Project Brief

Johnson & Johnson:

Our Credo: Johnson & Johnson is guided by the values set forth in Our Credo, created by General Robert
Wood Johnson in 1943. These principles have guided us over the years and continue to set the tone of
integrity for the entire Company. At all levels, the employees of Johnson & Johnson are committed to
the ethical principles embodied in Our Credo and these principles have been woven into the fabric of
the Company. We believe it’s a recipe for business success. Put simply, Our Credo challenges us to put
the needs and well-being of the people we serve first.

Project Title:

Defining optimal network strategy for J&J supply chain, to ensure customer service (OTIF) & agility (best
in class lead time, responsive to disruptions) in the network (Multi node /Direct) combined with
implementation of multi-echelon inventory model.

Background of the Project:

Johnson & Johnson MedTech business in APAC serves customer of almost 20+ countries through
different manufacturing sites across the globe based out of US, Europe, APAC & LATAM. The existing
network deals with the complexity arising from 100+ transportation lanes to 20+ countries across
multiple businesses. Key lanes include Global DC  Countries, Regional DC  Countries & Global DC
Regional DC Countries. Recently, team had piloted successful direct ship from Plant to countries
too.

Each market presents its own set of challenges with varying customer requirements, regulatory &
warehousing landscape, and challenges in the maturity of logistic network. For eg: business growth is
between fluctuates from low single digits (1%-3%) to double digits (10%-15%) across different countries.
In order to ensure right customer visibility, technology plays a pivotal role. With multiple ERPs, planning
systems and data lakes working in sync, complexity of information flow is a current byproduct. In order
to ensure regulatory compliance, some countries need Value Added Services which currently only
Regional DC can provide (eg: customized labelling, local language manuals).

With multiple such constraints, the current network has significant inventory parked at various nodes to
protect customer service. This also presents a high impact opportunity to optimize the inventory across
nodes or redefine the network itself. The challenge is to find the perfect sync between agility and cost
which would ultimately enable the supply chain to deliver better gross profits across businesses.
Opportunity Area:

1. Improving network landscape across E2E chain.

2. Inventory optimization -Multi Echelon model.
3. Optimize cost without impacting service
4. Agile SC with customer service in focus.

Current E2E Network Overview:

An illustration of current sample Supply Chain Network with 3 different manufacturing sites, 1 Global
Distribution Centre which acts as a primary hub, 1 Regional DC which acts as a secondary hub and some
markets with direct ship from the manufacturing site.

Market 1

Market 2
Mfg 1

Market 3

Mfg 2 Global DC
Market 4

Regional DC Market 5
Mfg 3

Market 6
Existing network parameters are as below:
Total Active SKUS: 795
Markets and RDC replenishment in current model is weekly
Ordering cost varies per product & mentioned in excel working file
Current SS
ABC Category Weeks of cover Target Service Level
A Category 6 98%
B Category 9 95%
C Category 11 92%

Project Objective:

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To review E2E product flow i.e. Supply chain network & define strategy to improve agility & cost i.e.
(inventory, warehousing, distribution) with improved customer service.

Project deliverables:

 Identify the additional factors to be considered for network/inventory optimization.

 Evaluate different network models across industry and identify the best fit for given data points
and requirements.
 Recommend best E2E model for the network to optimize cost & agility for identified service
levels.
 Define inventory parameters across nodes for the suggested multi-echelon model
 Identify factors to be monitored at a periodic frequency to recommend if/when model should
be revisited/modified.

NOTES / additional info:

Guide Name
Buddies:
Mentor Name:

Johnson & Johnson India: http://www.jnjindia.com/

OUR CREDO: http://www.jnj.com/connect/about-jnj/jnj-credo/

Note: Please submit duly filled form to requester along with additional guidelines / instructions /
information, in case any.

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