SB saves millions with global supply scheme

27 January 2000
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27 January 2000 | Elizabeth Bellamy

A global supply-chain standardisation project has saved pharmaceutical giant SmithKline Beecham (SB) millions of pounds and cut supply lead times by up to three weeks, writes Elizabeth Bellamy.

The scheme has seen an electronic ordering system, similar to electronic date interchange (EDI), and key performance indicators for supply plan adherence and customer service introduced across operations in Africa, South America, Asia and Australia, said Nigel Keating, business process manager of global and strategy initiatives.

Plants have also increased their forward sales forecasting from one to two years, Keating told the Supply Chain Expo 2000 in London.

The five-year scheme, due to wind up in September, is now 90 per cent complete and aims to standardise supply chain operations at 137 plants.

The need to merge SB's consumer and pharmaceutical divisions, which had traditionally existed in separate locations within countries, was a driver for the plan, said Keating.

But the scheme meant an expert scheduling system in the UK and other initiatives were put on hold, he said. A culture of innovation at SB also made it hard to introduce standard measures.

Keating would not comment on the possible implications for SB's supply chain of the merger with rival Glaxo Wellcome, but said it could cause "a bit of a problem". The move could see 10,000 jobs axed globally.

Dick Hall, professor of operations and procurement strategy at Durham University Business School, urged companies to take care when standardising: "Transferring European work practices to a country that is culturally different can cause problems."


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