Whirlpool also developed a software package that enabled it to access information

about the delivery status of its products as well as product damage reports. Such
information was received through a personal data assistant (ICMR Center for
Management Research 2004, p. 8).

Thus it enabled the firm to oversee the transportation of its goods even though its
logistics were being handled by a third party. However, the firm had to transfer
the technology to its logistics partner, Penske. Such technological transfers are
usually associated with challenges such as training staff in order to adopt the new
technology (Charki & Boukef 2009, vol. 4, pp. 8-30).

Merits and Demerits of Push and Pool Manufacturing Strategies

Push Strategy
A push manufacturing strategy involves the production of large quantities of goods
and then relying on the distribution channel to sale them. Its merits are as
follows. First, it enables the firm to utilize its full production capacity (Sharma
& Agrawal 2009, vol. 36, pp. 1622-1632).

This is because the level of output is determined by the producer through historic
order records rather than actual demand. Second, production at full capacity
usually translates into low production costs. This is attributed to the economy of
scale associated with mass production. Finally, it enables producers to hold
emergency stock.

Its demerits include losses associated with overproduction. This is because the
storage cost will be high if the stock can not be cleared in time. Second, it leads
to an increase in the time needed to fulfill non-standard orders (Sharma & Agrawal
2009, vol. 36, pp. 1622-1632).

This is attributed to the fact that a push system is supported by a rigid

production schedule. For example, Whirlpool spent up to four weeks in order to
fulfill non-standard orders when it was using the push strategy.

Pull Strategy
According to this strategy, the level of output is informed by the actual demand.
Its merits are as follows. First, it helps in avoiding the losses associated with
overproduction.

This is because the firm produces just enough to meet the existing demand thus
avoiding unnecessary storage costs (Garaghty & Heavey 2004, vol. 1, pp. 75-90).
Second, it helps in reducing the order processing time since the firm is capable of
fulfilling non-standard orders easily. Finally, it enables the manufacturer to
prioritize its production objectives.

The demerits associated with the pull strategy include difficulty in

implementation. It is usually difficult to adjust production capacity on a regular
basis as demand changes (Garaghty & Heavey 2004, vol. 91, pp. 75-90).

This explains why Whirlpool had to invest in a hybrid system that accommodates both
push and pull strategies. Second, firms using the pull strategy can not hold safety
stock. Thus they can not fulfill emergency orders. Finally, it leads to under-
utilization of the production capacity if the demand is low. This translates into a
reduction in returns on investment.