Procurement is expected to become a strategic weapon for Kraft Heinz.
Beset by poor management and financial misconduct, procurement had become an embarrassment for Kraft Heinz. Under the direction of Marcos Eloi, the new Chief Procurement Officer, the department is being revamped and repositioned as a major cost savings contributor within the supply chain. Centralization, automation, and collaboration are the main characteristics of the transformation that Kraft Heinz touts as game changing, but that skeptics view as perhaps insufficient to deliver the results expected by the company.
Video Spotlight: Kraft Heinz’s CEO Describes the Shift in Strategy
This post is based on the Supply Chain Dive article, The Kraft Heinz Procurement Overhaul Is Here, by E. Cosgrove, September 24, 2020, and the YouTube video, Heinz CEO Discusses Selling off Cheese Business and the Company’s Reset Strategy, by Yahoo Finance, September 16, 2020. Image source: Comstock Images / Alamy.
1. Describe the major aspects of the overhaul. Are they aligned with Operations’ competitive priorities (cost, quality, delivery, and flexibility)?
Guidance: The overhaul involves: 1) a decrease in transactional sourcing, 2) a reduction in internal manufacturing capacity and a heavier reliance on outsourcing, 3) Continue reading