Case on Delivery Performance Improvement

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by Distributor Center twice a week. What TTT can implement is to outsource third-party logistic like DHL, FedEx, Nationwide and etc. They are specialized in delivery arrangement and the transportation can be trace via online tracking system at convenient. TTT can arrange them to pick-up spare parts from Singapore and right away to be delivered to Kemaman. This option will reduce current lead time for delivery from 14 days to 2 days. For this option Operation Manager needs to evaluate additional cost will incur as monthly expenses versus delivery efficiency to gain more sales to the company.

Lecturer may ask from group of students what is commonly used courier service / third-party logistic service provider available in Malaysia. To discuss further on mode of transportation available for this option like van, 3 tons lorry or trailer, depending on shipment sizing.

2. Supply Chain Management

– Supplier Selection Analysis.

As mentioned above there are few third-party logistic provider available for Operation Manager to choose. One way to get the best selection among the service provider is to do evaluation probably base on criteria below.

o Vendor responsiveness on information requests or inquiries that arise in the course of pre-purchase of products or services.

o Vendor responsiveness /timeliness inquiries, problems or issues that arise in the course of post-purchase of products or services.

o Vendor attitude and professionalism when dealing with your request or problem.

o On time delivery of products or services.

o Price comparison with competitors or industry standard (on average).

From above mentioned criteria Operation Manager need to put weightage for each category and finally rate among service provider. Selection will be made from highest score.

Lecturer may ask students on how to allocate weightage to each criteria, discuss among themselves on prioritize and quality of service provided.

3. Inventory Management.

From the case study shows TTT does not implement inventory management as all spare parts needed unavailable on-shelve and need to be ordered directly from main distributor center. What can Operation Manager do to resolve this is to list down common spare parts which considered fast moving items, need to be available as minimal stock at TTT warehouse. From the list of client and history of service jobs done TTT should have a proper record of the spare parts and the accuracy of the list is very importance to avoid surplus and shortages of spare parts.

Lecturer may ask students to discuss on what is the effect of surplus and shortages of stocks, the importance of inventory and its relationship to operation cost.

4. Human Resources

One of the objective of Human Resource Strategy is to manage workers so that they are effective and efficient at work place. However in real situation a company can’t avoid human factor of inefficiency such as illness and exhaustion during working period. Mentioned in the case study that the supervisor is working alone without assistance as back up. To resolve this, Operation Manager should think of hiring additional manpower to assist supervisor in handling the task. If the cost of new employment is an issue to company’s budget, the manager also can redesign each supervisor scope of work so that each person can at least be able to perform other task not designated to each person.

Case Practice

In real practice, the Operation Manager of TTT agreed and realize that there are few imperfections on how he managing the company. He agrees on the risk of supervisor is working alone without back-up. As short term solution TTT will hire a contract staff to assist Service Parts Supervisor. He also consider on the option to appoint third-party logistic to manage spare parts delivery. However he need to further discuss this proposal to higher management for vendor selection process, additional budget and impact to operational expenses. Regarding the suggestion on inventory management Operation Manager needs to discuss with headquarters before he can decide anything due to he is not familiar with warehouse management system, stock account and need in depth study for stock planning and forecast due to inconsistency of volume order per service jobs.

In this case study we discuss the outcome of implementation and practice of Operation Management, Lean Management, Total Quality Management and System Improvement Management.

To implement the possible solutions, the author is expecting a high magnitude of participation, teamwork and accountability between Operation Manager, higher management at headquarters and among supervisors at TTT to adapt with the changes in the future.