Just in Time Distribution

Everyone who knows instant delivery and Barilla SpA business has heard the word "just in time" (JIT) inventory. It involves creating only what you need when you need it. The principle of timeliness is to eliminate the source of production waste by obtaining the appropriate amount of raw materials at the right time and producing the appropriate amount of products in the right place. (1) In this way, the manufacturer receives parts and materials "in time" in time to meet the production quotas of the day. (3) JIT is a manufacturing management method developed in Japan to meet customer needs in the 1970s.

Since the company's demand at that time was very unstable, the fundamental cause of Barilla's then logistics director, Brando Vitali, proposed the concept of "instant delivery" (JITD). The order of dry products varies widely every week. For example, as shown in the case, the number of orders in 1989 has increased from about 850 in 12 weeks to about 175 in 13 weeks. It has decreased by nearly 80% this week. The order drops below 100 at 14 weeks, below 50 at 15 weeks, and then approaches 800 again at 17 weeks. This type of model, also referred to as the Bullwhip effect (see, for example, Figures 1 and 2) is difficult to predict and puts pressure on Barilla's manufacturing and logistics operations. When stocks of dry goods are out of stock on 10 calendar days

Even if there is extra stock in the entire supply chain, Barilla has problems to meet the changing needs from distribution centers. Brando Vitali made the proposal of Instant Distribution (JITD), but the sales team of Barilla's sales team or distribution center did not agree with this approach. At the same time, these teams realized that our customers are leaving because of the lack of services we can offer. The distribution center needs to increase inventory to prevent out of stock, but the proposal was not accepted. In return, they gave complaints about the number of Barilla 's SKUs. It made it uncontrollable and brought about a long production cycle due to tough heat and humidity specifications. Environment and Root Cause Analysis