Case Study 1: Network optimisation – Business Post
Business Case:
Business Post is one of the UK’s largest express carriers. In June 2001 a project began, that involved the services Key3 Partners to support Business Post management, to establish the effectiveness of the current linehaul system and assess new methods of operation. The goal was to improve efficiency, reduce costs and save £2m on current expenditure.
Objectives:
-To examine the network, sortation and cross dock operations to identify improvement opportunities.
-To restructure the network to enable expansion.
-To implement the proposed changes
-To reduce costs by at least £2m per annum
Results:
£2.6 million fully implemented annual savings, signed off by the client.
Increased network capacity.
Case Study 2: Best Practice Business Case:
Comparison of the distribution costs across a multi site network with several hundred vehicles showed marked variances, even when geographic factors such as driver costs had been factored out. The aim was to achieve significant cost benefits and procedural standardisation through the understanding and cross fertilisation of best practice, driving down the cost per unit in all sites.
Objectives:
To provide baseline costs and KPIs for all sites in the network, to allow clear tracking of project benefits.
Identify the areas where differentials exist between depots and identify the root causes of why these variances exist.
Identify the cost benefit of implementing Best Practice into each of these areas and define which areas will be focused on first.
Identify the most efficient Best Practice for each focus area and pilot the new working methods in one site.
In the light of the pilot, implement the definitive Best Practice across all sites in the network.
Results:
£1.3 million fully implemented annual savings, signed off by the client.
Procedures were standardised across the sites.
Case Study 3: WTD mitigation – Exel plc Business Case:
The operation covered 5 sites throughout the country employing more than 50 drivers covering both day and night operations. This was a retail operation managing not only store deliveries but also inter-depot trunking activity.
The Exel Working Time Directive impact assessment showed that, in the worst case scenario their annual costs would rise by a staggering £750,000 in year 1 and £500,000 per year from year 2 onwards as a result of the new legislation.
Objectives:
Review driver activity to establish and opportunities to reduce current hours
Review the network and routes to establish the optimum shift length
Create peak and non-peak driver rotas to maximise productivity and provide equity across drivers
Create a driver terms and conditions model to assist the move towards a unified set of driver T&Cs
Results:
£750k year 1 cost increase mitigated
£500k ongoing annual increased costs mitigated
Case Study 4: Project management of new system adoption
Business Case:
The multi site operation required a new driver administration system to capture and report drivers’ working time under the Working Time Directive.
Objectives:
Specify the system requirements with the operators and taking into account the legislative requirements
Project manage the build of the software
Ensure the software was tested and debugged
Manage the rollout and implementation to full adoption
Results:
All sites adopted the software and complied with the data capture requirements
The entire operation is fully WTD compliant
Case Study 5 : Health & Safety process review
Business Case:
The management of health and safety has been identified as an area where performance needs to improve globally as operations had been identified with good, mediocre and poor performance in this area. The root causes of the inconsistencies were believed to be a failure to set clear standards, to create processes that drive desired behaviours and to recognise and address the skill/will issues of the management team. The aim was to confirm the root causes of the variation in performance.
Objectives:
To complete a quantitative and qualitative review of:
- Current health and safety procedures
- Customer influence on attitude towards, focus on and compliance with Health and Safety procedures
- Site culture and attitude towards Health and Safety
- Training
- Site management quality and effectiveness
Identify the root cause of non compliance to current Health and Safety procedures
Audit the skills of site management in the field of Health and Safety
Propose solutions to improve processes and address non-compliance
Results:
Identification of the root causes for variations in health and safety performance
Identification of the next steps required to improve company health and safety performance and reduce site variations
Case Study 6: Paragon setup and optimisation
Business Case:
A WTD Impact Assessment identified potential cost increases of between 14% and 18% if no mitigating action was taken. The aim was to identify the potential mitigation solutions and the cost benefit that these may have, so that discussions could take place with customers to ensure that maximum operational and cost benefit was achieved. The approach to the project was on based on the cost differences between scenarios based on operational information where available.
Objectives:
To replicate the customer operation in Paragon Routing and Scheduling software and create an operational baseline
To create a WTD compliant baseline in Paragon
To validate the potential cost advantage of removing or reducing certain operational constraints, these being:
- Restricted loading windows
- Loading durations and delays
- Restricted unloading windows
- Unloading durations and delays
- Timed deliveries
To quantify the optimal shift lengths for each scenario run
To deliver an output in the form of a cost matrix displaying the various levels of operating costs by site for each one of the given scenarios.
Results:
Identification of potential savings of up to £2.2 million per annum
Calibration of the Paragon system to reflect the customer operation
