Week5 Case Study Discussion Review
Requirements
- All responses in the discussion board must be written in your own words demonstrating your understanding and analysis of the topics being discussed.
- Merely agreeing with another student’s answer is not enough, explain WHY you agree or disagree.
- In all your responses assume that the reader has no idea what the topic is about.
- Each discussion is worth 30 points.
Due Dates
- Initial Post: Each student must answer the discussion questions in DETAIL by Thursday night.
- Response Post: Later in the unit, re-enter the thread and respond to at LEAST 2 answers composed by your classmates. These peer responses should be thought provoking, stimulating further discussion of the topics with perceptions, ideas, and supported facts.
Instructions
- Compare and contrast the three options from the perspective of customer service. Which do you believe will provide the best level of service? Why?
Compare from the perspective of customer service – Between Option 1 and Option2 the PFC is improving the order fulfillment speed. Option 1 is improving this by expanding warehouse automation with smaller shipments. While Option 2 is achieving this by adding more DC’s to allow for the smaller shipments to closer locations to the DC.
Contrast from the perspective of customer service – The differences between the 3 companies is with Option 1 is improving the standing DC but incorporating multiple orders and smaller shipments while improving speed and efficiency but they will still be transporting the products to possibly far distances while doing it in smaller shipments so it still will take time. Option 2 is instead expanding the fulfillment network by adding more DC’s and changing the operational process to fulfill smaller or larger orders based on the customers needs. The added DCs allow for shorter transportation time to customers in the order fulfillment they need. Option 3 is outsourcing and doesn’t specify how the company is going to fulfill orders…
Best Level of Service – In my opinion I think the option that will provide the best level of service is Option 2. This is because it is expanding its fulfillment network so there are more warehouses that can transport the product to different locations that are in closer range then just keeping the one DC in Kentucky. Also not only will the transportation become more efficient but also the order will be more customer specific dependent upon the store and individual customer. So the customer will receive the product faster and in the quantity that they want.
- What types of functional and cost trade-offs will Himmer need to analyze?
In deciding which option to go with Himmer has many functional and cost trade-offs to analyze. In one option he is supplying multiple order types and smaller shipments from the same upgraded DC location but improving warehouse location. Which functionally is probably not going to the best option because it is going to require a lot of running around to fulfill these different orders with the same one location just a more improved system. Which the improvements will be beneficial and there wont be an absurd amount of costs in upgrading like the other 2 options but transportation costs will be costly depending on areas needed to serve and amount of smaller orders need to fulfill if they are all over the place. In the second option functionality will improve since they are adding the DCs to locations that probably have a high demand for customers as well as improving these operational processes. The costs will probably be more expensive because adding more distribution locations, which require more employees and the inventory to fill them but the inventory is now dispersed between the multiple locations rather then just being located at the single DC so there wont be an excessive amount of inventory being added just a little more. Cost would be more in this option then Option 1 but more functional then option 1. With option 3 Himmer will be giving up all aspects of the fulfillment to the third party logistics so it is dependent upon them to fill orders with speed, efficiency, and in order size shipments that the customer wants so functionality is based solely on the 3rd party logistics company. But also in this option it allows for PFC to focus solely on the quality, demand planning and inventory management so the two can improve with each other if they are both doing their jobs correctly. The costs with this could either be super expensive for what they are fulfilling but also there is negotiating probably going on so it could be a reasonable price just depends if the cost to make all these changes is more then it is to outsource.