PZ Cussons awarded place in Australia's Best Manufacturing Magazine, released July 2008.

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Neil Sigamoney, supply chain expert at PZ Cussons, has been included within the impressive series of publications entitled Australia's Best. The company has been featured in July 2008's edition of Australia's Best Manufacturing

PZ Cussons gets a pat on the back from Bean Media, publishers of the popular series of business magazines, Australia's Best. Here is a copy of the editorial that went into Australia's Best Manufacturing.

The Australian Purchasing Team at PZ Cussons work within a global Purchasing Network to select and assess suppliers throughout the relationship. All new suppliers undergo a rigorous series of assessments for quality, service and technical capability. Performance management of suppliers is an ongoing process with activities ranging from immediate interventions through to monthly operation scorecards and quarterly business reviews. PZ Cussons senior management also meets with key suppliers annually for a business review.

Management of the supply chain spans a wide area of control from moving materials globally through to manufacturing and distributing products to customer distribution centres. Customer service ranks as the number one supply chain KPI, closely followed by cost efficiency and quality measures. PZ Cussons Australia supplies a large range of locally manufactured and imported products. Its suppliers play an integral role in achieving these key business KPIs.

"Most of our suppliers have worked with us for many years and understand this aspect of the FMCG Industry," explains Neil Sigamoney. "Suppliers are carefully selected for their ability to deliver consistently against demand fluctuations and contain cost during this process."

Suppliers to PZ Cussons are managed through a QSIP process (Quality, Service, Innovation and Price) and are assessed on their ability to add value to the business through quality of product, service levels, innovation delivery and price competitiveness. "The supply chains are reliant on the supplier delivering quality products on time and in the right quantities for manufacture," states Sigamoney. "PZ Cussons manufacturing sites have limited storage capacity and products must arrive as and when requested in order to manage the flow of materials and goods."

Over the years, collaboration with suppliers has allowed PZ Cussons to improve levels of service and quality. Issues such as product quality are jointly solved through the supplier and PZ Cussons teams working together, often at the supplier's facilities. Suppliers are often invited to PZ Cussons manufacturing facilities to view problems and opportunities first hand in order to improve quality and service levels.

PZ Cussons believe that trust is a primary requirement in any relationship. Demonstration of the trust PZ Cussons has in its key suppliers is noted through its innovative processes. "Suppliers who collaborate closely are invited to participate in Innovation Workshops that are focused on new product development. This is an opportunity to have some fun, be creative but more importantly, to add significant value to PZ Cussons product portfolio," says Sigamoney. Key suppliers are also afforded the opportunity to run 'innovation' seminars within the business. A day is allocated for a key supplier to showcase new technologies, trends and opportunities to a cross functional audience including marketing, sales and R&D. These sessions often lead to creative sessions on products ideas.

PZ Cussons Australia has a reputation for technically strong brands and suppliers continue to play a key role in delivering new technologies to R&D. "All key suppliers work off annual technical and commercial business plans. These plans detail collaborative projects bringing together the suppliers and PZ Cussons expertise to develop new products. Results of this collaboration benefit the customer, consumer, PZ Cussons and the supplier - who benefits commercially through new material sales," says Sigamoney.

"Suppliers are in the business of making profit, as is any business. A supplier that is commercially unstable is a risk to continuity of supply. The supplier will cut costs irresponsibly to survive with resulting service level drops and quality issues. Therefore, there must be a balance between sustainable and acceptable cost. The supplier must be able to consistently deliver at the quoted price and make a profit. The PZ Cussons Purchasing team ensures that prices are constantly benchmarked globally and are acceptable. We work closely with our suppliers, sharing benchmark data and offering them every opportunity to remain competitive in a global environment. Margin improvement is critical to the supply chain delivering the right cost levels. Working together with our suppliers on cost improvements ensures there is no threat to the future of both PZ Cussons and the suppliers business."

Excellent quality and service is as much an expectation of PZ Cussons suppliers as it is from our customers and consumers. Due to this, the company has a grading system in place that ranks suppliers, in which poor performing suppliers are placed on performance management. Experts from PZ Cussons work with the supplier to improve their levels of service or quality. This process is assessed for effectiveness at regular intervals, with feedback given directly to the supplier's senior management.

"We find this process is effective in keeping quality and service levels high", confirms Sigamoney. "As we improve internally we find the need to 'raise the bar' with our suppliers and we use the same process to implement these changes."

"Suppliers are crucial to success in a fast, dynamic and complex supply chain. When selected and managed well, they are a phenomenal asset. If neglected they can be our greatest liability. At PZ Cussons we manage our suppliers with trust and respect for their commitment to our business. We find that this is rewarded through affiliations that are more flexible and in step with our business requirements," concludes Sigamoney.

Cognis is an affiliate of the worldwide Cognis Group. Cognis Australia is committed to being a pre-eminent specialty chemicals supplier and the world's leading supplier of natural mixed carotenoids. Australia is the sole manufacturing location for this product range. Cognis is a preferred supplier to PZ Cussons, were also involved in the editorial feature. Their specifc advertisement can be found here.

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CHRIS DUTTON
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