Unilever Australian Petone Case Analysis Essay Example

goods to the Unilever site lies with the in-plant representative. Approximately 20% of materials are sourced from overseas, primarily high-valued items. With the company's significant level of purchasing power (totalling $68 million NZD worth of raw materials), successful cooperation with suppliers is crucial. The proposal to assign in-plant representatives from overseas companies providing Unilever with high-valued products identified through ABC analysis should be well-received.

Questions for Discussion 1.

If lot-controlled raw materials arrive without the necessary Certificate of Analysis, they will not be stored until the certificate is received. These issues can cause production delays as the company employs the JIT approach.

Data analysis is impossible for the problem since the necessary data is not provided in the case.

• The following data will be appropriate in this point:
• List of the raw materials delivered with the delay; ABC analysis to define all the materials required for production including price of the materials, the name of the supplier, whether it is a domestic product or imported from overseas;
• The list of production runs postponed due to occurred delays;
• The specific time of the delay and postponed output;
• The list of the suppliers delivering with delays;

Flowchart of the involved processes

• The flowchart of the process
• Evaluation of the status of the process before the improvement

Here, we require specific data related to the problem.

• The total amount of the time the production output was postponed;
• The total sum of the damage occurred due to the delay in delivery

(including the expenses for extra warehouse space and fixing the problem);

The possible solutions for the problem

• The possible solutions should be based on the data analysis of the problem. In our case we produce the solutions based on the general conception of the problem.
• Renegotiation of the contracts with suppliers delivering with delays (without Certificate);
• Implementation of JIT II (see details in the analysis of the case);
• Detection of the carriage companies and modes of carriage delivering with delays. Renegotiation of the contracts with these companies.
• Review of the possibilities of another modes of carriage (perhaps more expensive but more fast and in-time);
• Making of the safety stock enough to overcome glitches in delivery for materials with a long lead time or with frequent glitches in delivery;

The Unilever Company considers exploring the feasibility of manufacturing the essential materials required for their production process, either internally or through partnering with local suppliers.

Detail improvement approach

• Actually the possible solutions should be specific and related to the concrete suppliers, carriage companies and products.
• It will be appropriate to review all the above mentioned solutions in accordance to specific issues.
• The estimation of the impact of the improvement
• To estimate the results of the applied solutions against the results of the status of the process before the improvement takes place (point

V).

Consider the various options available for enhancing the situation in the future.

Researches show that ISO certified companies have experienced a 48% increase in profitability and a 10% reduction in production costs due to quality improvements made while meeting ISO requirements. With the implementation of ISO 9000 and 14000 and the potential future introduction of ISO 19011, companies have begun analyzing and documenting their main procedures, resulting in a clear understanding of their own processes and awareness of areas that can be improved.

Although the ISO 14000 standard may initially appear to require significant expenses and time to implement, it can actually provide companies with a competitive advantage in the market. This is because ISO 14000 requires companies to continually track their use of raw materials and improve their environmental performance. Additionally, this standard promotes a greater understanding of all processes within the company. Furthermore, companies can also utilize advanced information technology in conjunction with ISO 14000, as well as with the ISO 9000 and ECR concepts.

Efficient scheduling of production quantities, raw material purchases, and labor hiring is facilitated by ISO standards implementation. This integration is ideally complemented by the JIT concept, leading to reduced non-productive expenses. Detailed raw material usage tracking requires equipped manual or automatic chip or bar-code scanners in all relevant areas, including the receiving and storage areas. These scanners are connected with a centralized database for automatic detection of all incoming and outgoing materials in the area.

By utilizing this database, a modern ERP system can automatically place material orders in the event of a shortage. The system also provides managers with comprehensive calculations based on continuous monitoring,

and generates advice to support decision-making processes in accordance with ISO and JIT policies. For companies seeking ISO certification after 2003, the ISO 9001:2000 standard has replaced the 1994 pattern of ISO 9002.

The standard covers the necessary conditions that an organization must meet to attain customer satisfaction by delivering consistent and satisfactory products and services according to customer expectations. The standard emphasizes the continuous monitoring of company performance using process performance metrics which are numerical measures of the efficiency of tasks and activities. The company must conduct internal audits and meetings frequently to review its performance.

It is recommended to map or establish definitions for all essential processes and monitor them. All products, whether from suppliers or produced internally, should adhere to documented requirements. The company must accurately identify customer needs and implement communication systems to inform them about product information, inquiries, contracts, orders, feedback, and complaints.

It is recommended to incorporate the subsequent information in these undertakings:

• Raw materials utilization;
• The amount of products produced and sold;
• The amount of labor and machine hours spent effectively and their idle time;
• The amount of defective goods and goods of unsatisfied quality etc.