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Proposal for Supply Chain Management Diagnostic | Confidential | January 27, 2004 IBM Confidential L’Oréal Supply Chain Diagnostic Presentation Agenda Project Scope and Activities Overview of Our Supply Chain Findings Processes Inventory Review Maturity Profiles Organization/ People and Culture Technology Supply Chain Roadmap Discussion of Next Steps Our Project Approach Over the past three weeks, we have: Interviewed 5 Executives of L’Oréal Canada Facilitated two cross-functional process workshops Collected and analyzed data Conducted a high level maturity assessment Compared L’Oréal process and performance to CPG best practice Identified key business issues and areas of improvement Summarized our findings in this presentation document Cross-Functional Participants Presentation Agenda Project Scope and Activities Overview of Our Supply Chain Findings Processes Inventory Review Maturity Profiles Organization/ People and Culture Technology Supply Chain Roadmap Discussion of Next Steps Processes Demand Planning – Issues and Opportunities Demand Planning – Issues and Opportunities Demand Planning – Issues and Opportunities Demand Planning – Issues and Opportunities Supply Planning – Issues and Opportunities Supply Planning – Issues and Opportunities Order Fulfillment – Issues and Opportunities Presentation Agenda Project Scope and Activities Overview of Our Supply Chain Findings Processes Inventory Review Maturity Profiles Organization/ People and Culture Technology Supply Chain Roadmap Discussion of Next Steps Observations Long frozen horizons, high minimum order quantities, and inconsistent shipping practices from L’Oreal factories result in high inventory levels and emergency expediting costs (out of scope) The same forecasting process should not be applied to all SKUs. It would be beneficial to re-evaluate the logic used for different product demand types. Four main product demand types were observed: Stable demand pattern Unstable demand pattern Sta
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