he Problem
Four billion times per day, P&G brands touch the lives of people around the world. P&G has consistently been at the forefront of supply chain excellence, being ranked as one of the top five best-managed supply chains in the world and winning numerous best practice awards. The company’s global reach provides significant scale opportunities to optimize areas such as inventory management, new product launches, merchandising, and promotions.
P&G’s supply chain analysts employ a standard roadmap to determine which inventory optimization tools are right for a given supply chain’s business and operating conditions. At one end of the spectrum, shorter and less complex supply chains utilize detailed single-stage calculators to determine optimum inventory requirements. At the other end of the spectrum, higher-complexity supply networks require more sophisticated multiechelon tools. In the early 2000s, P&G recognized the need for more advanced inventory tools to allow it to continue trimming already lean inventories while maintaining its superior customer service.