www.go2uti.com importance and management of “transit times” including >> supply chain...
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www.go2UTi.com
Importance and
Management of
“Transit Times”
including
>>Supply Chain Solutions that Deliver
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Why Focus on Transit Time?
DeliveryFulfillment
Profitability
Global Competition
Customer Expectations
Client Retention
TransitTime
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Roger says …
Our purpose as a company has been reaffirmed ?
“We deliver competitive advantage to our customer’s global supply chain”.
We have also validated the following guiding strategies:
Global Growth, Predictable Performance, Hustle, Intelligent Information, and Supply Chain Solutions
Roger MacFarlane, Sept 2001
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………. And one more thing!
“We are especially pleased with our performance in this
tough economic environment”
Roger MacFarlane: 5 September, 2001
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Set Standards
Commit to StandardsMeasure
Report
Improve
PerformanceManagement
What we Tell our Clients
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Goal
To differentiate UTi by meeting and exceeding customer expectations on transit times and
predictability.
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Global Top 10
The ABC of Transit Time Management
Dow CorningDaimlerChryslerAshantiEstee LauderGM/DeltaBayerBASFBMSJohnsons ControlsSara Lee
DE – USDE – ZAHK – USUS – ZAUS – HKUS – DEUS – GBGB – ZAAU – NZDE – JP
A. Focus on major routes
Plus all of usEVERYONE
B. Focus on major customers
C. Create performance culture
A BC
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A. Major Routes
0 500 1000 1500 2000 2500
DE-JP
AU-NZ
GB-ZA
US-GB
US-DE
US-HK
US-ZA
HK-US
DE-ZA
DE-US
Shipment Count
A
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QC focus groups Global and local Cross Functional
View process as a whole Set Standards Set up cross functional teams Measure and review
Sample when volumes are too high Action issues with the most impact (pareto
analysis) Action
How do We Manage Performance?
SpringboksSpringboks Think of Rugby, think of the Each person to willingly accept and pass the ball The more passes the more tries!
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Courier Docs
Contact Supplier
Arrange Pickup
Print HBL
Pre Alert
Queries
Issue Release
Receive/check process docs
Register UTRAC prealert
Issue SOBS
Docs to depot
Docs to line
Invoice charges
To inv clerk
Print & Sort
Messenger for Delivery
File from releases
Split & Photocopy
Invoice
CostingQuality Check
To Imports
From Customs
Rec from Imports
AllocateCapture
To Customs
Quality Check
Batching
O/Seas Office InvoicingEntriesDegroup
ClientShipping Line CustomsImport Channel
Congestion
Issue OBL
Weather
Late Sailing
Late documents
Original BIL
Late instructions
Permits
Release
RejectionsDelays
Stops /Detains
Exams Contact client for instructions
Original BIL
Receive and register documents Fax client
Split for entries
From customs
To releases
From invoicing
POD
PODRV
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Ocean Routes
0
5
10
15
20
25
30
35
40
45
50
JAN FEB MAR APR MAY JUN JUL AUG
US - ZA (OCEAN) US - HK (OCEAN) HK - US (OCEAN)
No
of D
ays
Transit Days (RV to DC) Ocean Shipments
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Average OK, but predictability not
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Air Routes
0
2
4
6
8
10
12
14
16
JAN FEB MAR APR MAY JUN JUL AUG
US - ZA (AIR) US - DE (AIR) DE - US (AIR) DE - ZA (AIR)
No
of D
ays
Transit Days (RV to DC) Airfreight
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US to ZA (Av = 6 days, PI = 10.5)
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USA to SA Gateway Alliance
11 Carriers down to 1 DTD - BA 90%
Transit time 10-20 days down to 6 days
35 Offices down to 5 Gateways
Costs $4.50/kg down to $1.70/kg
Net Savings in one Year $2.6 million
Grow the Business from 80 tons – 200 tons per month
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What Next on US to ZA?
How do we show continuous improvement?
Move the goal posts – get a new transit target of 6 days and consistently achieve shipments below this target
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Airfreight Shipments: Germany - USA
0
2
4
6
8
10
12
14
16
JAN FEB MAR APR MAY JUN JUL AUG
US - ZA (AIR) US - DE (AIR) DE - US (AIR) DE - ZA (AIR)
No
of D
ays
Transit Days (RV to DC) Airfreight
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DE to US (11.9 days, PI = 96)
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DE to US
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DE to US
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DE to US (5.9 days, PI = 10.8)
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Learning Points : Major Routes
Focus on data quality
Make someone responsible for editing obvious data capture errors
Institute QC focus groups to manage performance
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B. Major Clients
Dow Corning DaimlerChrysler Ashanti Estee Lauder GM/Delta Motors Eveready
BAYER BASF Bristol Myers Squibb Johnson Controls Sarah Lee Dimension Data
B
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What does Performance Management Say to our Customers?
It says we care about their business We are committed to improve our business It is also about improving our customer’s
business It is a service over and above daily
operational tasks It builds partnerships and relationships It is a proof statement about our performance
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How do We do it with Clients?
The same process as for major routes except that we
include both UTi and client people in the cross functional performance management team
Include small routes as well as big ones
The SOP drives the commitments
We identify KPIs with the client’s guidance
The Account Relationship Manager (ARM) should drive the process
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Tetrapak
Tetrapak a major client on the Sweden to SA route wanted to:
Reduce the number of flash shipments (lower cost)
Ensure that flash shipment moved with 3 day transit time
Establish a predictable transit target for consol shipments
A cross functional performance management team was set up with the client
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The Targets for Flash Shipments were Achieved by the Team
TetraPak Flash Shipments
20
11
7
3.82.6 2.1
0
5
10
15
20
25
May June July
No of Flash HBs Av Flash Transit Days
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We Met our Customers Expectations
Results From uAnalyseConsol Shipments
0
5
10
15
20
25
June July AugustPredictability Index Av Transit Days
No
of D
ays
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Learning Points: Major Customers
Start with SOP and ARM
Create QC focus groups including the client and leverage off major route performance teams
Include small routes
Develop KPI’s with client
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C. Performance Culture
Everyone should be familiar with and use the exception management tools that we have
These allow us to pro-actively manage the quality of our service on a daily basis
Every office and every manager, no matter how small the office is, should be doing this
C
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What are these tools?
HB’s at AR status (or invalid POD status) but not yet POD’d
ROS dates against vessels ETA (actual Shipment details)!
Forward Planning Report – selects PO’s with ERD date for two weeks ahead
And more ……
generates exceptions reports that focus on transit performance. For example:
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Excel Spreadsheets (Expected Orders)
Attachment to e-Mail
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Reports (Outstanding POD’s)
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Fig 1.1 Fig 1.2
EXCEPTION REPORT EXCEPTION REPORT
Email and SMS (ROS vs ETA)
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Learning Points: Performance Culture
Everyone must be included
Use uTrac exception reports
Take pro-active action
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Get This Right
Win every time …
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Win Every Time
Become World Champions