Gillette Sharpens Its Edge

Gillette is still in the process of making the system more robust and quantifying the business benefits. But the company now knows where every case of Venus razors is in its pack center, how long a case was there, where it was stored and when it was shipped. “We’re now breaking our supply chain processes down into their components,” says Cantwell. “Then, we’ll do an ‘as is’ versus ‘with EPC’ cost-benefit analysis to derive an ROI. The early indications are good, but we’re very much learning as we go, and it will be a while before all the assumptions and variables are pinned down.”


Gillette is already preparing to take the project to the next stage. By June, it expects to be working with a retail partner—it’s in the process of identifying one—to determine the benefits of using EPC technology across the extended supply chain. The tags that are read when pallets are loaded onto trucks will be read again when the shipment arrives at the back of the retailer’s store.

“The goal is to create an electronic proof of shipment and delivery,” say Cantwell. “We’ll know we assembled a perfect order, and the retailer will know it received what we shipped.”

Today, there are often discrepancies between what a manufacturer ships and what a store receives. Either the manufacturer miscounts the number of cases sent, the retailer miscounts what was received or goods go missing en route. In all instances, it’s costly to investigate inaccurate orders. By extending the pilot to a retailer, Gillette will be able to quantify EPC technology’s ability to improve order accuracy, reduce administrative error, facilitate the investigation of problems and eliminate areas of vulnerability. The company expects to improve its customer service and strengthen its relationship with its retail partners.

Gillette believes that EPC technology will ultimately provide the visibility needed to enable the company to reduce its inventory levels while ensuring that its products are always at the retail store when customers want to buy them. Automated scanning will reduce human error and provide accurate, real-time information about where goods are within the supply chain. This will let Gillette respond to real-time sales data from retailers and replenish stocks before the shelves are out of stock. Cantwell understands that achieving this great leap forward in supply chain efficiency involves more than just good technology; it requires business process change and a new culture at Gillette, and the Fort Devens project is part and parcel of this new philosophy. “We need a new framework to drive innovation at Gillette, a new process to drive breakthroughs in productivity,” says Cantwell. “That’s what this project is all about.”

The breakthrough benefits are still a couple of years away, but there is one big benefit of the Fort Devens project that’s just around the corner. Most of the top suppliers of Wal-Mart, the U.S. Department of Defense, Tesco and the Metro Group—which are all deploying EPC technology in their supply chains—will simply slap EPC tags on cases and ship them. That means the technology will be an added cost.

It will be a different story for Gillette. When the company rolls out the EPC infrastructure developed at Fort Devens to its other packaging and distribution centers globally, it will not only meet Wal-Mart’s EPC tagging requirements by January 2005 but will also be able to use the technology internally to eliminate manual case counting and scanning and other expenses. This will help to offset the cost of the tags and put Gillette in a position to be one of the first major manufacturers to earn a return on its investment in EPC technology. And that will give the razor company a sharp edge on the competition.