Delivering Service Exellence In The Supply Chain
A Kraft Foods UK case study

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Page 7: Service Excellence Programme ´piece by piece´

Perfect ordering

Kraft Foods Uk 6 Image 2Focuses on the successful management of a customer order from the moment it is compiled at the customer, its processing through Kraft Foods's order systems to the point of delivery at the customer warehouse. Any 'waste' that could cause delay or disruption should be eliminated. The order should be compiled correctly using accurate data, sent at agreed timings with jointly agreed delivery windows. Ideally the order is electronically communicated using EDI or the Internet.

Knowledge exchange

Involves a complete understanding of the joint Supply Chainincluding business systems and processes operating between Supply Chain Partners. This can be delivered in many ways, from a simple one day induction for the customer at the supplier premises or longer term assignments, e.g. job swaps. The overall aim should be to build a comprehensive shared knowledge base of systems, people and processes.

Increasingly e-commerce is improving communication with the use of e-mail and extranets making contact and the sharing of knowledge and information faster and easier.

Seasonal planning

Good Seasonal Planning ensures the supply chain operates smoothly through events such as:

  • annual celebrations - Christmas, Mother's Day, etc
  • seasons - spring, summer, autumn and winter
  • special events - World Cup, Olympics, Millennium, etc.

Demand from consumers will fluctuate dramatically during seasonal periods. The supply chain will need to react accordingly and flexible plans and processes are critical for success.

Seasons challenge the supply chain to deal with an increased volume of product in a very short space of time. Planning for a season will include the sharing and learning from historical forecast information, agreeing purchase quantities, arranging delivery timings and ensuring identical product specification data is held on Kraft Foods' and its customers' databases.

Delivery interface

Involves the fast and efficient transfer of products from the supplier to the customer.To move stock efficiently Kraft Foods and its Customers need to understand each other's distribution operations. At Kraft Foods, sufficient resources need to be in place to compile the order on time and reflect specific customer requirements; for example, goods delivered on pallets may not exceed certain heights.

The order needs to be despatched on time and in the correct type of vehicle. Delivery of the order will be required at the receiving depot at the agreed time. Should errors or discrepancies arise there should be agreed processes which deal with claims or complaints.

Great people

Kraft Foods believes that a truly excellent Supply Chain relationship with its Customers cannot be achieved without great people who are professional, trustworthy, helpful and responsive to customer needs. Kraft Foods defines great people as those with a passion for customer service and with the skills and behaviour required to build a Supply Chain partnership. This is why it is the central piece of the jigsaw.

Kraft Foods' employees need to listen, observe and act only when they have understood all the information. They should maintain a positive outlook in difficult situations and apply their knowledge in a supportive and constructive way.

Optimal inventory

Having enough stock (or inventory) of a product to satisfy customer demand, whilst not holding excess stocks sitting idle and getting old, is the goal of optimal inventory.

To optimise the inventory levels in the total supply chain, trading partners need to collaborate fully to understand the volume and type of inventory held along the chain and the future demands, to ensure production of a product takes place at the right time and is available for the customer and fresh for the consumer.

Stock may be held at manufacturing plants, warehouses or at the retailers' stores. Information on stock levels and sales can be shared using new technologies like the Internet. The systems enable Kraft Foods and its Customers to view and act upon the same information at the same time creating a 'total Visible Inventory Chain'.

 Data alignment

Kraft Foods Uk 6 Image 6For the supply chain to run efficiently, the supplier and the customer need to hold the same data about a product. This will include product description, number of units in a case, number of cases on a pallet, or bar codes and product information, such as detail on the product shelf life. Each area within the supply chain will use the information for a variety of purposes, for example the correct transmission of an order via Electronic Data Interchange (EDI) will require the use of the TUC code at the customer and Kraft Foods order management stages. At the customer depot, shelf life and product descriptor information will be checked.

Regular cross checks will ensure compatibility of data. Increasingly technology aids the process through use of extranets. Looking to the future, electronic 'catalogues' of information viewed on the internet and accessible by the supplier and customer will make this process easier and more efficient.

Variant management

There are times when products change, such as promotional product (e.g. a chocolate bar marked with a reduced price), new products into the marketplace or the jointly agreed substitution of one product for another.

Variant management is about successfully managing product change without affecting service. It is fundamental that Kraft Foods and its customers fully understand and have in place a process to manage:

  • changes to new product specifications
  • different order quantities and delivery timings
  • changes in demand expected from the consumer.

Consumer satisfaction

At the end of the supply chain is the consumer, like you. It is key to Kraft Foods and its Customers that the consumer is 100 per cent satisfied with their purchase. This can, in part, be achieved by delivering a high quality product in perfect condition every time. If this does not happen it is essential that it is resolved efficiently and speedily to the consumer's satisfaction.

The Consumer Satisfaction 'piece' defines the ideal complaint management process, specifically:

  • How Kraft Foods and its Customers should handle consumer complaints.
  • The mechanism for resolving the Supply Chain problem which caused the complaint.
  • A crisis management policy for recall of product which may have a quality issue.
  • A feedback route for consumer comments and suggestions e.g. a link to the Kenco Freephone Coffee Advice line.

Kraft Foods UK | Delivering Service Exellence In The Supply Chain