Reducing Time Required for Order Fulfillment by a Car Parts Distributor

¶ … applying quality improvement tools to an order fulfillment process* Like Americans, Europeans love their cars. When their cars are in need of repair, time is of the essence in completing the repairs and returning them to their owners. This case involves a European car part distributor that was faced with delays in providing replacement parts to car dealerships and repair garages from a European distribution center.

In response, the distribution center manager adopted the "Domino's Pizza approach" by promising all customers that their parts would be delivered within 24 hours or they would be free. In order to accomplish this feat, the distribution center manager formed a team to identify ways to facilitate the order fulfillment process with a goal of shipping 98% of all parts within 24 hours. This paper describes this process, as well as the tools that were used by the team. Answers to a series of key issues for discussion conclude the paper.

A review of the tools used in the case. The team first used a flowchart to identify the manner in which parts were located, packaged and shipped to customers to determine where delays might be introduced. The team used one check sheet per order to track 50 randomly selected parts through the order fulfillment process and noted the various activities involved and time required for each on the flowchart.

The team calculated the average time required for all 50 parts and graphed them to provide a visual representation using a Pareto diagram which revealed picking time was the most time consuming. In order to gain further insights into the potential causes of the suboptimal performance of the order fulfillment process, the team used a histogram to identify the primary clusters of picking times that characterized the distribution center's order fulfillment process. Based on their brainstorming, the team organized their conceptualizations of the constraints to order fulfillment using a cause-and-effect diagram.

Finally, to determine if their intervention (longer pick-up carts for part pickers) was sufficiently effective to satisfy the guarantee for 24-hour shipping, the team developed another histogram of 30 picking times using the longer carts. Although the case study is silent concerning the effectiveness of using longer carts in satisfying the 24-hour shipping guarantee, it does state that the intervention succeeded in significantly improving the amount of parts the company's pickers could pick during a single shift (30.2 orders using the old carts versus 50.6 orders with the longer carts).

Answers to the Key Issues for Discussion listed at the end of the case. 1. Explain how the process the team followed might align with the Deming Cycle and DMAIC. The process developed by the team assembled by the distribution center manager essentially followed Deming's "plan, do, check, act" process, but not necessarily in the order proposed by Deming because the team followed a "check, plan, do, act" process in their approach.

In sum, the process used by this team was more closely aligned with Six Sigma's "Define, Measure, Analyze, Improve and Control" approach because the team defined the problem, took steps to measure and analyze the sources of delay, developed an intervention to improve the process and controlled it by evaluating its efficacy in achieving the desired reduction in time required for car part order fulfillment. 2.

What might the team do if the reduction in order processing time resulting from the introduction of the longer carts was not large enough to achieve the goal of having 98% of the orders meet the 24-hour deadline? There are several steps the team could take to reduce the amount of time required in the order fulfillment process, including installing inspection stations.