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Tlog Barilla Essay

980 words - 4 pages

 
This leads to many problems for Barilla. Some of them are:

Production Costs: These costs increased drastically as the demand variationincreased. As Barilla struggled to cope up with the fluctuating demand, the production costs rose as changeover was costly.

Scheduling Difficulties: It was difficult for Barilla to schedule its resources andfacilities like Labor, Machinery and Trucks due to demand variations. This wasresulting in increased costs of Labor and maintenance.

Transportation Costs: As a result of uneven demand, Barilla had to transport more products to its distributors in periods of high demand in lesser time than whencompared to periods of low demand. The greater ...view middle of the document...

Overcoming Internal Resistance: Before trying to convince the distributors, one has toconvince everyone at Barilla that the JITD system will be a success. If everyone withinthe company is convinced and they provide a single front to the distributors, Barilla has a better chance of convincing the distributors. Some of the steps that Barilla will have totake in this regard are:

Convince and use the Upper Level Management: if they are convinced of itsfeasibility, they will offer full support in trying to convince the Sales department.It will make a lot of difference if the Upper management talk to the Sales peoplethan if just their Logistics peers talk to them.

Involve the Sales Department in all stages: To make the Sales people feelimportant and wanted, Barilla should involve them in all stages of the JITD proposal. They should be made to feel that they would have lots to do even after the system comes into effect.

 New Compensation System: The Sales department should be informed that theywould still be rewarded for good performance, except that in this case it was the performance of the entire company as a whole and not just they individually. Thenew system would award a percentage of Barilla’s profits to the employees as a bonus. They should be shown that the reduction in costs due to the JITD systemwould ensure greater margins for Barilla that would then be passed on to theemployees.Convincing Barilla’s Distributors: Barilla has to convince them that the plan will work and not only benefit Barilla but also the distributors participating in it. Somerecommendations to convince the distributors are:

 

Show them the money: This, as always, is the foremost issue on any businessenterprises’ mind. If an enterprise can be convinced that it will make more money,it will be ready to change its current practices. The distributors should be shownthat the costs of the system would reduce so much that everyone in the supplychain would save considerable sums of money.

Address Trust Issues: This...

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