The United States has various manufacturing industries
The United States has various manufacturing industries that produce a variety of commodities. One of these companies is Procter & Gamble (P&G), which manufactures household consumption goods. P&G's headquarters are in the city of Cincinnati, Ohio, and it was formed in 1837 by James Gamble and William Procter. The company focuses in a variety of products such as personal care, cleaning chemicals, and hygienic products. The corporate donated Pringles to another company called Kellog Corporation, which deals with food items. David Taylor is the company's current president and CEO. Since it was established the organization has always sought to expand its operations to the rest of the world in both manufacturing and marketing. Its first major international move was in 1930 when it acquired which is based in England (Thomas et.al, 2014). Since then, the company has continued to expand to different countries of the world as well as increasing its range of products. One of the revolutionary products of P&G is the disposable diaper known as pampers.
P&G products
The products that P&G is dealing with are generally classified as consumer goods. The company moved from the production of food and beverages when it sold its Pringles brand to the Kellogg Company in 2012 in a move that was seen as shifting focus to the most profitable products. The streamlining of the product lines of the company was in line with the changes that it took in its organizational structure (Murray et.al, 2007). The changes were geared towards improving the management of the company's operations. Presently, the company has five product mix segments which include beauty, healthcare, grooming, baby, feminine & family care and fabric & home care. The different segments are in line with how the company is managing its consumer goods business. In order to effectively manage the various segments, the company has attached each of them to managers who ensure that their segments are reported in the annual filings of the company with the Securities and Exchange Commission.
The beauty product segments
The beauty product segments include well known products such as Safeguard soap and Pantene shampoo. The products under the grooming segment include post-shave products, blades, razors and other related appliances. Specific hair care products that are being sold all over the world include balsam hair coloring, Aussie hair care, ascend hair care products, Frederic Fekkai hair care products, Nicky Clarke hair products, braun hair care and grooming products. The healthcare segment consists of products such as oral care items and supplements. The fabric & home care segment is composed of products such as fabric enhancers, laundry detergents among other related products. Baby, feminine & family products include Tampax feminine care products, bounty and Charmin tissue paper products. These wide ranges of products indicate that the company is keen on reaching out to a large market segment and expanding its customer base all over the world (Vault, 2002). The corporation is geared towards managing its operations in a more simplified manner and that is why it has adopted clear cut product segments.
Inventory policies
P&G has a modeling and decision support team that is responsible for the creation of global inventory models. The corporation has adopted a scientific model for controlling its inventory which is supported by the distribution requirements planning. The system was to allow for an easy means of ensuring safety of stock levels both at the location and item. The initial inventory control tool that the company came up with was the Lotus 1-2-3 which has been replaced by Excel inventory models. When the company was coming up with the spreadsheet model, it aimed at attaining two things namely educating the supply chain planners on the different forms, roles and the inner reason for coming up with inventories in the supply chain management (Tocquigny & Butcher, 2012). It was further aimed at offering a quick means of initiating safety stick within the established distribution requirement planning. The model also offers a clear mechanism that is used for the central support group in an effort to offer training to the users.
Some of the inventory components
Some of the inventory components include frozen stocks, safety stocks, anticipation and cycle stocks. The inventory model adopted by the company applies a continuous review policy which means that the inventory levels are being monitored each and every time. When the level of inventory goes below the set order point, the company initiates a reorder up to the set amount based in an order quantity or a multiple of the order quantity. The models have been formed so as to incorporate the demand as well as the production conditions that the corporation is experiencing. Some of the specific issues addressed by model include pull and push policies, replenishment intervals, automatic pooling of demands across shipping points and the modeling of both the normal and gamma distributions for forecast and demand errors.
Markets and customers
The company has a strong customer base all over the world. Its present customer base is at 4 billion which makes 58% of the total world's population. Every year, the company sells over 40 billion of its products. In the last ten years, the company has increased its net sales from $40 billion to $82.6 billion. The net earnings have increased from $3.12 per share to $3.93 per share over the last five years. Close to 65% of the total revenue of the corporation is generated from the developed countries in which the corporation has a strong presence in Europe and the United States. 35% of the corporation's revenue comes from developing countries of Brazil, China and Russia. To be specific 25% of the total revenue of the corporation emerged from South America and Asian countries. The company has 24 product lines that bring about annual revenue of about $1 billion. A case in point is Gillette which is one of the most successful products of the company that is being used by billion men all over the world. Crest which is a toothpaste brand by P&G is currently serving over 2.3 billion people all over the world.
Supply chain partners
P&G has over 82,000 suppliers and agencies all over the world who assist in the regular distribution of its products so that they organization can reach out quickly to its wide customer base. Some of the outstanding suppliers include BASF SE, Diamond Packaging, MonoSol, LLC, Albany International Corp, Jones Lang LaSalle, Eltex Ltd, SUPERPAC, INC., RONCHI MARIOS S.p.A, Rising Display Products Ltd, Yamada Electric and Technimark LLC.
Facilities
P&G has close to 130 manufacturing facilities in different countries. The facilities are in charge of the majority of the production being undertaken by the corporation. Since the corporation focuses on delighting its customers, the production facilities are well equipped to manufacturer superior and high quality products. The quality assurance team undertakes regular reviews of the facilities so as to ensure that they are highly competitive. P&G has regional facilities that offer the best value equation that demonstrates support to the many consumers worldwide (Napolitano & hoopla digital, 2014). The company is also making use of contract manufacturers especially when entering new markets. The level of production of P&G that is supplied by contract manufacturers varies based on the specific needs of its business operations. It is further based on the ability of the facilities owned by P&G to compete as well as win over production based on the provision of the best value. The corporation only relies on third party manufacturers at a small volume of its total manufacturing process.
Measures of manufacturing performance
Cost and pricing
P&G has recently come up with an online subscription business for its Tide Pods. This is a move aimed at being in line with the increasing trend in online marketing and sale. The Tide Pods branded the service as Tide Wash Club that offer the sale of P&G products through its online platform (Thomas et.al, 2014). P&G is quickly moving away from the traditional means of selling products through the use of big-box retailers and the local superstores such as Target and Walmart. The average cost of P&G products on Tide Wash Club is between$15.99 and $20.99 based on the sizes that customers order.
Quality
P&G applies Total Quality Management principles that focus on every aspect of the organization. The organization is keen on attracting employees who bear not only individual qualifications based on their job descriptions but also have special characteristics and unique qualifications. As a result, they only select the very best people based on their academic levels when they are still in college owing to the firm belief that people who excel in their academic have the ability to adapt quickly in any environmental conditions (Moody, 1990). The organization follows the idea of quality control in which they normally conduct daily meeting management system based on indicated schedules. The business processes are divided into various departments that have designated responsibilities hence making operations easy and quick. The company has adopted an aggressive planning technique in which the management sets goals that are aimed towards increasing the level of consumer demand for the various products. It has a recruiting and development philosophy that presents it with a strong culture of trust as well as shared experiences.
Reliability/Dependability
The reliability of an organization is based on a number of factors that include the determination as to whether the manufacture and supply of its products are consistent over time, the website is well articulated with regular updates on its progress and the existence of physical addresses that include telephone contacts, physical office, manufacturing plants and a permanent management team (Genoff, R., & Green, 1998). P&G has incorporated all these elements hence it qualifies as a very reliable organization that consumers and other stakeholders can depend on for several years to come.
Flexibility
P&G has emerged as one of the most flexible organizations in the world. This has been demonstrated by their ability to quickly adapt to the changing trends in marketing and manufacturing. The organization is has recently initiated online delivery of laundry services in the United States after a successful test was undertaken in the city of Chicago through Tide Spin. Tide Spin which was launched lately by the corporation will be able to pick up, wash, fold and then deliver laundry to the customers. The Tide Spin services currently come at a cost of $1.59 per pound for wash and fold services. Picking of the already washed clothes or delivery is done at no cost. The company has come to the realization that the buying preferences of consumers are quickly shifting towards online purchase thus lowering the returns from the traditional means of selling products. The company further launched the Gillette Shave Club in an effort to boost the sale of the product through online platform after it realized the sale of Gillette was quickly diminishing.
Sustainability
P&G is focused on improving the lives of people across the globe in a manner that ensures preservation and protection of the entire planet. The organization has already initiated a long-term vision that can only be attained by setting short-term goals that will offer clear guidance. In regards to climate, the organization has committed itself towards reducing the absolute greenhouse gas emissions by 30% by the year 2020. In the transportation sector, the organization is committed towards achieving its goal of delivering 20% reduction of truck kilometers per unit of production (Penzkofer, 2007). The social programs of the company are currently on course as the company is set to attain children's safe drinking water goal by 2020 through the provision of 15 billion liters of clean water.
Manufacturing strategy improvements
In order for P&G to retain its current position globally, the corporation must focus sharply on some of its most profitable products and brands by polishing them so that its stays ahead of the competitors. Some of these products include the Gillette and the Swiffer Dusters that have earned international recognition. Due to the unpredictable changes in the market trends, P&G need to put into consideration the need to be more innovative so as to exploit all the available avenues for growth (Friedli, et.al, 2014). Organizational culture of the organization needs to incorporate innovative tendencies and motivation of employees so that they can bring out their best. Being able to properly manage changes is a major step towards success. By incorporating changes, it is possible to remain relevant in the current unpredictable as well as competitive environment. This will allow the organization to quickly attain its vision besides forming a win-win situation for itself and the consumers. Initiating great growth opportunities for the employees will enable them to become more motivated and dedicated in their work. The company needs to invest more on quality assurance and image building so as to gain the minds of targeted consumer blocks.
Conclusion
The strategic manufacturing policies of P&G as highlighted above indicates that the organization is focused towards promoting its products and the wellbeing of the society in which it operates. The organization has overcome several challenges since its inception and has managed to rise above its competitors in the dynamic world. The strategic measures that have been adopted by the management of P&G have seen it emerge as one of the leading organizations that are well prepared to tackle the challenges of the 21st century.
References
Friedli, T., Thomas, S., & Mundt, A. (2014). Strategic management of global manufacturing networks: Aligning strategy, configuration, and coordination.
Genoff, R., & Green, R. (1998). Manufacturing prosperity: Ideas for industry, technology and employment. Leichhardt, N.S.W: Federation Press.
Moody, P. E. (1990). Strategic manufacturing: Dynamic new directions for the 1990s. Homewood, Ill: Dow-Jones Irwin.
Murray, J., Beiske, B., & White, S. (2007). Procter & Gamble Europe: Vizir Launch. München: GRIN Verlag GmbH.
Napolitano, G., & hoopla digital. (2014). Motivation in the workplace: a procter and gamble case study. United States: Babelcube Inc.
Penzkofer, A. (2007). The Procter & Gamble Acquisition of Gillette.
Tocquigny, R., & Butcher, A. (2012). When core values are strategic: How the basic values of Procter & Gamble transformed leadership at Fortune 500 companies. Upper Saddle River, N.J: FT Press.
Vault (Firm). (2002). Procter & Gamble. New York, N.Y: Vault Inc.
