A customer focussed operational design in a building materials distributor resulting in significant revenue gain.

Support was required for a building materials organisation to re-tender for a multi-million-pound contract and to design an operation that would create significant competitive differentiation. There were customer service and operational issues with the current model leading to a need for the new design to be different to reassure the customer a step change in service levels was achievable.

The results:

• Successful implementation of a new customer focussed, efficient operation.
• Increase in share of customer wallet from 33% to 50%, resulting in over £14mn of incremental revenue
• Record breaking on time in full ratings consistently delivering over 98% (Previously had averaged circa 84%).

The approach:

This project involved designing an operation from scratch with a high level of customer focus so there were three key stages post tender the project team progressed through – diagnose, design and deliver.

DIAGNOSE

We found the current model was delivering the model through 60 plus outlets leading to high levels of variation amongst the service offered and a lack of feeling of ownership for this specific contract.

Understanding today’s problems and tomorrow’s requirements

Deliverables:

• Identify the issues with current performance
• Understand the customer’s critical success factors
• Assess the options available for future operating model design
• Select the most suitable option
• Agree ownership and resource required for the new operation

DESIGN

We designed a model focussed on centralised customer service and a consolidated distribution network, this allowed an outstanding level of consistent customer service and efficient and effective standardised ways of working within the distribution network. A data driven approach to demand management and transport planning resulted in the previously stated record on time in full achievement.

Converting the vision into operational reality

Deliverables:

• Translate the organisational strategy and customer requirements into a service proposition for the new operation
• Understand demand for the new operation, including:
• Likely order no.’s by time of day, day of week, week of year, etc.
• Orders by geography
• Runners, repeaters and rarities of stock
• Modelling of the above volumes to ensure operation can stand up to forecasted tolerance
• Design of new processes and customer journeys complete with standard operating procedures to ensure critical success factors are met

DELIVER

Early recruitment during the diagnose and design phase lead to a number of colleagues being involved in ideation and design through to implementation and day to day operation. This heightened the sense of ownership and built a good knowledge base for the early days of the operation and allowed for a quality induction of the newer team members. High energy, daily planning calls allowed for rapid progress and quality senior stakeholder engagement meant that any roadblock were quickly overcome.

Implementation and embedding of proposed operating model

Deliverables:

• Physical set up of operation inc. racking, vehicles, stock, physical space, desk, phones and systems
• Full induction and up skill of team
• Ensure an appropriate control period during which the operation was closeley monitored in order to react to any teething problems
• Quality communication with the client to understand their early perceptions of the new offering and responding quickly and effectively to any issues raised