Logistics Manager Magazine

GlaxoSmithKline cut lead times in its R&D lab supplies operation and more than doubled OTIF through a series of initiatives – and it went on to win not one, but two European Supply Chain Excellence Awards last year.

Trevor Reay, GSK’s procurement director for R&D lab supplies, explained how the company implemented its transformation project to delegates at the Logistics and Supply Chain conference in London last week.

Under the heading of driving innovation and value through a fragmented supply chain, Reay started with the fact that supply chains evolve, and in a sector which sees products taking up to 18 years to get to market, inefficiencies and bad habits can set in.

“Performance management is just one part,” said Reay, “You have to step change to supplier relationship management for the big wins.”

He explained that as well as measuring KPIs, GSK monitored customer feedback and CSR projects too.

“We won’t deal with anyone who doesn’t measure those, and with our reduced supply base it allows us to do that easier.”  

By working with fewer partners the company has also identified added value services that vendors can offer that were not visible when dealing with 2,800 suppliers.

A total of 18 initiatives have resulted in a major increase in service levels in delivery and quality, cycle time reductions, waste reduction from consolidation and data visibility, and greatly reduced risk.

Reay said that lead times have been reduced to within 48 hours on average and delivery on time in full has been improved from 40 per cent 90 per cent.