Standardised KPI / QBR program implementation

Background and situation

• Global Food Manufacturer operating in most countries in the world. Producing, procuring and selling food products to the Global Market.

• Localised, mostly ‘stand alone’ business units.

Client Objectives

• To create a central contract management business unit, and standardise the logistics contracts and logistic service provider management (LSP) in Northern Europe, across initially 8 LPS.
• To integrate the logistics aspects of several acquisitions

Drewry Approach

• Interviewed the local logistics staff and determined current way of working with the LSP
• General Management (mostly day-to-day, issues exception management, fire-fighting
• Clear and concise Pricing Structure removing ambiguity and double charging / non-agreed charges
• Introduced standard Contracts (those in place mostly referring to the rates)
• Discover pain points among local logistics staff
• Created a number of KPIs that would enable Manufacturer to:
  • Measure the current performance of their LSPs
  • Set realistic stretch targets
  • Implement standard contract language regarding LSP service expectations

Implemented and standardised:

• Regular Review Meetings
• Regular interaction at senior level
• Clarity on expectations
• Objective service measuring

Identify and create focus on target improvement areas

Results Achieved

• Improved relationships (at day-to-day operational level and senior management level)
• More influence with the LSP due to regular interaction with senior management
• Improvement in service levels to the manufacturer, which in-turn resulted in improved service levels to their end customers
• Cost saving initiatives identified and implemented, directly affecting the bottom line of the manufacturer
• Longer term initiatives discussed and implemented
• Clearer pricing structure and rate review guidelines
• Paved the way to more easily integrate the logistics aspects of acquisitions / merging with other companies
• Created pro-active, positive culture
• Both sides clear on what is expected and needed so that the other party could fulfil their obligations in the best way
• Easier day-to-day running of the business, creating a happier and more productive workforce.