Hershey Foods Inc

By David F. Carr  |  Posted 2002-12-16 Print this article Print

The confectioner's holiday sales melted when it switched software in 1999. Now, a second try is succeeding. Here are the lessons learned.

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Hershey Foods Inc. Base Case
Headquarters: 100 Crystal A Drive, Hershey, PA 17033
Phone: (717) 534-6799
Business: The leading chocolate maker and manufacturer of other confections.
Chief Information Officer: George Davis
Financials in 2001: $4.6 billion in revenue, $207 million in net income
Challenge: Restore confidence in distribution systems following a 1999 breakdown in Halloween orders, while extracting additional efficiencies from supply chain

Baseline goals:
  • Maintain sales growth of at least 3% to 4% per year, outpacing growth in the confectionary industry
  • Save $75 million to $85 million by the end of 2002 through restructuring initiatives, including closing of older distribution centers
  • Use supply-chain efficiencies to help increase gross margin above the 41.5% level achieved in 2001

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    David F. Carr David F. Carr is the Technology Editor for Baseline Magazine, a Ziff Davis publication focused on information technology and its management, with an emphasis on measurable, bottom-line results. He wrote two of Baseline's cover stories focused on the role of technology in disaster recovery, one focused on the response to the tsunami in Indonesia and another on the City of New Orleans after Hurricane Katrina.David has been the author or co-author of many Baseline Case Dissections on corporate technology successes and failures (such as the role of Kmart's inept supply chain implementation in its decline versus Wal-Mart or the successful use of technology to create new market opportunities for office furniture maker Herman Miller). He has also written about the FAA's halting attempts to modernize air traffic control, and in 2003 he traveled to Sierra Leone and Liberia to report on the role of technology in United Nations peacekeeping.David joined Baseline prior to the launch of the magazine in 2001 and helped define popular elements of the magazine such as Gotcha!, which offers cautionary tales about technology pitfalls and how to avoid them.

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