A STUDY ON THE SUPPY CHAIN LOGISTICS OF

WHIRLPOOL OF INDIA LTD.

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 TABLE OF CONTENT

S.NO PARTICULARS PAGE NO.

CHAPTER I
1.1 Introduction

1.2 Scope of the study

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1.3 Objective of the study

1.4 Need for the study

1.5 Limitation of the study

CHAPTER II
2.1 Review of literature

2.2 Research methodology

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2.2.1 Research

2.2.2 Methodology

2.2.3 Research Design

CHAPTER III
3.1 Data Analysis and Interpretation

3.1.1 Industry profile

3.1.2 Company profile

3 3.1.3 Vision Statement

3.1.4 Mission Statement

3.1.5 Values of the company

3.1.6 Products of the company

3.1.7 Company overview

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 3.1.8 Organisational structure

3.2 Whirlpool supply chain logistics

3.2.1 Major suppliers of Whirlpool corp.

3.2.2 Retailers of Whirlpool

3.2.3 Pondicherry Bajaj Electronics

3.2.4 Brands owned by Whirlpool

3.3 Whirlpool`s strategy regarding supply chain

3.4 The benefits of supply chain to an organisation

3.5 The challenges faced by whirlpool corp.

3.6 Demand, capacity, scheduling and inventory challenges

3.7 Overview of Whirlpool`s SCM

3.7.1 SCM

3.8 Supply chain issues and improvements

3.8.1 Turnaround of whirlpool

3.8.2 CPFR implementation

3.8.3 Electronic Data Interchange (EDI)

3.8.4 Supply chain collaborator

3.8.5 Other E-Initiatives

3.8.6 Effective of initiatives

CHAPTER IV
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4.1 Findings

CHAPTER V
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5.1 Conclusion

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 CHAPTER I

1.1 INTRODUCTION

• Whirlpool of India Ltd., a prominent player in the home appliance sector,

operates with a sophisticated supply chain that integrates manufacturing and
marketing processes to deliver high-quality products to consumers. The
company's supply chain dynamics are crucial for maintaining competitiveness
in a rapidly evolving market.

• Supply chain logistics refers to the processes and activities involved in the
planning, execution, and management of the flow of goods, information, and
services from the point of origin to the point of consumption. It encompasses
the various logistical elements within the broader supply chain framework,
ensuring that products are delivered efficiently and effectively.

• This project provides the analysis of the supply chain logistics of Whirlpool of
India ltd.

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1.2 SCOPE OF THE STUDY

The following are the scope of the project:

• To analyse the supply chain logistics of whirlpool of India ltd.
• To assess the operational efficiency of the company and analysis of costs helps
identify areas for potential savings, such as transportation, warehousing, and
inventory management.
• To gather knowledge on the supply chain structure and supplier relationships of
the company called whirlpool of India ltd.
• To identify the delivery performance, inventory levels, demand forecasting,
market responsiveness of such company.

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1.3 OBJECTIVE OF THE STUDY

The following are the objectives of the study:

• Aims to analyse the operational efficiency, customer satisfaction, quality assurance of

such company, sustainability initiatives.
• To gather more insights on the strategy on how the company retains its suppliers and
customers
• To analyse the strategies and techniques employed by the organisation on the supply
chain logistics.

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1.4 NEED OF THE STUDY

The following are the need of the study:

• To explore the supply chain management of the company called whirlpool of India ltd.
• To gain insights about the network of the company worldwide.
• To Explore eco-friendly practices within the supply chain which can enhance
Whirlpool’s sustainability efforts in the market.

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1.5 LIMITATIONS OF THE STUDY

The following are the limitations of the study:

• The time limit was insufficient to understand the vast amount of information about the
supply chain logistics of whirlpool of India ltd.
• Access to data and resources were limited results in affecting the comprehensiveness
of the study.

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 CHAPTER II

2.1 REVIEW OF LITERATURE

1. E-commerce and Last-Mile Delivery

Bai, C., & Sarkis, J. (2021): This study explores the challenges and innovations in last-mile
delivery within e-commerce. It highlights the critical role of last-mile logistics in enhancing
customer satisfaction and the complexities introduced by consumer expectations for speed and
flexibility. The authors discuss various strategies, such as crowd shipping and automated
delivery systems, that can optimize last-mile efficiency.

2. Supply Chain Logistics Management

Bowersox, D. J., Closs, D. J., & Cooper, M. B. (2013): This foundational text outlines the
principles of supply chain logistics management, emphasizing the importance of integration
across various supply chain components. The authors present a comprehensive framework for
understanding logistics functions, detailing best practices for improving service levels and
reducing costs through effective supply chain coordination.

3. Logistics & Supply Chain Management

Christopher, M. (2016): Christopher provides a holistic view of logistics and supply chain
management, focusing on the need for agility and responsiveness in dynamic markets. He
discusses concepts such as the demand-driven supply chain and the role of information flow in
achieving operational excellence. The work emphasizes the need for collaboration among
supply chain partners to adapt to changing consumer demands.

4. Performance Measurement in Supply Chain Logistics

Cuthbertson, R., & Piotrowicz, W. (2011): This paper addresses the critical issue of
performance measurement in supply chain logistics. It identifies key performance indicators
(KPIs) and frameworks for assessing logistics efficiency, effectiveness, and alignment with
organizational goals. The authors argue for a balanced approach to performance measurement,
incorporating both financial and non-financial metrics.

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5. Circular Economy

Geissdoerfer, M., Savaget, P., Bocken, N. M. P., & Hultink, E. J. (2018): This study introduces
the concept of the circular economy as a sustainability paradigm that redefines traditional
supply chain practices. The authors discuss the implications of adopting circular principles,
such as resource efficiency and waste minimization, and provide a framework for integrating
circularity into supply chain logistics.

6. The Balanced Scorecard

Kaplan, R. S., & Norton, D. P. (1996): Kaplan and Norton’s work on the balanced scorecard
presents a strategic management tool that aligns business activities with the vision and strategy
of the organization. They advocate for measuring performance beyond traditional financial
metrics, incorporating customer, internal process, and learning and growth perspectives to
enhance decision-making in supply chain management.

7. Impact of Technology on Supply Chain Logistics

Kumar, M., et al. (2020): This research examines the transformative effects of technology on
supply chain logistics, particularly through digitalization and automation. The authors highlight
advancements such as IoT, big data analytics, and blockchain technology, discussing how these
innovations enhance visibility, traceability, and decision-making capabilities within supply
chains.

8. Defining Supply Chain Management

Mentzer, J. T., et al. (2001): This seminal work provides a comprehensive definition of supply
chain management, emphasizing its interdisciplinary nature. The authors outline the
components of supply chain management, focusing on the collaborative relationships
necessary for optimizing supply chain performance and creating value for customers.

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9. Green Logistics

Mishra, D., et al. (2022): This review addresses the growing importance of green logistics in
response to environmental concerns. The authors explore various strategies for implementing
sustainable logistics practices, such as reducing carbon footprints and optimizing resource use,
and discuss the challenges organizations face in transitioning to greener supply chain
operations.

10. Supply Chain Resilience

Ponomarov, S. Y., & Holcomb, M. C. (2009): This study delves into the concept of supply
chain resilience, particularly in the context of disruptions. The authors identify factors
contributing to resilience, such as flexibility, redundancy, and adaptive capacity, and discuss
the importance of proactive risk management strategies in maintaining supply chain continuity.

11. Risk Management in Supply Chains

Schmidt, A. J., et al. (2019): This literature review synthesizes various approaches to risk
management within supply chains. The authors categorize risks and propose frameworks for
identifying, assessing, and mitigating risks, emphasizing the need for a comprehensive risk
management strategy to enhance supply chain robustness.

12. Global Perspective on Supply Chain Management

Schoenherr, T., & Speier-Pero, C. (2015): This work offers insights into global supply chain
management, focusing on the complexities and challenges of managing supply chains across
different regions. The authors discuss the impact of globalization on logistics practices,
highlighting strategies for effectively managing international supply chains.

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2.2 RESEARCH METHODOLOGY

2.2.1 RESEARCH

Research is a process of systematic inquiry that entails collection of data;

documentation of critical information; and analysis and interpretation of that data/information,
in accordance with suitable methodologies set by specific professional fields and academic
disciplines.

2.2.2 METHODOLOGY

Fundamental to the success of any formal research project is a sound research

design. A good research design has the characteristics of problem definition, specific methods
of data collection and analysis, time required for a research project and estimate of expenses to
be incurred. The function of a research design is to ensure that the required data are collected
accurately and economically.

A research design is purely and simply the framework or plan for an analysis of data.
It is a blueprint that is followed in completing a study. It resembles the architect's blue-print
(map) for constructing a house. It may be worthwhile to mention here that a research design is
nothing more than the framework for the study ensures that the study will be relevant to the
problem and the study will employ economical procedures.

Claire Seltizetal defines Research Design as “Research design is a catalogue of the

phases and facts relating to the formulation of a research effort. It is the arrangement of
collection and analysis of data in a manner that aims to combine relevant research purposes
with economy in procedure”.

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2.2.3 RESEARCH DESIGN

Research design is the framework of research methods and techniques chosen by

a researcher to conduct a study. The design allows researchers to sharpen the research methods
suitable for the subject matter and set up their studies for success. There are three main types
of designs for research:

I. Data collection
II. Data Analysis

SUPPLY CHAIN LOGISTICS

Supply chain management (SCM) involves overseeing and optimizing the flow of goods,
information, and finances as they move from suppliers to manufacturers to distributors and
finally to consumers. It encompasses various processes, including:

1. Planning: Forecasting demand and aligning production and inventory accordingly.

2. Sourcing: Selecting suppliers and managing relationships to procure materials.

3. Manufacturing: Overseeing the production process to ensure efficiency and quality.

4. Logistics: Managing the transportation and storage of goods throughout the supply
chain.

5. Return Management: Handling returns, recycling, and disposal of products.

Effective SCM aims to reduce costs, improve quality, enhance customer satisfaction, and
respond quickly to market changes. Technologies like automation, data analytics, and supply
chain software are increasingly used to improve visibility and efficiency.

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IMPORTANCE OF SUPPLY CHAIN LOGISTICS IN AN ORGANISATION

Supply chain management (SCM) is crucial for companies for several reasons:

1. Cost Efficiency: Effective SCM reduces operational costs by optimizing resource

use, minimizing waste, and enhancing logistics, leading to better profit margins.

2. Improved Quality: By managing supplier relationships and ensuring quality control

throughout the production process, companies can deliver higher-quality products.

3. Enhanced Customer Satisfaction: Efficient supply chains ensure timely delivery of

products, which boosts customer satisfaction and loyalty.

4. Increased Flexibility: A well-managed supply chain allows companies to adapt

quickly to market changes, such as shifts in demand or disruptions.

5. Risk Management: SCM helps identify potential risks in the supply chain, enabling
companies to develop strategies to mitigate those risks, such as diversifying suppliers.

6. Sustainability: Companies can implement sustainable practices through SCM by

optimizing resource use, reducing waste, and selecting eco-friendly suppliers.

7. Data-Driven Decisions: With advanced analytics, companies can gain insights into
supply chain performance, allowing for informed decision-making and strategic
planning.

8. Competitive Advantage: Companies with efficient supply chains can respond more
rapidly to market trends and customer needs, setting themselves apart from
competitors.

In summary, effective SCM is essential for operational efficiency, customer satisfaction, and
long-term business success.

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 CHAPTER III

3.1 DATA ANALYSIS AND INTERPRETATION

3.1.1 INDUSTRY PROFILE

• The home appliance industry is one of the fastest expanding in the Indian market.
Home appliances in India have been expanding steadily, driven by both large and small
appliances.

• The industry has a sizable untapped market for appliances such as air conditioners
(AC), washing machines, and refrigerators.

• The Indian home appliance market is competitive and moderately consolidated, as top
players have a high market share in the industry of big and small appliances.

• Some of the major players are Electrolux AB, Whirlpool Corporation, Haier
Electronics Group Co Ltd, LG Electronics, Robert Bosch GmbH, and Samsung, among
others.

• In 2023, India's home appliances industry generated $75 billion in revenue and is
estimated to experience continued expansion going forward.

• Projections indicate the sector will increase at a CAGR of 5.5% over 2024 – 2029.
CAGR - Compounded Annual Growth Rate (CAGR is a way to measure how an
investment or business has grown over a specific period).

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3.1.2 COMPANY PROFILE

• Whirlpool of India Ltd, is a subsidiary of Whirlpool Corporation, committed to

being the best global kitchen and laundry company, in constant pursuit of improving
life at home.

• Headquartered in Gurugram, we are one of the largest manufacturers and marketers

of major home appliances in the country.

• The company owns three manufacturing facilities at Faridabad, Pondicherry and

Pune.

• Pondicherry branch is the manufacturing sector of washing machine automatic as

well as semi-automatic. It has four plants and several departments like Finance,
Production, Purchase, Stores, Human Resources, Maintenance, etc,

• The CEO of Whirlpool India Ltd. is Mr. Marc Bitzer and the Director of the
Pondicherry unit is Mr. Sivaramakrishnan.

• The headquarters of Whirlpool India ltd is located at Benton Harbor, Michigan,

United States.

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3.1.3 VISION STATEMENT OF WHIRLPOOL OF INDIA LTD.:

Be the best kitchen and laundry company, in constant pursuit of Improving life at home.

3.1.4 MISSION STATEMENT OF WHIRLPOOL OF INDIA LTD.:

Earn trust and create demand for our brands in the digital world.

3.1.5 VALUES OF WHIRLPOOL OF INDIA LTD.:

▪ Respect

▪ Integrity

▪ Diversity and Inclusion

▪ One Whirlpool

▪ Spirit of winning

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3.1.6 COMPANY PRODUCTS

Single door refrigerator Top load washing machine Double door refrigerator

Chimney Air Conditioner

Micro oven Purifier

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3.1.7 COMPANY OVERVIEW

Particulars Details
Company Name Whirlpool of India Ltd
Founded 1960
Headquarters Gurgaon, Haryana, India
Website whirlpoolindia.com

Leading manufacturer of home appliances in India, part of Whirlpool

Overview Corporation. Offers a range of products including refrigerators,
washing machines, and air conditioners.

Mission To provide innovative solutions that enhance quality of life at home.

To be the most trusted brand in home appliances, recognized for

Vision
quality and customer satisfaction.

- Refrigerators (frost-free and direct cool)

- Washing Machines (fully automatic and semi-automatic)

Products and
Services - Air Conditioners (split and window)

- Kitchen Appliances (microwaves, cooking ranges)

Significant market share in multiple product categories with a strong

Market Presence
distribution network.

- 1975: Launched first washing machine in India.

Key Milestones - 2000: Became market leader in refrigerator segment.

- 2021: Introduced smart appliances as part of digital transformation.

- Mr. Vikas Ranjan: Managing Director

Leadership Team
- Mr. Vikas Bansal: Chief Financial Officer
Corporate Social
Engages in initiatives focused on education, health, and
Responsibility
environmental sustainability.
(CSR)

Strengthen product portfolio with smart and sustainable solutions and

Future Goals
expand market reach across India.

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3.1.8 ORGANISATIONAL STRUCTURE

SENIOR LEADERSHIP TEAM

The senior leadership team is led by chief executive officer Marc Bitzer and leadership from
all of the company’s major functions and regions. It exists to manage the operations of the
company in accordance with the company’s high ethical and professional standards, while
providing the operational oversight to enable the company to meet our business objectives.

Ludovic Beaufils Marc Bitzer

Executive Vice-president Chairman &

KitchenAid Small Appliances Chief Executive Officer

Danielle Brown Roberto H. Campos

Senior Vice President, Executive Vice President,

Chief Information Officer Global Product Organization

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Kyle De Jong Narasimhan Eswar

Senior Vice President, Managing Director,

Legal General Counsel India

Holger Gottstein Pamela Klyn

Executive Vice President, Executive Vice President,

Strategy and Business Development Corporate Relations and
Sustainability

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Alessandro Lombardi Carey L. Martin

Senior Vice President, Executive Vice President and

Global Strategic Sourcing Chief Human Resources Officer

Gilles Morel Alessandro Perucchetti

Executive Vice President Executive Vice President and

President, NAR

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James W. Peters Juan Carlos Puente

Executive Vice President and Executive Vice President and

Chief Financial and Administrative Officer President, LAR

Roxanne Warner

Senior Vice President,

Corporate Controller and Investor Relations

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3.2 WHIRLPOOL SUPPLY CHAIN LOGISTICS

Supplier disruptions have plagued Whirlpool Corp. In response, the company has leveraged
procurement strategies such as dual sourcing and reducing parts complexity to minimize
interruptions to its supply chain.

In 2017, Whirlpool and Sears split as the retailer struggled to retain suppliers and customers
amid a sinking retail market.

Then, in 2021, the home appliance maker told analysts during a Q4 2021 earnings call that
the Omicron variant of COVID-19 was impacting suppliers as were higher steel and resin costs.

Earlier this year, Whirlpool’s Q4 production volumes fell 5% because of a “one-off” disruption
at an unnamed supplier that has since been resolved.

Whirlpool has been assessing risks in its supply chain before committing to a plan.

For dual sourcing, the company assessed geopolitical instability, natural disasters, and supplier-
related issues.

Evaluating these issues provided the company insight on its vulnerabilities and where dual
sourcing could be beneficial, Whirlpool Corp. SVP of Global Strategic Sourcing Alessandro
Lombardi told Supply Chain Dive in an email.

“We have protocols established for compliance, quality control, supply chain management, etc,
which help signal when we may need to switch to an alternative supplier,” Lombardi said.

“We constantly monitor the performance of our suppliers to assess the effectiveness of the dual
sourcing strategy and make necessary adjustments as needed.”

The company’s risk assessment allowed it to introduce dual sourcing for electrical and
structural components.

In terms of parts complexity, Whirlpool also used an assessment to determine the adequate
parts to optimize.

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“We know that reducing parts complexity can lead to cost savings, streamlined operations, and
improved product quality,” Lombardi said.

“So we started by assessing our existing parts inventory and identifying opportunities to
consolidate similar parts or components.

Wherever possible, we streamlined the variety of parts by standardizing designs, materials, or

specifications.”

The company also collaborated with its supply partners to explore ways in reducing
manufacturing complexity.

“As a result of the actions we’ve already taken, we’ve seen significant cost savings, streamlined
production processes, and reduced supply chain disruptions,” he said.

“We expect this forward momentum to continue into Q4 and 2024.”

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3.2.1 MAJOR SUPPLIERS OF WHIRLPOOL

1. Supreme plastics
2. Brite plastic
3. Sree mother plastic
4. Motherson
5. National plastic
6. Act plastic
7. Jindal steel
8. Karthikeyan mold and dies
9. Southern pressure casting
10. Suja shoe rubber
11. Molex
12. Gadd
13. Imports supplier are as below
14. Welling China
15. Jeamo China
16. Hanyu China
17. Kawai China
18. Macurex
19. Sail

3.2.2 RETAILERS OF WHIRLPOOL

1. Vijay sales
2. Mahajan electronics
3. Vasanthan co
4. Devaki enterprises
5. Shri sai trading

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3.2.3 THESE ARE THE PONDICHERRY BAJAJ ELECTRONICS

1. Rupavani
2. Prakash showroom
3. Mani electronics
4. Sathiyam

3.2.4 BRANDS OWNED BY WHIRLPOOL CORPORTION

1. KitchenAid
2. Maytag
3. JennAir
4. Amana
5. Brastem
6. Consul
7. InSinkErator
8. Gladiator Garage Works
9. Swash
10. Yummly
11. Everydrop
12. Afresh
13. Acros
14. Hotpoint
15. Inglis
16. Estate
17. Bauknecht
18. Ignis
19. Indesit

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3.3 WHIRLPOOL STRATEGY REGARDING SUPPLY CHAIN

Whirlpool’s current strategy, regarding its supply chain, is concerned with the creation of some
objective preconditions for its logistics infrastructure to provide utmost efficiency – something
that is expected to result in cutting the operational costs and consequently, in making the
Company much more competitive. To illustrate the validity of this suggestion, we can refer to
the main principles of Whirlpool’s currently deployed logistical strategy, among which the
most notable are:

Centralization/Vertical integration of management

The fact that Whirlpool decided to reduce the number of its facilities across the US while
hoping that it will help it to sharpen the firm’s competitive edge, implies the Company officials’
awareness of the full scope of potential benefits, which the implementation of such an initiative
usually brings.

As Bhatnagar and Chee-Chong (2009) pointed out, “By switching from a decentralized
distribution/supply system with several warehouses… to a centralized system with a new
distribution… it is possible to achieve better coordination between its inventory, backorder,
and freight costs” (p. 205). In the aftermath of having been reorganized logistically, Whirlpool
was able to increase sales, as the Company that provides the industry’s shortest lead-times.

Low inventory

Ever since the time of its merger with Maytag, Whirlpool has remained committed to exploiting
the advantages of the low inventory approach to addressing logistical challenges. That is, unlike
many of its competitors, the Company does not face the necessity to spend money on ensuring
the availability of some low-turnover products for consumers. The adoption of such a logistical
strategy by a manufacturer/distributor is especially justified through the period of economic
recession, when consumers tend to grow increasingly price-sensitive, on one hand, and less
concerned with seeking ‘perceived value’ in goods and services, on the other.

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Technological intensity

The earlier mentioned logistical reorganization of Whirlpool could only be achieved by the
mean of integrating hi-tech solutions as an essential part of the Company’s corporate
philosophy. This has been effectively accomplished by the time all ten distribution centers
became fully operational.

After all, the very functioning of these centres is made possible by Whirlpool’s willingness to
rely on the latest technologies, within the context of how it goes about addressing the question
of “how do we get visibility to those (delivery) orders and how do we turn them very quickly
so that our trade partners do not have to carry as much inventory?” (Staroxman 00.02.31). As
practice indicates, this did help to bring Whirlpool to a whole new competitive level.

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3.4 THE BENEFITS OF CHANGE TO THE SUPPLY CHAIN

Among the main benefits, brought about by the undertaken change, can be named the
following.

Increased market-responsiveness

By the year 2009, Whirlpool had closed down 100 out of its 184 facilities, with the remaining
ones having been consolidated into 10 major regional distribution hubs. In its turn, this resulted
in increasing the logistical soundness of Whirlpool’s functioning, as a commercial entity
strongly affected by the fluctuations of demand in the home appliance market, “The lesser the
number of stages in the supply chain, the better you are in terms of responsiveness to the
customer demand” (MacMillan, 2008, para. 11). Given the earlier mentioned purchasing trend
in the home appliance market, the implementation of this specific logistical initiative does
appear to have been thoroughly justified.

Improved systemic integrity

The concerned restructuring also allowed Whirlpool to improve the systemic integrity of its
operations, in the sense of making it much easier for senior managers to come up with the
discursively justified and timely network coordination decisions. The logic behind this
suggestion is quite apparent. At a time of economic recession, the qualitative trends in the
locally bounded home-appliance markets become more or less unified, which in turn
presupposes a lesser need for Whirlpool to pay attention to the regional specifics of consumer
demand.

Consequently, this naturally required the consolidation of the Company’s operational

infrastructure to make it much more manageable, as a spatially stable logistical system (Sáenz
& Revilla, 2014). As a result, Whirlpool is now in a much better position to address the
objectively predetermined needs of the targeted clientele, as compared to what it used to be the
case before the Company’s merger to Maytag. The additional benefit, in this respect, can be
named the fact that by deciding to downsize the number of its facilities, Whirlpool was able to
achieve a significant reduction of the affiliated operating costs.

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Increased warehouse efficiency

The new logistic model, adopted by Whirlpool, calls for keeping a low level of inventory. As
a result, the Company was able to reduce the amount of storage-related costs and to provide its
regional managers with the powerful incentive to apply an extra effort in making sure that the
sold appliances are delivered to customers as fast, as possible.

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3.5 THE CHALLENGES FACED BY WHIRLPOOL CORPORATION

The drivers for change to the supply chain

Following the acquisition of Maytag in 2006 and the financial crisis of 2008-2009, it became
clear to the Whirlpool Corporation’s top-managers that both of these developments called for
many readjustments to be applied to the Company’s logistical paradigm. The reason for this
was that Whirlpool’s restructuring and the post-crisis economic realities in America resulted
in affecting the Company’s competitive stance – hence, requiring Whirlpool to invest in
increasing the effectiveness of its supply chain. Two of the main drivers for change, in this
respect, were following.

Transformation of purchasing behaviour, on the part of the targeted consumers

Whereas most of such consumers used to plan to buy home appliances well ahead of time, they
now tend to choose in Favor of acquiring a particular appliance while driven by the essentially
impulsive considerations (the so-called ‘distressed buy’). As MacMillan noted, “Instead of
mulling the purchase of say, a new washer, and dryer over a long period… a majority of
customers had begun to act more quickly, buying new machines because the old ones broke
down” (2008, para. 3). This is exactly the reason why, as of today, Whirlpool applies much
effort into ensuring that just about every product delivery takes place within the time-frame of
48 hours.

Strengthening of competitive pressures

Since, unlike its main competitors, Whirlpool decided to retain most of its US-based production
lines, the Company is not in the position to save on labour costs. This undermines Whirlpool’s
competitive stance rather substantially and presupposes that one of the ways to address the
situation, is ensuring that the Company’s currently deployed logistical strategy is maximally
efficient – especially given the outcomes of internal audits, conducted before the organizational
change in question. As Whirlpool’s Vice-President Brian Hancock pointed out, “The cash-flow
was probably $200-$300 million out of whack from what we wanted it to be” (Staroxman,
2010, 00.01.17). As of today, it can be safely confirmed that the Company did succeed in
reaching this particular objective.

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3.6 DEMAND, CAPACITY, SCHEDULING, AND INVENTORY CHALLENGES

Recommendations on increasing the speed of response to customers

Even though Whirlpool’s logistical restructuring did prove beneficial, the Company continues
to experience many challenges on the way of trying to remain highly competitive. For example,
the worsening of the economic situation in America presupposes that, as time goes on, the
demand-fluctuations in the country’s market of home appliances are going to become ever
more unpredictable. As a result, the Company’s current approach to logistics (which takes for
granted people’s high buying power) may prove not being conceptually adequate.

Another pressing challenge has to do with the fact that maintaining Whirlpool’s regional
distribution centers fully operational is an extremely resource-consuming task – the hubs’ sheer
size alone predetermines such as a state of affairs. The continual expansion of the Company’s
network of regional distribution centers is likely to prove somewhat problematic, as well, due
to the applicable legal regulations, “The (registration) process… for a facility that’s maybe a
million or 2 million square feet can take a long time” (MacMillan, 2008, para. 7). In its turn,
this implies that Whirlpool may never cease reassessing the circumstantial appropriateness of
its currently utilized logistical strategy.

As far as ensuring the Company’s scheduling integrity (speedy responses to customers) is

concerned, nothing can come in handier than the newly emerged technologies of relevance.
Therefore, it will be thoroughly logical to assume that, as time goes on, the representatives of
Whirlpool’s ‘research and development’ department are going to be endowed with ever more
executive powers. The full soundness of this suggestion can be shown, regarding the well-
established fact that the centralization of logistical infrastructure can only prove gainful if
conducted in a scientifically sound manner (Prajogo, Oke & Olhager, 2016).

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3.7 OVERVIEW OF SUPPLY CHAIN LOGISTICS OF WHIRLPOOL OF INDIA LTD.

Whirlpool has integrated its supply chain operations to streamline and optimize the entire
process from manufacturing to customer delivery. By merging leadership for manufacturing
and logistics, Whirlpool aims to break down silos and improve cross-functional collaboration.
This integration helps ensure effective communication and coordination across different stages
of production and delivery, enhancing both product quality and speed of delivery. To further
support this, Whirlpool employs SAP for real-time data and decision-making, replacing its
older system to better handle demand fluctuations and manage inventory efficiently.

A critical component in Whirlpool’s strategy is its partnership with Penske Logistics, which
serves as its lead logistics provider (LLP). Penske oversees and manages multiple third-party
logistics (3PL) relationships, providing Whirlpool with a centralized platform for routing,
shipment optimization, and supplier performance tracking. This setup allows Whirlpool to
monitor distribution activities closely and maintain high levels of on-time delivery and
inventory accuracy. By leveraging Penske’s technology, Whirlpool optimizes costs through
efficient route planning and improved visibility across the supply chain.

In addition to logistics efficiency, Whirlpool is committed to sustainability. Its procurement

strategy focuses on responsible sourcing by choosing suppliers who align with its ethical
standards and sustainability goals. This includes dual sourcing for supply chain resilience and
ensuring all major manufacturing sites aim for zero waste to landfill by 2030.

Whirlpool’s supply chain logistics strategy, marked by partnerships, technology integration,

and a strong commitment to sustainability, allows it to manage a resilient, agile, and efficient
supply chain that supports both operational excellence and customer satisfaction.

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3.7.1 OVERVIEW OF SCM OF WHIRLPOOL CORP.

Theoretical Framework of Supply Chain Logistics

1. Supply Chain Components

Manufacturing: The core of supply chain logistics revolves around production and
manufacturing facilities. These include regional manufacturing plants that create products and
ensure their quality.

Quality Control: Multiple quality checkpoints exist to maintain standards throughout the
supply chain, from production through distribution.

Regional Distribution Centers (RDC): These serve as hubs for storing goods before they move
to local or international markets. Regional distribution centers manage large-scale inventory
and provide logistics support for further distribution.

Local Distribution Centers (LDC): Located closer to end customers, these centers facilitate
efficient delivery and reduce lead times.

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2. Key Processes in the Supply Chain

Production and Procurement: The initial stages involve procuring raw materials and producing
goods at manufacturing plants. Efficient procurement strategies help control costs and ensure
a steady supply of necessary components.

Quality Control Procedures: At each stage, rigorous quality control procedures are
implemented to maintain product integrity, from manufacturing to distribution.

Logistics and Distribution Planning: Logistics encompasses planning routes, timing, and
transportation modes to ensure timely product delivery. Distribution is segmented into lead
logistics providers who manage transportation to distribution centers.

Warehousing and Inventory Management: Storage facilities at RDCs and LDCs hold inventory,
balancing demand and supply. Inventory management strategies are applied to optimize stock
levels, prevent overstocking, and reduce holding costs.

3. Supporting Infrastructure

Transport Networks: An integrated network of trucks, railways, and protective measures to

secure goods in transit. Trucks serve as a primary mode of transportation between
manufacturing plants and distribution centers.

Regional and Local Distribution Facilities: Dedicated sites that store and distribute goods, with
advanced logistics and warehousing systems.

4. Strategic Partnerships

Third-Party Logistics Providers (3PL): These external partners help manage the supply chain's
logistics aspects, enabling organizations to focus on core competencies. They handle
transportation, warehousing, and sometimes end-customer delivery.

5. Logistics Management and Lead Logistics Providers (LLP)

Lead Logistics Providers: Oversee all supply chain logistics, coordinating between
manufacturing plants, RDCs, and LDCs. They ensure optimized routes, manage transportation
fleets, and handle end-to-end logistics operations.

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Regional Parota Distribution Centers: Specialized centers managing regional logistics and
maintaining efficient distribution networks.

6. Challenges and Considerations in Supply Chain Logistics

Quality Control Consistency: Ensuring that products maintain consistent quality through the
various stages of production and distribution.

Infrastructure Limitations: Addressing challenges posed by insufficient infrastructure in certain

regions, such as poor road quality or limited access to railway lines.

Inventory Balancing: Effectively balancing inventory levels to meet demand without incurring
high holding costs.

Environmental Impact: Reducing the environmental footprint of logistics operations, such as

emissions from transportation and energy consumption in warehousing facilities.

This framework covers the main theoretical concepts of supply chain logistics, including the
roles, processes, and infrastructure necessary to support efficient product flow from
manufacturers to end-users.

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3.8 SUPPLY CHAIN ISSUES AND IMPROVEMENT IN THE WHIRLPOOL

Whirlpool’s supply chain encompasses more than 40 manufacturing facilities supplied from
7,000 different suppliers from every corner of the world. These facilities import as well as
export products to separate regions and delivered to about 30,000 retailers worldwide. Besides
retailers, the company also delivers products to builders and directly to consumers’ houses.
Whirlpool has 2.2 to 2.5 million units in inventory at any given time.

While the Whirlpool brand has long been associated with reliable household appliances, its
supply and delivery performance in 2000 was far from being reliable. The unfortunate irony of
the situation is that availability was low even while total inventory levels were often too high.
These inconsistencies were frustrating to retail partners and customers. It was clear to executive
leadership that these supply chain management issues had to be fixed.

Thus, some of the issues can be short-listed as:

• Oversupply in distribution channel.

• Slow response to non-standard orders (waiting time of 5 to 10 days for retailers.)

• Inadequate Inventory for some SKU’s leading to stock outs.

• Excess inventory which was transferred forcefully to distributors. (Almost 15

temporary buildings for stockpiles)

• Lack of communication between ordering and manufacturing units

• Large number of forecasting errors led to increased storage cost (result = locking of
working capital)

• The increasing paperwork caused increase in operational costs and issues with vendors

• Too many 3PL’s resulted in transactional and adversarial relationships. (Issues included
contract variations with no common metric to measure and check distribution)

• Vendors started demanding to publish all trade item information to the global data pool
for product information.

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3.8.1 TURNAROUND OF WHIRLPOOL

Whirlpool used a three tier method to obtain insights in supply chain. The first step was
Understanding End Customer needs. The major needs that were identified by the customers
were

a) Delivery on promised time

b) Delivery with integrity

c) Faster delivery time

In order to achieve the goals in Supply Chain Management, Whirlpool started using various
restructuring initiatives. Some of them have been discussed below:

3.8.2 CPFR IMPLEMENTATION:

“We want to get the right product to the customer when they expect it. While that is a simple
set of outcomes, it is an incredibly complex set of activities that have to be orchestrated all the
way to

our suppliers.”

-Reuben Slone, Vice-President of Supply Chain, Whirlpool 2003

In 2009, Whirlpool was facing forecast accuracy and demand variability challenges.
Benchmarking best practices in forecasting led Whirlpool and some of its key trade partners to
believe that CPFR offered a significant opportunity for improvement in the area of forecasting.
The desired state was to have Whirlpool or trade partners host a collaboration hub that would
act as a single point of storage for all forecast related data which is shared between both
companies within a very secure environment.

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Before the implementation of CPFR, the forecast error was 70% which dropped down to 11%.
Whirlpool and its trade partners saw a reduction in weekly order variability due to improved
forecasting and a less reactive stance by trade partners to take corrective action in order
variability. A forecast mismatch alert system was set up which allowed improved accuracy by
analysing the causes and making creative action plans.

3.8.3 ELECTRONIC DATA INTERCHANGE (EDI):

By early 1999, whirlpool adopted EDI to enhance the efficiency of its supply-chain further and
cut down on its expenses. It launched a scheme called the Easy EDI, using which the company
and its 600 suppliers could reduce paper work. EasyEDI, as per the management at whirlpool,
was aimed at achieving two benefits:

• Eliminating paper work of Whirlpool’s 300 smaller suppliers, and

• Reducing operational costs for its data interchange thereby saving upto $600,000 a year.

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EDI initiatives at Whirlpool prompted its small and medium sized suppliers to use the system.
Later by 2000, Whirlpool started offering the service to 300 of its largest suppliers.

3.8.4 SUPPLY CHAIN COLLABORATOR

Whirlpool initially used mails for communication with its trade partners where numerous
forecast-related documents were sent to its key trade partners via e-mail. This led to confusion
about which documents were the most current. Whirlpool selected i2 Suplly Chain Collaborator
software to solve this issue of version control. The most current version of any file was now
located in the secure, shared files section, easily accessible by any planner from either the
Whirlpool or partner viewpoint. This ensured that the same data is being used for
planning/forecasting purposes by both Whirlpool and its trade partners. i2 Suplly Chain
Collaborator allowed Whirlpool to migrate from a monthly alignment of forecasts to a weekly
alignment, improving overall accuracy levels. In addition, the forecasting performance also
improved because there was less room for human error.

3.8.5 OTHER E-INITIATIVES

Online Shopping:

In early 2000, Whirlpool in order to develop its electronic supply chain initiatives set up an
electronically-enabled organizational initiative and developed Internet enabled home
appliances. The company also developed a site called WhirlpoolWebWorld.com, setting up a
Business-to-business link. WhirlpoolWebWorld procurement let Whirlpool purchase all the
items it required through a common online catalog from its suppliers. It also enabled all its
retailers around the world to order from Whirlpool.

Demand Management:

Whirlpool also wanted to improve its demand management system. Earlier, it used old
techniques like spreadsheets and home grown systems to determine demand. But those systems

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could not accurately manage the various inputs and consumer variables. After a careful review,
the management decided to use the I2 Demand Planner to track demand in 1997.

Move towards Outsourcing:

By early 2000, the company decided to revamp its entire distribution strategy. It decided to
have its private fleet managed by a third party. Penske took over the Quality Express network.
This outsourcing to Penske brought several benefits to Whirlpool. Whirlpool concentrated on
the manufacture of white goods, while Penske’s Quality Express network took care of the
logistics. Towards end of 2001, Whirlpool started a new website that tracked real-time
information on customer orders. The company hoped this initiative would reduce the number
of phone queries it received and improve customer service.

3.8.6 EFFECT OF INITIATIVES:

The e-initiatives taken up by Whirlpool immensely improved its supply chain operations. Some
of the benefits of implementing e-initiatives have been noted below:

• Product availability at Whirlpool increased in the range of 90 to 95 per cent

• Inventories were reduced by 15 to 20 per cent

• Lead times became as low as five days.

• Forecasting errors were reduced by 50%

• Warehouse and transportation costs saving rose up to 5%

• Improved quality of goods delivery and integrity

• Improved relations with suppliers

• Increase in customer service levels

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In order to maintain quality in its logistics processes, Whirlpool used the Malcolm Balridge
Award Quality Criteria. The efficiency of the entire process was measured in terms of the
quality, cost and cycle time. Whirlpool constantly tried to update and adapt to the latest best
practises, ideas and innovations. The restructures operations yielded considerable benefits to
Whirlpool. As per reports, this led to a $4.8 million reduction in standing inventory in Australia
alone over just seven months! Whirlpool also reduced its annual inventory by about $250
million a year and to deliver products in 48 to 72 hours. Whirlpool also saved about $100
million a year because of improved efficiency in the new distribution system in 2005-
2006.Ordering and delivery functions of Whirlpool used to be located in separate divisions,
complicating coordination and resulting in costly mistakes when Whirlpool made too much of
a certain product.41 out dated warehousing sites were replaced with 10 huge regional
distribution centres that used high-tech warehouse management systems and upgraded vehicles
that could handle a variety of products.

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 CHAPTER IV

4. FINDINGS AND SUGGESTIONS

4.1 FINDINDS

Optimal Situation for Whirlpool's Supply Chain Management (SCM):

• Supply aligns with demand.

• Customer orders are responded to quickly and on time.
• Non-standard orders are handled flexibly and promptly.
• Excess inventory and inadequate inventory situations are minimized.
• Communication between internal and external units of the supply chain is consistent
and timely.
• Forecasts are precise and based on customer demand, minimizing paperwork
• All Third-Party Logistics (3PL) activities align with the overall SCM strategy, with
common metrics to measure performance and efficient vendor access to product data.

Major Differences Between Preferred and Current Approach:

• Lack of a lean inventory management approach.

• Lack of a customer-based lean approach to demand forecasting.
• Absence of an integrated information system to connect all supply chain participants.
• Lack of common measures for supply chain performance.
• Inconsistent approach to collaborating with 3PLs

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4.2 SUGGESTIONS

Recommendations for Whirlpool’s SCM Improvement:

• Adopt a lean inventory management and ordering system (a "pull" system) across the
supply chain.
• Stop assigning equal inventory to all locations and instead conduct a thorough inventory
analysis for each location.
• Implement a shared information system across all departments, providing different
levels of access for Tier 1 customers and suppliers.
• Create an extranet for efficient sharing of information and product sheets with vendors
and customers.
• Partner with a reliable 3PL provider and outsource major SCM functions as needed.

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 CHAPTER V

CONCLUSION

The analysis of Whirlpool of India ltd. 's supply chain logistics provides significant insights
that the company has developed a robust supply chain logistics system that enhances its
operational efficiency and market responsiveness over the years.

Whirlpool of India Ltd. has established a highly effective supply chain logistics system that
enhances operational efficiency and responsiveness to market demands. By integrating
advanced technologies like IoT and AI, the company optimizes inventory management and
improves demand forecasting. Strong partnerships with suppliers ensure a reliable flow of
quality materials, essential for maintaining high product standards. Furthermore, Whirlpool's
extensive distribution network allows for efficient market reach across India, minimizing lead
times and transportation costs. The company is also committed to sustainability, incorporating
eco-friendly practices and energy-efficient transportation methods. Ultimately, Whirlpool's
customer-centric logistics approach prioritizes timely delivery and adaptability, enhancing
overall customer satisfaction and ensuring competitiveness in the home appliance sector.

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