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Supply Chain Management Report on Kimberly-Clark

Essay by   •  May 5, 2019  •  Term Paper  •  2,803 Words (12 Pages)  •  122 Views

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Supply Chain Management Report on Kimberly-Clark

Module: 718N1

Student ID: 1947177

Word Count: 2236

1.        Introduction        3

1.1        Internal context of Kimberly-Clark        3

1.2. External context of Kimberly-Clark        4

2.        Analysis of supply chain issue in Kimberly-Clark        4

2.1. Superior Products        6

2.2. Use of Enduring Trademarks trusted and Recognized all Over the Globe        6

2.3. Global Team        6

2.4. Expanding Market        6

2.5. Kimberly’s Supply Chain        6

2.6. Kimberly-Clark’s Management of Supply Chain.        7

2.6.1. Supply Chain Advantage        7

2.6.2. Responsible Supply Chain        7

2.6.3. Demand-Driven Supply Chain        7

2.6.4. Reducing Inventory        8

3.        factors affecting company’s supply chain        8

3.1. Product Portfolio.        8

3.2. Manufacturing        8

3.3. Strategic and Operational Implications        9

4.        suggestion        10

5.        Conclusion        11

Reference        12

Appendices        14

  1. Introduction

Kimberly-Clark Corporation was established in 1872 in Neenah, Wisconsin as a partnership by four people: Charles B. Clark, Havilah Babcock, Frank C. Shattuck, and John Kimberly (Reuters, 2018). It started the debutant paper mill in the region, and its first product was newspaper manufactured from cotton rags and linen. In only six years, the Corporation grew through the acquisition of the majority interest in Atlas paper mill that changed crashed pulpwood into manila wrappers. The owners incorporated the company as Kimberly & Clark Co. in 1880 with Jon Kimberly being the president. One of the corporation’s earliest innovations was the rotogravure paper that is the procedure for photograph printing using the rotary press (Kimberly-Clark, 2017).

Today, approximately 25 per cent of the world utilises Kimberly-Clark’s products. The corporation’s vision is “to Lead the World in Essentials for a Better Life” (Kimberly-Clark, 2017). The company is committed into turning ideas into essentials which are then led to people to transform their lives positively. The corporation’s brands cut across several segments, including adult care, ingredients, feminine care, baby and child care, professional care, and family care.

  1. Internal context of Kimberly-Clark

Kimberly-Clark’s segments include K-C professional and corporate, consumer tissue, and personal care (Reuters, 2018). The firm sells its wares through an assortment of options like as drugstores, mass retailers, retail stores and joints, supermarkets, and storehouse clubs. Additionally, it distributes its products for away-from-home consumption straight to the lodging, public, building, and office settings, as well as via other vendors. The corporation has manufacturing facilities across 38 countries and sells the products to over 175 countries globally. Its dealings beyond the North American geographic boundaries include developed economies and emerging markets (these are Asia-Pacific, Africa, the Middle East, and Eastern Europe). As of December 2017, Kimberly-Clark Corporation had approximately 42,000 employees and had a net income of approximately US$ 2.278 billion.

1.2. External context of Kimberly-Clark

The corporation’s top competitors include renowned multinationals such as Johnson & Johnson, Unilever, Clorox, Procter & Gamble, Colgate Palmolive, and Edgewell Personal Care (Reuters, 2018). As of August 2018, Kimberly-Clark was the fourth regarding market share.

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Figure 1: Market Share (Source: Reuters, 2018)

  1. Analysis of supply chain issue in Kimberly-Clark

Supply chain management (SCM) offers a significant amount of methods and ideas to design and develop the value stream. All of the concepts contribute to a considerable degree of cost reduction and heightened levels of service delivery (Dyckhoff, Lackes, & Reese, 2013). However, similar thoughts do not necessarily augur well with different clients and their diverse needs (Aburto & Weber, 2007; Chandra & Janis, 2007). Hence, a one-size-fits-all SCM system cannot expressly contribute to success. The solution to overcoming this risk is through applying the hybrid supply chain (Stich & Meyer, 2009). This particular approach (the hybrid system theory in supply chains) postulates that the systems utilise the merits of its subsystems to attain superior outcomes as opposed to using a single, autonomous system.

The causal factor for inadequate availability of stock is best demonstrated by the antagonism between the need to optimise supply chain costs through increased efficiency and the desire to optimise availability by enhancing the supply chain’s agility (see appendix 1). This antagonism contributes to considerable logistical deficits. Holistic approaches have failed to correct this phenomenon. However, the application of the hybrid system theory into SCM could solve the problem considerably (Mentzer, 2017).

This has been demonstrated by analysing Kimberly-Clark Corporation’s case study. It could be demonstrated that a hybrid system encompassing diverse techniques can help to enhance demand forecasts and inventory replenishment levels, which contributes simultaneously to lower inventory levels and fewer sales failures. Kimberly-Clark’s supply chain management strategy is based on “responsibility” where distribution strategies consider the effects of distribution on the environment and the communities at large (Kantor & Nolan, 2017). The main issue that Kimberly-Clark desired to address was that of inaccurate demand and supply forecasts that contributed to delays in shipping and vast volumes of inventories. The point-of-sale date was not aligning with the inventory stored in retailer shelves and warehouses. This had to change, because it contributed to higher costs and resource depletion. The conglomerate justified its outlet shipments from data in its historical sales predictions that did not act as clear-cut predictors for potential sales.

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