FINAL GLAXOSMITHKLINE (GSK)- CASE STUDY ON (2)

GLAXOSMITHKLINE (GSK)- CASE STUDY ON SUPPLY CHAIN PERFORMANCE

OVERVIEW OF COMPANYGlaxoSmithKline (GSK) is the world’s

second largest pharmaceutical, biological and healthcare company

Its sales touched GBP 20 billion yielding a profit of GBP 6 billion approximately.

100,000 people worldwide, with over 40,000 in the sales and marketing teams.

CONT..Primarily headquartered in London, with

dual US headquarters in Philadelphia and Research Triangle Park.

GSK’s prime activities includeCreation, discovery, development, manufacture, and marketing pharmaceutical and consumer health-related products the world over.

CONT..GSK operates largely in two segments

Pharmaceuticals Consumer Healthcare

More than 36,000 SKU’s manufactured across over 80 manufacturing plants worldwide

GSK has a market share of 7% in the pharmaceutical business.

SUPPLY CHAIN OF GSK75,000 suppliers worldwidestrategic relationships with suppliers

that manufacture active Pharmaceutical ingredientsIntermediatesRaw materials Packaging for GSK medicines through to

local contractsGoods or services such as office equipmentCleaning and security

SUPPLY CHAIN PERFORMANCE

Supply chains have improved drastically in the past ten to fifteen years

Companies’ shift in focus to efficiencyEfforts in improving

Production processes packaging Enhanced supply to meet demand better

SUPPLY CHAIN CHALLENGESPost merger Integration Issues

* Integrating the separate identities* Integrating different strategies and* Integrating the packaging and manufacturing operations of Glaxo, Burroughs Wellcome etc.

Complex product portfolio

CONT..Multi faceted US MarketsRegulatory and operational challenges

Merger and acquisition activity implies complicated paper work compliance with regulatory frameworks of different countries

Different departments could always make different packaging design changes

CONT..Outsourcing/supplier challengesFinding alternate/multiple suppliersOperational/production challenges

different packaging and assembly linesimplementing automation and advanced technology

process improvement programmesTechnological Challenges

GSK’S RESPONSE SUPPLY CHAIN CHALLENGES.Countering Market Dynamics Late pack customizationmultifaceted US market and low volume

niche marketsproduction runs were up to 30,000

numbers for cost effectivenesseffectively produce as low as 100 or 500

packs at a time with this programme

CONT..Countering Packaging ComplexitiesGlobal Pack ManagementChange StandardizationDeveloping a pack catalogueCentral artwork developmentUniform and centralized information technology

Paperless labeling/electronic leaflets

CONT..Online Printing

Developing online printing that matches the speed of the packaging line and prints at the desired quality level

Keep costs of online printing down.

Countering Supplier/Outsourcing issuesFinding and qualifying multiple suppliers to avoid

any supply disruptionsCommunication can play a vital role in establishing

coordination among multiple suppliers

CONT..Countering Operational/ production challengesMinimize downtimeRobots do the cartooning and case packing as well

SUGGESTIONS Educate the upper levels of management.

Create a strategic visionSharing information around the globe

Consensus forecastingTraining for GSK procurement teams

CONCLUSION Organizations can follow its Supply Chain Management strategies as they truly extend the value of ProductPackagesPlants People