Improving Service and Productivity
The specific objectives of the project were to:
- Improve the level of service provided by the centralized service centre to the 25 store locations.
- Improve the labor productivity and reduce the outsourcing costs at the service facility.
- Improve the utilization of the transportation resources and reduce outside courier costs.
- Streamline the activities at the head office.
- Install a management operating system to provide accurate information to enable the front-line managers to problem solve recurring obstacles, and allow the executive team to hold all parties accountable.
Carpedia was brought in to work in the areas of Service, Transportation, and SG&A.
A five month project was undertaken with the Carpedia team working jointly with Stephenson’s management team. The savings from the project resulted in a 2.8:1 ROI. The specific actions taken to achieve the results included:
- Implemented batch washing of rental units which helped increase productivity to 27%.
- Recovered 10% of lost time through pre-staging electrical equipment.
- Reduced the over-servicing of tools.
- Installed a training matrix to cross-train employees.
- Eliminated outside repair costs by increasing capacity in-house.
- Rescheduled routes to recover 33% of the transportation costs at the service centre.
- Established a central dispatch service to help recover the 25% non-value added time among 26 store drivers.
- Reduced outside courier costs by 42%.
- Reduced the duplication of activities resulting in a 9% labor reduction in the SG&A area.
- Linked the “financial” targets to “day-to-day” operational targets.
- Installed a detailed resource plan and daily schedule for the service facility based on actual equipment demand at the retail outlets.
- Installed tools to control the execution of the plan, identify variances, and problem solve variances.
- Installed daily operating reports to measure the performance versus plan on a daily/weekly/monthly basis.
- Setup weekly executive meetings to hold all parties accountable to their numbers vs. the plan.
- Training and developing active management skills resulted in an increase in communication, problem identification and analysis, problem resolution and follow up.
The Client Experience
“Through Carpedia’s unobtrusive work with our management team in the areas of Service, Transportation, and SG&A, we have collectively managed to secure an ROI of 2.8:1, exceeding the promised ROI of 2.3:1. Not only are the savings beginning to be realized, but also the management operating system that was installed has provided us with the ability to drive accountability across our business.”
President, Stephenson’s Rent-All