P&G executive touts company's efforts to boost supply chain efficiency

The North American 3PL Summit and Chief Supply Chain Officer Forum recently concluded in Chicago. The event attracted a number of high-ranking industry experts, including Julio Nemeth, the senior vice president of product supply at Procter & Gamble (P&G), who gave a speech about the growing value of using analytics to manage supply chain operations.

Nemeth emphasized to attendees that companies like Procter & Gamble, which counts many major household brands among its products, have a wealth of consumer data available to them. If it can be organized effectively, this information can be used to plan new product introductions, marketing campaigns and distribution operations.

P&G has sped up its planning cycles in an effort to balance supply and demand more effectively through more frequent operational adjustments. Nemeth said that, through these initiatives, P&G hopes to realize a 2 percent increase in sales, margin improvement of as much as 5 percent and an increase in asset utilization of up to 10 percent. However, despite the increasingly sophisticated use of demand data, the company is still struggling to improve the accuracy of its forecasting processes.

Nemeth noted that supply chain systems have traditionally been siloed, causing companies to miss out on opportunities to achieve "holistic optimization" through the establishment of a "fully interconnected platform." P&G is still trying to overcome these lingering historical barriers.

One option available to modern companies is to shift certain supply chain functions to a third-party logistics firm. Turning to an external service provider can help by allowing a company to focus on its core competencies, while ensuring that deliveries and other operations continue to run smoothly.