Barilla Spa - Case Study

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Company History:

One of the world's largest food producer / marketers, Barilla S.p.A. is a holding company that produces pasta, sauces, and packaged baked goods including cookies, cakes, snacks, wafers, biscuits, and crisp breads. The company is the world's largest pasta producer, holding leading shares of the pasta markets. Barilla sells its products all over Europe, USA and many other countries, running plants and marketing operations throughout Europe, and other parts of the world. Barilla is a family-owned company throughout most of its long history.

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Table of contents:

Attention – Mr. Manfredo Manfredi, CEO

Preface – JITD – troubled introduction:

Re: JITD implementation plan

Barilla SpA is experiencing a growing burden of increasing production costs, inventory levels and inefficiencies in manufacturing and distribution system due to a huge fluctuation on demand and lack of forecasting ability. In order to mitigate the risk, we introduced and implemented “Just-In-Time-Distribution” system (JITD) to facilitate information sharing across the supply chain, to improve production and distribution forecasting and to reduce costs associate with inventories and inefficiency at all level of the company. However, the implementation plan is encountering trouble with resistances from both internal and external factors.

Executive Summary:

Internal issues

Lack of complete understanding of the JITD regime across the organization

Sales staff is concerned about their job security under JITD regime

Sales staff is fearful of losing their bonuses / incentives earning under JITD regime

Distribution staff unwary of the changed circumstances

External Issues

Distributors do not reveal information due to the lack of trust and or the business practices they are used to.

Also the nature of business is such that demand fluctuations are inherent