Delving deep into Godrej’s Supply Chain processes

Post By : News Desk
Post Date : April 9, 2019
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In Conversation With Rakesh Sinha

Dr Rakesh Sinha, Global Head – Supply Chain, Manufacturing and IT, Godrej Consumer Products Ltd in his career of more than two decades has successfully driven several wings of Godrej Consumer Products ranging from marketing, operations, corporate strategy to supply chain and manufacturing. Dr Sinha in an interview with Logistics Insider talks about his supply chain strategies and key lessons which every supply chain professional should follow to achieve greater efficiency. Excerpts

Retail sector is extremely competitive and each company of the sector tries to deliver their product first in a market. So how Godrej uses technology in its supply chain to reach first in the market and strengthen its presence?

We are present in several countries and have collaborated with many retailers for a seamless and agile supply chain. The degree of technology adoption varies across geographies, for instance, we use EDI to automate our transactions with retailers. Some retailers’ share store-wise information while some share on the basis of Stock Keeping Units (SKUs). We analyse the data on a daily basis which helps us in sensing the demand trend and accordingly we match supply agility with the dynamic changes in demand.

What is your go-to strategy to counter supply chain challenges that arise in the logistics of consumer products?

We optimize our network on the basis of agility. As a result, we get capable to respond faster to changes in consumer demand. All the elements of our supply chain, viz. plan, source, make, ship take the final consumer demand as a trigger and work in perfect rhythm to produce a seamless and agile supply chain. We also ensure that all the primary routes are serviced on a daily basis, which helps in responding faster to any unusual demand spike in any geography.

Which trends will drive the supply chain of retail businesses in the coming days?

I reckon consumers focus primarily on their two requirements. Firstly, high on-shelf availability and secondly, the freshness of products. Companies delivering high service levels with low system inventory will win the consumers. According to me, the frequency of planning and speed of execution will be the key differentiators in the coming days.

Which part of your supply chain activities are outsourced and which are controlled internally? Which are the major LSPs with whom you work?

We control most of the supply chain activities internally as it’s a key part of our business strategy and we are committed to high levels of agility in our supply chain. Planning, sourcing and manufacturing are done mostly in-house and only a small part of our portfolio is manufactured externally. We do outsource freight to various transport companies but do not work with a central LSP.

The supply chain must be optimized to attain higher agility at the place of reducing cost

You have proven your supply chain management capabilities several times in your long successful career. What learning and lesson you would like to pass to new generation professionals? 

There are two important lessons which I would like to pass on to new generation professionals.

Firstly, we must focus on consumers and give them the desired on-shelf availability and freshness. Instead of that, if we shift our focus to internal processes like forecasting and cost control, we are unlikely to win in the market.

Secondly, the entire supply chain must be optimized on the basis of agility instead of cost. A lot of professionals make the mistake of optimizing on cost, which is an internal measure, not consumer-facing or consumer-relevant issue. If we truly optimize on agility and plan well, it does lead to lower costs.

The trend of industry events is on a high rise in the supply chain industry and you are also participating as a panellist in India SCM Leadership Summit. So, how the industry events help businesses in crafting a futuristic and agile supply chain?

Industry events like India SCM Leadership Summit gather several leading supply chain professionals and listening to their ideas provide a new perspective to us. I am looking forward to this summit to get some more ideas for improving our supply chain.

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