August 30, 2011 by The Bridge Solutions Group Team
Apart from waging a price war, retailers today are adding new fronts in their battle to win the largest chunk of the market pie. Providing additional services like home delivery, installation services, post sales warranty services etc. not only allows retailers to maintain the connection with the customers but also create a new revenue source. Many of the large retailers have realized the potential of these kinds of services and maintain a skilled pool of resources that can be coordinated with the delivery truck to the customer’s house match the delivery to completing the services.
Sterling Commerce MCF package has the capability for allowing a retailer to provide services like home delivery and installation services in an efficient and effective manner. The major tools for this purpose are present in the Global Inventory Visibility module like the slot-groups and resource pools.
Providing additional services requires infrastructure and logistics set-up along with a pool of skilled professional who can carry out the different services like installing a dish-washer or a Home Theater system. Resource pools shall be used to manage the schedule and capacity of such resource
Sterling Capacity management- Resource Pools & Service Items
As inventory is to a product item, capacity is to a service item. By abstracting your value-added-services and delivery services into service items, you gain the ability to manage, predict, and provide visibility into your capability to provide services to fulfill your demand. Capacity, then, portrays the ability of the organization to provide a given service on a given day. More simply, there are a finite number of trucks and resources available to an organization and they can process and deliver a finite number of shipments in a work-day. This fact is captured in the concept of ‘Capacity’.
Sterling stores capacity against resource pools. Resource pools are as the name suggests pools of skilled personnel and equipment which can provide a specific set of services as assigned to them in the resource pool definition. Resource pools are assigned to the designated ship-nodes of the organization or to the supplier nodes, if required. Capacity is consumed by the service items as per the item definition. In the item definition it can be defined how many units of capacity a product item shall consume. When any order with the product item and the service line is scheduled, the appropriate amount of capacity is reduced from the resource pool of the ship-node.
Let’s first define the services against which the capacity is promised and consumed in Sterling, and then we shall move on to resource pools.
Sterling allows for two types of service items-
1. Delivery service items-
This type of item can be associated with say, ‘White Goods’ (fridge, dish-washer, home-theater etc.) which need special vehicles like trucks to be carried to the customer’s home. When this association is created in Sterling’s item definition, the order containing this item shall contain both the product item line and a delivery service line. This service item can also have service item options associated with it, which basically means adding services like haul-away and safe disposal of older appliances etc. Delivery services can be performed by the organization’s own fleet of trucks and drivers or by a 3rd party logistics provider. Delivery services can be charged to the customer based on business practices.
2. Provided Service Items-
This service item signifies service like installation services at the customer’s site, doing the electrical or plumbing set-up etc. before or after the product item is delivered or picked up by the customer. This service item can be associated with the product item in the item definition and it can also be defined how many hours before or after the delivery of the product item should the provided service should commence. Provided service items can also have service item options like ‘Cleanup after installation’ etc. assigned to them.
Provided service items also exist on the order as a separate line without any mandatory dependency on a product item line.
The term resource pool is used to signify the entity in Sterling which maintains the capacity of a Node (Store/warehouse/supplier node etc.) to fulfill a delivery or provided service request on an order. Resource pools can be either for fulfilling a delivery request or a provided service request. This is specified during the creation of the resource pool itself.
Resource Pool Attributes:
A node can have multiple resource pools to fulfill delivery or provided service which requires different kind of skills. Capacity is assigned to the resource pool against the time-slots and deducted as order with the consuming service items get reserved or scheduled Consider a bakery which makes really tasty chocolate icing for all kind of cakes. The icing is created in batches and one batch is enough only for 50, one lb. cakes. Each batch of icing goes bad within 2 hours of preparation and thus left-overs can’t be used. This means that the first batch of icing can be applied on at most, 50 cakes (any type), if sold between say, 10AM-12. From 12- 2PM a new lot of icing is available to process 50 more cakes. Each time a cake is sold, the amount of icing available goes down. Capacity is the icing of the cakes, available in fixed amount, for fixed time periods. Un-used capacity can’t roll over to the new time-slot.
The Cutting Edge: Allowing customers to select appointments for Home Delivery.
Resource pools allow organization the flexibility to provide customers with the choice of selecting a convenient time-slot to have the product delivered or serviced at their home/office. Sterling can return a list of available time-slot and date options during availability call before an order is created.
Customers can now select from this list, the time-slot and date when they want the product to be delivered at their ship-to address. The captured appointment is stamped on the order when it gets created and is communicated to the WMS during ‘Release’ of the order.
Resource pools also allow for an efficient utilization of available resources, automation of information flow, resulting in lesser instances of missed shipments or services. This also leads to greater customer satisfaction and lesser cost incurred in appeasement/re-planning in case of a missed out service appointment or delivery. The feature also allows for committing a very granular and assured time-slots for providing the service requested by the customer as the information is shared real-time and precisely across the fulfillment channels. Warehouse workers know exactly when to start pick, pack and staging process, truck drivers know when to start and end the loading process, skilled service providers like an electrician or a plumber knows exactly when the home-theater or dishwasher is to be delivered and depending on that timing, when should they reach and complete their services at the customer’s shipping address.
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Filed under: Warehouse Management