DHL Supply Chain Management - Case Study Example

Supply Chain Management Student’s name Course name Institution of affiliation Instructor’s name Date of submission Table of Contents DHL Supply Chain Management 3 1.0Background 3 1.0.DHL Company strategy 4 2.0.The Internet and web-based applications 5 3.0.Capacity planning 6 4.0.Process design 7 5.0.Location 7 6.0.Suppliers, Logistics, inventory management 8 7.0.Conclusion 9 References 11 DHL Supply Chain Management 1.0 Background DHL supply chain in Australia is located in Oakdale Industrial Estate, Eastern Creek NSW. DHL Australia is a subsidiary of DHL global that deals with services like Express, Freight transportation, and supply chain solutions; and Industrial sector solutions in Aerospace, Automotive, chemical, chemical, fashion, life science and healthcare, Retail, technology, industrial and engineering, and energy and renewable energy. The supply chain is managed to fit-for-purpose and also extends to offer international mail service. The international network links over 220 territories and nations worldwide[DHL142]. DHL operates in the Express Logistics industry and its products and services are assorted to fit into selected industry sectors in order to enable customers to promote from working with professionals in their specific market place and not just for logistics. The Express Logistics industry internationally is characterized by stiff competition from competitors like TNT and UPS. UPS was founded in 1907 and is one the largest company offering package delivery. The company also offers specialized transportation and logistics services. In addition, UPS offers cutting edge logistics services to customers and businesses using advanced technology, integrated network of technological, physical, and human assets, and access to global resources. Like DHL, UPS engages in offering solutions such as aerospace and defence, automotive, customer services, healthcare, industrial manufacturing, and high tech amongst others. TNT express is also an international carrier company offering numerous options to give ideal delivery services to their customers throughout the country. TNT offers express delivery services in Australia and is located in Mascot NSW 2020 which makes it a direct competitor with DHL. However, DHL stands out as a recognized market leader in outsourced contract logistics services and supported by over 1,500 employees and multi user warehouses across Australia[Bus12]. In Australia, the outstanding industries of specialization are Automotive, consumer, healthcare, retail and technology. 1.0. DHL Company strategy In the world, DHL group is a leader in postal and Logistics Company and comprises of three main divisions DHL express, DHL global forwarding, Freight and DHL supply chain. The company’s mission statement comprises of four major areas which are: making customers, investors, and employees successful; simplifying the lives of customers; positively contributing to the world; and always showing respect when achieving results. Further, the company’s mission stresses on making the company the first and best choice for customers such that they turn to it as The Logistics Company of the World. DHL Australia believes that in pursuing its the vision of being the choice of the people be they customers, investors, or employees, the company will add value to their interaction with people be it in excellent products or services. The company also focuses on engaging employees and nurturing their talents and by being a stable long-term venture on the stock market [DHL141]. For the community of operation, DHL Australia is guided by the motto of “Living Responsibility”. According to Business Excelence [Bus12], the DHL Australia’s strategy is to differentiate its operations to run in way that best characterizes the Australian territory. In its operations DHL Australia operates within seven gateways which are the subjects of a major DHL investment in Australia through continued investment in new facilities. This way, the company will strengthen its purpose of being the backbone of trade and ensuring internal support functions are aligned to unique buyer structures. At DHL Australia, jobs involve growth with challenges and focus at making a global difference. Each employee is empowered to be actively involved, take initiative and impact results differently. Productivity improvement is through Our First Choice program that aims to improve performance at every contact point with customers, and The Annual Employee Opinion Survey (EOS) which gives employees the chance to have their voices heard [DHL142]. 2.0. The Internet and web-based applications According to Hammond, [Ham11], Australian exporters have continually elevated their internet usage in the recent past. This has been aimed at protecting businesses from high dollar whose strength is affecting the exporters’ abilities to compete with overseas rivals using technology to trade globally. Additionally, the use of internet at DHL has also been used to cut costs involved in using middlemen or wholesaler while directly providing products to customers. In addition, DHL Australia uses import express online to give importers full control of their imports from any location for all its account holders. The DHL global mail is a cross-border e-commerce platform that enables end-to-end online shipment visibility which makes DHL a global commerce partner. According to Messmer [Mes97], DHL operates networks that are IP-based for all their 220 countries and only maintains one central intranet page that links all web servers within the company and that advertises. However, there are several sites and pages with restricted access. Web servers are crucial for DHL since they allow user to download software for proprietary desktop that the company designed to for the running of its business. In order to manage its internal websites, DHL uses MIS department as a consultant to enable departments to set up manageable sites. 3.0. Capacity planning In the Automotive sector of DHL Australia, transportation management and distribution works well in the management of international demands for components, spare parts, and vehicle demands. Since meeting the demand requires predictable, efficient and environmentally friendly solutions, capacity management system is established to allow easy and faster way to manage bookings whether processed manually or automatically. DHL utilizes capacity management system or CMS which only a DHL staffing can manually enter. In order to manage the capacity of air and sea freight services for the automotive industry are complemented by the company’s extensive network of ground transport including rail, road, and intermodal transportation. The aim of striving for harmony in all these transport and freight methods is to ensure that all raw materials and finished goods are delivered smoothly, effectively, and efficiently throughout each stage of the company’s supply chain. DHL’s scale and buying power provides the ability to secure container space at competitive rates and all fleets of vehicles are coordinated to promote minimization of running costs and the impact on the environment. Making the cycle times as low as 24 hours facilitates quick fulfilment which makes it easy to meet customer needs all industry sector as required. Additionally, the introduction of wireless and information technology ensures tracking of all items on transit and any delays in the product distribution is avoided to ensure that there is minimum or no impact on consumer efficiency and productivity. Increasing the number of facilities ensures that large number of items can be handled within the shortest time possible and their delivery planned. 4.0. Process design At DHL Australia, the major specializes in processes management. The driving force is obtained from customers’ increasing attention on their core competencies, which then requires DHL Australia to design, and offer processes that outdo traditional transportation and warehousing management to take in both overhead and line purposes which reduces customers’ costs and assists in the attainment of strategic objectives. At DHL Australia, process design is continuous since it involves competencies leveraging in project design and project management to directly engage with customers in order to understand their current strategies and issues. This process design involves offering the best solutions and services to customers. As a result, the continuous process design is keen to understand trends customer trends and study competitor operations to generate idea on how to simplify complex process design for consumer products and integrate new brands. The continuous process design aligns with the company’s differentiation strategy that aims at providing market specific services within each of the industrial sectors covered by DHL. In addition, differentiation in the supply chain means gaining, consistency, and predictability of the company’s supply chain. In order to achieve efficient differentiation, supply chain consultation and network design are used to understand what is working and what should be optimized to ensure more efficiency. 5.0. Location In Australia, DHL express has its head office located in 15 Bourke road in Mascot NSW 2020. Mascot is located seven kilometres in the south of Sydney central business district. The area is lowly populated with about 8, 517 with higher population in the area around Mascot railway station [DHL141]. The area has mixed commercial, industrial, and residential functions and is served with numerous bus routes and an airport and these factors contribute greatly to the logistics services for DHL. In addition, mascot’s closeness to Sydney airport and the 20 minutes ride to Sydney make it a best choice especially in ensuring that all customer products, solutions and services are available within the shortest time for customer efficiency and ease of management of the supply chain. In addition, the different modes of transport promote differentiation given that for each customer’s preferences, the best mode of transport is used. Selecting a location at Mascot would imply that the company considered reduction of the costs involved in transport since the location is near Sydney’s market. 6.0. Suppliers, Logistics, inventory management Inventory management offered at DHL Australia offers products and services through warehouse distribution using dedicated operations in state-of-art software systems that monitor and control all critical warehouse processes including control over stock levels, stock reordering and time for reordering stock. In the warehouse facilities, different kinds of products are available and this includes raw materials, work in progress and finished goods. DHL Australia uses the very best systems and processes for inventory costs reduction and obsolescence minimization. Inventory costs reduction is essential in supply chain management given it is a factor contributing to organization’s competitive advantage [DHL143]. One strategy applied at DHL Australia involves postponing the assembly, configuration and packaging of your finished goods until last possible and best time. This postponing element assists in the minimization of inventory and delivers a product custom-made to meet the needs and specifications by the customer. Additionally, the organization’s offering of exchangeable components works effectively in reducing obsolescence. The best example is when through ensuring that finished goods are assembled during fluctuations in demand instead of watching to see the inventory get stale or waiting for the missing components being imported to arrive through cross-docking. Cross-docking of finished goods facilitates increased delivery speeds while ensuring that storage costs are minimized. Another mode of improving inventory management is through the use of vendor managed inventory to ensure that all commodities get to the right place, at the right time within the supply chain management. This system plays the crucial role of improving product and communication flow between all the partners in the supply chain which then assists in the management and control of risk of loss, obsolescence and damage. The company also uses multi-client facilities to ensure the provision of flexible solutions needed. In addition, multi-client facilities guarantee care, custody, and control of customer products through the use of well-trained teams such that there is limited loss and cost related to damages. Through the use of state-of-art technology, it becomes possible to have the visibility needed for supply chain management especially through tracking and automated stock control. 7.0. Conclusion At DHL Australia, the management of supply chain has been discussed in this paper in terms of the company’ strategy, capacity planning, process design, location, the internet and applications, suppliers, logistics and inventory. The strategy of differentiation best works for DHL Australia given that there are changing customer demands for the different industry sectors handled by DHL. As a result, the differentiated strategy enables the company to satisfactorily meet the requirements of each customer for excellent, efficient and effective supply chain management. . One recommendation for DHL Australia is to offer sufficient information to customers on concerning each of their services. Information will ensure those clients’ expectations concerning a given service, solution, or product is contained. For instance, some distribution centres are not located within areas accessible without cars and neither is it possible for some deliveries to be transported without vehicles. In such a case, the expectation is that delivery will be done for them which is never the case. References DHL142: , (DHL Australia, 2014), Bus12: , (Business Excelence, 2012), DHL141: , (DHL Australia, 2014, p. n.p), Bus12: , (2012, p. n.p), DHL142: , (DHL Australia, 2014), Ham11: , (2011, p. n.p), Mes97: , (1997, p. 40), DHL141: , (DHL Australia, 2014), DHL143: , (DHL Australia, 2014), Read More