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A Case Study of XYZ Logistics Ltd.

XYZ Logistics Ltd. is ISO 9001 certified, leading & well known multi-locational company, established 15
years ago, with Turnover of Rs. 100 Crores, (in last Financial Year),providing warehousing services to
various customers dealing in consumer goods. Company maintains warehouses for consumer goods ,
which are hypothecated to local ATM Bank.
Company’s head office in Mumbai, supported by 5 branch offices and 6 warehouses, of which, 2 located
in Mumbai & suburban region, one each at Delhi, Chennai, Kolkata &Vizag employing 200 people
comprising of 50% on Co. payroll, balance on contract and Management Personnel strength being 5 % of
total Manpower.
Presently XYZ Logistics Ltd. is faced with severe Attrition of Personnel on Permanent Payroll and unable
to get Daily Paid temporary Manpower, at short notice, when a sudden spurt increase in In-coming & Out-
going Trucks to/from the Warehouses, for Unloading/Loading of Goods from/to Trucks.
The goods are delivered to warehouse by Goods Producer customers. XYZ company owned forklifts &
trolleys are used for smooth handling and storage of goods. Goods are then delivered to Goods User
Customers at domestic destinations as per the customer requirements, using XYZ Logistics Ltd., own
fleet of vehicles. Of late, pilferage and damage of Goods in transit from XYZ Logistics Ltd., Warehouses
to Door Delivery, to Goods User Customers, has increased and is a cause of concern.
Moreover the Goods Producer Customers are demanding Competitive Rates for Warehousing Facility
Services, whereas the User Goods Customers are pressurizing for early Door Delivery, across the
Country, from the placement of Order to Goods Producer Customer and XYZ Logistics Ltd., is slipping on
its commitments of Delivery too often, resulting in Producer Goods Customers as well as User Goods
Customers Dissatisfaction, which if not addressed to immediately, could affect future Business from
Existing and/or Prospective new Customers.
The Top Management of the Company is determined to show a turn-around in future Business Growth, as
promised to the Company’s Shareholders, in the last A.G.M. of XYZ Logistics Ltd., and has recently
revisited their business Vision, Mission & Values, Quality Policy, Quality Objectives, for a very ambitious
business growth, in the short-term period of subsequent 2 Financial years. The company is aspiring to
cross Rs. 125 Crores turnover target by the end of the second Financial year, taking last Financial year
turnover as the basis for future growth. It is also determined to expand domestic warehouse business by
establishing 6 more warehouses by the end of one Financial year from the base Financial year, and
thereby increase its Market Share from 30% to 50% in Indian Market. Funds for Infrastructure Growth
Expansion Programs are being sourced by Top Management, through Funding Houses.
The Company’s Marketing Intelligence Radar, has forecasted that a threat looms shortly, of entry by an
Overseas Multi-national Company in the Warehousing Business, into the Domestic Market, as a Joint
Venture with an existing Domestic Company in Warehousing Business and is planning for Export
Business from Domestic Shores, not only in Consumer Goods, but also in Food Perishables, viz.,
Vegetables, Fruits & Poultry. XYZ Logistics Ltd., as on date, is by no means prepared, to counter this
move nor pose a formidable challenge to this Business Diversification by this Overseas Multi-national
Company, .
Organization structure has been revisited to meet the challenges for 2 year short term growth by the
Company & fresh recruitment/ existing Personnel transfers, for manning of new Posts Inland, is in
progress, monitored personally by the C.E.O., of the Organization.
While the Warehousing Business in Domestic Market has increased a year ago, and shows promising
upward trends in years to come, it appears that Domestic Competition is also gearing up to grab a bigger
slice of the Market Growth Cake, in the short term period of next 2 years and are poaching around for
competent & talented Manpower as well as existing established Warehouses, available in the Domestic
Market, to achieve their Objectives.
The previous C.E.O. has resigned from the Company, on personal reasons and a new C.E.O. has been
appointed by the Board of Directors, who has taken charge 6 months ago & has been given the task to
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ensure that XYZ Logistics Ltd., shows a turn-around in growth, in the next 2 years, so that sustainability of
Company’s Business is assured.
The new C.E.O., though an Indian Citizen, has been educated abroad and been employed in Overseas
Multi-national Companies, in similar Business as XYZ Logistics Ltd. and has to his credit having achieved
noteworthy Business acumen and Laurels in his 25 years of Service.
Various processes that are taking place in this organization are as below :
1. Marketing :

The department is responsible for responding to customer enquiries such as sending proposals, following
up with them, negotiation & finalization of Contracts, subsequent to review, to ensure that the customer
requirements are understood & agreed to be fulfilled. Contract signing by Organization & Customer, to
this effect, is forwarded to the customer as a token of order acceptance.
The department is also responsible for handling of customer complaints and addressing the concerns by
taking appropriate corrective actions. The customer satisfaction is monitored by carrying out customer
satisfaction surveys.
2. Procurement :

This department is responsible for purchasing of goods and/or services required by the organization. This
includes purchasing of vehicle fuel, maintenance spares& other consumables, pest control services,
contract labour services. The procurement is done from various suppliers & service providers which are
appearing in the list of approved suppliers & service providers. The performance of these suppliers is
monitored & reviewed on quarterly basis. New suppliers & service providers are selected based on their
ability to supply goods and/or services as per the organizations requirements. Appropriate records are
maintained. All Outsourced Activities, are within the purview of this process.
Purchasing requirements are communicated to all the suppliers & service providers through formal
purchase order (PO) document.
3. Operations control :

Goods received are unloaded from the trucks & placed in the area earmarked for goods receipt. These
are uniquely identified by allocating appropriate lot number. The Goods are received in sealed packed
crates and are subsequently dispatched in as is where is condition, without opening the sealed crates, as
per communications received from Goods Producer Customer. Verification of received goods is done to
confirm that these are correct in description &quantity as declared in the accompanying documents such
as packing list & invoice as well as there is no physical damage.. Records of such verification are
maintained in the form of “Goods Receipt Verification Report”. Data collected through such monitoring &
measurement is compiled & further analyzed for possibilities of further improvements.
The accepted goods are then carefully handled by using forklift trucks & stored to ensure no damage.
Damaged goods are appropriately identified & placed in quarantine area before they are returned to the
customers. The goods are delivered as per the order requirements.
The preservation of Goods Producer Customer, in XYZ Logistics Ltd. Warehouses and ensuring no
damage or destruction or pilferage of same, falls within the purview of this process.
4. Equipment maintenance : This process owner is responsible for maintenance of transportation
vehicles, forklift trucks , trolleys, Trucks and is managed by a maintenance executive with one senior
mechanic & a junior mechanic for handling minor preventive & breakdown maintenance. However, regular
Preventive maintenance (PM) & major breakdown repairs are outsourced to approved garage.
Maintenance executive ensures that an appropriate control is exercised over this outsourced
maintenance activity. All statutory/regulatory requirements to carry out Warehousing activity as well as for
operation of Forklifts, Trucks across interstates and Operators, License procurement /renewals, falls
within the purview of this Process.
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5. Equipment calibration :

The organization uses equipments such as weighing balances, thermometers and measuring tapes.
These are being calibrated at a defined interval of 6 months by using external calibration laboratory.
Appropriate records of calibration are maintained. It is also ensured that the equipment calibration is
traceable to national standards.
6. Employee competence & training :

The organization ensures that the people employed are competent to perform the activities. Competence
requirements for each job category are determined. Skill matrix of all the people is maintained. Training
needs of all the personnel are identified during the annual performance appraisal based on which the
annual training calendar is made. Training is given to all the employees as planned. Additional training if
required is given & recorded in the individual employee training data sheet. Effectiveness of the training
given is assessed after one month of the date of the training. Re-training is considered in case of training
not found effective.
7. Control of documented information :

The documented information is maintained, retained & controlled in accordance with the procedure for
Control of Documented information which addresses all the requirements of Clause 7.5.
8. Internal audits

The internal audits are planned & conducted in accordance with the procedure for Internal Audit which
addresses all the requirements of Clause 9.2.
9. Top management functions :

The top management ensures that infrastructure facilities & other resources provided to carry out the
business processes are adequate & sufficient.
The top management ensures compliance to applicable statutory & regulatory requirement which include
renewal & maintenance of business license, transportation permits, driving licenses of all the drivers
&related environmental consents.
The top management has adopted a risk based approach to ensure that the requirements of customers &
other interested parties are always met & exceeded. The risk based approach is detailed out in a
document titled as “Guide to determine business risks & opportunities”. SWOT analysis becomes the
basis for developing “Strategic Business Plan” (SBP). The quality policy & objectives are reviewed &
revised if necessary based on the SBP.
The top management draws annual improvement plan based on the analysis of data collected through
various monitoring & measuring activities that includes :
1. Data on products & services verification
2. Customer complaints & feedback
3. Data on achievement of SBP
4. Data on analysis of risks & corrective actions to address these risks
5. Data on performance monitoring of suppliers & service providers
6. Data on internal audit results

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