Crown Paints Kenya Limited: Supply Chain Value Analysis in Manufacturing Firms

Abstract

The critical value chain areas addressed in this case includes: i) forecasting and planning; ii) procurement; iii) material handling; iv) production and v) warehousing distribution and customer service. The methodology used in understanding and finally analysing and providing useful recommendations for the company’s supply value chain involved both qualitative and quantitative research paradigms. This included: discussions with the organisations management staff; discussions with the organisations suppliers and customers; an analysis of the organisations supply chain; and benchmarking with leading local best-practise organisations. Six years down the line after the implementation of the researcher’s recommendations, the company tripled its gross earnings from Ksh. 1 billion by end of 2006 to Ksh. 3 billion by the end of 2011. The findings on forecasting and planning aspects of the supply value chain included: lack of formal supply planning process and insurance premium on excess stocks. The recommendation therefore was to formalise/ structure supply planning process. The findings on procurement were: large supplier base with no long term contracts with chosen few suppliers; high stock levels; make or buy decisions; stock outs; lack of clear specifications. The full paper presents other findings and recommendations reached on all the facets of the supply value analysis investigated.

Key words: value analysis, supply chain management, supply networks