with creating a corporate-level, consensus-based forecasting process to synchronize customer demand with factory operations. Brian Minnix, VP retail planning & analysis for Brown Shoe says,"Through a series of initiatives, we recently implemented upgrades to our supply chain, assisted by partnerships with firms like Logility, which will enable us to capture information about our consumer's purchases, and then apply that information to our sourcing and inventory management processes. This will help us better ensure the shoes our consumer wants will be available when and where she wants them. Additionally, a more streamlined supply chain enables us to deliver trend-right shoes closer to season so shoppers can always find the latest fashion." The successful implementation of Logility Voyager POS led to 80 percent forecast accuracy at the size/width level. Minnix says, " We continually seek ways to better serve our consumers, and earning CGT magazine's recognition for supply chain excellence lets us know we are doing just that."
Tyson Foods
Tyson Foods is the world's largest protein company and the only company selling all three proteins through all major distribution channels. The company seeks operational efficiencies in all areas and over the past several years, has worked to drastically improve its enterprise demand and supply planning capability, building a strong foundation for customer collaboration initiatives. Through the establishment of a formal Sales and Operation Planning (S&OP) process, supported by Manugistics technology, Tyson Foods has been able to reduce costs associated with inventory, direct labor and logistics, while improving customer service.
Tyson Foods is the world's largest protein company and the only company selling all three proteins through all major distribution channels. The company seeks operational efficiencies in all areas and over the past several years, has worked to drastically improve its enterprise demand and supply planning capability, building a strong foundation for customer collaboration initiatives. Through the establishment of a formal Sales and Operation Planning (S&OP) process, supported by Manugistics technology, Tyson Foods has been able to reduce costs associated with inventory, direct labor and logistics, while improving customer service.
CG