SUPPLY CHAIN MANAGEMENT

GlaxoSmithKline By: Ajakumbi Baba Usman

What Is Supply Chain?

Supply chain is the system by which organizations source, make and deliver their products or services according to market demand. Supply chain management operations and decisions are ultimately triggered by demand signals at the ultimate consumer level. Supply chain as defined by experienced practitioners extends from suppliers suppliers to customers customers.

Supply Chain Includes

Material Flow Information Flow Financial Flow

GlaxoSmithKline Profile
GlaxoSmithKline (GSK) is one of the worlds largest research-based pharmaceutical corporations that discovers, develops, manufactures and markets branded human health products. Headquarters: UK, with additional operational headquarters in the USA Global presence: about 160 countries Primary markets: USA, France, Germany, UK, Italy and Japan Employees: approximately 103,000

BRIEF HISTORY
Year Merger/Acquisition New Company Name

1989

Beecham merged with SmithKline Beckman Glaxo acquires Burroughs Wellcome & Co. Glaxo Wellcome merged with SmithKline Beecham GlaxoSmithKline acquires consumer health care company Block Drug Co.

SmithKline Beecham

1995

Glaxo Wellcome

2000

GlaxoSmithKline

2001

GlaxoSmithKline

GSK Mission Strategy

Grow: to diversifying into vaccines, consumer healthcare and biopharmaceutical areas and expanding into India, Brazil, Russia, and China. Deliver: to delivering more products of value from increased growth in the core pharmaceutical business with a stronger pipeline of research and development to ensure a continuous flow of new products. Simplify: is short for simplifying the business model to include reducing working capital, streamlining processes and evolving the commercial model

GSK Products
GSK produce medicines for major diseases such as asthma, anti-virals, infections, mental health, diabetes, cardiovascular and digestive conditions. In addition, we are a leader in the important area of vaccines and are developing new treatments for cancer.

Other Products
Over the counter(OTC)medicines: Gaviscon and Panadol dental products such as Aquafresh and Sensodyne smoking control products Nicorette/Niquitin nutritional healthcare drinks such as Lucozade, Ribena and Horlicks skincare products marketed by Stiefel Laboratories

Operational Characteristics
Glaxo has been profiled in some areas; i. Quality Functions. ii. Supply Base management. iii. Manufacturing Process Ownership. iv. Quality in R&D. v. Best Purchase- Supplier Collaboration.

Some Problems Faced By GSK

THREAT OF COUNTERFEIT DRUGS: Some counterfeit drugs from Underdeveloped Countries are now in Europe,Japan, and the USA. SOLUTION: RFID tags, spectroscopic ink and full-color graphics.

GSK SUPPLY CHAIN

VMI (Vendor Managed Inventory. Outsourcing Ethics

VMI (Vendor Managed Inventory

Supplier decides on inventory levels of products. Monitors buyers inventory levels. Replenishes buyers inventory according to sales forecast.
The goals of VMI is to eliminate buyer oversight. VMI focuses on information sharing on product sales,forecasts and inventory levels.

VMI IN GSK
Upsteram and Downstream -Central system via intranet for acces to sales forecasts stock level at distribution centers,production & purchasing plans and deliveries in transit. Each supplier network member can access info about other members in the network. Performance monitoring system (VMI vs CMI)

OUTSOURCING
Glaxo has set up cross-functional teams in a sourcing group management. Seperate team for each commodity. Team Responsible for short term and long term procurement.
GSK outsourced to Enhance efficiency, Increase flexibility, and obtain expertise and skill not available to them

Ethics
Glaxo spends 8.4 billion pounds among 90,000 suppliers. New suppliers are audited against GSK standards Those not audited are trained to meet the standards.

CHALLENGES
Post merger Integration Issues Complex product portfolio Regulatory and operational challenges Outsourcing/supplier challenges Finding alternate/multiple suppliers Operational/production challenges Paperless labelling/electronic leaflets

THE END THANK YOU