Supply Chain- what's that?

The recent furore over Mattel's Sesame Street toys have created major panic amongst parents worldwide and deprive many children of their favourite playtime toys. But the incident has probably caused the most damage to Mattel, who'll find itself stuck with a huge inventory of withdrawn and unsellable goods. But more damagingly, it has cost Mattel its reputation.

Being a veteran in the toy industry,Mattel is a well loved brand trusted to deliver superior and safe toys for little kids. Although the crisis was caused by a long-time supplier in Hong Kong which has outsourced its toy production to a factory in China who used the unapproved paint, Mattel could not shirk off any responsibilities. And ultimately, the corporate image has taken a dip and it would take alot of intensive PR to reinstate consumer confidence.

So what has this got to do with pharma?

It all boils down to supply chain. If Mattel had been a bit more vigilent in tracking its supply chain, it would have been able to arrest the situation before it'd erupted into the full-blown crisis that has become. There is no place for comfort zones and complacency in business.

In Singapore, the product mix for most pharmas are limited and most of our stocks are obtained from single source, on wherever whenever is available basis. Most of the time its handled by an administrative clerk overseen by the regulatory manager. Local PMs i noticed, hardly bother very much with supply issues.

This sort of lassie faire attitude may cost the company at best some inconvienieces, at worst, loss of customers. It about time supply chain management emerges from the back end and be made a shared responsibility much like HRM.

Commonly encountered problems in local pharma are usually the likes of insufficient stocks due to inaccurate sales projection. One have to understand that inventory management is a real tricky business. Too much stocks ordered in will lead to high cost of storage, too little will lead to a negative impact on sales. However, it is still in the PM's purview to provide a close estimate of stock movement based on sales projection. Another sticky problem which has a more disasterous consequence is goods withdrawals due to manufacturing or ADRs. In my opinion, the longer history of supplying the product the plant has, the less likely it is to produce defective packaging or other hiccups. While sourcing for a source may not be in the PM's usual scope of responsibility, it may still be worthwhile to have a little idea on his/her products' origins.

Product management in Singapore is in reality, very little more than A&P management. If we want to be considered true brand managers, we have to be able to handle more than just organizing events and developing collaterals.