GREAT DELIVERY CORPORATION CASE

GREAT DELIVERY CORPORATION CASE
1
© COPYRIGHT MANEL ARRIBAS IBAR
CASE 4 – GREAT DELIVERY
Actually, You have been appointed as the Spanish Chief Operations Manager (COM) of GREAT DELIVERY Corporation, a US multinational company of home delivery services of quality products. GREAT DELIVERY Co wants to introduce its business into the Spanish Market next year. They want to offer their services focusing in the markets of the metropolitan areas of the main Spanish big cities.
The company will establish its headquarters in Barcelona and has a plan of gradual introduction in the different local markets of the main Spanish cities. The first target will be Barcelona metropolitan area which they want to start next year, the next target in two years will be Madrid metropolitan area and the third selected city for this initial phase of introduction will be Zaragoza which will start in three years. Zaragoza city is located between Madrid and Barcelona and the three cities are well communicated by highway and railways.
Locally the target audience of their services are private consumers with medium and high revenues (families, singles, students, elderly people, …), public institutions, private companies and institutions, schools, universities, etc. which want to order some quality products for their use or consumption. The company considers them as its primary customers or primary target market.
The company offers them a wide range of different local quality products which are locally available and some other locally selected products from different cities where the company is present. Starting in the second year of introduction, Barcelona’s customers could order some local products from Madrid and on the contrary Madrid’s customers could order local products from Barcelona. Starting the third year a customer of one of the cities could order some local products from the two other cities. All of these products will be supplied by different city’s selected providers. The company considers them their secondary customers or secondary target market.
The company providers are considered among different restaurants, specialized groceries, pharmacies, selected supermarkets and hardware specific stores.
The company discretionally chooses their providers in each city to supply its local products to their customers. In each city the selection is made differently depending on the type of provider and its local market share through company’s primary target.
When the provider is selected, an agreement of collaboration is then negotiated an established. There is an exchange of information of customers, products and providers. Both companies expand their networks because GREAT DELIVERY Co provides their customers with access to new providers and at the same time provides their providers with new potential customers.
There are two different ways to make an order using GREAT DELIVERY:
1) Customers can initially place their orders through GREAT DELIVERY requesting specific products of the providers that they want. Then, GREAT DELIVERY places these orders with the specific providers and later GREAT DELIVERY picks up the orders from these providers and delivers the orders to the customers.
2) In case the customer is more confident with the provider of the desired product, customers can place their orders directly to the provider requesting the products. Then, the provider places the order to GREAT DELIVERY which picks up and transports that order to that customer.
Primary customers and secondary customers (providers) can place their orders through the company’s website, by email, by phone or by app. Then the order is registered in the database and then processed by the different areas of the operations department.
GREAT DELIVERY CORPORATION CASE
2
© COPYRIGHT MANEL ARRIBAS IBAR
One of the most important competitive edges that differentiates this company is that the company offers combined orders to their customers. They also offer different types of services to their customers depending on different delivery options and scheduling.
They will offer these different transportation options in Spain:
– Direct shipment of a customer order (directly from provider to customer, not passing through company’s warehouse). E.G. pharmacies urgent orders, some orders from restaurants, etc
– Customer combined order that has to be prepared in the company’s warehouse. E.G. a customer who places two orders at the same time and wants to receive everything together ( a combined order of a restaurant order + a pharmacy order).
– Indirect shipment: Customers’ orders are delivered with other added orders using pre-established and pre-standardized routes of delivery. Here the customer has two options:
o The same day delivery
o 24 HOURS or 48 HOURS of delivery (not intended for perishable products, like food, etc.)
The operations department will be organized with:
– A call center and customer service area with the operators that receive and check all of the orders (from customers and providers), manage the complaints, attend to the customers and providers, provides satisfaction surveys to the customers, etc.
– A transportation sector with all of the vans and motorbikes and its drivers and a workshop area for vehicle maintenance. This company is committed to the protection of the environment. For this reason, the company only uses electrical motorbikes or hybrid vehicles of gas and fuel. The company wishes to be accredited with the certification of 14.000 ISO standards in addition to the 9.000 ISO certification.
– A control operations center which establishes, controls and manages all of the operations resources and daily operations:
o They establish and organize the routes of the vehicle fleet (equipped with GPS locators) and reroute them to fill urgent needs, cut transportation times, reduce costs, resolve issues, etc.
o They also organize the indirect shipments and control the warehouse operations (combined orders, etc.). This center has to have a section of quality control assurance which reviews the performance and quality of the processes and services.
o They control and manage all of the information in the database to make forecasts and plan the operations accordingly.
– A technical information systems area which manages and maintains all of the software which supports and tracks all of the processes of the operations and tracks all of the orders and variables of service (scheduling, delivery times, mistakes, complaints, …). They also maintain the company website.
– A warehouse area with its workers divided in the following sections:
o section to receive pick up orders
o section to prepare combined orders with a combined packaging
o section to prepare indirect shipments (preparing shipments of different customer orders for different routes).
o section to prepare expeditions
GREAT DELIVERY CORPORATION CASE
3
© COPYRIGHT MANEL ARRIBAS IBAR
The available home delivery services and its fees, types of different products and providers will be presented and offered on the company website. The company website is an important marketing instrument that facilitates customer relationships and communication. This is because it also presents personalized discounts or providers of the day together with specific personalized daily news (new agreements with new providers, new products added, new transportation services, etc.). The Company also grants customers and providers with a customer loyalty program.
Additionally, the company website is a key element in the operations processes because:
– Customers and providers can place their orders on the website then the website syncs with all of the databases and processes of the company.
– Customer and providers can track the situation of their order thanks to the different programs of operations.
– GREAT DELIVERY tracks and controls the registration and situation of the different customers’ orders within the different system phases of operations. The system also launches and connects automatically all of the operations orders to the different operations areas of the department (call center, transportation sector, warehouse, …).
When the company opens its business in a new city, the company follows and implements a ramp-up period for the operations to complete with different gradual phases (see ANNEX 1 for Barcelona). This plan could be modified and adapted locally if some unexpected problem might arise during this process of introduction and if an adaptation or modification is needed for local specific needs or available resources from providers, customers or city infrastructure.
Thanks to their operations systems and information systems organization the company actually prides itself on matching expected delivery times with 10% deviation (caused by transportation delays, pick up rework, labelling mistakes, mistakes on postal addresses, … ) and on matching order requested composition with 5% deviation (caused by mistakes when placing the orders, mistakes of picking up the products, mistakes of picking up the combined orders, …)
QUESTIONS:
Answer the following questions and justify your responses:
1) Describe the service package of this company with all of its elements
2) Describe the physical value chain of this company with all of its elements
3) Describe the virtual value chain of this company with all of its elements
GREAT DELIVERY CORPORATION CASE
4
© COPYRIGHT MANEL ARRIBAS IBAR
ANNEXE 1 BARCELONA’S RAMP-UP PHASES INITIAL PROMOTION NUMBER OF EXPECTED VANS AND MOTORBIKES TYPE OF PROVIDERS OR PARTNERS ORDERING SCHEDULING TARGET/ GEOGRAPHICAL DELIVERY AREA OPERATIONS RAMP – UP PHASES COUPONS GIFTS NEWSPAPERS ADVERTISING SPOTS + COUPONS 2+ 5 RESTAURANTS + GROCERIES WEBSITE + PHONE JANUARY POSTAL CODE 08028 +08029+08021 +08006+08022 +08017 PHASE 1 + LOCAL TV SPOTS ADVERTISING PANELS LAUNCH OF THE PHARMACIES SERVICE 5+ 10 RESTAURANTS + GROCERIES + PHARMACIES WEBSITE + EMAIL + PHONE FEBRUARY ADD EIXAMPLE ZONE (08036, 08011, …) + PHARMACIES SERVICE PHASE 2 HARDWARE STORES AND RESTAURANT COUPONS LAUNCH OF COMBINED ORDERS + NEWSPAPER ADVERTISING 12 + 20 RESTAURANTS + GROCERIES + HARDWARE STORES+ SUPERMARKETS WEBSITE + EMAIL + PHONE + APP MARCH ADD SANT MARTI, HORTA + COMBINED ORDERS PHASE 3 MASS COMMUNICATION LOCAL TV INTERVIEWS REGIONAL TV SPOTS 20 + 25 RESTAURANTS + GROCERIES + HARDWARE STORES+ PHARMACIES + SUPERMARKETS WEBSITE + EMAIL + PHONE + APP APRIL L’HOSPITALET DE LLOBREGAT AND SANTA COLOMA PHASE 4 MASS COMMUNICATION 25 + 30 ALL OF THEM WEBSITE + EMAIL + PHONE + APP MAY ALL OF THE METROPOLITAN AREA PHASE 5
GREAT DELIVERY CORPORATION CASE