International Case: Reengineering the Business Process in Procter & Gamble
Procter & Chance (P& G), a multinational corporation praised for products including diapers, hair shampoo, soap, and toothpaste, was committed to improving value to the customer. Its products had been sold through various channels, such as grocery retailers, wholesalers, mass merchandisers, and membership stores. The flow of goods in the selling grocery route was from the factory's storage place to the distributors' warehouses before going to the food markets where customers selected the goods from the shelving.
The improvement-driven company was not pleased with its functionality and developed a variety of programs to improve the service and the efficiency of its operation. One such plan was electronic data interchange, which provided daily info from the retailers to P& G. Getting the system resulted in better assistance, reduced inventory levels, and labor-cost savings. Another way, the continuous replenishment plan, provided additional benefits to get P& G as well as for its retailer clients. Eventually, the complete ordering program was re-designed, with the result of dramatic overall performance improvements. The reengineering work also essential restructuring of the organization. P& G had been known for the brand administration for more than 5 decades. But in the late 1980s and early 1990s, the brand name management procedure pioneered by company inside the 1930s needed rethinking and restructuring. In a drive to boost efficiency and coordination, several brands were combined with expert and responsibility given to category managers. These kinds of a director would determine overall pricing and merchandise policies. Additionally, the category managers had the authority to withdraw weak brands, therefore avoiding turmoil between related brands. They were also held responsible for the profit of the item category they were managing. The switch to category management necessary...