Module 1 – Case
Facilities Planning and
Warehousing
Case Assignment
You and your rich friends are entrepreneurs in
Silicon Valley, but you don’t have the smarts to either build new devices or
write new apps. (Sorry.) Instead, you’re interested in tapping a more prosaic
market; the geeks who build new devices, and write new apps.
These guys and gals, both employees and
graduate students, never seem to sleep. And they get hungry at all hours of the
day and night. This has been good news for the various pizzerias and burger
joints that never close, and also offer 24/7 delivery. But you have a feeling
that the market for prepared food is saturated. Further, it doesn’t satisfy
everyone’s needs. What about the geek girl who feels the overwhelming urge to
cook a tub of spaghetti sauce at 3:00 Sunday morning, but doesn’t have any
oregano? What about the farm boy, overcome with longing for his Mom’s cooking,
who wants some calf’s liver smothered in onions? In other words, what about the
weirdos who actually want groceries at all hours of the day and night?
You have a tentative name for the business:
MyShoppingCart.com. Customers visit the site, and select items for delivery
using one of two shopping modes: by store (specify a business, see what it
sells, and pick items) or by product (specify a grocery item, see which stores
stock it, and pick a store). As usual, the customers fill shopping carts
online, enter their plastic, and await delivery. You plan to charge outrageous
prices, but hey – this isn’t a price-sensitive crowd.
Order fulfillment would take place in one of
two ways; either directly from a store, or from your own small, very
selectively stocked warehouse. Here’s now it would work.
If the store is open, you send a shopping list
to the store, and they fill a box for you to pickup – and add their own markup,
for the extra work. If the store is closed, one of your own agents, bonded and
preapproved by the store, opens the store up, gets the stuff, and leaves an
invoice at Customer Service. If a store isn’t open, and you can’t reach an
agreement with the owners to let one of your guys go rummaging through the
shelves in the middle of the night, then that store wouldn’t be on your website
during the hours that it’s closed.
If the customer orders by product, then you
have two options; either go to the nearest store that has the requested items,
or fill the order out of your own warehouse. The items in the warehouse either
belong to you, having been purchased from a wholesaler, or are there on
consignment – that is, they belong to local merchants, and they’re letting you
keep them and sell them on their behalf. Perishables are either frozen
rock-hard, or (in the case of fresh vegetables) not available unless a market
is open for pickup.
All in all, it would be an ambitious,
enormously complex enterprise. It would be impossible without cutting-edge
apps, which your geek coworkers are developing for you.
At the moment, you’re in the fact-gathering,
preliminary planning stage. The immediate problem is the warehouse. What information
would you need to determine:
1.
A satisfactory site?
2.
What items would need
to be kept in stock, and the optimum stocking level of each?
3.
What size facility is
needed – both floor space (sqft) and volume (cubic ft)?
4.
An optimum system for
locating items, so your employees will know where to put them when they arrive,
and find them when they’re needed?
Pertaining to number 4 above: You’re
anticipating the need for some sort of scanning system that identifies items as
they arrive, keeps track of where they’re located in the warehouse, and issues
instructions for retrieving them. Most, but not all, of the items will arrive
with some sort of computer-friendly label already affixed; however, the label
doesn’t necessarily provide all the information you might need, particularly
for the items that are there on consignment. For those items, it would be nice
to know to whom they actually belong. You’re also interested in the possibility
of generating barcode labels for customers, to be affixed to the sacks and
cartons containing their orders. The delivery people could read those labels
with hand-held devices, and receive real-time driving instructions that take
traffic congestion and road closures into account. The three labeling options
are UPC barcoding, RDIF tags (either single-use or reusable) or 2-D barcodes
using one of the standard protocols.
5.
Which of the three
options would be best? Why? Explain.
In conclusion, you should give some thought to
safety.
6.
What are the minimum
procedures you should put into place, to ensure that your warehouse workers
(probably no more than one or two people) aren’t exposed to unnecessary risks?
Module 1 – SLP
Facilities Planning and
Warehousing
The Trident Session Long Project (SLP) is, in
fact, a session long project. However, each the four discrete assignments is
uploaded and graded separately. The purpose of the project is to embed the
concepts of the course in a real-world example of your own choosing.
Pick an organization to examine throughout the
course. It may be one you work for, or have worked for; but in any event, it
should be one you’re familiar with, and about which you’re able to collect
information. It’s particularly important you be able to collect information
about the following logistical functions:
·
Facilities layout and
warehousing (Module 1)
·
Product distribution
(Module 2)
·
Logistical quality
control (Module 3)
·
Reverse logistics
(Module 4)
A few words about each of these
broadly-defined functions may be helpful.
·
Facilities layout and
warehousing, from the logistical point of view, is primarily concerned with the
temporary storage, management and retrieval of materiel received in advance of
immediate requirements, and products either awaiting sale or being held for
customers in advance of agreed-upon delivery dates.
·
Product distribution
is the process by which the goods and services created by the organization are
made available to users.
·
Logistical quality
control is the process of monitoring logistical processes, identifying
problems, and resolving them. It’s a continuous process.
·
Reverse logistics
pertains to the organization’s involvement in the movement and disposition of
goods following their use by customers. This includes such topics as customer
returns, collection and disposal of wastes, and recycling.
For the first SLP, please address the
following topics:
1. The name of the organization
2. Its primary business or mission
3. Why you chose this business
4. How it handles its warehousing functions
Submit the assignment for grading by the end
of this Module.
Module 2 – Case
Product Distribution
Case Assignment
Respond to either Topic I or II, below.
Topic I: Delivering Groceries
Please refer to the hypothetical grocery
delivery business described in Case 1. You are now confronted with a decision
concerning transportation modes.
Obviously, neither trains, ships, pipelines,
large trucks nor airplanes are options for deliveries in residential
neighborhoods (although drones may be an option in the near future). The
options for your business are cars, motorcycles or bicycles.
Cars can either be owned by the business,
leased by the business, provided by employees (e.g. the usual pizza delivery
scheme), or rented on a per-trip basis from a taxi company or private owners (à
la Uber). A mixture of these options is also a possibility.
Motorcycles can be owned by either the riders
or by the business. Ditto bicycles. Although the weather in Silicon Valley is
generally temperate, a delivery system that relied exclusively upon
wind-in-the-face vehicles would have to have some sort of foul weather backup.
In addition to flexibility and
cost-effectiveness, whatever system you devise will have to consider the
availability of operators and insurance costs, both for your employees and for
the people they may run over.
The readings in this Module are mostly
concerned with “heavy” systems, up to and including multimodal (ships to trains
to trucks), but the basic considerations involved in choosing a system – speed,
efficiency, cost-effectiveness, safety, etc. – are applicable to any type of
technology.
So what sort of transportation mix would you
choose for your business? We’re looking for close, logical argumentation,
backed up by citations and references.
Topic II: The Keystone Pipeline
The case of the Keystone pipeline clearly illustrates
the centrality of logistics in daily life. Pipelines, trains and trucks are
everywhere, but are usually ignored until there’s some sort of stoppage (e.g.,
a drivers’ strike) or a major disaster, such as a derailment resulting in a
dangerous spill.
The Keystone pipeline, championed by business
and opposed by environmentalists, would move millions of tons of thick, sludgy
oil from the tar sands of northern Canada to the American Gulf Coast. At the
time of this writing, the Congress has approved it, but the President has
promised to veto it. Strong partisan feelings dominate the discussion.
For this assignment, you should read the
additional sources, plus anything else you can find on both sides of the issue,
and state your case either for or against the pipeline. The most important
logistical factors are cost and safety. The most important environmental
factors are oil production from tar sands, which is a polluting activity, and
the global-warming implications of having another major source of inexpensive
petroleum.
By the time you read this topic, the issue may
be resolved, and the pipeline either cancelled or under construction. If that’s
the case, then please discuss the resolution, detailing the factors that
entered into the decision. You should also explain why you think the decision
was either right or wrong, and whether you believe it ought to be reversed.
(Government decisions are sometimes wrong, and can be reversed.)
As always, we’re looking for close, logical
argumentation, backed up with citations and references. Strong opinions are
permitted, even encouraged – but they must be supported.
Module 2 – SLP
Product Distribution
Product Distribution
This SLP continues your analysis of the
organization you nominated in SLP1.
You may find it convenient to review the
thumbnail descriptions of the various logistical functions, found in SLP1.
For this SLP, please address the
organization’s product distribution strategy, to include:
·
Transportation modes
·
Ownership and
management of the modes (the organization, common carriers, contract carriers
etc.)
·
The rationale behind
the use of those modes
·
The strengths and
weaknesses of those modes
·
Future developments,
such as anticipated technological advances and resource availability, that may
affect the choice of transportation modes
Submit the assignment for grading by the end
of this Module.
Module 3 – Case
Logistical Quality
Control
Case Assignment
Please refer to the Case 1 description of the
hypothetical grocery delivery company.
Let’s suppose the company has Taken Off, and
is now a Big Deal in Silicon Valley. Thousands of otherworldly, overpaid
people, many of whom could either find the time to go shopping themselves, or
delegate the task to their PAs, have come to rely upon MyShoppingCart.com for groceries
– and not just at 3:00 AM on Sunday morning.
The company’s success has been due to its
clean, beautifully intuitive shopping app, which works flawlessly on every
device, and also to its awesomely fast delivery service. In one instance, which
has become the stuff of local legend, a millionaire’s trophy wife was horrified
to discover that she was completely out of cocktail onions, and a party she was
hosting was beginning in a half hour. She placed an order on her cellphone, and
a motorcycle courier from MyShoppingCart had the onions in her hand in 17
minutes flat. (That $1.75 jar of onions did, of course, cost her $50, charged
to her American Express card, but she didn’t notice.)
But now the company has encountered a problem
— the warehouse. There are bottlenecks: it’s taking too long for items to get
from the receiving side of the shipping dock to the shelves. It’s taking too
long to pick an order from the shelves and get it out the door, in either a car
trunk or motorcycle saddlebags. There’s no minimum acceptable time for either
activity; the emphasis is always on making things faster.
Obviously, it’s impossible to know the
particulars of what’s going on. But how would you find out? Once you know, what
sort of program would you put into place, to make things better? In particular:
1.
How would you go about
benchmarking the warehouse’s performance?
2.
How would you collect
data concerning the details of warehouse performance?
3.
How would you apply
the PDCA process to improving performance?
Your discussion should be solidly grounded in
the background materials, and supported by citations and references.
Module 3 – SLP
Logistical Quality
Control
This SLP continues your analysis of the
organization you nominated in SLP1.
You may find it convenient to review the
thumbnail descriptions of the various logistical functions, found in SLP1.
For this SLP, please address the
organization’s logistical quality distribution strategy, to include:
·
The specifically
logistical functions for which the organization is responsible.
·
The metrics pertaining
to those functions that determine quality. Possible metrics are timeliness,
reliability, cost, shrinkage (damage and loss), etc.
·
How those metrics are
monitored.
·
How the organization
applies Deming’s PDCA paradigm to quality control; or if it doesn’t, how it
could or should apply that paradigm.
Module 4 – Case
Reverse Logistics
Case Assignment
We return to the hypothetical grocery delivery
business described in Case 1.
If you buy a defective computer, then it’s a
given that you’re going to take it back to where you bought it, either to be
repaired, replaced, or returned in exchange for a refund. If you buy a net of
onions that has some moldy ones in it, then it’s a given that you’ll simply
throw them away. Taking them back to the store isn’t worth the trouble.
In the case of MyShoppingCart, the situation
is a bit more complex. Your customers are paying a high premium for fast, 24/7
delivery of groceries. If a Silicon Valley matron gets a corked bottle of pinot
grigio, or a tin of pate de foie gras with an unwholesome aroma, then
she expects your company to come get it, and credit her account.
This is an example of reverse logistics, which
your readings describe as “a supply chain opportunity.” But you’re having
difficulty finding any opportunities in the smelly bags of spoiled groceries
that turn up at your warehouse from time to time. This problem is a lemon. Your
challenge – to make lemonade!
Carefully examine the situation, and discern
any opportunities to profit from the returns, or at least earn enough money to
offset the losses. Here are some clues. You bought the products from somebody,
right? Maybe they’re good for it. Also: information about product quality is
valuable, at least in principle. How could you monetize that value? Who would
be interested in seeing that information, and what could you gain by providing
it to them?
Again, be sure to base your discussion on a
close reading of the required sources. Be sure to provide citations and
references.
Module 4 – SLP
Reverse Logistics
This SLP continues your analysis of the
organization you nominated in SLP1.
You may find it convenient to review the
thumbnail descriptions of the various logistical functions, found in SLP1.
For this SLP, please address the
organization’s involvement in reverse logistics. The nature of reverse
logistics depends upon the organization. Not all of the following topics may be
relevant; please address those that are.
·
How the organization
handles customer returns, to include return policy.
·
Organizational
participation in recycling and repurposing efforts
·
Organizational
responsibility for after-end-user disposal and pollution
·
Organizational
involvement in customer efforts to increase efficiency and decrease waste
Submit the assignment for grading by the end
of this Module.
