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On Time, In Full: Customer Service Improvement

"Our management team have been left with a skill set and series of tools to work on the business together and have been left more motivated with a better sense of what is possible." - Managing Director


Industry

Durable Consumer Goods – DIY and Homeware

Support Level

1 consultant, 8 weeks

Objective

Improve customer service through an increase in ‘On Time in Full’ performance and reducing the lead time between customer order received and product dispatched.

Results

In eight weeks, fundamental process changes have been implemented and the number of customer orders delivered late have been reduced by 90 %.


Why did this manufacturer join forces with chartwell?

The client had successfully implemented a sales growth strategy that saw their volume significantly increase.  Their primary customers were DIY superstores, plumbing merchants and large on-line retailers.  The increased sales volume exposed weaknesses in their business process resulting in poor delivery performance and an increased risk of upsetting and losing customers.

Results of the 8 week project

  • 90 % reduction in late orders
  • Customer performance improved substantially and a reduction in the cost of manufacturing allowed the sales team to reduce prices and grow market share

Examples of Project work:

 

 

To what degree was delivery performance suffering?

FOCUS AREA:

The first area of focus was to look at the standard product which was manufactured to order and promised to be delivered in one week.
A measure of ‘On Time in Full’ was implemented using existing data in the order processing computer system.  The surprising result was only 60 % of standard orders were achieving the desired one week lead time.

What was the root cause of poor delivery performance?

PROBLEM:

The business accepts standard (7 days) and expedited (24hr) orders from customers.  The single largest cause of missed delivery time was due to the product not being in the warehouse when it was due to be picked.


On investigation it was discovered that:

  • Expedited ‘next day delivery’ orders were being ‘taken’ from the warehouse to meet a customer’s urgent requirement
  • No notification for replenishment was being made
What actions were taken to improve delivery times?

ACTION:

The following actions were taken:

  • Clear performance metrics including causes of missed on time delivery
  • Dedicated warehouse space and stock for top 80 % of next day delivery products using a simple Kanban for replenishment
  • No ‘self service’ of products from the main warehouse without an order placement
  • Daily morning review of delivery performance and reasons for missed deliveries