Mychala’s post

What rationale is offered by HQ Depot in support of the idea of using a 3PL? Do you agree with the reasons cited for the interest in a 3PL?

      With HQ wanting to expand their reach into the market but not having access to the logistics to expand it would make sense for them to want to use 3PL. With a third-party logistics HQ would not have to worry about transportation, warehousing, distribution, and financial services. The rationale behind the decision was based on HQ wanting to maintain their status on their shelf-stable juices, while being able to strengthen that core. HQ wants to expand their logistics network. Also, HQ would be able to centralize their transportation operations.

What steps would you suggest be considered by HQ Depot as it begins to analyze the feasibility of forming a relationship with individual 3PL providers?

· Perform a strategic assessment- HQ needs to view the options and locations of various 3PL’s to find which would fit more with their goals

· Decision to form a relationship- HQ would then decide which 3PL’s would suit their needs and goals. And contact their agents for meeting and discussions.

· Evaluate alternatives- an in depth look at all the competing 3PL’s. Which 3PL’s are going to align with the A: HQ’s needs and priorities and B: their potential partners capabilities.

· Select a Partner- the selection of a partner has the costumer in mind and the credentials of the best 3PL’s.

· Structure and operating model- this is when HQ and their choice would go over their needs, the operating controls, communication, the financial investment, and the scope of the relationship.

· Implement continuous improvement- this includes incentives for work performed. Allows both companies to achieve breakthroughs together.

Coyle, J. J., Langley, C. J., Novack, R. A., & Gibson, B. (2016). Supply chain management: a logistics perspective. Nelson Education.

Heather’s Post

If you were hired as a consultant to develop these KPIs for WD, how would you assess what KPIs they should be measuring? In general, what areas of service and cost would these KPIs address? Be sure to include both internal and customer KPIs.

-Wash & Dry has had remarkable growth, but KPIs of Wash & Dry needs improvement to measure the performance of the company a little more accurately. The company can be advised to assess specific KPIs that should be measured.

            Self-experience: Drawing from ones own experience of what can be done to improve situations, the consultant can advise Wash & Dry with what to proceed with.

            Industry trends can be compared with other companies that are similar to wash & dry and suggest what KPI to select.

            A consultant can request employee feedback on which KPI would be the best option to will best to provide the results wanted. Employees at the operational level can provide great insight.

            Cost areas that KPIs can address are Insurance cost, procurement costs, maintenance costs, other operational costs, and infrastructure costs.

How would you measure the revenue and profit impacts of these new KPIs?

-Using KPIs such as defective production rate, holding cost of inventory, rate of return of products, and back order rate will help in reducing the several costs such as: Accuracy in analyzing the defects in production will help in reducing the cost.  Otherwise this might have been incurred to correct the defects, monitoring production levels and measuring holding costs will help in reducing the chances of investing high in storing inventory, and reduction of other related costs such as maintenance costs, labor costs, and material costs. Reduced cost levels will help in increasing profits directly and indirectly. The use of KPIs can be measured using any financial measuring tool such as financial ratios. It can also be measured using Net Profit, Cost-volume-profit analysis, cash flow measurement, maintenance cost and total expenses.

Langley, C. (georgia Institute Of Technology). Supply Chain Management - a Logistics Perspective. Cengage Learning, Inc, 2016.

Christopher’s Post

Case 13.1 Wash and Dry, Inc

1. If you were hired as a consultant to develop these KPIs for WD, how would you assess what KPI's they should be measuring? In general, what areas of service and cost would these KPIs address? Be sure to include both internal and customer KPIs.

One KPI could be customer satisfaction. It can measured on the satisfaction of the customers expectations and WD can focus on improving customer satisfaction to increase business and popularity in the retail industry. Another KPI to measure is if resources are being used to their fullest to gain the most productivity out of the company. WD would have to focus on building more productivity on both areas of soap and paper. Quality assurance can be another KPI for WD to measure on and that would mean focusing producing their products with the best quality and keeping up with those standards throughout the manufacturing process. Main focus on internal KPI would be to utilize the company as much as they can and improve delivery time for customers. This would also include quality product and delivery that is fast and with no damages or defects.

4. How would you measure the revenue and profit impacts of these new KPIs?

To measure revenue, WD would focus on the income that the they are bringing in compared to the expenses they are incurring which can include raw material, labor and capital.This would be their revenue KPI that would be recommended to focus on. The profit KPI would focus on the profits the company is receiving which can include the measurement of their net profit and net profit margin. 

Reference:

Coyle, J. J., Langley, C. J., Novack, R. A., & Gibson, B. J. (2020). Supply chain management: a logistics perspective. Mason: South-Western.