Louis Vuitton Company Essay Example

seeking Louis Vuitton bags frequently end up on waiting lists for their popular products (Passariello, 2006). To integrate with a new culture, the company looked to Japanese automaker Toyota for inspiration, resulting in the creation of Pegase, an assembly process named after a mythical winged horse and a Louis Vuitton brand. This innovative process allows for quick bag assembly.

Traditionally, various craftsmen at Louis Vuitton are specialized in distinct areas such as gluing, sewing, and finishing touches. This latest approach from the company will result in quicker fashion design delivery every six weeks by minimizing waiting times at workstations. Louis Vuitton has previously addressed globalization by expanding into Japan during the 1980s, having only had a factory in Asnieres near Paris during the 1970s. The company has continuously procured factories or ateliers in France, as heightened globalization demands more.

The average expansion of Louis Vuitton used to be two factories or ateliers each year. Now, there are 13 factories solely focused on accessories. However, this still hasn't resolved the supply problem. Louis Vuitton releases a new handbag style each season, but even with manufacturers working overtime, they cannot keep up with demand when a seasonal bag becomes popular. As a result, potential customers are turned away when stores run out of stock (Passariello, 2006). Louis Vuitton was impressed by the ability of Japanese car dealers to produce and change vehicle orders quickly.

Despite being called the "zero-deficit policy," it may not be feasible for Louis Vuitton due to the nature of their factory. The facility employs 250 individuals who specialize in specific tasks such as cutting leather and canvas, preparing and sewing materials, creating pockets and linings,

and assembling bags. As a result of their specialization, it may be challenging to promote flexibility among workers, an issue highlighted by Passariello in 2006. Louis Vuitton refers to these employees as specialists.

These workers used to focus on one bag at a time, such as half-finished purses that were placed on carts and moved to another station to be completed. The specialization of artisans allowed Louis Vuitton to maintain its zero deficit policy, which was nearly impossible. To address this issue, the company enlisted the help of McKinsey. The group identified the problem: there was too much wasted time. To revamp the Pegase plan, they began by training each worker to perform three different tasks. They also divided the production process for each product into separate tasks, giving each worker more time to complete one product.

In response to the demand for increased production, Louis Vuitton reorganized their factory floor based on the team format used by Japanese electronic makers. They grouped workers into teams of 6 to 12, depending on the complexity of the task, and arranged workstations into U-clusters for maximum efficiency. Within each cluster, workers passed products from one to another. These changes primarily affected the production team and were implemented to enhance supply (Passariello, 2006).