The combined changes in systems, strategy, organization, and policies resulted in a
dramatic improvement in total order quality at P&G (Exhibit 5). Billing errors decreased by more
than 50% from 1992 to 1994, and the percentage of billing disputes resolved in P&G's favor
increased by more than 300% during the same period. The first-year savings from increased
collections on invoices alone were enough to pay for the entire cost of development of the new
pricing systems. P&G's customer teams were also able to concentrate on providing better service and
marketing new products instead of spending time resolving billing problems. P&G's redesign of the
total ordering process required fundamental changes in its structure, policies, and systems but
yielded dramatic benefits in cost reduction and quality improvement. In addition to reducing
invoice deductions, the redesigned business process allowed P&G to reduce costs throughout the
entire ordering process.
The combined changes in systems, strategy, organization, and policies resulted in a
dramatic improvement in total order quality at P&G (Exhibit 5). Billing errors decreased by more
than 50% from 1992 to 1994, and the percentage of billing disputes resolved in P&G's favor
increased by more than 300% during the same period. The first-year savings from increased
collections on invoices alone were enough to pay for the entire cost of development of the new
pricing systems. P&G's customer teams were also able to concentrate on providing better service and
marketing new products instead of spending time resolving billing problems. P&G's redesign of the
total ordering process required fundamental changes in its structure, policies, and systems but
yielded dramatic benefits in cost reduction and quality improvement. In addition to reducing
invoice deductions, the redesigned business process allowed P&G to reduce costs throughout the
entire ordering process.
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