20 Dec Let’s help Brett…
Over the past few weeks, we have been taking a close look at DIFOT… Asking the tough questions about its relevance in today’s B2C market. We also introduced a new KPI, called PID. Today, we take a use case and see how PID can help all parties involved.
Over the past few weeks, we have been taking a close look at DIFOT… Asking the tough questions about its relevance in today’s B2C market. We also introduced a new KPI, called PID. Today, we take a use case and see how PID can help all parties involved.
Brett’s Florist (BF) is a traditional bricks & mortar business which increasingly relies on online purchases for is revenue.
BF offers same day delivery for orders placed before 3pm. To make this work, BF uses a courier company, who make perform two pickups from store per day, and guarantee same day delivery. With a target of 97% DIFOT. Customers love the same day delivery service, however, Brett is looking to further improve the customer experience, by offering more granular delivery windows to his customers.
While the Courier Services received by BF are meeting DIFOT KPI’s, BF still gets complaints from customers who are not able to receive deliveries at a specific time. Sally recently ordered a bouquet of flowers to be delivered to her wife Lara @ work. It was a special birthday gift. The customer had ordered the flowers two days in advance. On the day of the delivery, the Courier was delayed in making their deliveries by a few hours due to traffic. Lara’s boss had let Lara leave work early, and as a result, when the courier arrived to deliver the flowers, Lara was not at work to receive the goods. The flowers where returned by the Courier to Brett the next day. He had to give a full refund to Sally, pay the Courier for the work, and deal with an unhappy customer.
What Should have happened, is this….
Brett ensured that Lara’s flowers were ready for pickup by the Courier. Once the Courier Picked up the flowers, Sally was notified, and an ETA (Estimated Arrival Time) was provided to deliver the goods at 3pm. At 1pm, Sally found out Lara would be leaving work @ 4pm today. Later that day, Sally was informed via SMS of delays due to traffic the ETA was now of 4:30-5pm. Included in the SMS was a link to the couriers site. Sally was able to click on the link, which took her to a site that allows her to change the delivery details. She changes the delivery address to their home and agrees to pay the Courier surcharge. The Courier accepts the new delivery address, and a new ETA is provided. The delivery of the flowers is made to Lara’s home, where Lara is there to receive the flowers. Everybody is happy.
Once Brett had handed over the goods to the courier, he knew that they would handle everything for him. The Courier can charge more for this premium service as well as being able to generate additional revenue directly from the shipper (and receiver in different use cases).
In a world where traditional KPI’s like DIFOT govern the how carriers are measured, the above scenario will not be possible until become possible if we start to measure carriers differently.
Lets again look at PID, our Predictable, Informed and Dynamic KPI. By measuring the courier using PID, rather than DIFOT they would not be penalised for the late delivery above, allowing them to start offering tighter delivery windows.
By measuring the Information shared with the shipper and/or the receiver, we will start to see courier proactively communicating. The ability to enable dynamic delivery, while this may see a bit of a fantasy, the technology exists today to support these scenarios.
Unfortunately, there is no single product in the market today that can support this paradigm. And introducing this capability into an existing organisation, weather you are a shipper, or a logistics service provider, is not simple. Below is an example of a Functional domain model we regularly apply in the Logistics space. IF you are a 3PL, this will make up much of your operational capabilities, but if you are a Shipper, this may be a single domain in your functional architecture, with multiple interactions with enterprise systems. One if the key takeaways from this diagram is, that @ FourPL we, look at your problem from all perspectives, and we work with you to find the right solution for your organisation.
Here at Four PL we think we are in the perfect position to help drive the logistics industry forward. You have seen today how we can help Brett’s Florist. Let us know how we can help you too.
If you missed our previous two blogs, please click here
FourPL Contact for more information: contactus@fourpl.com.au
About the Author:About the Author: James Foran is FourPL’s “Transportation Guru” and is well known as a thought leader in the Industry. James’s expertise is helping business stakeholders understand technology capabilities and how to get the most out of their current technology, or, help develop a strategy to introduce new technology into their business.
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