Business and Strategic Services (Logistics). DLW Solutions

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1 Business and Strategic Services (Logistics). DLW Solutions Business Challenge: A $200M food processor was supplying both fresh green product and refrigerated salads to the grocery and restaurant community. There purchasing group bought ingredients from various types of suppliers, including direct growers and wholesale houses. When they purchased a new company, and established it as a separate division they inherited an unsophisticated transportation procurement process and control methodology. The new division was more made to order product than any of the other company units and became difficult for them to integrate n\into the base logistics operation. Adding to the difficulty was that this new division was the only facility in California and they had a private fleet. The parent company needed to assess the level of competency within their new division and determine if transportation improvements could be made. Solution: Immediately in the assessment phase it became clear that the new division was challenged by not accumulating transportation cost in a uniform manner. They could not identify the cost of the private fleet nor did they accumulate purchased transportation properly and therefore not accurately identify cost. Almost as quickly, it became clear that the data being supplied their warehouse and carrier partner s was incomplete and inaccurate, contributing to performance and cost deficiencies. A Rock Ledge principal provided an assessment of not only the transportation cost and operations but also identified warehouse and IT system changes that were required to impact cost. Results: IT changes that were required to improve customer performance, including a basic bill of lading re-write were implemented. A warehouse RFP was generated and a new warehouse provider was implemented. The new provider was able to provide the client more timely and accurate information regarding inventory and outbound shipments. A recommendation was made to eliminate the private fleet, saving over $250,000 annually. A transportation RFP was generated and implemented to save over $300,000. In addition, 12 logistics processes were defined and documented internally and a separate recommendation was made to save another $ if a change were made in shipping and how they interacted with their warehouse.

2 Business and Strategic Services (Trucking). DLW Solutions Business Challenge: The trucking division of a short line railroad based in Minnesota, had just had a fatal accident and required a review of the accident particulars, a review of existing safety procedures and subject matter expertise dealing with the Department of Transportation safety audit process. Solution: The priority of action required attention to the accident first. While The consultant reviewed pictures of the site, police reports and driver testimony, The consultant had an accident reconstruction expert also provide an analysis of the scene reports. As is normal, there were discrepancies between the various eye witness reports that had to be resolved. An extremely detailed review of all accident files was completed. During and after the accident review process, a review of the safety program of the carrier was also being conducted. It was determined there were short comings that had to be corrected and implemented in order to be prepared for the DOT Safety Audit. Results: As a result of the analysis and issue identification, the company was able to appropriately defend itself regarding accident litigation. A complete Safety Manual was written detailing carrier management responsibility. With regards to Safety in general and driver files, driver hours and other driver related issues specifically, the Terminal Manager was provided a clearly defined course of action. Safety meetings were initiated to be held monthly for 3 months and every other month thereafter, with regular safety information included in their weekly pay envelopes. Due to effort of all parties the carrier was able to retain its DOT safety rating of Satisfactory after the DOT review.

3 Operations Excellence (Trucking) Services DLW Solutions Business Challenge: A regional trucking company was unprofitable and to wanted to turn around the P&L. They needed to know quickly if, how and how long it would take, to return to profitability.. Solution: The consultant was established as GM in order to have the authority required to handle the turnaround. A customer and process assessments was conducted to determine where the true profit drain was occurring. Included in this assessment were dispatch operations, accounting, billing, safety and the software being used to support these functions. Results: In a very short period of time, it was determined there were several issues that needed to be and were addressed. Driver utilization was improved through better utilization of the software and a realignment of dispatch operations. Insurance cost was reduced due to a competitive bid process and creation of complete safety manual and program. Invoicing was improved in both quality and timeliness, reducing time of activity to invoice by 30%. In addition to addressing the normal operating issues, The consultant was able to start a brokerage division which added 20% new revenue to the organization and laid out a plan to reduce the carrier s dependence on its largest customer. The carrier returned to profitability in less than 9 months.

4 Operational Excellence Manufacturing DLW Solutions Business Challenge: A $150M food manufacturer was concerned about its private fleet utilization and its overall transportation expense. It was leasing equipment from Ruan and employed drivers directly. The most significant issue was should they or shouldn t they have a private fleet. Compounding the situation was the fact that some equipment and deliveries required tankers. They have 4 separate manufacturing sites. Solution: To provide an accurate evaluation it was necessary to gather transportation cost data, private fleet cost data (which was not consolidated) and document current processes, controls and how decisions are being made. It was also necessary to gather data regarding equipment leases in order to evaluate not only cost, but competitiveness. The consultant put the data into a logistics usable structure in order to be able to present coherent comparisons to senior management and also allow for a market place cost and service evaluation. Market place comparisons were made. Results: The consultant was able to determine the company could save an estimated 16% of its transportation cost by eliminating the private fleet (recommended in 2 phases) and sending an RFP to the carrier marketplace. The consultant also recommended a strategic methodology to mitigate customer risk. The focus was to have employees of the client handle actual implementation. 1 month after the presentation the client called to have the client do implementation.

5 Business and Strategic Retail. DLW Solutions Business Challenge: A $30B retailer was evaluating how to create a state of art Transportation Management System. The issue was should it be built in house, should canned software be used, or should existing systems be modified to satisfy the business requirement. While searching for available software vendors the decision was made to have 1 of the major consulting organizations undertake an analysis, led by and having the retailer represented by the consultant. The vendor would work through the consultant and he would communicate with the retailer. The retailer had over 100 distribution facilities, over 3000 selling units and a large corporate office to consider for transportation requirements. Solution: The consultant and the vendor visited locations and met with key participants to determine system requirements. During the site visits and in many group meetings, system specifications were categorized into must have, should have, and would like reviews. After system specifications were defined, the consultant researched vendor software options and the major consulting firm generated cost associated with building a proprietary system. The retailer s IT department determined the modification cost to existing software. Results: The effort reflected that there was no canned software package on the market to satisfy the retailer s need that would require any less modifications than the modification required to existing software. The proprietary system architecture specified and evaluated by the major consulting firm was examined from a cost-tocreate view point. It was determined that the cost to build an advanced proprietary system (scraping the existing software) exceeded the cost to modify existing software. The modification would accommodate all the must haves and some the would like items. The retailer s IT division was to undertake the system rewrite based upon normal budget and capital review.