@ Amrita Vishwa Vidyapeetham INTERNSHIP PROJECT 2011 prpock Delivering Value Project done by Avinash Heston, ‘Student of Amrita University. ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction 1The following table shows the list of figures present in the research project:- The Flow of Consignments Page 516/26 Type: chart ‘Akout :Rshows the Faw of eanignmant from source ta delivery pati Factors affecting Transportation Segments Pago :20 type: Chart ‘About :bifferent Factors affecting the transportation of consignments and thelr ‘shares. Mode of Loading and Unloading Preference Page 22 Type: Chart ‘About : Mode in which consignments are loaded nd unloaded. Main Goal of the Company Page 128 Type: Chart ‘About : Employees response tothe main goal ofthe rommpany. Material Damage Source Pago 327 sType : Chart ‘About : The question “Where’is answered, kogping the material damage source ia ‘mis, Employee's Needs Satisfaction Scale Page: 31 sType : Chart ‘About : Employee's nied satifaction scale answered in VES/NO, ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction 2Chapter 1 Introduction 1.1) The Topic “The Enfectiveness of Logistics, Distribution, and its relation tr Customer Satisfaction’ 1.2) Reason for the Selection of the topic Marketing, based on its definition, is the whole idea of the business. It should not be assumed as a basie process of sales and distribution alone. The area of Logisties and Distribution is ‘considered a very important sub-sector of the Marketing segment, In the current era of business, Customer satisfaction is given top most priority hecause ‘customers decide the fite of the product or service, unlike ‘earlier tithes wherein the sellers sind distributors had D rock monopolistic control over the products or service, Therefore, Doliwering Valve the fate and survival fuctor of a business lies on the hands of tors, Mh the customers, Whien Logisties and Custeimer st iden flaws and facts can be derived, to improve the overall productivi Wuetion sie taken as depend W thus solutions ean be processed and outsourced $0 as and sustainability of the Business sector. Hence, the logistics ment p al rofe in distributing the produets/Serviees to the eliens, thus attaining overall “enl-customer satisfaction”. 1.3) Why is the topic important to the company ) BUILD A PLATFORM FOR DEVELOPMENT, GROWTH AND INFRA. “TUR DTDC Courter and Cargo Ltd is a service sector eompany, primatily focusing on Courier Serviees, I is one OF the leading Express distribution companies in India covering both domestic foremost clients are ity Customers and and intemational services. A Courier company ‘Customer satisfaction remains a primary priority to the company, Logistics and Distribution fumetionin eh is the main gost play a'key re in th ofthe company and on-time deliver ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction 3‘of the company, which results in client satisfaction. Thus, problems associated with the distribution and end-customer reactions based on the accuracy of the delivery can be solved by deriving the fink between the former and the latter. ‘The Logistics department handles the Movement of Goods/Products/Serviee Packages from one place to another. It ensures that the goods which are received for delivery are distributed effectively and efficie at the specified time period. Management of distribution channels are can essential platform for the company to function in an optimum manner, 1.4) Learning from the Study ‘The logisties sector itself, is a competitive yet complicated part of the ever-growing market. It is a third-party service sector which acts as an intermediary between sender and receiver of consignments, thus proving it 10 be an important section in business world, Its relation with its valued customers promotes its growth and sustainability. t plays a crucial part in the transfer of _goods from Oné place to anther, within the specitied time, thus creating an initiative which does not compromise on the time factor. Customer relation plays a major key in servige Sector ‘business since the functionality of the service should be flexible according to the needs and desires of the customers. ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction 4ony elelard 2.1) 2.2) Organization Profile Industry Profile The Thitd-Party-Logisties provider (TPL) is a firm that provides a ane stop service to its customers of cutsourced or “third party? logistics services for the part, or all of their supply chain management funetions Third party logistics providers specialize in. int egrated operation, Warehousing. and transportation services that can be scaled and customized to customer's needs based on market conditions and the demands and delivery service requirements for their products vind iHlaterials, Acconding to the Council of Supply Chain Mandgement Professionals, TPL can be defined as “A firm that) poovides multiple, logistics serviges for use by customers. Preferably, thesé services are integtaied or “bundled together, by the Provider, Among the services, TPL provides ti nsportation, warehousing, eros: doe inventory management, packaging, and freight forwarding”, Company Profile 2.2.1) About the Company and It's Formation. DTDC Courier and Cargo Ltd. is one of the leading express distribution companies in India covering toth domestic and intemational services. Incorporated in the year 1990, DIDC is in its 20” year of operations in India, It has a large delivery network coverin ‘lose to 10,004 pin codes giving its customers the est reach in the country. Its effécient international network spans over 24 glabal destinations supported by its own offices in US, UK and Dubai and associate offices global destinations, Head! all. the important quartered in Bangalore DTDC has its Zonal offices in Bangalore, Mumbai, Dethi and ‘The Effectiveness af Logistics, ibution and Customer Satisfaction 5Kolkata supported by 300 plus own offices and over 4000 channel partner affices spread across the country delivering over LOD million shipments every year. Company has the State of art IT infrastructure to support their operations and has built many customized applications for its corporate clients, Under the able leadership of Mr. Subhasish Chakraborty, the founder chairman of the organization, DTDC has an efficient team of management professionals who are working round the clock delivering value to their customers. DTDE has been innovating constantly 1 provide products and services that meet customers current and future needs, Today you will find DTDC offering wide range of solutions, Retail services ig Supply services like Express courier, cargo, end to end supply chi like ticketing solutions, bill payments, Mobile & DTH top ups apart rom Trai chain professionals through ils supply chain training institute, DTC's Customer profile:cuts across the industry verticals covering banking. insurance, telecom, manufacturing and IT, Company provides excellent solutions for E commerce business and has capability of seamless integration of applications with the customer providing efficient transaction and database management, DTIC has sirategic equity participation by ADAG group. DTDC plans to consolida growth and its vision is to interface with customers more often in their value chain by offering wide range of products and services. 2.2.2) Business Focus DTDC focuses primarily on Courier services and Cargo [Logistics] services. It is a service sector company, implementing of consignments to its designation, ranging from documents to heavy freights. The Vision aand Mission of the company is as follows:- portance on satisfying the customer's delivery a) Vision ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction 6+ Tobe the most admired and suecessfil Express Distribution Company in India by meeting and exceeding our customer's expectation of services. b) Mission = To focus on Customer Loyalty and make it a goal of our organization. - To encourage our people for adoption of new technologies, processes and for improved, reliable and speedy service. + To relentlessly monitor to reach a minimum net service level of 98% delivery. ¢) Quality Policy + Satisfied intemal customers, extemal customers and Business Associates ~ Continual Improvements in products, processes, services and quality management systems. + Satisfied, motivated and committed employees. 2.2.3) Some of the clients of DTDC a) The Telecom Sector Clients > Aine! > Aircel * Vodafone b) Bank clients > Axis Bank > Ci ® HDFC Bank > BOB sank, ¢) IT Clients ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction 7> ABB > Bharat Forge > BHEL > Therma d) Other Clients ® Sony > Philips > Dell 2.2.4) Distribution Network of DTDC ‘The Company owned branch typically covers a specific range of pincodes, which have been predetermined for purpose of effective deliveries. Coverage of the pincode rage is handled by way of assigning # dedicated franchisee for each pineode, who covers the geographical expanse falling under the subject pincode. The overall performance of the deliveries for the range of pineodes assigned is taken care of by the DTDC branch. The company's main distribution network covers places like Ahmedabad, Bangalore, Bhubaneshwar, Chennai, Cochin, GGR, HHPJ, Hyderabad, Indore, Kolkata, Mumbai, Nagpur, North Dethi, Northern RO, Paina, Pune, South Delhi, UP. 2.2.5) DTDC's Products and Services a) DTDC Plus dtdce plus ‘The Effectiveness af Logistics, Distribution and Customer Satisfaction 8Features of DTDC Plus Assured Next Business Day Delivery 100% money back guarantee if not defivered within committed delivery period. ‘Tamper-proof Security pouch, SMS/Enail Alerts b) DTDC Blue Features of DTDC Blue Assured Second Business day delivery, 100% money back guudiantes if not delivered wi iin committed delivety period. Service to locations beyond DTDC plus lanes ‘Tamper-proof security pouch. DIDC also offers services such ay Student express package, DTDC lite as well. ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction 9‘Chapter 3 Research Objectives and Scope of Research 3.1) Problem Definition 3.1.1) Evaluation of Revenue Dimension of the Logistics/Distribution Department. Revenue ean be defined as the Income of the company or firm, Revenue is required far the business to grow and diversify, thus enabling the business to-attend to its day to day functions and objectives, ‘The overall profitability of DTDC mainly depends upon the hoice of transportation available for the company such as trucking, air or by train etc. In DTDC, revenue gener: respective clients, In a normal company behavior, transportation is regarded as a cost for jon is mainly through the transportation and warehousing of consignments for its the company. Whereas, in case of Third-party-logistics providers, transportation is considered as a revenue earner as well as a cost fo sinee the cost ineurred, the compar for hiring transportation, is thoroughly billed to the clients themselves, during the period of booking. 3.1.2) Customer Reach, Reaction and Satisfactory levels with the service provided. For any business to prosper and grow, it requires a souree from which revenue can be derived. And for any profit-making business firm, its main source of revenue is its customers. In ease of DTC, customers are also termed as ‘onsignment Clients’. While a consignment is received by DTDC Premium servic it checks whether the pin code of the destination is compatible with its delivery options. After verification and appraval, it Will be sent to the designated location, and within the specified time period. The Time- ‘The Effectiveness af Logistics, ribution and Customer Satisfaction 10factor decides the satisfactory levels of the clients. If the consignment reaches the location within or at the specitiod time, the customer will be satisfied with the service and if not, 2 complaint is registered and the entire amount paid by the client for using the service is reflanded, if the client claims for it, 3.1.3) Problems related to the Logistics segments/Distribution channels, such as Domestic and International Segments, ‘The proximity of problems within the logisties department may. vary but it so remains that the Connectivi ‘issues shares a higher ground, initiating problems in the daily functioning of the company. Due to hunian or not-human disturbaiiees, the performance on the delivery of goods may deteriorate, thus causing problems to the consignment holders. It such issues ane recognized by the company before the acl delivery, it will be duly notified to theelients in advance, While availing’delivery options like the PEP (Preinium Express Products).they develop altemative solutions or delivery plans so that the consignments reach its destination in or on time. Even though such altemative solutions are implemented, it cannot be declared as « fool-proof system. $.1.4)Matching Branch performance with Delivery performance. Branch Performance and Delivery performance are two diverse, yet co-related aspects The delivery performance mainly deals with the status of the consignments. All the activitios which the consignment goes through, such as transportation of the goods, delivery to thie branch office, reaching the custome can be considered as the delivery performance. The branch performance, on the other hand, includes operations performance, delivery performance, and the overall performance of the company, ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction a3.2) Objectives of the research project 3.2.1) Primary Objectives TO UNDERSTAND THE PROBLEMS RELATED TO THE LOGISTICS DEPARTMENT 4) Te understand DTDC's position — Commensurate to market area. Most of the companies consider Transportation and Travel charges as the eémpany’s incurred E ES. In case of Courier companies, such as the DTD. Transportation and Travel ave filtered out-as the main soiree of REVENUE for the company. Every business firm ais at maximizing their profits atid [cuses on the attaitnert of satisfaction to their customers with their products or service. Henge, customer satisfaction remains the main goal of DTDC as well. 6) Problems related to international and domestic segments. TDC is head quartered in Bangalore, having its Zonal offices in Mumbai, Delhi and Kolkata, supported by 300+ own offices and over 4000 ehannel partner offices spread across the county delivering over 100 million shipments every year. The Company has the state of the art IT ihfiastructure to support their operitions and has built many customized applications for its corporate clients, Although a perfect, fool-proof system ‘cannat be achieved, the proximity of discrepancies is although high for such a vast system, This in-turn leads to pioblems related to intematiorial and domestic segments, 4.2.2) Secondary Objectives ETH. a) To know the satisfactory levels of the customers. “Customer is King’; an important saying in the market world. Customers are the primary organs deciding the fate of the products and services given out by the ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction 2manufiiclurers and service providers. Ifthe customers are nol satisfied with the products which they buy or the services which they avail to, the survival of the business is at stake and it would be forced to accept closure, due to extensive losses, ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction 3fee Tia Research Methodology and Limitations 4.1) Research Plan The Researeh plan based on the project topic, “The Effectiveness of Logisties, Distribution, and its relation to Customer Satis ction’ in order to derive the problems related with logistics, distribution and end-customer satisfaction, the Research plan for the project mainly involves employees of DTDC, DTDC der, mainly concentrating on Transpo direct contact with the pr from and to their clients, thus proving it to be a service based company, Services, unlike goo lo spec is a Third-party ion, Warehousing and Delivery of consignments are intangible commodities and hence, services should be rendered with fle bility in accordant with the type of customer, While involving in a research with a Service sector company, one of the efficient ways of conducting a research is by: intaining a thorough contact with the ‘employees of the company, as they would be most aware of the problems faced by the company. Alternative resea rch plans, such as questionnaire distribution and Telephoni conversations woul ¢ implemented, for deeper penetration into the company’s root equse af the problems, as mentioned in the Problem definitions, The following table [ able 1.1] shows the basie research plan: [TABLE 1.1: Basic Research Plans] “To know the present consition of the company in the service sector, “To know the problems faced by the logistics department af the company while dealing with its varied customers “To know the employee's opinion about the lopistics department, its functions and the problems faced by Iten its day to day operations + Tonlighten the importance of the Logistics depariment and its importance to its costamers. + To contact and derive information from the corporate sector(Top Lev manapement "specratn nctaning oe oges Sparen nao sgn te compen = sion wit ie customers ‘The Effectiveness af Logistics, Distribution and Customer Satisfaction 144.4.4) Preliminary investigation = TDC is a Third-party Logisties provider, providing multiple logistics services for use by its customers. Preferably, these services are integrated by the provider. Among the services, DTDC provides tansportation, warehousing, cross-docking, inventory management, packaging, and freight forwarding. ~The main focuses of the logisties department of DTIDC are its customers, particularly prioritizing the Industrial customers and their lange-scale goods, which is to be transferred by the company to the specified location by the eustomes and. within the specified periad, = One of the primary issues faced by DTC is the problem related with transportation. Sinee Courier ahd logistics services function ‘with the time factorand have eliemts whe prefer or want their goods/consignments on time, the mode of transportation andl channels are often given high rank of importance and disturbances in the channels of transportation, which includes human or non-human: disturbances, can be 4 cause to loss of goods or revenue for the company. - There exists considerable difference between the branch performance arid delivery performance. = Norriuil Cousice service differ extensively as when compared to Logistics serviees, in which the former focuses on small-scale delivery whereas the latter concentrates more on large-scale delivery of goods to its customers, mainly the industrial customers. = The restrictions implicated by DTDC on certain gauds/products transfer and delivery such as Explosives, Gaseous, Flammable liquids, Flammable solids, oxidizers and organic peroxides, radioactive material, Corrosives ete, Such goods or products possesses ‘The Effectiveness of Logistics, Distribution and Customer Satisfaction 5hazardous characteristics and are categorized by the IATA in the Dangerous Goods Regulation. ~The following chart [chart 4.1.1] shows the flow of consignments from one Location [L.1] to another location [L2]:- CHART [4.1.1 : Flow of Consignment] 4.1.2) Explorative Study ite press problem faced by’ ana company cannot be fool-proof, although the ‘greatl ning an average above the costs (Profit) can inerease the sustainability,i.c the life of the business and hence promotes growth, ‘When the scenario of DTDC is considered, the problem lies with its reach to the consignment