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Does your company need a supply chain SWAT team?
When Kraft Foods Inc. decided that it needed to free up cash in its supply chain, it assembled a group of experts for the task—what one Kraft executive called a "supply chain SWAT team."
Kraft's top management wanted to find $1 billion in extra cash. Since inventory sitting in warehouses ties up capital, executives knew that supply chain practices would be a good place to start. However, because each of Kraft's 23 business units operated its own supply chain, there was no single solution that would work for all. So the food giant decided to study best practices within the company and create a team of its own managers to act as internal consultants and apply those practices companywide.
The team met with each business unit to analyze its particular situation and propose ways to loosen cash flow. In some cases, that meant changes to production, relationships with customers, and inventory holding practices.
It should be noted that Kraft offered bonuses to managers in its business units to motivate them to find and make changes. Still, Kraft's approach to solving its problem is one that any company might consider emulating: Instead of turning to outside consultants, it looked within its own ranks for the best and brightest to help lead the way.
Although the challenge facing your supply chain organization probably is different than Kraft's, developing an in-house SWAT team is an idea worth considering. Whether it's improving customer service, finding freight savings, or implementing carbon mapping, an internal team may just provide the answer to the problem.
Editor's note: To learn more about how Kraft freed up cash in its supply chain, be sure to read the Quarter 1/ 2010 issue of CSCMP's Supply Chain Quarterly, available in mid-March.
We Want to Hear From You! We invite you to share your thoughts and opinions about this article by sending an e-mail to ?Subject=Letter to the Editor: Quarter : Does your company need a supply chain SWAT team?"> . We will publish selected readers' comments in future issues of CSCMP's Supply Chain Quarterly. Correspondence may be edited for clarity or for length.
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