Whirlpool Europe

Cassinetta’s meeting Dec 9th 2008

Alessandro Piatti
Supply Chain Strategy Deployment

Whirlpool Europe
Cassinetta’ s meeting Dec 9 th 2008
•8.45 Welcome @ Cassinetta Gate entry process

•9.00 Whirlpool ( corporation ) general introduction by Alessandro Piatti

•9.15 Whirlpool Europe by A.P. & Elena Marangon

•Business contest

•Supply chain processes

•Supply Chain Management

•Roles & processes

•Supply chain network

•10.30 Coffee break

•10.45 Whirlpool in Italy by Manuel Comi

•Business contest

•Warehouse management key points

•11.45 WER Quality approach by Flavio Bardelli

•12.15 Move to ternate Warehouse for the visit (Manuel Comi)

•13.00 Lunch @ canteen

•14.00 leave Cassinetta to go to Bertoni WHS in Besozzo

-2-

1
 Whirlpool
General introduction

World Leader in Domestic Appliances

WHIRLPOOL CORPORATION

Operates in 170 countries

40% bigger than nearest competitor
95 years specialist in home appliances
“At home” in over 200’000’000 households world-wide

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2
 Brand Portfolio
We Touch All Key Consumer Segments

Cooking passionates

Creative & modern mentality

Look for professional-like results

Premium segment

Quality minded

Very brand conscious

Home enthusiast

Up market
Style and design minded
Time pressure
Fashion oriented
Technology / design driven

Mass market

Young families

Value sensitive
Passionate about simplicity
Looking for reassurance

-5-

Whirlpool in Europe Whirlpool in Europe

Factories
 European Operations Centre

g #4 position as manufacturer;
#1 as Whirlpool brand

g Sales 2006 US $3,4 billion

g Brands: Whirlpool, Bauknecht Ignis,

KItchenAid across the region;
Maytag in some markets, Laden in

France, Polar in Poland

g Serves Europe, Middle East and

Africa





g Sales offices, export in other 38


countries

27 . S.Africa.
-6-

3
 Supply Chain Process

S&OP Order Intake

Supply Planning Order mgmt
Production Planning
Demand mgmt
Built To Order
Make To Stock Deliver From Stock
Footprint design
Distribution mgmt
Logistics providers
selection & negotiation Warehouse mgmt
Carriers mgmt Service level mgmt

Factories Customer
Order To Delivery

Suppliers Trade

-7-

Supply Chain Business Models

Suppliers Factory FDC/CDC RDC TP’s
Customer
PUSH - Forecast driven

PULL - Order driven

MTS
Make To Stock
Forecast Order

VMI
Vendor management inventory
Forecast Stock re-fill

USS
Forecast Upstream Stock
Order

BTO
Forecast Built To Order
Order

Decoupling point = point synchronisation between TP order and supply

WE business models well supported by organisation, processes and systems

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4
 Whirlpool Europe
Planning process

WER Demand management & fulfillment process overview

Yearly
YearlyProfit
Profitplan
plan (Plant
(Plant/ /Sales
Salesorg
org/ /SKU
SKU/ /product
productaggr.)
aggr.)

Monthly OPD
Monthly
MonthlyOPD
OPD
Monthly
MonthlyOPD
OPD
Monthly
MonthlyOPD
OPD Monthly
Monthly
Monthly OPD Monthlyvolume
volumecontrol
control&&factory
factoryload
load
MonthlyODP
ODP review
reviewM+1/m+3
M+1/m+3&&Year
YearGoods
GoodsMovement
Movement
review
review

review
reviewof
ofDemand
Demand
Monthly S&OP Monthly S&OP
&&load
loadVolume
Volume/ /
Monthly S&OP
Monthly S&OP extraordinary
extraordinary
Monthly S&OP
actions
actionsetc
etc

Weekly
WeeklyGross
Grossdemand
demandFCST
FCSTreview
reviewby
bySKU/Plant
SKU/Plant Weekly
WeeklyAvailability
Availabilitycheck
check
calls
calls
Daily
Dailyregenerated
regeneratedsupply
supplyplan
plan / /inventory
inventorynetted
netted&&last
lastminutes
minutesSales
Salesorders
ordersqualified
qualified

Fully integrated process to support the financial results

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5
 SHORT TERM – DAILY PLANNING PROCESS

Horizon: 13 - 20 weeks (depending from the product)

Weekly Rolling: Forecast netting & net requirements calculation (full horizon)

Daily: Supply Plan is generated giving priorities to BTO/Promotion/Replenishment

Target Stock and Maximum stock level

Frozen Period

Lead time

SUPPLY PLAN

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SUPPLY PLAN

The Supply Plan has to satisfy my market requirements taking in account:

1. FACTORY CONSTRAINTS

2. FACTORY FROZEN PERIOD

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6
 1. FACTORY CONSTRAINTS

FACTORY CAPACITY

- quantity per day for Models / lines / resources

- full respect within 4 weeks (regardless demand level)

- surplus / shortage management – fair share

QUALITY constraints

- critical resources management (e.g. colours/cross constraints..)

RAW MATERIALS SUPPLY constraints (number of pieces per day/week/month)

and THE SYSTEM HAS TO RESPECT THESE CONSTRAINTS

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2. FACTORY FROZEN PERIOD

based on factory calendar
The definition of the frozen period is based on factory working days:
E
PL

Frozen period Liquid

AM

D1 D2 D3 D4 D5 D6 D7 D8 D9 D10 D11 D12 D13 D14 D15

EX

During this period is not possible to change the production (exceptions will be managed) .
This is the reason for which we need a very HIGH level of Forecats Accuracy, in order:
-To Be able to satisfy the market requirements;
-For the factory to plan the correct purchase requisitions, in order to be alligned in terms of stock value
(inventory) and supply chain requests;
-To work with and for the FDC in order to minimize the stock level of finished goods ;
-To work with and for the FDC in order to schedule the shipments every week: DEPLOYMENT PLAN and
manual adjustment; this is related to the availability of means of transport !!

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7
 Master plan - Demand propagation - Lead time effect

W1 W2 W3 W4 W5 W6 W7 W8 W9 W10 W11 W12 W13 W14

RDC
Amiens

W1 W2 W3 W4 W5 W6 W7 W8 W9 W10 W11 W12 W13 W14

RDC
Isled’abeau

W1 W2 W3 W4 W5 W6 W7 W8 W9 W10 W11 W12 W13 W14

RDC
Oosterhaut

W1 W2 W3 W4 W5 W6 W7 W8 W10 W9 W11 W12 W13 W14

Factory
Slush
Liquid

In order to fill up the factory capacity till week 8

the demand till week 13 will be propagated
-15-

Whirlpool Europe
Network & footprint

8
 Whirlpool Europe’s
delivery models

Production Sites
Headquarters Factory DCs’

Norrköping


M
TS
Regional DCs’ BBP’s

BTO / DD
Wroclaw



Poprad
Amiens
Neunkirchen


Schorndorf Trade

Comerio


Trento
Cassinetta

Siena

Naples

Isithebe Consumer

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DCI: Gamma di Prodotti

Brand:

Canali di vendita: Retail & Kitchen

Prodotti:
Cooking (Cooktops – Ovens – Hoods – MWO)
Cooling
Washing
Dishwashing
Drying
Accessories
Small appliances (KA)

Numero codici prodotti finiti gestiti: 1.300

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9
 Segmentazione canale Retail (Eldom)

BUYING GROUP MULTIPLE HYPER

70% in valore 20% in valore 10% in valore

• CENTRALE di • CATENE • GRANDE DISTRIBUZIONE

COORDINAMENTO (food)
• UNICA CENTRALE
organizzativo
ACQUISTI • PIATTAFORMA
• AZIENDE LOCALI con PDV LOGISTICA
• UNICO CENTO di FT
DETTAGLIO
• MAG.LOCALI solo per
• PIATTAFORMA
• CENTRI di FT PERIFERICI gestione riordino PDV
LOGISTICA
• LOGISTICHE
• MAG.LOCALI solo per
INDIPENDETI
gestione riordino PDV

INDIPENDENT
Realtà sempre meno presente.
Piccoli pdv che decidono di affiliarsi

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Insegne canale Retail (Eldom)

BUYING GROUP MULTIPLE HYPER

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10
 Segmentazione canale Kitchen
KITCHEN MANUFACTURER KITCHEN DISTRIBUTORS KITCHEN RETAILER

45% circa in valore 40% circa in valore 15% circa in valore

• PRODUTTORI DI CUCINE • GROSSISTI (24 • GRANDE DISTRIBUZIONE

DISTRIBUTORI DI
• PIATTAFORMA
PRODOTTO DA INCASSO
LOGISTICA
WHIRLPOOL SUL
TERRITORIO NAZIONALE • MAG.LOCALI solo per
SUDDIVISI PER AREE gestione riordino PDV
GEOGRAFICHE)

RIVENDITORI DI
MOBILI/CUCINE

CONSUMATORE FINALE

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Supply Chain Italia - Order To Delivery Organization

Attività & responsabilità principali

Supply Chain Manager

Order desk Logistics Operations Planning

• Interfaccia della forza vendita:
• Inseriscono ordini a sistema
• Controllano correttezza delle
informazioni legate a promozioni
& sconti
• Verificano disponibilità dei
prodotti allocandoli presso i
magazzini più vicini al cliente
• Forniscono feedback &
conferme alla forza vendita &
clienti
• Gestiscono resi & claim desk
• Pianificazione delle consegne ai clienti • Gestione della demand e del relativo
mediante negoziazione data di scarico supply
• Gestione del metodo di consegna ai • Interfaccia con la Supply Chain
clienti Centrale
• Supervisione delle attività di • Gestione dello stock
magazzino e del trasporto
• Gestione e coordinamento BTO
• Gestione e relazione con i fornitori del
trasporto e della logistica
• Analisi e monitoraggio costi della
Supply Chain

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11
 Flusso informazioni tra le funzioni DCI

Maggiori Clienti Inviano ordini a

Clienti Order Desk per
Kitchen l’inserimento

Forza Vendita
Inserisce ordini a sistema

Order Desk
Concordano
SAP
promozioni con Trade Marketing Inseriscono, controllano e
NAM
verificano ordini in SAP,
creazione delivery ad hoc

Planning Logistica
Inseriscono DP in SAP della fsct Negoziazione Consegne,
per SKU/Plant/Wk, rescheduling e preparazione shipment
creazione massiva delivery gestione consegne

Funzioni Supply Chain Italia

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Schema del processo di Planning del 1°Monday of each month

Supply

Owner del processo: Planning

diviso per categorie di prodotto:
Lavaggio, Dryers, Piccoli KA
Cooking, MWO, Accessori
Cooling

FDC

Flusso del Primario RDC

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12
 Processo di Spedizione Logistica Italia
Pianificazione del trasporto Picking Carico

Planner del trasporto

(dedicato a una precisa area
geografica): ogni giorno
controlla le delivery per i
clienti della propria zona
Autista certifica che il pre-
Operatore Ufficio carico sia qualitativamente
Magazzino per ogni e quantitativamente
shipment e per ogni cliente conforme
estrae dal sistema la
Picking list

Operatori di magazzino
Planner contatta via
caricano il mezzo
telefono, fax, mail la
Operatore di magazzino sulla rispettando l’ordine di
logistica del cliente per
base della picking list esegue carico impartito dal
negoziare data di ricezione
il prelievo dei prodotti planner del trasporto
disponendoli per mezzo e per
ordine di consegna sulla
marshalling area Operatori di magazzino
Planner: in base alle date
concordate,ai m³ di ogni caricano il mezzo
consegna determina il rispettando l’ordine di
numero mezzi di trasporto carico impartito dal
necessari Operatore addetto alla planner del trasporto
qualità controlla per ogni
prodotto lo stato qualitativo
le quantità e il codice
Planner: in base alle date Operatore Ufficio
concordate,ai m³ di ogni magazzino conferma la
consegna determina il numero spedizione delle delivery
mezzi di trasporto necessari e in SAP
metodo distributivo: DIR/BBP Operatore addetto alla
qualità controlla per ogni
prodotto lo stato
qualitativo, le quantità e il
codice Creazione automatica in
Planner: crea in SAP la SAP della fattura e della
shipment (viaggio) per valorizzazione del
ogni mezzo di trasporto trasporto

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Whirlpool Europe
Quality @ warehouses

13
 Quality in Supply Chain Strategy

Customer Quality is the 1st enabler of WER Supply Chain Strategy

Strategy
Supply Chain Objectives

Mission:
“To support our Brand Value Creation Strategy Serveeach
Serve eac hcustomer
customer
we will deliver ‘thewa
‘the wayyhe
hewould
wouldlike
liketo
to be
beserved’
served’
atbest-in-class
at best-in-c lass
sustainable competitive advantage” workingcapital
ca pitaland
andcosts
c ostslevels
levels
working

Enablers:
 Customer Quality
 Competitive Benchmarking Service
Service
 Extended Supply Chain Assignments Excellence
Exc ellence
 Supply Ch ain Business Model Inventory
Inve ntory Costt
Cos
 Distribution Network
 Supply Ch ain Processes
 Supply Ch ain Execu tion - Marke t, S CM, Direct
 Lean
 CC OpEx
 Org anizatio n & Pe ople
VISION:
VISION: Installing
Installing an
an uncompromising
uncompromising approach
approach to
to Quality
Quality in
in our
our logistics
logistics operations,
operations,
while
while reducing
reducing by
by 50%
50% products
products handling
handling and
Update March 2 007 and transport
transport damages
damages -14-

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Platform Capabilities: Definition

Capability:

The ability, skill or power

that makes an organization
able to do
what it needs

“Structural capacity to work according to a predefined quality system”

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14
Process to build a robust Platform Capability

• Identification/Definition

• Measurement

• Defining Action Plan for Improvements

(Process Capabilities Review)

Our
Our goal
goal is
is to
to reduce
reduce Non-Quality
Non-Quality costs
costs

-29-

Process to build a robust Platform Capability

• Identification/Definition

• Measurement

• Defining Action Plan for Improvement

(Process Capabilities Review)

Our
Our goal
goal is
is to
to reduce
reduce Non-Quality
Non-Quality costs
costs

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15
 Identification: How do we proceed

Workshop Capability
Results

Manag. Commitment

Organisation
WPL Metrics Processes & Procedures
FACTORY
Logistics
P.C. Proposal
Packaging Equipment Skills
Iso9001:2000

Existing
External
Experience

-31-

Capabilities Elements

CAPABILITY ELEMENTS
Logistic Organisation for Quality
Quality Culture Promotion
ORGANISATION & LEADERSHIP Quality System Definition & Implementation
Management Review
Safety Environment Management

Job Descriptions & Skills Definition

MANPOWER SKILLS & MOTIVATION Training & Education
Skills Management

Processes & Equipment Definition

Process Control plans & procedures
Operational Instructions & Control Methods Definition
PROCESS & EQUIPMENT QUALITY
Equipment Maintenance & Control
Auditing Process

Continuous Improvement Quality Approach

Product and Services Continuous Improvement
PREVENTION & IMPROVEMENT Processes Continuous Improvement
Continuous Improvement Periodical Review

Product Quality Control

Products NC Identification & Management
PRODUCT - SERVICE QUALITY Services NC Identification & Management
NC Analysis & Corrective Actions Development & Control

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16
 Platform Capabilities: Evaluation

• Identification

• Measurement

• Defining Action Plan for Improvement

(Process Capabilities Review)

Our
Our goal
goal is
is to
to reduce
reduce Non-Quality
Non-Quality costs
costs

-33-

Measurement: Capabilities Evaluation

Every Capability - after defining - must be periodically evaluated (by a specific AUDIT)
in order to obtain the Status
of Logistics Operations Quality Platform Capabilities

Qualitative meaning of Capability Evaluation:

5: Unobtainable
4: World Class/Best in Class
no visible quality issue that can be related to capability
no one can teach us how to do better
3: Very Good
as good as anybody else
consistent, very high level of quality
2: Average
1: Poor
0: Capability does not exist in function

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17
 Platform Capabilities: Spider-charts

Element Capability

Capability Score 0,3

Capabilities Score: 1,8 -35-

Platform Capabilities: Action Plan

• Identification/Definition

• Measurement

• Defining Action Plan for Improvement

(Process Capabilities Review)

Our
Our goal
goal is
is to
to reduce
reduce Non-Quality
Non-Quality costs
costs

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18