The Pirates of the Silver Land

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- In Perak there are only 4 palm oil refineries, in which only one operated in the northern region.

4. To increase loading bay

- With the increase of inventory (CPO), the infrastructure needed to be improved.

Long term solution:

Include the requirements as stated for the millers in the supply contract. This solution will not involve any cost for the refineries company and is significant for the business in order to meet the clients demand.

Increase the consignment quantity is adequate for mid-term counter measure and outsourcing the supply is a short term action to prevent loss or shortage in the production.

Problem 2

According to Oilene, the crude palm oil supplied by PHSB as contaminated with water or sludge. As the result, Oilene has to shut down their processing plant to clean on the sludge almost on a weekly basis. When this happened, the expenses will increase and as the result, Return on Investment (ROI) will decrease due to the plant shut down. Other then that this issue will give a huge impact to oilene such as:

damaging nation’s image of oilene as quality palm oil producer enable to secure service contract loss of major customers dampened the profit dropped issue.

Solution:

Oilene should consider option in replacing PHSB to avoid these problems as soon as possible due to these several reasons:

- To maintain the reputation and image of oilene

- To reduce cost incurred due to plant shut down and to avoid the decrease in ROI

- To overcome the loss occurred because of late delivery to customers and clients

- To engage with MPOB (Malaysian Palm Oil Berhad) to restrict and enhance the rules and regulation process.

- RECOMMENDATION

The benefit of deploying fleet management system

Reduce operation cost

1. Ensure that drivers and vehicles are properly deployed and utilise.

2. Verify that drivers are not making unscheduled or long stops.

3. Verify that drivers are not making unjustified mileage claims.

4. Verify that drivers are not making claiming unjustified overtime.

5. Ensure vehicles are maintained and serviced properly

6. Verify and reduce excessive and unjustified toll claims.

Achieve fuel savings

1. Verify that drivers are not making unauthorized trips.

2. Verify that drivers are using the most efficient route.

3. Check and reduce excessive idling (ignition on without moving).

4. Check and curb speeding by drivers.

Ensure vehicle and load security

1. Ensure security of vehicle in view of rising vehicle theft rate.

2. Ensure safety and security of load and cargo.

3. Reduce insurance cost with GPS fleet management and vehicle security.

Improve driver behaviour

1. Identify good and bad drivers fairly and accurately with driver rating.

2. Curb bad habits including excessive idling, speeding and harsh braking.

3. Reduce unplanned trips, unauthorized trips and personal errands.

4. Ensure driver/staff compliance. Check late departures, late arrivals, long stops, unscheduled stops, idling.

Improve dispatching

1. Ensure that drivers and vehicles are making enough deliveries.

2. Verify that vehicles arrive at customers place on time.

3. Check on vehicle status and locations in real-time.

4. Reduce poorly planned trips and overlapping routes.

Improve customer service

1. Improve customer service to clients by reducing non and late deliveries.

2. Increase flexibility and response time to customer's request with real-time fleet management to cater for last minute requests.

Practise green policy

1. Reduce fuel emissions with better fleet management.

2. Practise Corporate Social Responsibility via Green Policy.

3. Enhance corporate image and brand with Green Policy.

Grow Business

1. Grow and expand business with improved customer service and more customer confidence as a result of fleet management capability.

2. Achieve more customers that goods can be delivered or service provided.

3. Gain a strong position to grow market share and expand business.

- CONCLUSION

As conclusion, by overcome the high maintenance upkeep, high absenteeism and shortage of drivers and also high compensation cost with the possible solutions such as the fleet management system, will automatically be solve together with the matters regarding the insurers as well as the major customer’s complaint on the quality of CPO delivered by PHSB.