1. What factors help to explain why J&J historically had as many as 12 DC’s in Europe?
Johnson & Johnson historically had as many as 12 distribution centers that were geographically located
in Europe due to their focus on maintaining the needs and service expectations of their European
customers. The company wanted to maintain a high level of service to its customers. These services
include one-day services for some customers and two day services for others. Since most of the
distribution centers were near the customers this allowed the company to maintain low transportation
costs, however, this in turn resulted in them having higher operational costs. Overall this increased the
speed of the supply chain as a whole. One other factor may have been the expense of long-term leases.
2. What steps in the supply chain network design process discussed in this chapter would
have been most relevant to the task faced by J&J in Europe?
Step 2: Perform a supply chain audit: This step profiles the current supply chain network and helps to
gather essential types of information that will be used throughout the design process. This process
would also establish key performance measurements or KPIs to track during and after the design
process. Information relevant to Johnson & Johnson’s case would be the customer requirements and
their key logistics goals and objectives. This is the step where Johnson & Johnson would have
established that a high level of customer service is a main objective in the design process.
Step 3: Examine the supply chain network alternatives: This step examines the available alternatives
for configuration of the supply chain, which includes suitable locations for manufacturing, logistics, and
distribution facilities. This is done by applying quantitative models to the current logistic system of
