Logistics and Distribution Project - DTDC


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  • Kindly mail me the soft copy to this mail id:lokeshsvinay@gmail.com
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  • please post to me the research proposal of a title logistics management
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  • Hello, Avinash I am really impressed with your project work and would like to save it for my future reference. I would appreciate if you could send this file to my mail ID: raghavdudeja@gmail.com. Thanks in advance for your time and consideration.
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Logistics and Distribution Project - DTDC

  1. 1. The Effectiveness of Logistics, Distribution and Customer Satisfaction 1 Amrita Vishwa Vidyapeetham INTERNSHIP PROJECT 2011 Project done by Avinash Heston, Student of Amrita University.
  2. 2. The Effectiveness of Logistics, Distribution and Customer Satisfaction 2 List of Figures The following table shows the list of figures present in the research project:- The Flow of Consignments •Page : 16/26 •Type : Chart •About : It shows the Flow of consignment from source to delivery point. Factors affecting Transportation Segments •Page : 20 •Type : Chart •About : Different Factors affecting the transportation of consignments and their shares. Mode of Loading and Unloading Preference •Page : 22 •Type : Chart •About : Mode in which consignments are loaded and unloaded. Main Goal of the Company •Page : 24 •Type : Chart •About : Employees response to the main goal of the company. Material Damage Source •Page : 27 •Type : Chart •About : The question 'Where' is answered, keeping the material damage source in mind. Employee's Needs Satisfaction Scale •Page : 31 •Type : Chart •About : Employee's need satisfaction scale answered in YES/NO.
  3. 3. The Effectiveness of Logistics, Distribution and Customer Satisfaction 3 Chapter 1 Introduction 1.1) The Topic „The Effectiveness of Logistics, Distribution, and its relation to Customer Satisfaction‟ 1.2) Reason for the Selection of the topic Marketing, based on its definition, is the whole idea of the business. It should not be assumed as a basic process of sales and distribution alone. The area of Logistics and Distribution is considered a very important sub-sector of the Marketing segment. In the current era of business, Customer satisfaction is given top most priority because customers decide the fate of the product or service, unlike earlier times where-in the sellers and distributors had a monopolistic control over the products or service. Therefore, the fate and survival factor of a business lies on the hands of the customers. When Logistics and Customer satisfaction are taken as dependant factors, many hidden flaws and facts can be derived, and thus solutions can be processed and outsourced so as to improve the overall productivity and sustainability of the Business sector. Hence, the logistics department plays a vital role in distributing the products/Services to the clients, thus attaining overall „end-customer satisfaction‟. 1.3) Why is the topic important to the company TO BUILD A PLATFORM FOR DEVELOPMENT, GROWTH AND INFRASTRUCTURE DTDC Courier and Cargo Ltd is a service sector company, primarily focusing on Courier services. It is one of the leading Express distribution companies in India covering both domestic and international services. A Courier company‟s foremost clients are its Customers and Customer satisfaction remains a primary priority to the company. Logistics and Distribution channels play a key role in the functioning of the company and on-time delivery is the main goal
  4. 4. The Effectiveness of Logistics, Distribution and Customer Satisfaction 4 of the company, which results in client satisfaction. Thus, problems associated with the distribution and end-customer reactions based on the accuracy of the delivery can be solved by deriving the link between the former and the latter. The Logistics department handles the Movement of Goods/Products/Service Packages from one place to another. It ensures that the goods which are received for delivery are distributed effectively and efficiently, at the specified time period. Management of distribution channels are an essential platform for the company to function in an optimum manner. 1.4) Learning from the Study The logistics sector itself, is a competitive yet complicated part of the ever-growing market. It is a third-party service sector which acts as an intermediary between sender and receiver of consignments, thus proving it to be an important section in business world. Its relation with its valued customers promotes its growth and sustainability. It plays a crucial part in the transfer of goods from one place to another, within the specified time, thus creating an initiative which does not compromise on the time factor. Customer relation plays a major key in service sector business since the functionality of the service should be flexible according to the needs and desires of the customers.
  5. 5. The Effectiveness of Logistics, Distribution and Customer Satisfaction 5 Chapter 2 Organization Profile 2.1) Industry Profile The Third-Party-Logistics provider (TPL) is a firm that provides a one stop service to its customers of outsourced or „third party‟ logistics services for the part, or all of their supply chain management functions. Third party logistics providers specialize in integrated operation, warehousing and transportation services that can be scaled and customized to customer‟s needs based on market conditions and the demands and delivery service requirements for their products and materials. According to the Council of Supply Chain Management Professionals, TPL can be defined as “A firm that provides multiple logistics services for use by customers. Preferably, these services are integrated or „bundled‟ together, by the provider. Among the services, TPL provides transportation, warehousing, cross-docking, inventory management, packaging, and freight forwarding”. 2.2) Company Profile 2.2.1) About the Company and It’s Formation. DTDC Courier and Cargo Ltd. is one of the leading express distribution companies in India covering both domestic and international services. Incorporated in the year 1990, DTDC is in its 20th year of operations in India. It has a large delivery network covering close to 10,000 pin codes giving its customers the best reach in the country. Its efficient international network spans over 24 global destinations supported by its own offices in US, UK and Dubai and associate offices in all the important global destinations. Head quartered in Bangalore DTDC has its Zonal offices in Bangalore, Mumbai, Delhi and
  6. 6. The Effectiveness of Logistics, Distribution and Customer Satisfaction 6 Kolkata supported by 300 plus own offices and over 4000 channel partner offices spread across the country delivering over 100 million shipments every year. Company has the state of art IT infrastructure to support their operations and has built many customized applications for its corporate clients. Under the able leadership of Mr. Subhasish Chakraborty, the founder chairman of the organization, DTDC has an efficient team of management professionals who are working round the clock delivering value to their customers. DTDC has been innovating constantly to provide products and services that meet customers current and future needs. Today you will find DTDC offering wide range of services like Express courier, cargo, end to end supply chain solutions, Retail services like ticketing solutions, bill payments, Mobile & DTH top ups apart from Training supply chain professionals through its supply chain training institute. DTDC‟s Customer profile cuts across the industry verticals covering banking, insurance, telecom, manufacturing and IT. Company provides excellent solutions for E commerce business and has capability of seamless integration of applications with the customer providing efficient transaction and database management. DTDC has strategic equity participation by ADAG group. DTDC plans to consolidate its growth and its vision is to interface with customers more often in their value chain by offering wide range of products and services. 2.2.2) Business Focus DTDC focuses primarily on Courier services and Cargo [Logistics] services. It is a service sector company, implementing importance on satisfying the customer‟s delivery of consignments to its designation, ranging from documents to heavy freights. The Vision and Mission of the company is as follows:- a) Vision
  7. 7. The Effectiveness of Logistics, Distribution and Customer Satisfaction 7 - To be the most admired and successful Express Distribution Company in India by meeting and exceeding our customer‟s expectation of services. b) Mission - To focus on Customer Loyalty and make it a goal of our organization. - To encourage our people for adoption of new technologies, processes and systems for improved, reliable and speedy service. - To relentlessly monitor to reach a minimum net service level of 98% delivery. c) Quality Policy - Satisfied internal customers, external customers and Business Associates - Continual Improvements in products, processes, services and quality management systems. - Satisfied, motivated and committed employees. 2.2.3) Some of the clients of DTDC a) The Telecom Sector Clients  Airtel  Aircel  Vodafone b) Bank clients  Axis Bank  Citi Bank  HDFC Bank  BOB c) IT Clients
  8. 8. The Effectiveness of Logistics, Distribution and Customer Satisfaction 8  ABB  Bharat Forge  BHEL  Thermax d) Other Clients  Sony  Philips  Dell 2.2.4) Distribution Network of DTDC The Company owned branch typically covers a specific range of pincodes, which have been predetermined for purpose of effective deliveries. Coverage of the pincode rage is handled by way of assigning a dedicated franchisee for each pincode, who covers the geographical expanse falling under the subject pincode. The overall performance of the deliveries for the range of pincodes assigned is taken care of by the DTDC branch. The company‟s main distribution network covers places like Ahmedabad, Bangalore, Bhubaneshwar, Chennai, Cochin, GGR, HHPJ, Hyderabad, Indore, Kolkata, Mumbai, Nagpur, North Delhi, Northern RO, Patna, Pune, South Delhi, UP. 2.2.5) DTDC’s Products and Services a) DTDC Plus
  9. 9. The Effectiveness of Logistics, Distribution and Customer Satisfaction 9 i) Features of DTDC Plus - Assured Next Business Day Delivery - 100% money back guarantee if not delivered within committed delivery period. - Tamper-proof Security pouch, SMS/Email Alerts b) DTDC Blue i) Features of DTDC Blue - Assured Second Business day delivery. - 100% money back guarantee if not delivered within committed delivery period. - Service to locations beyond DTDC plus lanes - Tamper-proof security pouch. DTDC also offers services such as Student express package, DTDC lite as well.
  10. 10. The Effectiveness of Logistics, Distribution and Customer Satisfaction 10 Chapter 3 Research Objectives and Scope of Research 3.1) Problem Definition 3.1.1) Evaluation of Revenue Dimension of the Logistics/Distribution Department. Revenue can be defined as the Income of the company or firm. Revenue is required for the business to grow and diversify, thus enabling the business to attend to its day to day functions and objectives. The overall profitability of DTDC mainly depends upon the choice of transportation available for the company such as trucking, air or by train etc. In DTDC, revenue generation is mainly through the transportation and warehousing of consignments for its respective clients. In a normal company behavior, transportation is regarded as a cost for the company. Whereas, in case of Third-party-logistics providers, transportation is considered as a revenue earner as well as a cost for the company, since the cost incurred for hiring transportation, is thoroughly billed to the clients themselves, during the period of booking. 3.1.2) Customer Reach, Reaction and Satisfactory levels with the service provided. For any business to prosper and grow, it requires a source from which revenue can be derived. And for any profit-making business firm, its main source of revenue is its customers. In case of DTDC, customers are also termed as „Consignment Clients‟. While a consignment is received by DTDC Premium services, it checks whether the pin code of the destination is compatible with its delivery options. After verification and approval, it will be sent to the designated location, and within the specified time period. The Time-
  11. 11. The Effectiveness of Logistics, Distribution and Customer Satisfaction 11 factor decides the satisfactory levels of the clients. If the consignment reaches the location within or at the specified time, the customer will be satisfied with the service and if not, a complaint is registered and the entire amount paid by the client for using the service is refunded, if the client claims for it. 3.1.3) Problems related to the Logistics segments/Distribution channels, such as Domestic and International Segments. The proximity of problems within the logistics department may vary but it so remains that the Connectivity issues shares a higher ground, initiating problems in the daily functioning of the company. Due to human or non-human disturbances, the performance on the delivery of goods may deteriorate, thus causing problems to the consignment holders. If such issues are recognized by the company before the actual delivery, it will be duly notified to the clients in advance. While availing delivery options like the PEP (Premium Express Products),they develop alternative solutions or delivery plans so that the consignments reach its destination in or on time. Even though such alternative solutions are implemented, it cannot be declared as a fool-proof system. 3.1.4)Matching Branch performance with Delivery performance. Branch Performance and Delivery performance are two diverse, yet co-related aspects. The delivery performance mainly deals with the status of the consignments. All the activities which the consignment goes through, such as transportation of the goods, delivery to the branch office, reaching the customers, can be considered as the delivery performance. The branch performance, on the other hand, includes operations performance, delivery performance, and the overall performance of the company.
  12. 12. The Effectiveness of Logistics, Distribution and Customer Satisfaction 12 3.2) Objectives of the research project 3.2.1) Primary Objectives TO UNDERSTAND THE PROBLEMS RELATED TO THE LOGISTICS DEPARTMENT a) To understand DTDC’s position – Commensurate to market area. Most of the companies consider Transportation and Travel charges as the company‟s incurred EXPENSES. In case of Courier companies, such as the DTDC, Transportation and Travel are filtered out as the main source of REVENUE for the company. Every business firm aims at maximizing their profits and focuses on the attainment of satisfaction to their customers with their products or service. Hence, customer satisfaction remains the main goal of DTDC as well. b) Problems related to international and domestic segments. DTDC is head quartered in Bangalore, having its Zonal offices in Mumbai, Delhi and Kolkata, supported by 300+ own offices and over 4000 channel partner offices spread across the country delivering over 100 million shipments every year. The Company has the state of the art IT infrastructure to support their operations and has built many customized applications for its corporate clients. Although a perfect, fool-proof system cannot be achieved, the proximity of discrepancies is although high for such a vast system. This in-turn leads to problems related to international and domestic segments. 3.2.2) Secondary Objectives TO KNOW THE SATISFACTORY LEVELS OF THE CUSTOMERS WITH A BRIEF SAMPLE BASE a) To know the satisfactory levels of the customers. „Customer is King‟; an important saying in the market world. Customers are the primary organs deciding the fate of the products and services given out by the
  13. 13. The Effectiveness of Logistics, Distribution and Customer Satisfaction 13 manufacturers and service providers. If the customers are not satisfied with the products which they buy or the services which they avail to, the survival of the business is at stake and it would be forced to accept closure, due to extensive losses.
  14. 14. The Effectiveness of Logistics, Distribution and Customer Satisfaction 14 Chapter 4 Research Methodology and Limitations 4.1) Research Plan The Research plan is based on the project topic, „The Effectiveness of Logistics, Distribution, and its relation to Customer Satisfaction‟. In order to derive the problems related with logistics, distribution and end-customer satisfaction, the Research plan for the project mainly involves direct contact with the respective employees of DTDC. DTDC is a Third-party-logistics provider, mainly concentrating on Transportation, Warehousing and Delivery of consignments from and to their clients, thus proving it to be a service based company. Services, unlike goods, are intangible commodities and hence, services should be rendered with flexibility in accordance with the type of customer. While involving in a research with a service sector company, one of the efficient ways of conducting a research is by maintaining a thorough contact with the employees of the company, as they would be most aware of the problems faced by the company. Alternative research plans, such as questionnaire distribution and Telephonic conversations would be implemented, for deeper penetration into the company‟s root cause of the problems, as mentioned in the Problem definitions. The following table [table 1.1] shows the basic research plan: [TABLE 1.1: Basic Research Plans] • To know the present condition of the company in the service sector. • To know the problems faced by the logistics department of the company while dealing with its varied customers • To know the employee's opinion about the logistics department, its functions and the problems faced by it on its day to day operations. • To enlighten the importance of the Logistics department and its importance to its customers. • To contact and derive information from the corporate sector(Top Level management) regarding the functioning of the logistics department and to enlighten the company's relation with its customers.
  15. 15. The Effectiveness of Logistics, Distribution and Customer Satisfaction 15 4.1.1) Preliminary Investigation - DTDC is a Third-party Logistics provider, providing multiple logistics services for use by its customers. Preferably, these services are integrated by the provider. Among the services, DTDC provides transportation, warehousing, cross-docking, inventory management, packaging, and freight forwarding. - The main focuses of the logistics department of DTDC are its customers, particularly prioritizing the Industrial customers and their large-scale goods, which is to be transferred by the company to the specified location by the customer and within the specified period. - One of the primary issues faced by DTDC is the problem related with transportation. Since courier and logistics services function with the time factor and have clients who prefer or want their goods/consignments on time, the mode of transportation and channels are often given high rank of importance and disturbances in the channels of transportation, which includes human or non-human disturbances, can be a cause to loss of goods or revenue for the company. - There exists considerable difference between the branch performance and delivery performance. - Normal Courier service differ extensively as when compared to Logistics services, in which the former focuses on small-scale delivery whereas the latter concentrates more on large-scale delivery of goods to its customers, mainly the industrial customers. - The restrictions implicated by DTDC on certain goods/products transfer and delivery such as Explosives, Gaseous, Flammable liquids, Flammable solids, oxidizers and organic peroxides, radioactive material, Corrosives etc. Such goods or products possesses
  16. 16. The Effectiveness of Logistics, Distribution and Customer Satisfaction 16 hazardous characteristics and are categorized by the IATA in the Dangerous Goods Regulation. - The following chart [chart 4.1.1] shows the flow of consignments from one Location [L1] to another location [L2]:- CHART [4.1.1 : Flow of Consignment] 4.1.2) Explorative Study Solution to a particular problem faced by any company cannot be fool-proof, although the amount of loss can be greatly reduced. Reducing cost, and at the same time gaining an average above the costs (Profit) can increase the sustainability,i.e the life of the business and hence promotes growth. When the scenario of DTDC is considered, the problem lies with its reach to the consignment clients. If we take a look at the root cause of the problem, Transportation and warehousing are highlighted, where-in Transportation takes up a larger share in the root cause of the problem. The issues related to Warehousing extents only to a particular limit, where the problem lies with the loading and unloading time-gaps, which would, as a result, disturb the flow of transportation. Hence, transportation remains the primary problem faced by the company. The major problems related to Transportation and customer reach are as follows:- FRANCHIS ES-L1 BRANC H-L1 APEX- L1 APEX- L2 BRANC H-L2 FRANCHIS ES-L2
  17. 17. The Effectiveness of Logistics, Distribution and Customer Satisfaction 17 a) Environment Disturbances, leading to breakage in the flow of consignments from one place to another, be it via Air, Road etc b) Human errors, such as delayed delivery, which would lead to refund and resultantly, unsatisfied customers. c) Unloading and Loading time gaps. If the unloading and loading time gaps increase more than the proposed. Approximated time needed to finish the function; it would lead to delay in transportation as well. d) Miscellaneous; problems related to traffic, incorrect address of the addressee etc. When a third party logistics provider is compared with a normal business firm concentrating on FMCG or other products, the former needs to imply more attention to its clients because of the direct customer relationship, which is needed for service based companies, unlike the latter which approaches intermediaries for distributing its physical products to its customers. Hence, losses can be greater when a service company is involved with its clients. In case of DTDC, if a courier doesn‟t reach its destination on time, it would result in complete refund, thereby increasing the overall cost of delivery and also a loss to the company, and finally, an unsatisfied client. 4.2) Research Design 4.2.1) Developing the Research plan : The basic design for researching a Service sector company is by interacting with the employees and labourers of the company, and as such, the current research project follows a similar pattern of direct interaction, such as Personal meetings, group discussion and personal interviews. With such research patters, direct data can be derived with minimal deviations regarding the company‟s functionality and sustainability. In order for verifying the information derived by the methods mentioned, Questionnaire sampling technique would also be used so as to gain those date which could not be verified with the main research methods.
  18. 18. The Effectiveness of Logistics, Distribution and Customer Satisfaction 18 4.2.2)Collection of Data a) Secondary Data b) Primary Data 4.3) Sampling Plan Sampling Plan Base points Info Sampling Units 20 Sampling Technique Random Sampling Method Research Instrument Questionnaire Contact Method Direct Contact 4.4) Sample Size : 15. 4.5) Data Collection Instrument Development : Employees of DTDC. 4.6) Research Limitations a) Limited Base Time for the project b) Vast Geographical coverage c) Extensive customer base Web References Existing Company reports 3rd party references Personal Interviews Questionnaires Group Discussions
  19. 19. The Effectiveness of Logistics, Distribution and Customer Satisfaction 19 Chapter 5 Data Analysis, Interpretation and Presentation The short yet elaborate sample- sized research on DTDC‟s current scenario has given a better understanding on the company‟s basic functions and its major problems related to distribution (Logistics Sector) of its services to the customers. Every system has a weakness and attaining stability on the system‟s weakness can lead to correction and sustainable functioning of the system. DTDC, a service sector company, faces problems related to attainment of an effective system, which can reduce the risks and additional costs faced by the company on its day to day operations. 5.1) About the Research The key areas of research focus mainly on the problems faced by the company, particularly the problems in the company‟s logistics sector and its customers. The Logistics sector is the developing wing of the company and hence, enlightening the problems which can possibly occur in such a sector would and possibly could improve its growth rate and sustainability. Since courier companies face stiff competition, it has to look into the cracks in its operations and fill them up before it loses out its potential and existing customers. Efficiency can only be attained by developing a system which can be closely related to a „fool-proof system‟. 5.2) The Research Output 5.2.1) Factors affecting Transportation of Consignments. Transportation for DTDC‟s consignments holds the largest share of risks. It is also the area which contributes, on a large scale, to the company‟s overall revenue. Larger the risk, possibility for earning higher profits remains high, even though a loss might have double the effect on the company‟s operations and its reputation. The Problems pertaining to the distribution channels increases the chances of loss for the company. If the company loses a client, the loss remains permanent due to non-attainment of satisfaction by its customer. According to the questionnaire
  20. 20. The Effectiveness of Logistics, Distribution and Customer Satisfaction 20 analysis, it is observed that out of all the distribution errors such as Environmental disturbances, errors caused by man, unloading and loading gaps, Human errors cause most of the problems in the transportation and distribution of services/consignments to its prospective customers. Human errors mostly occur in the Transportation of the consignments to its designation. An automated system for transportation and distribution of consignments is a cost-intensive approach and hence, the company follows manual labour, thus cutting down the costs as when compared to an automated system for handling the consignment. Perfection cannot be attained in manual labour since this type of work is done by human hands. Hence, problems such as improper timing of consignment arrival or departure, improper verification of address of the customers etc, lead to possible loss and damage, thus threatening the company‟s reputation. CHART [CHART 5.1] shows the different factors affecting the transportation segment of the company:- [CHART 5.1] 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 Environmental Disturbances Human Errors Unloading and Loading Gaps Others
  21. 21. The Effectiveness of Logistics, Distribution and Customer Satisfaction 21 According to the table, Human errors cause most of the problems in the transportation segment, followed by the discrepancies occurring in the unloading and loading gaps. Under the unloading and loading gaps, both machine and manual labour occur simultaneously. The Loading and unloading gap refers to the time period between receiving, directing and sending the consignment to its prescribed location. The company fixes a time during which the consignment should be received, processed and sent to the next transit/ultimate customer. When it is not processed nor sent or delayed, it causes problems in transportation of consignments since the customer would be unable to receive his goods on or before time. Hence, unloading and loading gaps play an important part in the transportation sector and discrepancies can lead to possible loss of consignment and its client. 5.2.2) The Loading and Unloading Cycle Preference One of the most important sectors in distribution is the Loading and Unloading sectors. It is here where the consignments are received from different branches/apexes. Once the consignments are received, the address of the addressee and related information are processed and once this process is over, the consignment is transported to its client/customer who awaits its delivery. The time between the loading and unloading cycle is called the Time Gap and this time is the most crucial time factor for the company. Any discrepancies occurring under this Time Gap can lead to possible delay or loss of consignment, thus a loss for the business enterprise. Some of the Courier companies such as DHL, Fedex etc, use extensive automated system for loading and unloading of consignments, thus reducing the amount of human errors, even though the initial cost for setting up a high tech solution for their consignment handling, is particularly very high. Such automated systems are prominent in Europe and other developed regions. DTDC, being a leading domestic courier and cargo company, It applies its focus on a system which gives more priority to labour rather than a complete, automated system for the handling of consignments. a) Positive Aspects of a labour intensive approach:- - Adaptable to change - Labour intensive approach leads to reduced costs.
  22. 22. The Effectiveness of Logistics, Distribution and Customer Satisfaction 22 b) Negative Aspects of labour intensive approach:- - Human errors are comparatively prone as when compared to automated machine work. - The Labours are able to perform the work as per directions but are not aware of the question such as „why are they doing it‟ The Chart [chart 5.2.2] given, shows the preference of employees on the basis of the mode of Loading or Unloading systems. [CHART 5.2.2] According to Chart [chart 5.2.1], a majority of the employees prefer manual labour with a semi- automated system. This increases the adaptability and acceptability of the system. When such a mode is initiated for the loading and unloading cycles, it will lead to considerable reduction in cost as when compared to a fully automated system. When a change is required in the existing system of loading and unloading, the change can be accepted easily and adapted due to the 0 1 2 3 4 5 6 7 8 Mannual Labour Automated System Mannual Labour with Semi-automated system Others Loading and Unloading Cycle System
  23. 23. The Effectiveness of Logistics, Distribution and Customer Satisfaction 23 presence of the manual labour. Thus, such an approach will lead to efficiency and adaptability due to the presence of both Manual labour and a semi-automated system (System which is operated partially by the existing labour force). Minority of the lot has selected the option of Manual Labour and none for an automated system fearing very high initial cost for setting up of the machines and related accessories. 5.2.3) the Main Goal of the Company A Business firm‟s main aim is to attain maximum customer satisfaction. Since it is the era of „Customer is King‟, customer‟s interests are given more priority as when compared to older beliefs such as „Monopoly‟ or „Maximum Production‟. A firm‟s well-being lies in the hand of its customers. A firm, when found to be producing a product or service below the customer‟s expectation, it will lead to loss in business and hence result in a complete shut-down of its activities, because of the fact that it cannot generate revenue from its activities, due to dissatisfied customers. Henceforth, most of the companies fix their primary goal as „Customer Satisfaction‟. Even though when a company selects such a primary goal, there is always a hidden goal. The hidden goal of the company can be regarded as their primary goal, even though it is not mentioned in their mission or vision. It can be only understood only when a researcher works within the company premises, thus understanding its true goal and actions taken to attain them in accordance with their exposed goal.
  24. 24. The Effectiveness of Logistics, Distribution and Customer Satisfaction 24 According to the given CHART [CHART 5.2.3], DTDC‟s main goal is customer satisfaction, like any other business firm. This is just the exposed goal. Most of the correspondents have selected „customer satisfaction‟ as their choice, in reference with the goal of the company. But some of the employees have also selected „Customer satisfaction & reduced costs‟ as their choice. This enlightens the fact that a company may possess a hidden goal, which can also act accordingly with its primary goal. In case of DTDC, the hidden goal is to reduce the costs incurred by the company, while meeting the needs and wants of its customers. A company can give its priority to its customers but it cannot abandon the fact that costs are being incurred for meeting the needs and wants of the customers, and for its day to day operations. Thus a company must look out for itself, in order to ensure its sustainability. A company such as DTDC, has its customers to attend to, but at the same time, it should also ensure that the costs are reduced so as to impute to their future growth and survival. 0 1 2 3 4 5 6 Maximum Revenue Customer Satisfaction Reducing Costs Customer Satisfaction & Reduced costs 0 6 1 4 Main Goal of the Company
  25. 25. The Effectiveness of Logistics, Distribution and Customer Satisfaction 25 5.2.4) Material Damage Source Before getting into material damage source, we should know about the company‟s basic structure through which the materials passes on. The DTDC Company is divided into 3 different function based segments which is as follows:- a) Franchises – The Franchise sector is the place where the consignments are booked by the company‟s clients. The delivery of the consignments is also done in the franchise sector. Hence, it can be concluded that the franchise sector forms the lower management level of the company, on the basis of decision making and it forms the highest level of management, on the basis of consignments delivery and booking. b) Branch(can be a Transit) – The Branches of DTDC are responsible for receiving the consignments from the franchises and then sending it to the nearest Apex sector. The branch also performs a reverse function where in the consignments, which have already passed through the chain of segments in a different locality and which is to be delivered in the current chain, are delivered to the concerned franchises for final delivery of consignments. It forms the middle level of management. c) Apex – The apex sector of DTDC is where the consignments arrive and are sorted out for final delivery. It is here where the goods are received from the branches of the consignment origin and are sorted out for delivery, as per specification of the client (The clients submit the necessary details at the franchises) and are finally sent to the Apex of the locality where the consignment is to be delivered. d) Corporate Office – It is the head office of DTDC, where Policies and plans are made and given for implementation. It forms the highest level of management of the company. It does not indulge in the physical functioning of the courier but derives policies, procedures and plans for better functioning and growth of the company.
  26. 26. The Effectiveness of Logistics, Distribution and Customer Satisfaction 26 The Following figure shows how the consignments travel from one area to another. [FIGURE 5.2.4 A] Material damage can occur in an automated system as well a manual system comprising of labour. The damage can occur due to several environmental factors as well. The magnitude of damage varies with each situation. Even when the organization structure is taken into consideration, damages can occur either in the branch, or in the transits etc. There exists no fool- proof system which can avoid all types of damage. Hence, measures can only be taken to reduce the risk of damage or to counter with the situation when damage occurs. In DTDC, the consignments travel through different branches, apexes and transits to reach its final destination. While the consignment passes through different levels, there are high possibilities for the consignment to attain damage, due to improper handling of consignments. According to the given chart [Chart 5.2.4 B],
  27. 27. The Effectiveness of Logistics, Distribution and Customer Satisfaction 27 [CHART 5.2.4 ‘B’] 80% of the employees have agreed to the fact that most of the consignment damage occur in the transit areas. It is not because of the improper functioning of the transit, but due to the increase in the number of loading and unloading cycles. When consignments pass through a large number of transits before reaching its destination, it has to be unloaded and again loaded to the designated truck/plane etc. When the consignments are loaded and unloaded, material damage is likely to occur, thus leading to temporary or permanent damage. Most of the employees recommend reducing the number of transits so as to avoid material damage. Reducing the number of transits reduces the number of loading and unloading cycles, thus reducing the risk of damage. 80% 5% 5% 10% Material Damage Source Transits Apex Franchises Branch Offices
  28. 28. The Effectiveness of Logistics, Distribution and Customer Satisfaction 28 Chapter 6 Findings, Suggestions and Conclusion 6.1) Findings based on Research 6.1.1) Findings about the Company a) DTDC, i.e. Desk To Desk Courier, is a third-party logistics and courier provider, providing customized courier services to its clients, giving high importance to the time factor. The company focuses primarily on satisfying at least 98% of its consignment deliveries to be successful in a fiscal year, and thus, this remains as their primary goal, indirectly indicating a high customer satisfactory level. b) The company satisfies a majority of its customers/clients with its renowned, premium products such as DTDC Plus and DTDC Blue. It also focuses on normal-income clients with products such as DTDC Lite. c) Normal business firms follow a downward-flow trend where-in the ideas and concepts are passed on from the top level management to the lower levels in the management hierarchy. In DTDC, there is an upward-flow trend where-in the ideas are taken from the lower levels of the management to the higher levels. Such a system is necessary due to the fact that the lower levels of the management are comparatively more closely inclined with the company‟s customers. Since it is a service sector company, it has to adapt itself with the changing consumer needs and requirements and hence, the lower levels of management are the ones who are more aware of the real market situation. d) According to the observations based on the sample, the Employees of the company are satisfied with their workloads given by the company. Hence, the company has a healthy working environment, although in certain cases the
  29. 29. The Effectiveness of Logistics, Distribution and Customer Satisfaction 29 employee‟s needs or wants are neglected due to priority of business goals over the employee‟s personal objectives. e) Service Companies often rely on their customer‟s feedback so as to bring in changes, thus leading to a much better platform for effectiveness. DTDC spares no expense in considering the feedback from its valued customers, although the cost incurred by the business is also taken into conclusion. In Short, It follows „Customer Satisfaction with reduced costs‟. f) The overall functionality of the company is good, although improvements can be made so as to attain the status of „Optimum functionality‟. 6.1.2) Suggestions as per Sample Observation a) Suggestions for the developing Logistics sector - According to the observations, the logistics sector of the company has commenced on its business, starting off in the year 2010. Even though it just started off with its functioning, it faces stiff competition from companies like TCIXPS, Gati and Safe Express. Developing the basic infrastructure for a strong foundation would be a start. - In the current Scenario, the company uses manual labour extensively and a mechanical system to support its labours. This leads to an increase in consignment damages due to human errors. Developing an automated system would bear high initial costs but in the future run, it can reduce possible loss for the business firm, since mechanical errors are comparatively lower. For example, The weighing of Consignments is manually done, thus increasing the time taken for consignment processing. Even though an automatic system for weighing the consignment is developed and bears a high initial cost tag, it would in-turn reduce the time
  30. 30. The Effectiveness of Logistics, Distribution and Customer Satisfaction 30 gap between loading and unloading, thus enabling a more precise and on- time delivery. b) Suggestions for the Company as a whole - Staff related learning programmes should be given more importance (referring to the labour force) since human errors are the most prominent problem causing factor in the unloading, loading and transportation of consignments to its customers. Hence, steps should be taken so as to improve the knowledge of the staff regarding basic precautions regarding consignment handling and verification. This step can improve the staff‟s knowledge and thus, reduce the risk coming under Human errors. - One of the primary problems which the company faces is the distribution channel problem, basically regarding transportation of consignments. Even though there exists no fool-proof system for avoiding all barriers while transporting the consignments, effectively utilizing technology (giving more importance to technology), such as the GPS system for traffic based reports can be commenced so as to avoid blockage in consignment delivery. Such a system would also provide immediate alternatives so as to avoid possible consignment non-delivery and thus, avoiding loss for the company. This leads to an increase in customer satisfactory levels and also earns revenue for the business. - It has been noted that as the number of transits increase, the risk of consignment damage is high. When consignments are loaded and unloaded more number of times in different transits, it can lead to consignment damage, either permanent or temporary. Reducing the number of transits can avoid material damage.
  31. 31. The Effectiveness of Logistics, Distribution and Customer Satisfaction 31 - A company would remain empty in majority if its employees are not present. Employees form the backbone of any company. They are responsible for the growth of the company. Hence, the employee‟s needs and wants should also be satisfied so as to gain employee support, which would be beneficial for the company as a whole. The Company should make sure that the employee‟s needs should be molded in such a manner that it goes in tune with the company‟s objectives and goals. Monetary and Non-monetary incentives should be given so as to boost the employee‟s working ability. The Chart below shows the information provided by the employees of the company. [Chart 6.2.1] [CHART 6.2.1] A company would always have to face risks, either externally or internally. But more the risk they face, their possibility for earning higher profits also increases. Every factor, either a minor or a major factor, must be taken into consideration so as to bring out the full potential of a company, thus reaping essential benefits for its sustenance in the growing industry of business. 0 2 4 6 8 10 Yes No Are Employee needs satisfied?
  32. 32. The Effectiveness of Logistics, Distribution and Customer Satisfaction 32 Chapter 7 The Limitations 7.1) Project Limitations The Time period for the project given was narrow, thus restricting further and detailed analysis of the company‟s functioning, environment and its prospective markets. Continuous verification and clarification of project related queries were possible, but only to a certain extent due to communication barriers. A constant methodology could not be adopted due to the variances in the project analysis, due to the fact that the project research was duly based on a service sector company. DTDC is a domestic and international courier service company. Hence, the sample size required to conduct the research was rather large. Due to restrictions, a smaller sample size had to be proposed, which does not give the exact environment of the company‟s operations and its customer satisfactory levels. 7.2) Company Limitations Due to the Intern tag, certain areas such as Company Operations meeting etc were restricted.
  33. 33. The Effectiveness of Logistics, Distribution and Customer Satisfaction 33 DTDC has a large number of branches, apex and transits. In order to individually research on their functions, the time period given for completion of the project was not sufficient enough. Working hours had to be adjusted due to the location of the branch, which was assigned for the research. Detailed analysis on the customer base and customer satisfaction was not possible due to a large customer base.
  34. 34. The Effectiveness of Logistics, Distribution and Customer Satisfaction 34 Chapter 8 References / Bibliography 8.1) Sample Questionnaire QUESTIONNAIRE By Avinash H, Student of Amrita University. DTDC RESEARCH PROJECT Employee Name : ________________________________________ Employee Occupation :_________________________________________ QUESTIONS JUST FOR YOU (?) 1) Does the company satisfy a majority of its customers? A) Yes B) No 2) Are you comfortable with your daily workloads? A) Yes A) No 3) Does the company give priority to its employees needs? A) Yes B) No 4) Do you think distribution channel problems, related to transportation, can be minimized? A) Yes B) No HOW (if yes):
  35. 35. The Effectiveness of Logistics, Distribution and Customer Satisfaction 35 5) Is customer satisfaction the ultimate goal of the company? A) Yes B) No 6) Do you think setting-up more branches would boost the company’s revenue, rather than relying on franchises? A) Yes B) No 8) Is the Company working on its optimum functionality? A) Yes B) No 9) Are customers feedback taken into consideration by the company? A) Yes B) No 10) Which of the following shares a larger pie on problems affecting the company? A) Transportation B) Warehousing 11) Which of the following factors, under the transportation segment affects its functionality the most? A) Environmental Disturbances B) Human Errors C) Unloading and Loading Gaps D) Miscellaneous Please Mention, if your option is D :
  36. 36. The Effectiveness of Logistics, Distribution and Customer Satisfaction 36 12) If a consumer is not satisfied with the products/services provided by the company, which type of company gets most affected with the situation as mentioned? A) FMCG Companies B) Service Sector Companies C) Government Organizations D) Others(Please Mention) : 13) Which Factor is given the highest priority in relation with Customer Reach? A) Franchise booking agent’s behavior to its clients B) The Time Factor, starting off with Booking and ending with Final delivery C) Policies made by the corporate office based on previous year’s performance D) Loading and Unloading Cycles. 14) Which combination of work-force works well with the company’s requirements for loading and unloading cycles? A) Manual Labour B) Automated System C) Manual Labour with a Semi-automated system D) Others (Please Specify): 15) Possible material damage happens in the __________ . A) Transits B) Apex C) Franchises D) Branch Offices
  37. 37. The Effectiveness of Logistics, Distribution and Customer Satisfaction 37 16) Will the event ‘PEP 20-20’ bring a boost on the company’s overall functionality? A) Yes B) No 17) Which factor, out of the ‘uncontrollable’ situation, affects the daily operations of the company? A) Harsh weather conditions B) Political Issues C) Traffic D) Government Policies 18) To improve Customer satisfaction, which of the following options can be initiated? A) Increasing the number of Franchises in different parts of the domestic area B) Increase the number of hired vehicles C) Initiate more line of products which enhance speed and accuracy in delivery D) Initiate more number of owned offices of the company in different localities for better reach. 19) Should staff-improvement programmes be given higher priority, as when compared to the current scenario? A) Yes B) Not needed 20) Main Goal of the company, according to you. A) Maximum Revenue attainment QUICK THINK
  38. 38. The Effectiveness of Logistics, Distribution and Customer Satisfaction 38 B) Customer Satisfaction C) Reducing costs to attain marginal profit D) Attaining Customer Satisfaction with reduced costs. 8.2) Web References www.wikipedia.com • Search Query : Courier/Marketing/Logistics • Information about : What is courier?/Logistics www.google.com • Search Query : DTDC • Information about : Desk To Desk Couriers www.dtdc.in • Search Query : Company Profile and related info. • Information : Co Profile/Industry Profile/Products/Services/Vision/Mission.