Walmart Raises the Stakes for Supply Chain Reliability

Walmart Raises the Stakes for Supply Chain Reliability

February 19, 2018

Walmart has raised the stakes for supply chain reliability. Its new on-time, in-full delivery guidelines (OTIF) were rolled out in 2017, with escalating requirements for 2018.

Both early and late deliveries get the thumbs down; failure to meet the metrics results in the supplier being fined 3% of the value of their order.

Requirements vary, depending on whether the shipment is a full-truckload or less-than-truckload (LTL) shipment. But either way, suppliers and 3PL’s cannot use weather or other uncontrollable events as acceptable reasons for failure to deliver in full and on time.

This post is based on the Supply Chain 24/7 article, Keeping Pace with Walmart’s On-Time Delivery Requirements, by Scott Bolduc, February 5, 2018. 

Discussion Questions
1. Assume that you are responsible for designing a lean supply chain for a supplier to Walmart. Find a company that supplies packaged water to Walmart from an internet search.  (Or find another company that supplies Walmart if you choose.)  How would you improve the supply chain to become lean to meet the demands Walmart has now imposed for suppliers such as your chosen company?

Guidance: Students should review lean supply chains, facility location considerations, and the Continue reading

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Teamsters Say No to Driverless Delivery

Teamsters Say No to Driverless Delivery

February 2, 2018

UPS and the Teamsters have opened contract negotiations.  Their last contract was signed in 2013, at the start of the online retail boom.

In light of the large growth in deliveries from online store like Amazon, UPS is looking to add flexibility in this contract to allow competition against other delivery organizations, and meet the increasing demands to speed up delivery of goods.

However, the Teamsters’ initial demands are to prohibit UPS from using drones or driverless trucks. Also, they want to eliminate deliveries after 9:00 pm (including the Christmas delivery season), and hire an additional 10,000 employees.  UPS has added approximately 40,000 employees over the last five years.

This post is based on the Fox Business article, Teamsters Tell UPS: No Drones or Driverless Trucks, by Paul Ziobro, January 24, 2018. 

Discussion Questions
1. Should UPS consider the demands of no drones and no driverless trucks in contract negotiations?

Guidance: Collective bargaining is a difficult process.  Unions typically want to protect their membership, and expand if possible the number of union jobs.  This is exactly what the Teamsters are demanding with these provisions.

Management always wants to provide as much flexibility Continue reading

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