Returns - Supply Chain Strategy

Supply Chain Strategy – Returns

Are you a Manufacturer / Distributor or Retailer?

If so have you checked your Returns Policy and Procedures recently?

Are you aware that many companies offer a 12 month returns policy that falls short of both the EU & UK law?

If not read on.

Supply Chain Strategy is key to your business success and profitability. Most businesses realise this and spend time and effort to provide a first class service. However there is a “back end” to the Supply Chain that is often forgotten and can give untold problems.

Key Areas to consider in developing your Returns Policy:-

Customer Facing Issues
Research - What are your Competitors doing?
What is the UK & EU applicable law
Writing the Policy
Tell you Customer what your policy is
Fostering Loyalty

Internal Business Issues
Learn from your returns
Returns Processing
Cost of Returns

Consequences
What if I get it Wrong?
What if I get it Right?


Research - What are your Competitors doing?

Research is very important. You need to understand what your competitors are offering! Consumers have become more discerning and are looking for added value. If your returns process is complicated or of less value than your competitors, then you have lost the customer and the sale.

What is the UK & EU applicable law

A recent case publicised in the press and on the radio has highlighted the legal rights of individuals to return faulty goods to the place of purchase.
“A consumer returned his faulty product to the store where it had been purchased after a period of 15 months. The receipt was produced and the store asked to replace the faulty product. The store refused as they said that the warranty was for 12 months only. The consumer knew his rights under both UK and EU law and demanded a replacement. After much arguing and ado within the store the customer services desk called Head Office only to be told that the consumer was right and to give him a replacement item and a full apology”
Key lessons to be learnt from this as follows:
· Train Customer Service staff correctly
· Make sure the warranty is in line with the applicable law
· Because of this the store probably lost the consumers loyalty
· Other consumers witnessed the issue and probably thought twice about purchasing from the store.

Writing the Policy

The policy is in effect a legal document and is often written as such. Consumers may not fully understand the implications due to the use of legal jargon / legalese. The key rule here is to use plain English that everyone can understand.
History tells us that consumers will spread the word about poor policy and that extends to poorly written and incomprehensible returns statements.

Tell your customers what your policy is

Make sure all of your documentation accompanying the goods clearly shows the returns policy.

Fostering Loyalty

Your Brand name is important so:-
· don’t destroy it by having a bad reputation for exchanging damaged or faulty products.
· collect your customer e-mail address when product is returned for exchange or refund and

send them an e-mail with an apology and a comforting message.
· train your Customer Services staff to understand legal requirements and the customers’

needs.

Learn from your returns

Returned product can tell you a lot about your customers, their requirements and product issues. This information should be captured at source and added to along the returns process to provide a detailed picture containing:-
· Date of Purchase
· Date of Return
· Customers contact details
· Reason for return
· Exchange or Refund
· Issue with product as stated by Customer
· Issue with product after inspection by technical department
· Disposal method
· Cost of transaction
Use this information to analyse the returns and take corrective action.

Returns Processing

Once product is returned from the sales outlet you need to process it in a managed way. The first thing is to collect further information on the returned item and add the data to the history file.
Key Points for actions:-
· Process returns quickly (Returns are inventory and inventory is “dead” cash)
· Keep separate from new inventory (Expensive errors can easily occur)
· Involve Sales / Purchasing / Finance and Manufacturing in the returns process and data

analysis. (Issue resolution and action are required from these areas)

Cost of Returns

Calculate the cost of returns and relate this to each item. The cost is high and will focus the business to improve product quality and eliminate returns. This calculation should also include the cost to the business of a lost sale / customer.

What if you get it wrong?

· Your customer gets upset and goes elsewhere = LOST SALES
· Your product gets a bad name = LOST SALES & DAMAGE TO BRAND NAME
· You generate high levels of returns = CASH TIED UP IN INVENTORY
· Your warehouse has to process the return = INCREASED OPERATING COSTS
· You have to dispose of un-repairable products = INCREASED OPERATING COSTS
· You have to repair product and repackage = INCREASED OPERATING COSTS
· Additional handling in returning to stock = INCREASED OPERATING COSTS
· Customer Services incur additional workload = INCREASED OPERATING COSTS
· You have to manage the returns process = INCREASED OPERATING COSTS

Significant additional cost to the business

What if you get it right?

· Improved Customer Loyalty = INCREASED SALES
· Reduced product handling = REDUCED OPERATING COSTS
· Reduction in Customer Services staff levels = REDUCED OPERATING COSTS
· Safeguarding Brand Integrity = INCREASED SALES

Safety of Brand & Increased Sales

About the Author:-

Mike Forryan FCILT is the owner of MF Logistics & Associates and has worked within the Global supply chain arena for over 30 years. He has worked in both the Public and Private sectors across multiple markets in Europe and Globally. For the past 12 years Mike has managed his own Consultancy, operated as a Project Manager and an Interim Director / Manager. Contact Mike for further details on “Returns”. Tel 07711 083227

Example of an Interim Managers Supply Chain Assignment

Interim Supply Chain Managers Example Assignment

I’ve received a phone call from an Interim CEO who I have worked with on a number of occasions:

“Mike, I need you to have a look at the Supply Chain operation for me! I’m in the warehouse and nothing is moving, no working space, inbound delays and delays to outbound shipments”

Next morning I met with the CEO and the Supply Chain Director at the warehouse. After the usual introductions and walk around it is down to business……..

“Can I see the last 4 weeks KPI’s please” …………….

……….. “We don’t have time to collect the data” …………

“What are the pick rates per operative” ………………..

……….. “Which rate do you want? The one with the base staff levels or the one with the additional 84 agency staff at present” ………….

“What is the missed pick rate?” …………….

…………..” Well that is a big issue for us as the first 3 months receipts into the warehouse were corrupted when SAP went live and we are still trying to find out where they were located. Therefore we do have a high number of miss picks / not founds” …………

The warehouse was 850,000 sq ft of working space in two adjoining units. One was VNA racked with 12,000 pallet locations the second was a ground floor with 3 additional floors containing in total 100,000 bin locations, a small manufacturing / assembly operation and the packing and despatch area. The business managed 75,000 SKU’s plus ring fenced stock for specific companies.

I spent the next week identifying the key issues, some of which are summed up as follows:-
1. Material Masters within SAP had not been generated correctly and the information was both inaccurate and more often just missing.
2. Due to the corruption of data at warehouse start up, 3 months receipts had been put away into pick and bulk locations but the system, SAP, was not aware of where they were.
3. There were 1,500 pallets of returns and scrap materials in the bulk storage area.
4. There was no working space within the facility.
5. “Goods In” was constrained through lack of space to put away
6. The booking in system at “Goods In” had failed
7. The Logistics Director was struggling to manage the situation as his skill set was in HR.
8. The culture of “Silo” management was rife in the business with all of the associated problems.
9. Pick Notes were generated by SAP and printed at the warehouse. Unfortunately each line of each order was printed on a separate piece of paper requiring a manual process to collate orders before issuing to the warehouse operatives. Typical order processing time was 5 working days.
10. Links between Purchasing and the warehouse were nonexistent. Purchasing ran the “booking in” diary with no regard to the capability of the operation.

I could go on and on but suffice to say that it was a shambles and costing the company a fortune in operating costs and lost orders through inefficiency.

Drastic measures were called for to make the changes quickly. The following is a summary of some of the changes and processes that took place in this specific environment:-

Make Working Space:
Working space within the warehouse was the major issue. New product was stacked up outside under the canopy. Key actions taken included:-
· Move 1,500 pallets of returned goods out of the warehouse to a remote location. Bring in Head Office staff to process these specific returns
· Relocate the returns area to a smaller and more secluded location within the warehouse. Set up a procedure to action and clear the returns within a maximum of 5 working days.
· Working with Head Office, identify the old non moving products and implement a disposal programme.
· Identify SKU’s with stock levels that are too high. Work with Purchasing to block orders until more acceptable levels of stock are reached.
· Consolidation of stock in multiple locations

Identify “What is Where” in the Warehouse:
The first 3 months receipts into the new warehouse were not entered correctly into SAP. Therefore the locations for those SKU’s were incorrect and causing multiple issues with missed picks and stock volumes. Key Actions taken included:-
· Implement a data team of 8 heads to work a night shift with clearly defined tasks:-
o Visit every stock location within the warehouse
o Verify the stock SKU and Quantity against SAP. Correct SAP if required.
o Verify the Material Master details and correct as required. Make sure Weight and Dims of SKU item are correct
· Run on the basis of Perpetual Inventory Stock Check
· Agree with Risk Management and Auditors the process to enable removal of year end stock check.

New Procedure for Populating the Material Master for New Products:
Set up a new procedure at Head Office for initial creation of New Product Material Masters. Set up procedures at “Goods In” to identify new products on first receipt and then Weight and Measure each SKU. This information to be added to the Material Master in SAP.

Identify Old Product in the Warehouse and arrange for Disposal:
· Working with Head Office, identify the old non moving products and implement a disposal programme.

Change the Warehouse Management Structure:
It was apparent that there was no leadership from the top within the logistics area. Key therefore was to find the right person internally with the product knowledge and skills to lead the team. In this case it was the Warehouse Manager. Key Actions taken included:-
· Removal of the Logistics Director who was not experienced and not a leader.
· Promote the Warehouse Manager
· Set new structure for the Shift Managers and Team Leaders
· Identify training needs and set up training programme
· Set up Team Briefing Sessions
· Set up feedback mechanism for staff where they could benefit from identifying issues and helping to solve them.
· Announce changes to the business

SAP Process Workshops:
SAP was an issue and needed some work on the output documentation. SAP is an excellent product but the data input has to be absolutely correct to get decent information out. In our case SAP R3 had not been configured correctly and a volume of work was needed to reduce work levels within the warehouse. Key Actions taken included:-
· Pick Note generation and printing to be corrected to enable a one Pick Note per Client / Order.
· Back Orders, now available to ship, to be incorporated into the Pick Notes on a daily basis
· Create greater visibility to the remote warehouse
· Create reports required for warehouse operation
· Monitor Material Masters for accuracy
· Generate KPI’s directly from SAP to remove manual procedures.
· Transfer the “Booking In” system from Purchasing to the Warehouse. Move two Purchasing staff to remote warehouse to act as link with Purchasing and to maintain the “Booking In” log.

Cross Functional Co-operation:
Being remote the warehouse was an unknown to the Head Office staff and this had resulted in an “Us and Them” situation. Key Actions taken included:-
· Creating a meeting room at the warehouse for all locations to use.
· Requesting all Directors to utilise the meeting room at the warehouse.
· Set up tours of the warehouse for all visiting staff
· Create a visual set of boards in the reception area to show staff what actions were being taken and where we were with the implementation of them.
· Create a monthly news letter to staff explaining what changes were being made and how they would improve service and co-operation across the business.

The overall project took 12 months to complete and at the end of the project we had returned the logistics operation to a healthy situation, implementing a new local processing system linked to SAP to enable a paperless system based on use of Bar Codes and Hand Held Scanners. We were able to reduce the headcount by 100 and produce a Return on Investment of 1,303.7% (ROI).

About the Author:
Mike Forryan FCILT is the owner of MF Logistics & Associates and has worked within the Global supply chain arena for over 30 years. He has worked in both the Public and Private sectors across multiple markets in Europe and Globally. For the past 12 years Mike has managed his own Consultancy, operated as a Project Manager and an Interim Director / Manager. www.logistics-consultants.co.uk

Supply Chain Consultants

The Benefit of an SME using a Supply Chain Consultant

In days of old before the great depopulation of business skills, an SME would identify any internal business issues through their own operational audit team. This team was, in effect, an in house consultant looking at the supply chain and logistics issues from end to end. Now, however, those audit teams are long gone, along with all of the expertise and skills needed to evaluate and update supply chain operations / processes.

However before I move forward let’s just define one or two things so we are all talking the same language. We need to define the true meaning of some key words which the industry uses without due care and attention.

Supply Chain
A supply chain is the system of organisations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer. Supply chain activities transform natural resources, raw materials and components into a finished product that is delivered to the end customer. In sophisticated supply chain systems, used products may re-enter the supply chain at any point where residual value is recyclable. Supply chains link value chains.

A typical supply chain begins with ecological and biological regulation of natural resources, followed by the human extraction of raw material, and includes several production links (e.g., component construction, assembly, and merging) before moving on to several layers of storage facilities of ever-decreasing size and ever more remote geographical locations, and finally reaching the consumer.

Many of the exchanges encountered in the supply chain will therefore be between different companies that will seek to maximise their revenue within their sphere of interest, but may have little or no knowledge or interest in the remaining players in the supply chain. More recently, the loosely coupled, self-organising network of businesses that cooperates to provide product and service offerings has been called the Extended Enterprise

Extended Enterprise
An Extended Enterprise is a loosely coupled, self-organising network of firms that combine their economic output to provide products and services offerings to the market. Firms in the extended enterprise may operate independently, for example, through market mechanisms, or cooperatively through agreements and contracts.

Alternatively referred to as a "supply chain" or a "value chain", the extended enterprise describes the community of participants involved with provisioning a set of service offerings. The extended enterprise associated with "McDonald's", for example, includes not only McDonald's Corporation, but also franchisees and joint venture partners of McDonald's Corporation, the 3PL's that provide food and materials to McDonald's restaurants, the advertising agencies that produce and distribute McDonald's advertising, the suppliers of McDonald's food ingredients, kitchen equipment, building services, utilities, and other goods and services, the designers of Happy Meal toys, and others.

Extended Enterprise is a more descriptive term than supply chain, in that it permits the notion of different types and degrees and permanence of connectivity. Connections may be by contract, as in partnerships or alliances or trade agreements, or by open market exchange or participation in public tariffs.

Logistics
Logistics is the management of the flow of goods, information and other resources, including energy and people, between the point of origin and the point of consumption in order to meet the requirements of consumers (frequently, and originally, military organisations). Logistics involves the integration of information, transportation, inventory warehousing, material-handling, and packaging. Logistics is a channel of the supply chain which adds the value of time and place utility.

Consultant
A consultant is usually an expert or a professional in a specific field and has a wide knowledge of the subject matter. A consultant usually works for a consultancy firm or is self-employed, and engages with multiple and changing clients. Thus, clients have access to deeper levels of expertise than would be feasible for them to retain in-house, and to purchase only as much service from the outside consultant as desired. It is generally accepted good corporate governance to hire consultants as a check to the Principal-Agent problem

Interim Manager
Interim management is the temporary provision of management resources and skills. Interim management can be seen as the short-term assignment of a proven heavyweight interim executive manager to manage a period of transition, crisis or change within an organisation. In this situation, a permanent role may be unnecessary or impossible to find on short notice. Additionally, there may be nobody internally who is suitable for, or available to take up, the position in question. This could also be a short term Project Manager.

The Key Stages to be examined are as follows:-

Why does the business need a Consultant?
Define the issue as you see it
Define what you would expect from a Consultant
Find a Consultant
Set Consultancy Stages
Initial Meeting
Request a Quotation
Compare Consultants
Appoint the Consultant
Expectations from the Consultants Report

1. Why does the business need a Consultant?
The Supply Chain in its’ true sense has a very wide business aspect. In effect most business issues can be linked with the Supply Chain and these issues may not have the causes you expect.
Problems of poor warehouse efficiencies can be caused by too much stock (an issue of purchasing or sales). It can also be caused by poor material master maintenance in the business systems / IT area. Each of these examples would need to be tracked back to source.

The need for help is identified through issues / problems that you cannot solve internally or perhaps you need to update the processes used internally to improve overall efficiencies. In either case help is needed and the right Consultant will be able to provide solutions.

2. Define the issue as you see it
Clearly understand the issue by writing a project brief. This will help clearly define the issue for you, the business and the Consultant. Without a brief you will be wasting valuable time and hence money.

3. Define what you would expect from a Consultant
· Expertise & Skills in the Supply Chain
· Reference to specific areas if possible such as Warehousing, Reverse Logistics, Returns
· Industry experience (Do not fixate on this however as cross industry experience could well add value to your operation)
· Define a timeframe (Start and End)
· Identify a daily rate that you consider is commensurate with the skills and experience you need.
· What you expect as an output from the consultancy work.
o What has been looked at
o What was found to be right and wrong in those areas
o How to correct the problems
o Implementation schedule and timeframe

4. Find a Consultant
Firstly you should understand there is a difference between a Consultancy Company and a Consultant. The Consultancy Company may have great marketing but only average Consultants. It will be the Consultant that does the work not the Consultancy Company.
You should therefore meet the Consultant who will undertake the work and look for the following:-

· The right skills and experience for the job – look at the CV and past assignments list
· Experience in your sector
· A member of a recognised Institute such as The Chartered Institute of Logistics & Transport or The Chartered Institute of Purchasing & Supply.
· Experience within the Supply Chain and as a Consultant. 25 years experience is worth more than a degree obtained two years ago.
· A degree in Supply Chain Management is advisable but do not concern yourself with degrees In other subjects. Experience over a good number of years in the Supply Chain is far better.

Look on the web at medium sized and small consultancy businesses. Examine the detail on the web site and call them. Speak with the actual consultant who will do the work.
Pick two or three and compare daily rates and expenses.

At the end of the day you will need to meet the consultant face to face to see if you can work with them. Once you have a successful business relationship with a Supply Chain Consultant it is worth retaining the contact and utilising them as a Mentor.

5. Set Consultancy Stages
In advance of meeting the Consultant define what you want from him.
Typically the work would be in the following stages:-
· Initial Investigation on site
· Review of Data and Processes
· Report Writing
· Presentation of Report
· Implementation
Agree with the Consultant what he is going to do, by when and how many days.
The last item of implementation can be discussed after the presentation of the report and a clear understanding of what is needed.

6. Initial Meeting
Prior to the first meeting with a Consultant provide them with a copy of the brief. Make sure you are meeting the person who is doing the job.
Set aside one and a half hours for the meeting. It should be structured as follows:-
· You give an overview of your business and of the issues you have
· The Consultant should describe his background, skills, experience and ability to manage this work.
· You should receive a copy of the Consultants CV
· Walk through the operation
· Sum up the expectations and discuss daily rates etc.

7. Request a Quotation
Stage 1 would be to request signature of a Non Disclosure Agreement (NDA)
Provide any additional requested data after signature of NDA.
Request a quotation / Proposal to include expected timeframe, dail cost and expenses, terms of payment and references

8. Compare Consultants
· Price is one key factor. Look for a fix period of an agreed number of days
· Qualifications and / or experience of the Consultant
· Your preference for the individual. You will have to work with them. There needs to be trust.
· Always call the references to see what the Consultants work is like.
· Look on the web and do a “name” search to see what comes up. Always worth the effort.
· Make sure you find a Consultant that lives locally or you could be in for some hefty travelling expenses.

9. Appoint the Consultant
Issue a letter of appointment confirming the details of the assignment and listing the deliverables / dates.

10. Expectations from the Consultants Report
You should expect the following as a bare minimum:-
· Details of what was looked at and the output from this.
· A detailed list of the good and the bad.
· Consolidated list of items that need addressing with a Why the issue in the first place / What needs doing / Potential Result.
· Order of Work and some estimate of timeframe.
· Summary of Benefits.
· Suggestions as to who can undertake the remedial actions.

_______________________________________________________________________________
I hope this has been useful. If you need additional help please call Mike Forryan at MF Logistics & Associates on 07711 083227

About the Author:
Mike Forryan FCILT is the owner of MF Logistics & Associates and has worked within the Global supply chain arena for over 30 years. He has worked in both the Public and Private sectors across multiple markets in Europe and Globally. For the past 12 years Mike has managed his own Consultancy, operated as a Project Manager and an Interim Manager at board level.
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What is a Supply Chain Project and How is it Managed

Mike Forryan has worked as a Global Supply Chain project Manager for twelve years both in the public and private sectors on a global basis. See www.logistics-consultants.co.uk for further details about his supply chain consultancy and project management business.

Before we start there are a number of definitions we need to be clear about. These relate to the type of person needed to manage the work and understanding what a project plan is.

Project Manager:
A project manager is the person accountable for accomplishing the stated project objectives. Key project management responsibilities include creating clear and attainable project objectives, building the project requirements, and managing the triple constraint for projects, which is cost, time, and scope.
A project manager is often a client representative and has to determine and implement the exact needs of the client, based on knowledge of the firm they are representing. The ability to adapt to the various internal procedures of the contracting party, and to form close links with the nominated representatives, is essential in ensuring that the key issues of cost, time, quality and above all, client satisfaction, can be realized.
In effect the Project Manager oversees the project but does not become involved in the physical doing of the work.

Project Management Office:
The Project Management Office (PMO) in a business or professional enterprise is the department or group that defines and maintains the standards of process, generally related to project management, within the organization. The PMO strives to standardize and introduce economies of repetition in the execution of projects. The PMO is the source of documentation, guidance and metrics on the practice of project management and execution.
A good PMO will base project management principles on accepted, industry standard methodologies such as PMBOK or PRINCE2. Increasingly influential industry certification programs such as ISO9000 and the Malcolm Baldrige National Quality Award (MBNQA) as well as government regulatory requirements such as Sarbanes-Oxley have propelled organizations to standardize processes. Organizations around the globe are defining, borrowing and collecting best practices in process and project management and are increasingly assigning the PMO to exert overall influence and evolution of thought to continual organizational improvement.

Interim Manager:
Interim management is the temporary provision of management resources and skills. Interim management can be seen as the short-term assignment of a proven heavyweight interim executive manager to manage a period of transition, crisis or change within an organization. In this situation, a permanent role may be unnecessary or impossible to find on short notice. Additionally, there may be nobody internally who is suitable for, or available to take up, the position in question.
In effect the Interim Manager physically does the work and acts as both the designer and implementer.

Project Plan:
A project plan, according to the Project Management Body of Knowledge, is
"...a formal, approved document used to guide both project execution and project control. The primary uses of the project plan are to document planning assumptions and decisions, facilitate communication among stakeholders, and document approved scope, cost, and schedule baselines. A project plan may be summary or detailed."
PRINCE2 defines
"...a statement of how and when a project's objectives are to be achieved, by showing the major products, milestones, activities and resources required on the project."
At a minimum, a project plan answers basic questions about the project:
· Why? - What is the problem or value proposition addressed by the project? Why is it being sponsored?
· What? - What is the work that will be performed on the project? What are the major products/deliverables?
· Who? - Who will be involved and what will be their responsibilities within the project? How will they be organized?
· When? - What is the project timeline and when will particularly meaningful points, referred to as milestones, be complete?

Project Schedule:
A detailed plan of major project phases, milestones, activities, tasks and the resources allocated to each task. The most common representation of the project schedule is in a Gantt Chart. A typical PM tool is Microsoft Project which can depict the project as a Gantt chart.


The aim of this article is to understand the different key areas of a supply chain project and what is involved in each.
The key areas are:-
Deliverables
Timeframe vs. Costs
Resources
Management Structure
Responsibilities / Escalation Process
Documentation
Work Streams
Milestones
Dependencies
Schedule
Dashboard
Visibility

1. Deliverables
The project deliverables have normally been outlined by the business and may cover multiple aspects of the Supply Chain / Logistics operations. The deliverable can either be linked to the business case or can be redefined by the PM to clearly outline what is expected and by when. This should then be presented to the project sponsor and signed off.
This document will be referred to during the life of the project and may change. If changes are made they need to be recorded and signed off by the project sponsor.

2. Timeframe vs. Costs
Projects differ in their key requirements. Timeframes may have been set to achieve the end result and cost, although important, is not the key driver. In other cases the cost in implementing the project is key and the business can live with slippage in the timeframe.
Clearly understand what the criteria are and document them for they will change and potentially cause friction within the management team.


3. Resources
Most large projects require the PM to manage the project in the true sense and not to become involved in doing the work. Please note this does not abrogate the PM’s responsibility to oversee the validity of work undertaken by others.
The PM should agree, with project sponsors, work stream Owners and work stream Implementers.
Project stream owners are fully responsible for managing the design, resourcing, implementation and successful completion of each sub work stream.
Project Stream Implementers are responsible to the work stream Owners for all aspects of the sub work streams.

4. Management Structure
Clearly define the management structure for the project. Appoint a core working group and define the reporting between this group and the main board.

5. Responsibilities / Escalation Process
Core Working Group
To be made up of a senior person from each business area that is involved in the overall project. See Work Streams for further details.
Project Steering Group
To be made up of key board members.
The Core working group will meet as and when required as defined by the PM. The Project Steering Group should meet fortnightly on set immovable dates where the PM and any invited Core Working Group members report to the Steering Group. The Steering Group will report to the main board.
Escalation of issues will be through the Steering Group

6. Documentation
There are numerous types of pre set documentation which can be used but the following are the minimum.
· Definition of Business Objectives
· Meetings Log
· Project Milestones
· Meeting Notes (with ACTIONS)
· Issues Log (Current problems to be resolved)
· Risks Logs (Problems that might happen)
· Contacts
· Gantt Chart

7. Work Streams
Work Stream

Each key work stream area has an owner who has overall responsibility for each sub work stream. The work stream owner is responsible for allocating sub work stream implementers.
Work streams are identified by the PM and the Work Stream Owner and in put to the Microsoft Plan to produce a Gantt chart. The sub work streams will be verified by the work stream owner and his implementers will fully populate the Gantt chart with the PM.

8. Milestones
Define the project milestones with the steering group. Complete a milestone chart showing date, milestone and a RAG (Red, Amber, Green) status flag. Set milestones into Gantt chart.

9. Dependencies
Complete a detailed dependencies chart across all areas of the business showing how they are related and what the relationship is. An example chart is set out below.

10. Schedule
The schedule is in fact a Gantt chart. This is generated by software such as Microsoft Project and is in effect a list of all project components, linked and with dates attached. If one date changes then it recalculates the project end date and highlights all issues with related sub work streams.
This tool is important and does not represent the be all and end all of any project. It is a guide and cannot contain everything.

11. Dashboard
A project dashboard is used to manage all of the actions that are agreed to in meetings. One of the key issues in project is sub work stream implementers not keeping to their actions or dates.
The dashboard is a monitoring tool where all actions are added and is monitored weekly to make sure all actions are being processed in time. An example dashboard is available from mike.forryan@logistics-consultants.co.uk

13. Visibility
Do not enclose the project in a cloak of secrecy. Make it as visible as possible within the business constraints. Consider utilising a shared system drive to hold all project files and making them available to all. Perhaps a “SharePoint” option would also suffice.

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A Duty of Care

Like many people reading this blog, I have spent much of my working life in the Transport, Warehousing and Logistics Industry. Over the years we have always had to face a changing market place, consolidation, regulation and of course competition.

However there is one issue that I never thought I would be faced with, an issue of such magnitude it could affect everyone on this planet.

The issue of course is Global Warming, Climate Change and the whole Eco Challenge. Add to this the incredible rises in energy prices and suffice to say we all need to look at our business models.

Warehouse construction has shown marked improvements over the years as new building regulations, new materials and techniques have all helped reduce energy consumption and CO2 emissions. There is however, always room for improvement and one area I believe we could improve, not only on reducing Energy Consumption and CO2 emissions, but also on Health and Safety, Improved Working Environment, reduced Picking Errors, and better productivity is in the Lighting Standards of our warehouses.

Working with a company who specialise in Energy Efficient Lighting Solutions I was able to clearly understand the multiple issues involved in creating a cost effective and operational efficient solution.

The results of the work undertaken were outstanding. Using High Quality Luminaries, with state of the art presence detection, has shown energy savings of over 80% per annum. Not only that, improvement to the working environment was clear for all to see. Examples of before and after results at some “case study” sites showed that the new technology has led to some really big steps forward in Illuminating Large Areas where Low Occupancy Levels (as in most warehouses) exist.

The concept is quite clear and straightforward:-

Replace the existing (typically inefficient Low Bay or High Bay Fittings) with new Fluorescent T5 Lamped Fittings all fitted with Presence Detection suitable for High Level Installation. The luminaries run at reduced power consumption when there is no movement detected, but INSTANTLY switch to full brightness when an operative enters the area covered by the detector. Having carried out several test sites, the manufacturers were able to observe the movements of staff and plant around the warehouse, and couple this with the energy consumption via a “Power Logger”. The results are self-explanatory; the shown graph clearly identifies the reduction in energy used when nobody is present in an aisle.

The magenta mine clearly shows the power consumption at Full Loading from the moment the building opens, until closing time. The blue line identifies operatives movement around the building and the reduction in energy used.

You can also see from the before and after photos how the lighting has improved the work place. One of the best examples of this is how the new fittings, with better LOR (Light Output Ratios) illuminates the “vertical” surfaces of the pallet racking. This makes identifying items to be picked that much easier, leading to better productivity and reduced picking errors.


One of my main concerns was having long racking aisles at times in darkness thus causing Health and Safety issues. The solution was to allow the lights to run at just 10% of power consumption when not in an “occupied” state. This of course means that the aisles are never in total darkness. Another benefit from this technical advancement is extended lamp life. This works because the “cathode” (the bit that warms up the gases in the tube to you and me!) is never allowed to get completely cold and therefore its life span is increased. Manufacturers of lamps, when stating Lamp Life, base their calculations on 6 times switching from cold, per day, This new design means the cathode is always running warm thus extending its life. The biggest cause of failure in lamps is the switching on and off from cold.


To summarise I found this technology most informative and useful, and when large areas of warehousing with low occupancy levels are involved, the savings are significant. Even without the energy savings the quality of lighting resulting in better Health and Safety and productivity should be considered.

We all need to think about the future, whether it be rising fuel costs, or protecting the planet for our children and our grandchildren. Everybody in all sectors of life can do something to help both their profitability and the quality of the environment.

Why don’t you consider reviewing your warehouse lighting and do your bit for the planet as well as saving money for the business.


In Conclusion
We All have a duty of care to the planet which can be addressed through newly developed technology. This new technology was developed and tested by Dexeco. If you would like to know more about the technology then contact:- Alan Reynolds, Dexeco, Brickfields Business Park, Gillingham, Dorset, SP8 4PX. Tel:- 01747-858100e-mail sales@dexeco.co.uk

Phots removed but if you want a copy of the article please e-mail me at:-
mike.forryan@logistics-consultants.co.uk

Customer Service

In my job as a Supply Chain consultant I am frequently asked to provide a service that the customers want. When I research the way in which they identify the Customers requirement I find a bag of issues but no clearly defined customers views. I am sure this is not because the Customers have no views but is the result of the way in which the views are recorded and collated.

The research I undertook showed quite clearly that there was plenty of so called feedback services but none of them “did what it said on the tin”

The process needed to give the customer a “Closed loop Customer / Supplier feedback on products and or services where the Customer defines an issue. Other Customers can see it and add a signature to it or alternatively add new issues”

The concept is based upon a human trait of wishing to complain but the knowledge that complaining directly to a Company is not going to have the impact to resolve the issue.

A novel but forceful concept. I found a company, Equora Ltd, that provides just such a service. Utilising the Equora Ltd system consolidates like complaints and focuses the Customers thoughts through volume and specifically targeted complaints.

Equora Customer Services provides commercial organisations with the ultimate feedback mechanism allowing them to implement continuous improvement based on continuous customer feedback. And for their customers, it gives their opinion some weight because of the “commitment to act” that an organisation has to sign up to before adopting Equora Customer Services. The whole process has been designed to filter out one-off issues or gripes and to allow organisations to focus on improving products or services based on a critical mass of customer opinion.

If this is a service you are interested in to give you a major competitive advantage then call me to discuss the service.

The Green Supply Chain

I have seen many articles discussing the green supply chain and in every case the articles talk about reducing carbon emissions, reducing the carbon footprint but little about actual ways to reduce the footprint.
Have any of you people out there had experience with this issue and if so please tell us how you have helped in reducing the carbon footprint? We know it is right to do it but we want to see ideas on how it should be done.