RTPL - Case Study

CASE STUDY
<Logistics>
Industry : Logistics
Segment : Container Carrier Fleet
Pre Engagement Brief
The client is a major fleet owner based in Mumbai with operations at the Jawaharlal
Nehru Port Trust (JNPT) and Mundra port (Gujarat)
Started operations in 1990; Operates as a family run business
Had over 530 vehicles in 2014, all of which are container carriers
Business operations are not much organised and fall

in line with the thoughts of the owners who have a
traditional approach. However, change is slowly
creeping in as the business is in transition to be
taken over by the next generation
Current issues involve slow growth and increasing

cost in (light of increasing competition, market
linked fuel prices and market dynamics as the sector
is majorly unorganised)
SWOT
STRENGTHS
WEAKNESSES
One of the largest fleet owners in West

India
Immature processes; Opportunity driven

organisation
Strong relationships with key customers

and industry stakeholders
Structural and cultural issues
Old and loyal employees
Information technology implemented to

the bare minimum
Micro analysis till last mile of productivity
and profitability, lacking
Dependency on a few big customers
Locational and route limitations
OPPORTUNITIES
THREATS
Containerised business increasing globally
Sector is highly unorganised (even

individuals operating without vehicles)
New ports opening to ease pressure at

JNPT
Rising fuel prices
Government pushing for EXIM hubs to

ease congestion at ports
FDI in logistics in India
Impetus on Make in India
Regulation on privatization of Port-Hub

train operations to ease port congestion
Linking Management Aspirations to the

Key Focus Areas
Pro
Reali
Minimi acti
Expe zatio Custo
Real
ze
ve Financ
nse
n
mer
Time Efficien
accide mai ial
Analy gross Segm
vehi
t
Cost
System
Efficient
nts nte Planni
sis and entati
cle collecti
Opti
Integrati
Purchasi and nan ng
and net on &
Trac on &
mizat
on
ng
loses t ce and
Actio for all Pricin
king recover
ion
custom of Manag
n
servi
g
Syst
y
ers veh ement
Plann ces Strat
em
and us icle
ing under egy
s
taken
Custo
mer
Redu relati
ce onshi
Dete
p
ntion Mana
geme
nt
Business Whats
Profitability
Differential Customer
Service
Inventory Management
Financial Control
H
H
L
M
L
H
H
H
M
M
M
M
M
H
M
H
M
H
M
H
L
M
L
M
L
M
Business Expansion
351
279
279
261
243
243
243
225
225
225
225
225
225
Total
Key Account Management, Relying on Robust

systems and Processes
People, Process, Systems Capability building for
Scalability
Develop Functional and
Individual KRAs
Integrate all IT modules and

link with Financial Module
Develop IT system and

incorporate all functional
modules
Get new business, Hire

Business Development team
Vehicle Monitoring
Inventory and Maintenance

Process
Collections and Recovery

Process
New Customer Evaluation

Process
Create Processes to monitor all

Functions
Pillars of Strategy
Vision 2014
TOP LINE DELIVERY Reduce Credit and Creditor Days
TRANSPARE
NCY
MEASUREM
ENT
MONITORIN
G
IMPROVEME
NT
SUSTENANC
E
Focusing on Business Operations and

Order to Cash Process for improvements
Human
Resource
Time
Money
Vehicles
ORDER TO CASH
(OTC) CYCLE
ORDER
RESOURCE
ASSETS
TCO/
PRICING
IT
IT
INTEGRATION
INTEGRATION
OPERATIONS
MAINTENANC
E
VEHOCLES
CASH
UTILIZATION
Offerings
Customers
Markets
Operation
Segments
Worksho
p
Inventor
y
Efficiencies
Financial Impact
Detailing the Aspirations &

Conceptualising the Core Agenda
Aspiratio
n
1.
Profitabil
ity
2.
Business
Growth
Target Areas
Broad activities
Process Mapping, Cost

Optimisation, TCO Based
Pricing Strategy, Segment
Wise Profitability
Process Mapping And

Improvement, Cash Flow
Optimization, Asset/
Resource/ Consumables
Cost Optimisation,
Operation-pricing
Planning, TCO Model,
Category/ Asset Wise
Profitability Monitoring,
Operational Efficiency
Study
Customers Base And

Acquisition, Operational
Diversification, Offering
Spectrum, Location Planning
And Entry Strategy,
Competitive Positioning, Asset
Growth Planning
Organisation Structure,
KRA, Customer
Identification To
Acquisition, Order To
Cash Process,
Competitive
Landscaping, Market
Gaps, Fleet Growth
Planning, Operational
Restructuring
RESOURCE
ASSETS
IT
IT
INTEGRATIO
INTEGRATIO
N
N
OPERATIONS
ORDER
TCO/
PRICING
VEHOCLES
CASH
UTILIZATION
Inventory Lifecycle
Management,
MAINTENAN
CE
1Business
Structure:
Key Activity Grouping and Prioritization
1
Resource
Resource Efficiency
Efficiency
Resource
productivity
Resource productivity
Structure
KRA
Driver Engagement
Review Mechanism
RESOURCE
ASSETS
IT
IT
INTEGRATI
INTEGRATI
ON
ON
Operational
Operational efficiency
efficiency
Operation
Operation wise
wise profitability
profitability
Customer
wise
profitability
Customer wise profitability
Business segmentation
Vehicle Utilization
Offering/ Pricing
Customer segmentation
Driver management
Review Mechanism
Asset
Asset utilization
utilization
Asset
Asset Downtime
Downtime
Asset
profitability
Asset profitability
OPERATIONS
MAINTENAN
CE
Cost impact
Revenue impact
Vehicle Efficiency
and Productivity
Vehicle Profitability
Transparency
Monitoring
mechanism
Spare
Spare Purchase
Purchase
Spare
Spare Consumption
Consumption
Transparency
Transparency
Vendor management
Purchase process
Inventory life cycle mgm
Job transparency
Maintenance Strategy
Monitoring mechanism
Order to Cash Process Activity Detailing
BILLING CYCLE
1-10 DAYS
1-30 DAYS
ORDER
OPERATIONAL CASH EXPENSE

DAY 0
TCO/
PRICING
VEHICLES
CASH
UTILIZATION
CASH REALIZATION
60-120 DAYS
Cash Flow Management

Order to cash process
Order to Cash time monitoring
Collections efficiency
Payables and receivables strategy

Data recording and management
Collections efficiency improvement
Reducing the detention
Customer Profitability
Vehicle profitability
Paybles
Collating Current Metrics

Some of the Current Activities Studied:
Group Wise Operations, Pricing and Profitability

Customer Wise Profitability
Resource Productivity
Vehicle Wise Profitability
Vehicle Age Impact On Maintenance Cost, Efficiency And Profitability
OTC Efficiency
Cash Flow Gap And Monetary Impact
TCO And Pricing Strategy
Inventory Purchase Process
Inventory Purchase and Consumption Cost
Sample Solution Deployment
Collections process and improvement
We had identified collections as one of the immediate

activity to be focussed on.
Implemented customer segmentation
Implemented reconciliation and collections process

Reconciliation
Communication
Calling
Escalation
Periodic Reviews
IDENTIFIED
PROCESS
GAPS
DEPLOYED
NEW
INITIATIVES
INSTITUTIONA
LISED
MONITORING
PROCESS
Revised JD and modus-operandi of the collection and

billing team
Initiated
reviews
and
institutionalised
weekly
collections
Positive Impact on
Collections
Billing growth 4%,
Collections growth 21%;
normalised collections
growth 9.5%
Some Current Achievements

Inducted
Inducted 95
95 vehicles
vehicles in
in the
the last
last 4-5
4-5 Months
Months
Current
Current estimated
estimated Turnover
Turnover increase
increase of
of 20%
20%
Current
Current estimated
estimated Profitability
Profitability increase
increase of
of 15-18%
15-18%
Collections
Collections Improvement
Improvement by
by 9.5%
9.5% (normalised)
(normalised)
Business
Business expansion
expansion into
into scrap
scrap and
and steel
steel segments
segments
Spare
Spare Inventory
Inventory purchase
purchase cost
cost reduction
reduction by
by Rs
Rs 3
3 lakhs
lakhs per
per month
month
Promoter
Promoter Involvement
Involvement in
in Periodic
Periodic Reviews
Reviews in
in areas
areas as
as resource/
resource/ asset
asset productivity,
productivity,
asset
asset profitability,
profitability, P&L,
P&L, order
order to
to cash
cash process
process
Developed
Developed a
a TCO
TCO based
based pricing
pricing strategy
strategy to
to be
be more
more competitive;
competitive; customer
customer
acquisition
acquisition and
and inventory
inventory cost
cost optimisation
optimisation
Helped
Helped find
find and
and finalize
finalize IT
IT integration
integration partners.
partners.
Devised
Devised the
the executive
executive dashboards
dashboards and
and review
review mechanisms
mechanisms to
to bring
bring in
in transparency
transparency
on
costs
and
efficiency
on costs and efficiency
Devised
Devised the
the optimum
optimum fleet
fleet life
life strategy
strategy for
for optimising
optimising efficiency
efficiency and
and revenues
revenues at
at
minimal
minimal cost
cost
Thank You!!

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CASE STUDY

Pre Engagement Brief

Started operations in 1990; Operates as a family run business

Business operations are not much organised and fall

Current issues involve slow growth and increasing

One of the largest fleet owners in West

Immature processes; Opportunity driven

Strong relationships with key customers

Structural and cultural issues

Old and loyal employees

Information technology implemented to

Containerised business increasing globally

Sector is highly unorganised (even

New ports opening to ease pressure at

Rising fuel prices

Government pushing for EXIM hubs to

FDI in logistics in India

Impetus on Make in India

Regulation on privatization of Port-Hub

Linking Management Aspirations to the

Key Account Management, Relying on Robust

Integrate all IT modules and

Develop IT system and

Get new business, Hire

Inventory and Maintenance

Collections and Recovery

New Customer Evaluation

Create Processes to monitor all

Focusing on Business Operations and

Detailing the Aspirations &

Process Mapping, Cost

Process Mapping And

Customers Base And

Order to Cash Process Activity Detailing

OPERATIONAL CASH EXPENSE

Cash Flow Management

Payables and receivables strategy

Collating Current Metrics

Group Wise Operations, Pricing and Profitability

Sample Solution Deployment

Collections process and improvement

We had identified collections as one of the immediate

Implemented customer segmentation

Implemented reconciliation and collections process

Revised JD and modus-operandi of the collection and

Some Current Achievements

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