Case Study: Logistics – Beer Segment

LEAKAGEThe Logistics function of a Packaging Supplier finds itself pressured to meet changes to a Customer Finite Schedule, with less than 3 hours notice, at least 12 times per week. Each change causes $1k of disruption cost, worth $624k per annum

CAUSECustomer Plant Managers were seeking to save 1 hour of downtime costs ($6k), during each unplanned Schedule change ($3.2m annually). They acted outside of agreed Service Levels and weren't held to account

ACTIONSupplier & Customer Commercial leaders conduct a joint meeting with Logistics and Operation stakeholders to re-set the SLA benchmarks

RESULTCustomer agrees to pay Logistics costs for any Short Notice changes. Customer and Supplier negotiate a long term value sharing benefit for reducing Finite Schedule "fixed period"

$624k of delivery Leakage