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Johnson & Johnson Overview

Johnson & Johnson (J&J) & Logistics Management Solutions (LMS) Health & Personal Care Conference April 12, 2011. Founded in 1886 in New Brunswick, NJ World’s most comprehensive & broadly-based manufacturer of health care products Over 110,000 employees

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Johnson & Johnson Overview

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  1. Johnson & Johnson (J&J) & Logistics Management Solutions (LMS) Health & Personal Care Conference April 12, 2011

  2. Founded in 1886 in New Brunswick, NJ World’s most comprehensive & broadly-based manufacturer of health care products Over 110,000 employees Selling products in over 175 countries Facilities in over 50 countries Over 210 decentralized operating companies Johnson & Johnson Overview

  3. Consumer Products

  4. GTO Overview • Function like an “Internal 3PL/Shared Service” with responsibilities for Transportation activities across the enterprise • Product Portfolio • Consumer Products • Medical Devices • Pharmaceuticals • Scope • In / Out / Within North America • Modes of Transportation • Air • Ocean • Truckload • LTL • Intermodal • Cold Chain

  5. Global Transportation Organization Mission Statement

  6. GTO Team Structure

  7. J&J – LMS Relationship

  8. Relationship Overview • In 2007 we sought out a partner to: • Provide tactical level support in several areas, including: • Freight Payment bill resolution • Track & Trace • Initial value proposition enabled: • Continued GTO growth within J&J with available resources • Continued focus on key areas of competency including • Sourcing & Supplier Performance • International Trade Compliance • Operations • Relationship with a partner with a demonstrated track record of service and performance in the Transportation space

  9. Growth & Expansion • As value was demonstrated early on additional opportunities were identified, including: • Project based support work • Trade Customization / Display tactical support • On-site load planning at remote distribution centers • Compliance review / filing • Call Center Operations • Off-hours support for CPFR functions

  10. Integration into the business • On-site account management played a key role in relationship development • Detailed understanding of J&J business & requirements • Immediate / visible support when needed • Continued discussions on business and any challenges allows a collaborative problem solving approach • SAP / TMS Upgrades • Freight Payment enhancements • As value was demonstrated marketing became easy, both within GTO and J&J

  11. Integration into the business • Master Service Agreement (MSA) provides a clear understanding of rules of engagement as it outlines: • Pricing structure • Supply of services • Confidentiality agreements • Indemnification • Employment practices • Subcontracting • Audit functions • Severability • Insurance • Data Safeguards • Dispute resolution process

  12. Keys to success: • Ensure requirements are clearly documented • Ensure KPI’s are established upfront • Develop a shared understanding of success • Quarterly business reviews enable visibility to total business relationship and provide an opportunity for higher level visibility of relationship • Maintain open lines of communication • On-going involvement of leadership from both sides

  13. Keys to success: • Leverage best practices of both organizations: • Training & development • Technology • Market Intelligence • Invest the time in developing the relationship • Ensure roles & responsibilities are clearly understood (co-employment)

  14. Thank you!

  15. LMS Company Overview • Information-based 3PL • Established in 1996 in St. Louis, MO • 21 On Site Command Centers in North America • Transportation Management Services & Software

  16. Partnership Engagement • January of 2007 - GTO RFP for Tactical Logistics Support • TMS Support • Export and Compliance Support • Freight Payment Resolution and Support • Shipment Tracking & Tracing • Call Center / Transportation Planning • Provided On and Off Site Personnel based on business need • Dedicated Account Manager • Initial team of 5 providing tactical support

  17. Partnership Evolution • Started with tactical non strategic roles. • Initial engagement allowed for LMS to learn the complexities of the JJ organization as well as the role of the GTO. • Inclusion of Account Manager and team members in business planning meetings allowed LMS and JJ to identify additional opportunities for our partnership. • Created a transparent pricing model that eliminated negotiations and allowed for scalability. • Developed processes to expedite opportunities in order to react quickly to the dynamic needs of JJ.

  18. Partnership Optimization • Communication is Key • Continual Evaluation • Ongoing Identification of Opportunities to: • Lower Cost • Provide Better Service • Augment Current Process with Technology • Provide a platform that allows for easy expansion and contraction based on JJ business partner needs • Manage to KPI’s and Pay for Performance • Better back up • Creative Solution Development

  19. Partnership Best Practices • Quarterly Business Reviews – Critical • Definition and agreement on performance metrics – distributed regularly to team and management • Value driven mind set vs. Short term win mind set • Jointly created goals - short and long term • Inclusion of 3pl in project planning and business changes (SAP implementations; Upgrades; Acquisition implementations etc) • Defined processes to handle new opportunities (SOW) and issue resolution • Trust and transparency in the relationship

  20. Partnership Lessons • Learn the landscape and adapt to it! • Do not under or over estimate your value • Quick fixes do not work – take the time to do it right • Be creative with solutions and processes • Always be flexible • Be open to new and different ways of working together – embrace change! • Trust and communicate at all levels

  21. Coming together is a beginning.Keeping together is progress.Working together is success. - Henry Ford

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