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KEL019

SUNIL CHOPRA

Excel Logistics Services

Background

op yo “The quality of our performance has improved significantly, but stores continue to complain about our deliveries,” said John Margolis, general manager of the Springfield Warehousing and
Distribution Center (WDC) run by Excel Logistics Services. Margolis looked at the customer satisfaction survey for the fourth quarter of the previous year. “At this point, it is becoming increasingly difficult for us to make further improvements. We need a detailed plan of action regarding what to do next. Robin, I would like to see an initial plan from you in the next couple of months. Why don’t you begin by looking at the receiving function?” Robin Stalk, …show more content…

Inventory storage referred to the process of storing products at the WDC. Order filling referred to the process of receiving a store order, picking required items from storage, and loading the delivery truck. Shipping referred to the process of transporting the store order from the WDC and delivering it to the store.
These four processes were identified as key because any error in these processes impacted
Springfield’s ability to supply a store order on time and in the right quantity. An error in receiving or inventory storage could result in an improper quantity of a particular product showing up in the inventory system. As a result, the WDC could promise delivery to a store from stock, even though the item was out of stock. This error would be detected when the WDC tried to fill the order and found they could not. This would cause the delivery to the store to be late. Margolis’s objective was to manage the four processes in the warehouse in such a way that store orders could be delivered in the right quantity at the right time.

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By June, detailed process flow maps were constructed for each of the four processes (see
Exhibit 2 for receiving) and key objectives were identified for each process. To identify the objectives, Stalk and Margolis took into account store requirements in terms of delivery accuracy.
The process mapping and objective identification was done in coordination with the personnel