A highly integrated approach to internal logistics is paying dividends for Pfizer.
Complexity is a fact of life in pharmaceutical logistics. Every shipment must be tightly controlled to meet stringent quality, security and safety requirements across freight lanes that can span the globe. When your business involves 24,000 separate SKUs and sales of more than $52 billion a year, that complexity becomes difficult to imagine.
But managing complexity on that scale is an everyday challenge for Pfizer, a company that has reached its current size through a combination of organic growth and extensive mergers and acquisitions. In recent years, a key focus for the organization has been the transformation of a supply chain with its roots in more than 30 separate businesses into a single “highly orchestrated supply network.”
“In the past, we were often acting in silos,” explains Danny Hendrikse, Pfizer’s Vice President of Intercompany Operations. “We had a global transportation group that was working hard to optimize our processes internally, while our plants are doing likewise locally. There were little common goals and collaboration. We were not really acting as a network.”
Highly orchestrated supply
In 2014, Pfizer established a new global initiative designed to support our ambitions to become a Highly Orchestrated Supply Network. “It starts with getting the customer demand signal from the market, transmitting this signal to the sites for production, and the same signal captured by the Network Supply Operations team for short term to 36 months production and capacity planning; and our Product Portfolio Management team using the same signal to develop a longer term Product Strategy. This ability to connect all the supply chain nodes resulted in a balanced demand, supply and product delivery network helping us in achieving our segmented customer service targets and optimized inventory levels. All these are also well supported with by Business Technology which provides great end-to-end network visibility. Hendrikse’s Intercompany Operations organization is responsible for all logistics and distribution activities between Pfizer plants and on to its regional or in country distribution hubs. From there, four regional organizations handle in-market distribution of products to the first paying customer.