She’s had dozens of houses over the years, along with hundreds of cars, countless thou-sands of outfits – and that’s not even counting her shoe closet or hat collection. With so many belongings already in her possession and hundreds more arriving in stores every year, Barbie needs a world-class supply chain to keep her and her millions of fans happy, so she’s fortunate to have Mattel Inc. keeping her closets and garages stocked. As one of the world’s biggest toy manufacturers, Mattel not only is responsible for the world’s most popular and iconic fashion doll, but also brands such as Hot Wheels, American Girl, Fish-er-Price and Thomas and Friends. Mattel’s products are found in toy stores in more than 150 coun-tries, and it has operations in 40 countries employing about 31,000 people. Managing a supply chain with that kind of scope is not easy, but the company’s global supply chain is crucial in the company’s success, says Executive Vice Presi-dent and Chief Supply Chain Offi-cer Peter Gibbons. Mattel’s prod-ucts are sold to parents to bring their children happiness, meaning the company has to ensure that it has accountability at every stage in the supply chain before they reach those precious end-users.

www.mattel.com / 2014 net sales: $6 billion / Headquarters: El Segundo, Calif. / Employees: 31,000 / Specialty: Toys /

Peter Gibbons, executive vice president and chief supply chain officer: “Mattel is in the trust business, and our supply chain is in the trust business.”

Barbie’s Dream Supply ChainMattel has the supply chain it needs to keep its toy brands moving

swiftly from the factory floor to the playroom floor. By Chris Petersen

PETER GIBBONSEVP and Chief Supply Chain Officer

manufacturing & distribution mattel inc.

Mattel’s products are found in toy stores in more than 150 countries, and the company has operations in 40 countries.

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“Mattelisinthetrustbusiness,andoursupplychainisinthetrustbusiness,”Gibbonssays. Gibbonsbringsawealthofexpe-rienceinmanagingaworld-classsupplychaintohiscurrentposi-tion.BeforejoiningMattelmorethantwoyearsago,GibbonsspentmanyyearsmanagingsupplychainandmanufacturingoperationsforStarbucks,andpriortothatspent20yearsinthechemicalindustrywithcompaniesincludingGlidden. Thetoyindustryisonecharac-terizedbyconstantchange,asnewbrandsemergeonayearlybasis

andconsumersareconstantlylookingforthenextbigthing.Gib-bonssaysMattel’sglobalsupplychainoperationsenablethecom-panytokeepaconstantstreamofnewandexcitingproductsmovingfrommanufacturingplantstoretailers’shelvestotoyboxesallovertheworld.“Thisisafast-mov-ingbusiness,”hesays,butdespitethechallengesMattelcontinuestofindwaystostayoutinfrontofit.

Keeping UpKidsarenotoriouslyficklecon-sumers,andthehottoyofoneholidayseasoncouldbeintheclearanceaislebythetimeschoolletsoutforthesummer.That’sthereasonwhyMattelrefreshesnearly80percentofitsSKUseveryyear,creatinglogisticalchallengesun-heardofinmanyotherindustries.What’smore,thetoybusinessisextremelyseasonal,withahugeamountofsalesmadearoundthe

holidayseason.GibbonsexplainsthatMattel’ssupplychainisgearedspecificallytomeetthesechallengeshead-on. “Ourabilitytogetnewproductsintomarketisabigpartofwhatoursupplychainhasdonesuccess-fullyovertheyears,”hesays. OneofthebiggeststrengthsMattel’ssupplychainhasisthecompany’sengineeringstaff,whichiswell-versedindesigningproductionprocessesthatcanbescaledupsignificantlyduringperiodsofhighdemandwithoutstrain.Gibbonssaysthankstothisexpertise,Mattelhaslittlediffi-cultyingearingupfortheholidayseason.FinalproductengineeringistightlyintegratedwithinMat-tel’ssupplychainoperations.“Soyoucanimaginethatgivesusabigadvantagefurtherdownthesupplychain,”Gibbonssays. Thecompany’sengineeringprowessalsocomesintoplaywhen

manufacturing & distribution mattel inc.

Mattel refreshes nearly 80 percent of its SKUs every year in an effort to stay ahead of the market.

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AVATA As part of their transformational journey to improve their supply chain, Mattel partnered with AVATA on key strategic initiatives. AVATA assisted Mattel in an assessment of their end-to-end global supply chain which broke down the fundamental components related to people/organizational structure, pro-cesses & metrics, and systems. AVATA provided a qualitative and quantitative analysis that resulted in a series of leading practice recommendations across their entire supply chain; from demand forecasting, supply planning, procurement to warehousing & logistics. AVATA went on to do a similar study across the quality organization and the implications on both supply chain, quality, responsiveness and effectiveness.

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working to reduce costs through-out the production process. With labor inflation being a significant concern in many of the Asian pro-duction centers Mattel operates in, Gibbons says the company is focusing its efforts on reducing costs through automation and greater efficiency. By working with its key contract manufacturers and increasing efficiency in its own manufacturing centers, Mattel is always looking for ways to manage the nearly $2.5 billion it spends running its supply chain every year. “We have a big responsibility to keep bending the cost curve,” Gibbons says. Part of increasing that efficiency and reducing costs is forecasting consumer demand, and Gibbons says Mattel continues to look for methods through which it can provide better service to retailers and get products onto shelves in real-time with the demand. “We believe we can make sig-nificant improvements in terms of service in terms of building systems and services to forecast and react to consumer demand,” he says.

Ethical StrengthAnother major challenge for Mat-tel is maintaining a supply chain that contributes to the company’s strong ethical standards. In both 2014 and 2015, Mattel was named one of the world’s most ethical companies by Ethisphere Maga-zine, and it is ranked among the top five best corporate citizens by Corporate Responsibility Magazine. Gibbons says the company takes its responsibility to children and their parents extremely seriously,

and so it takes great care to know where its materials are being sourced from, who it trusts with contract manufacturing and how closely it and its partners follow HSE protocols. Gibbons says the company is proud of the highly integrated program across its entire supply chain that ensures it operates to the highest standards in every way. A major component of what helps the company’s supply chain adhere to those high standards is an investment in the people Mattel has working along the supply chain. Gibbons says developing talent is one of the three pillars of its supply chain, along with improved services and low cost. “Having the best talent allows you to drive improved services and lowered costs,” he says. Mattel takes pride in the training it provides for its supply chain employees, including a program designed to map everyone’s role throughout the entire operation. “Each individual will have a clear

line of sight to what he/she needs for their current role and what will be needed for the next role,” Gibbons says.

New HorizonsThe strength of Mattel’s supply chain gives it the opportunity to drive new products into the market with greater effectiveness than most of its competitors, and Gibbons says that has become more important than ever with the integration of technology into its products. With digital and physical products becoming more connected – as in the case of the company’s new Hello, Barbie line of interactive dolls coming later this year – Mattel needs to be able to bring products to market at the speed of technology. Thanks to the company’s un-wavering commitment to supply chain excellence, Gibbons says, Mattel will be able to ensure the newest incarnation of Barbie and all of its brands make it to market quickly and efficiently.

manufacturing & distributionmattel inc.

In improving its forecasts of consumer demand, Mattel is working to better serve retailers and get products onto shelves in real-time with demand.

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