Question:

1. List possible solutions / Alternatives ; What are the options to resolve the key issue or issues.

Introduction Whirlpool Corporation is one of the worlds leading manufacturers and marketers of major home appliances. The company has principal manufacturing operations and mar- keting activities in North and South America, Europe and Asia. Whirlpools primary brand namesKitchenAid, Roper, Bauknecht, Ignis, Brastemp, Consul and its global Whirlpool brandare marketed in more than 170 countries worldwide. In North America, Whirlpool is the largest supplier of major appliances to Sears, under the Kenmore brand. This accounts for nearly 20% of Whirlpools sales. Whirlpool, which manufactures its products in 13 countries, makes about 25% of its sales in Europe and is concentrating on emerging markets in Asia and Latin America.

Regional Operations Summary North America Whirlpool operations in the United States, Canada and Mexico together form the North American Region. The combined operations work with a uni- fied strategy for manufacturing and marketing appliances in the three countries. Latin America Whirlpool includes Central and South America and the Caribbean. The Latin American Appliance Group of Whirlpool and its affiliates have the largest market share and one-third of the manufacturing capacity of the region. The Latin American home appliance market is expected to expand more rapidly than either North America or Europe. Asia Whirlpool has been exporting home appliances to Asia for over 30 years. From 1993 to 1995, Whirlpool moved aggressively to increase its presence throughout the region by establishing marketing and manufacturing joint ventures. In Asia, Whirlpool focuses on four key products: clothes washers, refrigerators, air conditioners and micro- wave ovens. Today, the company enjoys the number one position among non-Asian competitors in the region. With a staff of approximately 11,000 and eleven factories in six countries, Whirlpool Europe ranks as the third-largest producer and marketer in Western Europe. It com- mands the leading position in Central and Eastern Europe, and is growing steadily in the Middle East and Africa. A strong focus on the needs of customers in each of Europes various markets, combined with a coordinated, pan-European approach to many common operations and activities, provides Whirlpool Europe with a strong foun- dation to build for the future.

-------

Company Vision, Values and Social Responsibility The Whirlpool VisionEvery Home . . . Everywhere with Pride, Passion, Performance. We create the worlds best home appliances that make life a little easier and more enjoyable for all people. Our goal is a Whirlpool product in every home, everywhere. We will achieve this by creating: Pride . . . in our work and each other; Passion . . . for creating unmatched customer loyalty for our brands and Performance . . . results that excite and reward global investors with superior returns. ValuesFive fundamental values: Respect, Integrity, Teamwork, Learning to Lead and Spirit of Winning, represent the essence of who we are as a company. They provide a framework of expectations for how we behave and relate with others. The power of these values and the behaviors that support them lies in how they help us achieve a consistently high level of performance, regardless of business or economic cycles. Social ResponsibilityWhirlpool Corporation meets its societal obligations by extensive commitments to Habitat for Humanity International. It is donating a Whirlpool brand refrigerator and freestanding range for homes built in the United States and Canada under Habitats new More Than Houses Program, a campaign to build 100,000 new homes by the year 2005. The company previ- ously announced that it would donate up to U.S. $5 million in appliances for homes built by Habitat. We are truly grateful to Whirlpool for making such a generous pledge of support, said Millard Fuller, President and CEO, Habitat for Humanity. Literally, thousands of families will benefit from this exciting partnership.

-------------

ERP at Whirlpool The following topics concerned with the enterprise resource planning (ERP) at Whirlpool are provided for analyses: dispatcher assignment, centralized pricing, vendor interfaces and Internet application problems. Within these topics are side issues includ- ing the Internet application decision, response time monitoring, and application integration.

---------

Dispatcher Assignment Sophisticated geographic routing software is helping Whirlpool Corp. consolidate 22 field service offices into a single hub operation, slashing millions of dollars in real estate costs in the process. The U.S. $200,000 Resources in Motion Management System (RIMMS) from Lightstone Group in Mineola, New York, is expected to help Whirlpool manage and coordinate its 440 appliance technicians across the U.S. from one service hub in Knoxville, Tennessee. The Benton Harbor, Michigan-based appliance maker has already consolidated seven of its 22 field locations. The remainder will be brought into the fold by years end. Whirlpool is replacing the colored pins and giant wall maps that have been used in its regional service centers for years. Automation will mean dispatchers may lose the inti- mate knowledge they had of local routes and traffic trouble spots. (With the manual sys- tem, it sometimes took dispatchers a full day to plot a daily service route for a single technician). Using RIMMS, Whirlpool dispatchers can lay out each technicians route within an hour.

------------

The consolidation has presented Whirlpool with some tricky personnel problems. Under the service overhaul, technicians are being asked to cover new territories and squeeze in extra work in the same amount of time. Whirlpools technicians typically handle ten customer calls per day. The hope is that by utilizing the most efficient routes from one customer call to another, each service technician will be able to squeeze in an extra customer job each day, said Tom Mender, a senior analyst at Whirlpools LaPorte, Ind., parts distribution center. "Even if we can get an extra half a job a day, the [full- year] benefits are staggering," said Mender. "Our biggest challenge has been managing the expectations of our technicians," Mender said. Whirlpools service center consolidation also means it will probably need only five or six dispatchers, not the 24 it once used to support its field service centers. Downsizing "is something weve wrestled with from the beginning," Mender said. By centralizing and automating its service centers, Whirlpool loses "the quirks of knowing your hometowns," he said. Mender said the fate of its dispatchers hasnt been decided.

------------

Centralized Pricing When Frigidaire Co. drops freezer prices, a flurry of faxes and FedExes fly from Whirlpool Corp.s offices in a fight to match those prices. But soon Whirlpool will be able to match competitors pricing with a few keystrokes, allowing the company to react quickly to market changes or launch a special promotion for a single product. Whirlpool is implementing a centralized pricing configuration system from Trilogy Development Group, Inc. in Austin, Texas. The pricing software will allow Whirlpool to cut by more than half the 110 days it now takes to reprice its entire product line of more than 2,000 models each quarter. Most important, the application will give Whirlpool a centralized pricing structure. Previously, the company used separate pricing models and order entry systems for each Whirlpool division, from small appliances to large goods to spare parts. The big driver for all of this is to make Whirlpool easier to do business with, said Bill Hester, a senior information systems project manager at Whirlpool. Whirlpools technology overhaul, which also includes implementing SAP AGs R/3 and a massive operational reorganization, is necessary to prime Whirlpool for the dish- washer wars in years to come. The entire IT overhaul is estimated to cut U.S. $160 million from Whirlpools operational budget over five years. Hester said the company expects the new pricing system will pay for itself within a few years. Historically, Whirlpools customer claims usually resulted from pricing discre- pancies. We would tell trading partners we were going to sell them something at x price, but the system was charging them y, said Kathleen Descamps, business project manager for Whirlpools new pricing system. So we would have to issue them a credit. It creates dissatisfied customers. Its much easier to say we are charging them x and that is what is on the invoice. With one centralized pricing system, sales agents will be able to meet that goal. The same information will be replicated in sales agents laptops for quick reference when making field calls to trading partners. They will have the same sales history information that is used to make [production] forecasts, Descamps said, so they will have the same information to help meet the forecasts. Whirlpools current pricing system is highly dependent on spreadsheets, a laborious and time-consuming system. Bill Hester, project manager at the appliance giant, said the quarterly job of revamp- ing the pricing of every product takes 110 days and is prone to errors. Pricing has to be entered for every product under eleven different brand names. It took roughly 180,000 cells in the spreadsheet, Hester said. Since pricing is formula-driven, if someone

changed a formula, you wouldnt know the effects somewhere else in the spreadsheet. It took a lot of work to get the pricing masters printed. If a marketing manager needs to change the price of dishwashers to match General Electrics pricing, that person can now enter the information, do a profitability analysis on the change and then, if acceptable, enter the new price. Then a message is automati- cally sent to the pricing administrator, who sets up any rules for the pricing, and as soon as they hit enter, if the pricing is effective today, the next person that places an order gets that new price, Hester said.

----------

Vendor Interfaces A warehouse automation system has propelled Whirlpool Corporations Parts Distribution Center in LaPorte, Indiana, into a new era of customer satisfaction. The sys- tem, comprised of an elaborate configuration of computers and automatic conveyors, reduces the order-processing cycle time for customers around the world. It helps us bet- ter manage our inventories with the ultimate improvement being customer satisfaction, says Tom Harrow, customer service supervisor. Whirlpool Corp. hopes a new e-commerce initiative, Easy EDI, will cut down supply chain expenses and enhance efficiencies. Easy EDIs goal is twofold: to eliminate the paper process used by Whirlpools 300 smaller suppliers, and to save Whirlpool up to U.S. $600,000 a year in operational costs for the electronic data interchange network used by Whirlpools 300 largest suppliers, says David Tibbitts, manager of strategy and planning in global procurement at Whirlpool. Initially, Easy EDI will involve four small and midsize suppliers that rely on paper transactions to conduct business with Whirlpools fourteen North American manufactur- ing facilities. Four to six weeks later, the service will expand to about 30 suppliers; all small and midsize suppliers should be online by years end. Whirlpool then expects to gradually roll out Easy EDI to its largest suppliers, which use a public value-added net- work (VAN) for EDI transactions. The company hopes to phase out VAN-based EDI, Tibbitts saysalong with the U.S. $40,000 to U.S. $50,000 a month it pays for the service. Easy EDI is an example of how the consumer-goods manufacturing industry is mov- ing in the same direction as the automotive industry, says Susan Cournoyer, an analyst at Dataquest. Agile, just-in-time manufacturing and its use of the Internet will cut costs and improve communications and responsiveness to customers, she says. Whirlpool is working with integrator Litton Enterprise Solutions, a division of government contractor Litton Industries, to develop Easy EDI.

----------

Missing part. will post another one next.