Sejarah

1. What principles and practices have allowed quality to flourish at Gillette in Argentina over the years?

Gillette opened operations in Argentina shortly after World War I. At that time, Argentine subsidiary is just manufacturing plant which was taken from a closed German blade company. Since that, they were facing many problems and challenges such as competitors, country’s political, inflation and economic instability. For example, the economic crisis in 1989 brought Peronist presidential candidate Carlos Menem to office, and within a year, the business climate began to undergo profound change. State-owned companies were privatized, tariff laws all but disappeared, and regulatory changes of huge proportions were put into place. Astute managers began to recognize that competition would soon increase, in all likelihood from foreign companies.

Although there are a lot of barriers to run the business, Gillette sales grew by 19% in the years between 1993 and 1998, and the average profit growth in this same period was 22%. Inventory turns went from 4.8 to 8.7, and POE (period operating expense) went down by 40%. Finally, ROA (return on assets) increased by 60% in the same period. They estimated that the profitability increase attributable directly to TQM were $17.8 million dollars between 1993 and April 2000, plus all non-monetarily quantified benefits, mainly related to external clients and internal process improvements. The question is what they have done principles and practices have allowed quality to flourish at Gillette in Argentina over the years?

i. Gillette focusing on quality

Gillette was focusing on quality in Argentina since 1980s by Carlos Rotundo, director of manufacturing and logistics. Quality means products those meeting or exceeding customer requirements. He excited of the need of customers as a best practice platform to measure quality. He was particularly interested in the idea of using crossfunctional teams to achieve better...