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CASE STUDY #2
(Consultancy Assignment) - CUSTOMER TELEPHONE SUPPORT REVIEW
(Client Business Sector) - WHOLESALE DISTRIBUTION COMPANY
CLIENT BUSINESS PROFILE
The Client was a Wholesale and Distribution Company with a nationwide presence that distributed newspapers and magazines to a large network of retailers. The Client had invested heavily in a distributed computing network and produced "pick lists" in the early hours of the morning from which the warehouse workers picked, packed and addressed individual parcels of newspapers and magazines for delivery to individual retail customers. The Client operated their own fleet of vehicles for delivery of the newspapers and magazines. The system was very sophisticated and dynamic, for example - customers could telephone the distribution centre as late as 2am on the morning of delivery (typically the delivery drivers started their rounds around 4am) and change their "standing order". Clients organization provided a telephone support facility that would receive requests for adds/changes/deletes to their standing order. Support staff would then update the customer order on the computer systems, resulting in a new "pick" list that would be used a few hours later by the warehouse staff. The retail customers would also call into the telephone support facility to report missing or excessive copies in their received delivery parcels.

The client for many years had held a virtual monopoly on this distribution service, but new competitors had entered the marketplace and the Client was encountering serious competition. Whilst there was no immediate threat , one of these new competitors was a multi-national publisher who had purchased many newspaper/magazine titles and was committed to dominating the newspaper/magazine distribution business. This new competitor forced major changes in the first level of distribution (Printer to Wholesaler). A particular threat to the Clients business was that this new competitor was extremely aggressive and had secured contracts with publishers giving him exclusive distribution rights to their publications. If this trend were to continue it would pose a serious threat to the Clients business. Whilst this dimension to Clients business situation was not part of the consultancy assignment, it reinforced the need for the Client to ensure an excellent customer service experience, with the minimum of errors in the packages distributed to their retail customers. Thus, their telephone support service was crucial to their success
CLIENT PROBLEM SUMMARY
The Client stated that retail customers were regularly complaining about the difficulty of getting through to the Clients telephone support service to make late changes to their standing order or to report errors in their delivery parcels. The Client stated that the sheer volume of calls during "peak" periods (early morning) were overwhelming support service resources and retail customrs were complaining. The two main customer complaints were a) All Telephone Lines busy when they call, or, b) Telephone Lines ring and nobody answered promptly. The Client believed that the problem was lack of telephone capacity on ageing telephone systems and commissioned a consultancy assignment to review the current system and propose a more effective way forward.
IINITIAL CLIENT BRIEF
Client's initial briefing to the Consultant involved the following:
Client requested a telephone call analysis and reports for a large number of their distribution centres . (Note, many modern switchboards include the option of an in-built "call analysis" system whereby the user is able to easily produce reports of his telephone usage and activity which would show bottlenecks etc. Clients telephone system involved an earlier/older technology and no such on board call analysis facility existed. Thus to gather the information an external call analysis system would have needed to be installed at each/any of the distribution centres to collect this information. This would be an expensive proposition as, at that time, such call analysis systems were provided by third parties who provided both the equipment and undertook analysis and reporting of results. It would also take a significant period of time to capture information from a large network of distribution centres and corrolate and analyze the data. Client was seeking an urgent remedy to the apparently increasing rate of customer complaints. It was agreed that the first step would involve visis tot several of the more troublesome distribution centres and meet with the warehouse management, observe the overnight picking/packing operations and undertake a study of customer telephone call activity into the centre. The Consultant would then document the findings in a report, discuss this with the Client and agree the next steps

It soon became apparent that the telephone support service was not the real problem area. The problem was that the "number of calls received in the busy hours of the early morning had increased over time and were now at an excessive level". The majority of these peak period calls was that the retail customers were finding errors (shortages/missing copies etc) in the packages of newspapers and magazines delivered to their outlet. A retail customer would telephone the support service and report the error. Any shortages would result in the retail customers own customers failing to receive a newspaper/magazine they had ordered and the subsequent loss of a sale. Clients support service would report the shortage to the distribution staff who would despatch an individual in a small van to go out to the retail customer and deliver the missing copies. Not only was this a service issue for retail customers, it was an expensive remedy for the Client involving people and vehicles. There was another dimension to these picking/packing errors - many publication titles are distributed on the basis of "Sale Or Return". Delivering an excess of a publication to a Client resulted in an excessive rate of "Returns", which the Client had to pay (refund) their customer for and added to the overall workload.

The Consultant drafted an "Initial Findings' report that summarized the picking/packing errors that were causing the high volume of telephone calls to Clients telephone support service. The Client was shocked by the findings, they were quite convinced the problem was a bottleneck at the support centres. The Consultant report included a study and analysis of support centre activity, plotted and displayed on graphs which visually displayed the upward trend of call volume over time. At this point the Consultancy assignment was effecively complete as the Consutant had identified that failures in the picking/packing operations which were the causes of the problem. The Consultants recommendation was that Client need to undertake an internal audit/review of their picking/packing operations, modify working practices of a unionized workforce, ensure adhearance to operational procedures to reduce the high level of picking/packing errors etc.

ACTION PLAN
At the time of this assignment the newspaper print and distribution industry was undergoing a major transformation. Publishing and printing had traditionally been heavily unionized, but new publishers and print operations were being established on a non-unionized basis. Computer technology was increasingly being used in the production of publications, displacing traditional skils such as those of the typesetter. Machines that counted copies, bundled and packaged the publications were increasingly being used, displacing the manual job of a human operator physically counting copies, bundling and tying up the bundle with string ready for distribution.

The Client's distribution business was entirely unionized, which meant that any changes to picking/packing procedures would require the involvement and agreement of the union leaders in order to achieve any changes. The Consultant worked with the Client to produce an action plan but it was Client responsibility to negotiate the implementation of changes with his workforce.

Interestingly, the core problem was not a lack of existance of good warehouse operational procedures, it was more a case of warehouse staff failing to follow the documented procedures, warehouse staff taking short cuts, not using computer pick lists correctly, failing to check update status/print an updated pick list before commencing picking/packing operations, failure by supervisors to query/follow up on the obvious high occurance of picking errors and identify the cause and remedy.

TREAT THE CAUSE NOT THE SYMPTON

This was another assignment where the Client perception was of a problem at his Customer Support Operation and he had assumed that capital investment in additional telephone equipment and staff would be the solution. The assignment revealed that the cause of the problems were in fact an excessive demand for Customer Support Services resultant from operational and procedural failings by warehouse staff leading to a high, and increasing number of calls into the Customer Support Centre. Remedying the cause (and not the sympton) at the operational level would in fact avoid an unecessary capital expenditure on equipment and turnaround the stressed Customer Support Service. and more importantly, resolve the root cause of the operational failings..Contact Tillotson Services