A system study on CHA/SE Ventures Incorporated

• Main Author: Masamayor, Michael
• Format: text
• Language: English
• Published: Animo Repository 1999
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/1646
• Institution: De La Salle University

CHA/SE Ventures Incorporated is one of the companies under JAD (a company founded by Jay Bernardo, Allan Reyes, and Dina Bernardo) that warehouses and distributes Pfizer's Animal Health Group (AHG) Products and Pharmaceutical Products Group (PPG) products. The company receives items from Pfizer and keeps them in the warehouse. There are different types of items that require different types of storage. The company also does repackaging of items before delivery. For distribution, the company hires third party forwarders to deliver the items to the provinces. The system study conducted by the group established the problem, 28.06% of AHG deliveries from July 1997 to June 1998 were delayed by an average of 5.11 days . After data gathering and analysis, it was determined that nine significant factors leads towards this problem. These factors include deliveries are consolidated before being loaded to a ship, fixed schedule of shipping vessels, unloading delays upon arrival of ship, forwarder consolidates deliveries to General Luzon, cancellation of trip due to limited shipment, no direct flight, permanent flight cancellation, delayed flight and very short lead times. The proposed solution was to improve the current set of forwarders and adjust the lead times for Visayas and Mindanao deliveries. Increase lead times to Visayas and Mindanao deliveries to a more realistic period and some of the forwarders should then be replaced by other forwarders because they are lagging behind in performance. A system of rewards and penalties can then be instituted to make the forwarder more aware of their performance and make them strive to do better. As the results, for the overland deliveries, delayed deliveries are reduced from 6.17% to approximately 3.06% and for deliveries to Visayas and Mindanao, sea shipment delays are reduced from 53.66% to approximately 8.29% while air shipment delays are reduced from 53.66% to approximately 8.29% are delayed deliveries are reduced from 62.97% to approximately 17%. It is proven that the combination of factors provided by the solution will allow the company to accomplish its objective. There is no significant cost since there is no huge investment or purchase required. Instead the problem is solved by changes in the current policy namely, increasing the current lead times for Visayas and Mindanao shipments and replacing two incompetent forwarders with new ones. Having this new solution, CHA/SE may have some qualitative benefits. They may actually have good relationship with Pfizer and all the customers. Aside from this, CHA/SE will have smaller risk of paying extra cost which is 80% of the value of the item due to damaged products. Implementation of the proposed solution can be accomplished within 3 months. Activities such as meeting with new forwarders, adjusting lead time, and having a test run constitute the major activities related in the implementation process. The group created this implementation plan to ensure the changes are done smoothly so as not to harmfully affect the current system.