A systems study on the order to delivery process of Unilever Philippines Inc. to a modern trade customer

• Main Authors: Chua, Keith Henrich M., Pujol, Michael Andrew E., Valle, Angelo Gabriel N.
• Format: text
• Language: English
• Published: Animo Repository 2011
• Subjects: Unilever Philippines Inc.; Delivery of goods; Physical distribution of goods > Management; Industrial Engineering
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/10540
• Institution: De La Salle University

The study focused on the order to delivery system of Unilever Philippines Inc. for a particular Gold Account Modern Trade Customer. Unilever manufactures and caters the most popular consumer brands like Sunsilk, Vaseline, Creamsilk, Pond's and others. After careful appraisal and evaluation the logistics department's present system, it turned out that the most prevalent problem of the system is the recurring instances of late deliveries for a particular Gold Account Modern Trade Customer. This led to the group's problem statement which is stated as follows: Unilever Philippines' on-time delivery performance for a particular Modern Trade Customer has reached an average decline of 13.17% (from 95% to 81.83%) from the targeted on-time delivery rating of 95% from the 4th quarter of 2010 until the 2nd quarter of 2011. An estimated penalty cost of Php 9,054,405.11 was incurred from months October 2010 to June 2011. Analysis of the different causes of late deliveries was presented and discussed using different problem analysis techniques and methodologies such as the Ishikawa Diagram, Why-Why Diagram, validation checklist, personal interviews, ad workplace observations. It was identified that the actual later deliveries were caused mainly by six major factors: long truck waiting time (28.57%), long warehouse processing time (22.45%), traffic (22.45%), truck ban schedule (10.20%), truck breakdown (4.08%), and truck accidents (4.08%). Although the focus of the study is on minimizing the late deliveries for a particular Modern Trade Customer, solutions addressing the system's overall late deliveries were also presented. Alternative solutions addressing the system's overall late deliveries were also presented. Alternative solutions were generated to tend to specific problems and were evaluated to come up with proposed solutions. For the long truck waiting time, the use of daily truck scheduling through the LEKIN software was proposed. For the long warehouse processing time concern, the proponents came up with 4 possible mutually exclusive solutions which are stated as follows: dedicated storage area for the Modern Trade Customer, allocation of additional checkers if available, use of automatic stretch-filming equipment, and the use of methods improvement. For the issue on traffic, the proponents propose the use of mandatory checking of traffic updates. For the concern on truck ban schedule, the promotion for the use of delivery vans and 4-Wheeler trucks is advised. For the truck breakdown, implementation of strict regular check-up and maintenance is advised. Lastly for the concern on truck accidents, the proponents advise the promotion of defensive driving and safe driving through periodical seminars. The full implementation of these proposed solutions is expected to reduce the occurrences of late deliveries by 100% which means that there will no longer be any late deliveries to the Modern Trade Customer once these solutions are implemented. The computed net present value (NPV) of the proposed solutions is Php 4,484,020.95. The company would be able to recover its initial investment of Php 1,283,539.07 in 0.25 year or 3 months. Given these values, it can be seen that the proposed solutions are feasible to implement. The solutions can be implemented within approximately 12 weeks of 3 months.