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Gap-analysis and improvement of operational efficiencies of logistics company
A leading provider of logistics services
In order to increase efficiency of freight transportation by curtain-sided trucks, the client who was in charge of several large divisions, providing transportation services, created logistics center of freight transportation, which was intended to increase business efficiency, provide development of the company and propel it to leading positions in the field of freight transportation.
As a result of significant deviation of the actual financial results from the performance target and incurred loss due to activities of the logistics center, it was decided to involve an external consultant to carry out gap-analysis, to identify weaknesses of the business, to quantify inefficiencies and to develop recommendations on how to eliminate them.
A detailed diagnostics of the existing business activities of the logistics center and other constituent companies was carried out. Critical analysis of pricing, procurement, production planning, finance, systems, human resource management and technical state of the truck fleet had been accomplished. With the purpose of the analysis inquiries and interviews with staff were carried out along with collecting information on competitive companies and performance benchmarking. According to the results of the findings, relevant recommendations, a number of which were innovative, and working schedule (Project Charter) taking into account the best practices of large international logistics companies were developed.
Project Charter comprised key forms of project management such as work breakdown structure (WBS), project time schedule, risk management plan, proposed organizational structure of the logistics center and necessary documents for project initiation.
The company received a comprehensive image of the areas of inefficiency with their calculation and specification in the overall cost structure. Justification and review of the current and projected revenue levels included in the operational plan were presented as part of detailed analysis of the market and competition. Segmentation and prioritization of areas of inefficiency allowed the company to move to the stage of implementation faster.
As part of carrying out the analysis "quick wins" areas had been identified and promptly presented and discussed with the participation of managers of the client company. As a result of these meetings, implementation of areas of quick change started immediately.