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On Time, In Full: DIY & Homeware

OTIF failures reduced by 90% within 8 weeks of project start

Industry

Durable Consumer Goods – DIY and Homeware

Project Length

8 weeks - 1 consultant leading several teams

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

  • Within 8 weeks, the number of customer orders delivered late have been reduced by 90%

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

"Our management team have been left with a skillset 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


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 online 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.

Key Workstreams

OTIF Measurement

  • Before Chartwell support started, there was not a reliable up-to-date OTIF measure that the management team could access
  • Working with the plant S&OP leaders, the team built measures using existing data in the order processing system to effectively quantify OTIF and make the result easily available to all key stakeholders
  • This metric showed that only 60% of standard product orders were achieving the desired one-week lead time.
OTIF Improvement 

Investigating with the operations team, the leading causes of OTIF misses were found:

  • 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.
  • Expedited ‘next day delivery’ orders were being ‘taken’ from the warehouse to meet a customer’s urgent requirement, but mo notification for replenishment was being made
  • The team created safeguards to prevent "self-service" of products from the main warehouse without an order placement
  • A Kanban process was set up with dedicated warehouse space and stock for the top 80% of next-day delivery products - applying a second line-of-defence against stockouts caused by process failures


Processes for Sustaining and Developing Improvement Further

  • The team created clear performance metrics to show daily and weekly OTIF performance, and the top causes of OTIF failures
  • A daily morning review of delivery performance and reasons for missed deliveries was implemented to ensure that this data was used effectively to drive performance up