SCDigest Editor Dan Gilmore recently sat down with Mark Jamison, Vice President of North America Customer Supply Chain for Kimberly Clark Corp., to discuss the company’s “Supply Chain Network of the Future” program. Last week, Gilmore offered his summary review and comments of that interview and program. (See Kimberly Clark Rethinks its Supply Chain.) Here is the full transcript of the interview.
| SCDigest Says:
|We want to move to an environment where we let inventory get pulled through the supply chain rather than be pushed. We wanted to redesign our supply chain from the shelf back, while our supply chain had really been designed from our manufacturing assets forward.
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Gilmore: What was the genesis of the Supply Chain Network of the Future project at Kimberly Clark?
Jamison: Wel,l what really was the catalyst was about 4 to 5 years ago we were refreshing our supply chain strategy, and as part of that refreshment we wanted to evaluate strategies for how we wanted to go to market.
Through that process we decided that we would spend some time with our customers and retail partners understanding what their supply chain objectives and goals were, and then match the capability of our physical distribution network against those goals.
Our retail partners told us three things – help us improve customer service and reduce out-of-stocks, help us take inventory out, and help us reduce cycle time - three of the key priorities they shared with us.
And as we looked at our physical distribution network four years ago or so and compared it to those goals that our retail partners had, and as we looked to the future we knew that we had to change if we were more effectively going to meet those objectives. It would be hard to make much additional progress with our current network.
The second key thing that drove us was we felt there was an opportunity to become more cost effective in our supply chain. So, first and foremost we wanted to become more flexible and responsive with our supply chain design, and secondly we wanted to realize significant cost savings.
Gilmore: In addition to better meeting customer needs, were there some obvious pain points in the existing network?
Jamison: Yes, we were feeling some pain from the perspective that as our businesses had grown, our strategy had been primarily to ship direct from producing plants warehouses. And as we invested our capital over time we primarily invested in the plants and machines, we did not invest much in additional warehouse space for those plants and mills.
So as inventory required to support business needs grew, we ran out of space in those plant DCs and we went into overflow warehouses. So we were feeling some pain from a complexity standpoint. We felt our network had become more complex than it needed to be and that we needed to right size it and change how we went to market.
(Supply Chain Trends and Issues Article - Continued Below)