Service Solution Design

In order to develop a field service concept for Europe a reverse logistics process (L-HUB) was decentralized. The core of the solution was scalability and efficiency gain without having a negative impact on the customer experience.

Initial Situation

Our costumer, the pioneer manufacturer of smart phones with a focus on customer product- and feature experience, did not have a field service concept for Europe in place. Products returned by customers were simply replaced and defect ones were shipped to the factory for further processing. At an early stage it was evident that this concept would lead to dramatically increasing reverse logistic costs, especially in combination with fast growing sales volume. Therefore, our costumer decided to de-centralize the reverse logistic operations into so-called reverse logistic hubs (L-Hubs). For a successful implementation of the new L-Hub service, a blue print for standardized reverse logistic processes had to be developed. Besides the technical aspects like filtering, routing and repair, the focus of the project lay in the operational requirements:>> flexibility to manage strongly deviating volumes>> scalability for fast increasing volumes>> real-time transparency along the entire reverse logistics chainAs a specialist for developing business and solution models for leading industrial companies of telecommunication and consumer electronics, i-tec was selected to realize the project.

 

Achievements

The ROI was reached within 8 months after successful implementation. i-tec developed an innovative reverse logistic hub concept, which became the reference setup for further European L-Hubs. Key elements of the project were the establishment of a digitally steered screening workflow, an automated service level routing, and an employee qualification program in order to react flexibly on strongly deviating volumes while keeping high quality standards. The proof of value for the developed concept was emphasized by the referenced setup at a logistics provider in the Netherlands.

 

Approach

Apart from an agile project management methodology, the key to successful implementing a project is the stocktaking of all existing processes, a clear objective setting as well as the analysis of the project influencing critical factors such as data, levers and environmental parameters. i-tec uses its variable Solution Design Toolbox, which enables the development and implementation of customized solutions.

TOOLBOX KEY ELEMENTS
01. BI Solution for data analysis by “Tableau”
02. Target Costing
03. Digital Workflow Designer
04. Scenario simulation engine using “Witness”
05. APP modelling engine
06. Web based project management platform
07. Customized SCM analysis tools

The project focused on the scalability and efficiency of its ,solution, but without negatively affecting customer experience. Based on collected data and customer requirements a first draft concept was developed and coordinated with the sponsor as well as with logistics provider. An extended feasibility study identified adjustment requirements regarding workflow and use of measuring technology. Subsequently various scenarios were modeled and simulated. A downstream value benefit analysis and a business case including an integrated investment as well as resource analysis showed the high value of the developed solution.

The next step was the definition of an implementation plan including key milestones. This was aligned with the logistics provider. After setting up the L-Hub a pilot phase and supplementary optimization loops were established. Finally, the L-Hub was transferred to an operative phase and in subsequent steps the concept was rolled out globally.