Quality at Gillette Argentina Essay
Quality at Gillette Argentina
Jorge Micozzi, President for Latin America of The Gillette Company, looked up from the report on Argentina’s Total Quality Management (TQM) program that was going to be delivered to the corporation’s quality council in early 1999. “As you can see from these business measures,” he told the casewriter, “our TQM program has been very successful. This has been my most important program and Victor Walker, program manager, was the key to its implementation.”
Micozzi described the early days of the TQM program when, as general manager of the Argentine subsidiary of Gillette, he assigned Victor Walker as total quality manager, “When this program was launched, Victor helped us see how to implement it. This program has changed the company’s culture. We now believe that we have experienced a 40% benefit in our business as a result of TQM.” He pointed around him at the small, elegant building in a suburb of Buenos Aires that housed the professional and administrative staff of the Argentine affiliate: “This building was designed and built in 10 months by nine quality action teams tackling everything from furnishings to moving. The move occurred over a weekend. It’s tangible proof of our program.”
Micozzi had recently been promoted from his position as general manager of the Argentine affiliate to group President. His intention now that he had responsibility for all of Latin America, was to assure that every affiliate adopted the model that Argentina had developed: “I’m going to tell them, ‘Go, see and implement in your own subsidiaries’.”
Every working day at a Gillette plant in … South Boston, 200 men lather up their faces and scrape away the fifteen thousandths of an inch their 10,000 whiskers have grown over the previous 24 hours. Peering into side-by-side mirrors, these volunteers are evaluating razors of the future for sharpness of blade, smoothness of Anne Donnellon and Susan Engelkemeyer, Associate Professors, Babson College prepared this case as a basis for class discussion rather than to illustrate either effective or ineffective handling of an administrative situation. The development of this case was made possible with the generous support of the Institute for Latin American Business Studies at Babson College.
Copyright © by Babson College, Institute for Latin American Business Studies, 1999 and licensed for publication to Harvard Business School Publishing. To order copies or request permission to reproduce materials, call (800) 545-7685 or write Harvard Business School Publishing, Boston, MA 02163. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means – electronic, mechanical, photocopying, recording, or otherwise – without the permission of copyright holders.
Glide, and ease of handling. When they’re finished, the men punch their judgments of the prototype they used into a computer…
These rituals are carried out in a … building emblazoned with a quaint sign proclaiming it to be WORLD SHAVING HEADQUARTERS; the whole exercise seems more than a little archaic, like some throwback to a pre-industrial age. Yet the humble facility is operated by one of America’s premier corporate innovators, a company that churns out so many cutting edge products that it has climbed into a select circle of Wall Street superstars…1
Best known for its razors and blades (Trac II, Sensor, and its latest, the premium-priced MACH3), the Gillette Company is also the leader in batteries (Duracell), dental care (Oral-B), and toiletries (Gillette Series), and is a top seller of writing products (Paper Mate and Parker Pen) and electric shavers and other small appliances (Braun).2 The company was founded in 1901 and by 1905 had started operations abroad with a sales office in London and a manufacturing site in Paris. In 1999, Gillette sales amounted to $10 billion, with 60% of revenues from outside the United States. Manufacturing operations were conducted at 54 facilities in 20 countries, and products were distributed in over 200 territories around the world. The company employed 39,800 people, nearly three-quarters of them outside the United States.3 Every day, at least 1.2 billion people around the world used one of more Gillette products.
In 1998, the company was the worldwide leader in 10 consumer product categories. In recent years, Gillette had introduced more than 20 new products annually. That year was the fifth consecutive year in which at least 40% of sales came from new products. Gillette opened operations in Argentina shortly after World War I. Until 1942, it functioned as an importer and distribution company. According to a recent history of the company,4 the Argentine subsidiary built its first manufacturing plant in that year to take advantage of a void created when a German blade company closed its operations. Throughout the tumultuous decades that followed the war, the company’s early presence in Argentina allowed it to remain and grow, while other competitors fled from the country’s political and economic instability.