DHL Project final - Essay about DHL PDF

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Essay about DHL...

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Operations & Supply Chain Management

Submitted to: Dr. Marc Poulin Date: 6-May-2019 Done by

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Contents 1.Abstract................................................................................................................................2 2. Introduction........................................................................................................................3 3. Literature Review...............................................................................................................5 4. Methodology.......................................................................................................................6 5. Results................................................................................................................................11 5. Discussion..........................................................................................................................16 6. Recommendations............................................................................................................18 7. Conclusion.........................................................................................................................19 8. References.........................................................................................................................20

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1. Abstract

This paper is a critical analysis of Operation and Supply Chain process of DHL International. DHL is an international company that deals with parcel and e-commerce delivery. The company’s mission and strategy have enabled it to offer excellent services to individuals and business owners across the world. Segmentation is the major marketing strategy that DHL has successfully used to meet the needs of a large group of clients worldwide. Following this research, it is clear that DHL has an elaborate workflow that enhances the smooth running of its activities. In addition, the company has introduced systematic management, to ensure that all duties are covered by qualified and experienced professionals.

Global procurement strategies have also been coordinated in a manner that allows the company to make strategic decisions towards its growth. Customized logistics solutions are offered for years to customers in different parts of the world, thereby enhancing the company’s trust among its customer base. DHL supply chain consists of a well-managed reverse logistics to meet customer satisfaction. This paper also provides recommendations that are likely to align activities within the organization. For instance, there is a need for the company to establish any unmet needs for its customers to win their trust and acquire huge footprints within the industry. Eventually, there is a need for DHL to venture into the supply of more products, as well as try out electronic markets, in order to remain in business.

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DHL Delivery Services 2. Introduction

DHL International is the world’s leading and the largest company that provides domestic and international pick-up, delivery, and return solutions for freight and e-commerce for individuals and business customers across the globe. DHL was founded in America and is currently involved in Deutsche Post DHL, a German logistics organization. The company’s services are primarily majored in sea and air mail, particularly for international parcel, courier, and express service division. DHL’s system of operations that includes a well-coordinated supply chain process has led to the company’s success; however, there is a need to introduce strategies that will counter growing competition while also encouraging its entry to new markets.

DHL’s Mission and Strategy. DHL’s mission is to connect people and businesses in a bid to improve lives and businesses. The firm’s mission is “Excellence. Simply Delivered” (DHL). Its vision statement suggests that the organization intends to be “the Logistics Company for the World” (DHL). Considering that there is a significant connection between trade and the world's development in the global market, DHL has become a benchmark of reasonable business practices. Notably, DHL offers logistic solutions to over 220 countries across the world (Capon and Go 330). Finally, the company’s vision and mission are part of its international strategy for dominance and growth. The main goal of DHL is to offer excellent services to the increasing number of customers worldwide. For instance, the company now offers mining solutions by ensuring that all materials and goods are accurately moved on time, and within the budget throughout the mining cycle. In

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addition, the company offers on-site warehouse solutions, and at the same time provides experts in stocks inventory. The process of shipment begins by sorting and scanning materials to be delivered at a domestic DHL hub, and other local services centres prior to shipment. These items are later set on the final mile of delivery through DHL Express Courier. The company ensures that the delivery process is carried out safely whereby all documents are signed and reach their destination on time.

DHL uses multiple business techniques for growth and new-market entries including using mergers and acquisitions. Its primary strategy is to focus, connect, and grow (DHL). Deutsche Post DHL group, the parent company of the organization’s operations, has emerged as the world’s leading postal and logistics service provider. Besides its success, the firm has a host of other strategic business segments including DHL Express, DHL Global Forwarding, DHL Supply Chain, DHL eCommerce, DHL Freight, and DHL Parcel (Chung and Bowie 27). Currently, the firm uses segmentation as a major marketing strategy to meet the demands of the varied types of clients. Geographic and demographic segmentation strategies have been used to meet the needs of a wide range of customers. Moreover, the organization employs a differentiation targeting approach to plan its deliverables.

5 Source: www.logistics.dhl/global-en/home/insights-and-innovation/insights.html

3. Literature Review

The main objective of this paper is to analyze the operations and supply chain procedures of DHL delivery services to improve service delivery, procurement procedures, and organizational operations. For this purpose, a research is introduced. General Process of Research: The general research process will follow a systematic procedure to ensure that all aspects pertaining to DHL International are covered within this study. To start with, the researcher will identify the problem statement, which in this case is to analyze DHL operations and supply chain process, in order to focus on areas that may need further improvements. After collecting all the necessary information, further analysis will be applied. Moreover, the project analysts will seek ethical approval from the relevant authorities to ensure that rules are not violated during the research process. The research process will require quite an amount of money, and therefore some time will be set apart for funding application and followup (Williams 67). Furthermore, the process of collecting data will kick off following the selected methodology. Finally, the collected data will be analyzed to derive the most important details to support the research. Here, the most appropriate methods of analysis will be applied, in order to identify the valid answers for the research questions. Importance of Research Context. The main purpose of following this method of research will be to prove the related theories, contribute to the developing study, and form actions. Basically, research creates knowledge that can be initiated in a real-world situation (Williams 99). As researchers work as a team, they are able to identify the best ways of how problems can be addressed. Following this, therefore, the research that will be conducted on DHL International

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will not only be essential for its growth, but it can always also be used by other service delivery companies to ensure that the world stays connected.

4. Methodology

DHL Delivery Services is a large company with several divisions within the organization. Therefore, in order to conduct comprehensive research, there is a need for the researcher to apply effective methods of data collection for delivery services. In this case, the researcher will utilize a qualitative research method. The researcher will further utilize a quantitative research approach to supplement information from qualitative methods. The approach will utilize mathematical data, statistics, simulations, and calculations from the organization's reports to highlight some of the key operations (Sutton and Austin 25). Some of the sources of these figures will include company reports, publicly released records, and calculations from public domains such as Yahoo Finance and Bloomberg analytics. Ηence, the use of both quantitative and qualitative techniques will provide evidence of a need for improvements within the delivery services operations to improve profitability and growth.

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The above questionnaire provides brief ideas about the DHL overall performance globally, The main objective is to extract data related to delivery process, where it shows although they are innovative and good at professionalism, there is still less probability in customer service recovery and interaction, with lack speed in delivery process and few issues with wrong deliveries.

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Qualitative Research Qualitative research involves the collection of non-numerical data, and its main purpose is to establish patterns of events (Long 431). Data will be collected from within the company and from customers using interviews and questionnaires. Surveys will be formulated and directed to a few parties within the organization. For instance, the company’s managers at different divisions will be requested to answer some questions regarding the operation of delivery process at their branches. In addition, the questionnaires will be designed in a manner that allows the respondents to point out any challenges that they could be facing during their day-to-day operations. Regarding the delivery process, questionnaires will be distributed amongst some company officials, particularly those in the delivery services department. The scope of the problem will also be derived by allowing some local and international clients to answer questions regarding the kind of delivery services, the company offers.

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Collaborators Products & services required

Perfectionists Products & services required

Core product, BBX, onboard couriers, next-flight-out and charter options, shippers’ interest insurance, global mail, logistic inventory management, time and day definite services. Value-added services

Core product, global mail, time and day definite services. Value-added services

Price devotees Products & services required On-site mailroom staff, customization of billing / operation / IT solutions, key account desk (dedicated customer service), project management of customer solution. Value-added services

E-solutions, delivery duty paid, neutral delivery services, drop shipment, break bulk express, cross docking, one-stop clearance, key account desk. Current DHL practices

Domestic service, mailroom service, program management of solution implementation. Current DHL practices

Regular pickup service, data exchange process, late, pickups, early deliveries, onsite support, e-com tool, e billing, special billing, reweight report, daily shipment e-reports

IT solutions & EDI for billing, regular pickup and delivery, track and trace / regular activity reporting, same-day uplift.

Shippers interest insurance, sale in transit, neutral delivery service, delivery duty paid, shipment consolidation, special deliveries and pickups, free storage for three days, e-com tools, e-billing, key account desk. Current DHL practices Insurance, trade services, pre-export clearance, shipment handling, regular pickup service, late pickups, early deliveries, coordination with 3rd parties for on board couriers, next-flight-out & charter needs.

Source; Realigning service operations strategy at DHL express Tim R. Coltman, John Gattorna (2010).

The above table is showing DHL has segmented their products and services in collaborators, perfectionists and price devotees. Regarding the delivery services DHL is providing insurance, trade services, pre-export clearance, shipment handling, regular pickup service, and other services to meet collaborators’ demand. As for the perfectionists, DHL is offering regular pick up service, data exchange process, early deliveries and other added value services. Similarly, they are successfully handling price devotees demand by offering IT Solutions, EDI for billing, regular pickup and delivery, track and trace. However, the above segments have issues with late pickups and delivery process.

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5. Results

The company's workflow is strategically designed to accommodate several activities at the same time. The diagram below shows the connection between various systems within the company’s workflow, which are carried out by several qualified employees. Deutsche Post has a total number of 510,000 employees (Musiolik 11). Each of these employees performs a different role at DHL's supply chain.

This position is bottleneck and takes time in scanning sorting and redistribution

Source: www.logistics.dhl/global-en/home/insights-and-innovation/insights.html

The above flow chart shows that Individual and corporate customers’ deliveries are collected at one point “Central Location Office”, then they are sorted out for local or international distribution. This becomes a bottleneck position and takes time for delivery due to different

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locations’ collection. Therefore, DHL introduced a new process flow where all the suppliers, collectors, perfectionists and price devotees can use the facilities from one DHL office.

Fig 1: Delivery services of DHL Express (DHL Global Forwarding 4).

DHL delivery services has been keen to offer customized logistics solutions throughout the segment. It consists of a complete perspective that is formed from the manufacturer all through to the retailer, and consumers within a business. In addition, it allows customers to achieve excellent operational processes at every stage. The company’s supply chain deals with two major businesses. The first business involves contract logistics, which include ground-based service management such as warehousing, and distribution. The second level of operation in DHL’s

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supply chain includes freight management and ocean craft forwarding operations. Apparently, the design of delivery services is to provide consultation and a network system. Global Procurement Strategy Development: Development of global procurement strategies is another process of management that takes place in delivery services. It is at this point when the company can take up more mature roles such as the creation of centers of excellence and strategic management in legal and marketing matters. In addition, activities in this phase not only add value to the company but also aim at reducing costs. DHL supply chain has applied tech techniques such as robotics automation processes, DHL's proprietary end-to-end visibility solution, Internet of Things (IoT) to enhance services at the procurement department. DHL is engaging their employees with glasses which are already equipped with scanners, that saves time in sorting & processing the delivery.

Source: www.logistics.dhl/global-en/home/insights-and-innovation/insights.html

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Reverse Logistics: DHL reverse logistics is a process that takes place within the company’s supply chain. The process is essential in ensuring that customers receive guaranteed satisfaction at all levels of the company’s operations. The primary role of this process is to effectively manage returns by recapturing value in order to keep customers happy. DHL Head of Corporate communications and responsibility oversees all the activities in this department. The reverse logistics process involves de-installation of finished goods, receiving, sorting, and verifying returned goods, as well as express delivery for the exchanged goods (Edie newsroom). Radio Frequency (RF) identification in conjunction with sophisticated Warehouse Management System is the current wireless technology that is employed in DHL’s reverse logistics process.

Figure: 2 DHL reverse logistics (DHL Global Forwarding 4).

Warehouse Management Systems: DHL international is responsible for applying a framework to the majority of IT projects, in order to meet the changing needs of all the company’ stakeholders, as well as the customers. The system involves critical analysis of the project components in order to enhance activities in all the phases of the program. These activities include time management,

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quality assurance, project integration, cost reduction, risks mitigation, measurement of scope, and communication. The basic role of DHL Supply Chain IT Projects is to implement the application of third-party supply chain packages such as transportation and warehouse management systems.

5. Discussion One of the modern theories of operations is business process redesign (BPR) that was founded in 1993. This theory focuses on a business management strategy that calls for designing and analysis of workflow, and other businesses process in a bid to attain the set objectives (McClay). For DHL international, great emphasis has been put on this theory. This is evident in the company's workflow that is well coordinated, regardless of the size of the organization. Ultimately, DHL’s success has to some extent been fueled by the work of some theorists. Six Sigma is a theory of operations management that focuses on quality. This theory was developed at Motorola between 1985 and 1987. Six Sigma advocates for deviation from normal distribution to a higher new standard in terms of quality (Henshall). This theory was primarily designed to enable business owners to either increase their profits or reduce costs of production. The major tools that are used within this theory include ratios, calculations, and trending charts. Apparently, DHL has adhered to this theory as it has a history of providing excellent services to its customers, hence the reason why it has emerged at the top. The research has been effective in deriving DHL’s strengths, in order to give a clear understanding as to why the company has realized continuous growth over the years. To start with, DHL International has emerged as the leading service delivery company due to its large network. Notably, the company’s network is spread in over 220 countries, thereby emerging as

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the largest world’s freight career (Coltman et al. 16). Moreover, the large network gives the company an advantage over other global service delivery companies, as it enhances effective communication. Most importantly, the company has developed an excellent in-house network consultancy, hence the reason for its expansion. Secondly, DHL has been at the forefront when it comes to investing in innovative strategies. Apparently, DHL has grown to be a leader in the industry of logistics. Much of the company’s effort has been invested in research for new trends, as well as solution development for any identifiable problems. DHL’s innovative centre has turned out to be a meeting point between stakeholders, customers, and the company experts, where successful logistic solutions have been developed. For instance, Resilience 360 is an effective logistics solution emerged from the innovative centre. Overall, the strategies assist in growth through inn...