1. Avinash R
Ravi Pandey

2.  One of the largest manufacturers
supplying grocery to retailers and
wholesalers
 Leader in designing how branded
consumer-goods go to market
 Strong customer pull for P&G’s products
 Products were sold through multiple
channels, with grocery retailers,
wholesalers, mass merchandisers, and
club stores

3.  Recognizes the need to serve the needs of
both the consumer and the channel in
order to be successful
 Changes at P&G in affected both the
company and the entire channel
 Focus on improving consumer value by
eliminating non value-added processes in
the channel

4.  Swings in price were creating variability
and massive inefficiency in the entire
grocery supply chain
 Uncertainty in demand increased
manufacturer inventory requirements and
higher manufacturing costs
 Profit margins for the retailers were very
low since costs were very high due to
inefficient operations

5.  The retailer provide P&G with daily data on
warehouse orders received from the stores
 P&G uses the daily warehouse shipment
data to determine warehouse
replenishment volumes needed
 This would limit the retailer's warehouse
inventory to acceptable levels, eliminate
costly LTL shipments, and reduce stock
outs

6.  EDI is used to transmit data from the
retailer to P&G on warehouse product
shipments to each store
 EDI is an enhancement for the CRP and it
provided essential platform for CRP
operations
 It is a powerful tool when combined with
proper process reengineering
 It enabled transfer or large amount of error
free data between companies

7.  Benefits
• Reduces transaction cost
• Enables transfer of huge data
• Error free transfer
 Threats
• In case of problems, seeks manual intervention
• Potential for huge errors without human buffer
• Increases cost for P&G due to manual rework
• Without CRP it is useless

8.  Rewrote the entire ordering, shipping, and
billing (OSB) system
 The OSB system supported pricing, ordering,
shipping, invoicing, and separate credit
systems
 The OSB integrated many systems that did
not work well together across functions and
product sectors
 The system was designed to eliminate
manual processing steps and not to redesign
the existing processes

9.  Redesigning the ordering process involved
a combination of systems and business
process changes
 Shared database for product pricing and
product specifications
 The batch processing system which was
both inefficient and ineffective was
upgraded

10.  Benefits
• Standardization of the process
• Automation
• Reduction of complexity
• Reduction in error
• Reduction in the cost of the processes
 Threats
• Resistance to change
• Time and cost of implementation

11.  P&G led the grocery channel
transformation
 Moved from brand management to
category management
 Improvements in manufacturing and
planning processes
 Created value to the customers

12.  1993 - P&G sold CRP system to IBM's
subsidiary (ISSC)
 The P&G CRP system was to be offered
by IBM to all manufacturers
 IBM CRP service offering allowed retailers
to interact with multiple vendors in a
common format

13.  Benefits
• Standardization in the industry
• Reduced barriers to CRP adoption
• Reduced P&G’s cost of operation
• Increased the base for P&G’s operations
 Threats
• There were no economic benefits for P&G by
outsourcing

14.  IT can be a powerful tool when combined
with efficient process reengineering
 IT can be used to reduce the complexity of
processes thereby reducing the errors
 Outsourcing a process to a giant may
increase the chances of adoption of the
technology by masses