Answer # 1
The main purpose of Saturn Corporation is to become profitable in the market, however, it is essential for the underlying company to manage its cost effectively in order to become profitable.
It is central for any organization to reform its functions in general in order to cater the provisions of the business effectively. In this context, Saturn Corporation is expected to employ measures that could make it unique from its competitors. Particularly addressing the case scenario, there are several factors and issues that the vehicle transportation team of the underlying company must consider in the process of selection. Some of the major issues and factors are as follows:
Damage rates
It is a vital issue for the underlying company because the damage rate of vehicles cannot be ignored and required measures are to be considered in order to address the problem. The vehicle transportation team provides a deep focus on the prevention of damage rather than to provide a focus on inspection because inspection only identifies the cause of damage. An inspection helps to determine that who is responsible for paying the damage claim, but it does not provide the basic reason for the existence of damage (Xue, Chen, & Chen, 2011).
Transit time
The faster the rate of transit the vehicle in the outlet, the increase will be its sale and ultimately this is very significant for the organization which aims to increase its productivity. The main issue faced by the underlying company is the excess transit time of the vehicles at the outlets. This is the most critical issue faced by the underlying company because the short transit time reduces the opportunity for the company to sell the vehicles in the short time.
Customer service
The other major issue faced by the company is the customer service issue. The fast delivery to the customers helps to enhance the orders of the cars for the company. If the company provides late delivery services to the customers, it will impact negatively on the customers and they will be dissatisfied eventually.
Cost control
The other major issue includes the inbound and outbound logistics cost faced by the company. The prices of the vehicles are too low which has a great impact on the profitability of the underlying company. So the cost of the vehicles is a critical issue for the company.
In order to develop the factors that help to overcome all the issues faced by the company, is a very difficult task and the settlement of the stakeholders is a big challenge for the underlying company. The underlying company has faced the issues related to the stakeholders that need to be resolved. The company has to resolve all the issues before the delivery of the vehicle (Ben-Zvi, Rohmeyer, & Lombardi, 2015).
Answer # 2
Flowchart of delivery process
Event 38 Event 40 Event 42 Event 50
Truck delivery
The delivery truck of the underlying company can easily contain 12 vehicles in a single time. After the production of the car which is the event 38, the emission testing and employee inspection of the vehicle are conducted. If the vehicle is up to the standard, it further proceeds to the carrier which is the event 40. After this process, the driver of the truck loads all the 12 vehicles in the truck. After the loading of all the cars, the supervisor makes the final inspection. After that, the driver of the truck gets the approval to dispatch all the vehicles to the retailers which are the event 42. If the company found that the freight claim is necessary so it filed claims of freight to the GM logistics information system.
Rail delivery
The rail delivery of cars consists of the delivery of 15 vehicles at a time. The cars are parked in a lane of a rail ramp. All the lanes are assigned by the supervisor. It is very difficult for the employees to unload the vehicle from the rail ramp and also it takes too much time. After the loading process of vehicles in the rail, the supervisor takes inspection of the vehicles. After that, the freight documents are prepared and the vehicles are ready to dispatch, which is the event 42. After that, all the vehicles are dispatched to the destination as scheduled by the company. When the vehicles are transported to the destination, then all the vehicles are also inspected and unloaded. If the vehicle becomes damaged, so it is necessary to file the damage report of the vehicle. After that, all the vehicles are released to the drayage carrier which is responsible for the inspection of all the vehicles and reload the vehicles on a truck. Then all the vehicles are dispatched to the retailers of the underlying company. After the delivery of the vehicle to the retailers, the company receives the receipt of its vehicles which is the event 50 (Fischer, Fischer, & Tibken, 2011).
Answer # 3
Delivery method
The process of the outbound logistics includes the combination of the rail and the truck transportation that provides help to the underlying company in order to deliver the vehicles to the retailers of the company. The retailers which are at the distance of within 500 miles from the plant, receives the vehicles through the truck however the other retailers received the vehicles through the rail. The truck and rail transportation are used to move the cars of the underlying company. The company has made several innovative techniques for the delivery of the vehicles. The vehicle transportation team of the underlying company provides a deep focus on the delivery of the vehicles (Baykasoglu & Kaplanoglu, 2011).
The underlying table has discussed the cost of transportation of the vehicles of the underlying company to the retailers. The table shows the different locations of the retailers of the underlying company and the delivery cost to the retailers through the rail or truck. The transit time of truck to all the locations of the retailers is less than from the transit time taken by the rail. The cost per a load of the truck is more than the cost per load of rail in several locations. Only in the places named Baton Rouge, LA, Baton Rouge, LA and Baton Rouge, LA the cost of the truck is at lowest as compared to the rail, but in all the other places, rail is more suitable due to lower cost of delivery. The overall table suggested that the truck is better than the rail, if the company is conscious of the cost. After the analysis of the underlying table, I will recommend to each new retailer to focus on the rail delivery method because it contains the lower cost as compared to the truck delivery. Also, in the areas which are at the smaller distance from the company, it is essential to use the truck delivery because it is less costly and consumes small time as compared to the rail delivery. If the new retailer wants to minimize the outbound logistics cost per vehicle, so he should focus on the rail delivery method as it is more convenient and easy system as compared to the truck delivery.
Answer # 4
Transit time
The transit time of the delivery of the underlying company measures the interval between the event 42 which includes the approval from the company to dispatch the vehicles to the retailers of the underlying company and the event 50 when the retailer of the company received the vehicles. The transit time of the truck is started when the company load all the vehicles in the truck and the supervisor completed the inspection of all the vehicles, however, the transit time of the rail is started when the vehicle load on the rail. The time of transit becomes end when all the vehicles are moved to the retailer of the underlying company.
Transit time of truck and rail
The underlying table has shown all the places of the retailers of the underlying company and the distances of these places from the plant. The places which are below the distance of 600 from the plant, the truck only takes 1 day but the time of rail is greater. The places which are at the distance of below 800, the truck takes only 2 days to reach those destinations, however, the time taken by rail is much greater than the truck. Also, the place which is at the distance of above 1000 from the plant, the truck takes 3 days to reach that place but the rail takes 9 days. So the underlying table has clearly identified that the truck is suitable for the underlying company and takes minimum time as compared to rail. The company has to use the truck delivery because this is much faster and more consistent than the rail delivery. The standard deviation of the transit time of the truck of the underlying company is 0.9 days and the average of the transit time of the truck is 1.3 days. The performance of the truck in the underlying company is very best and takes small transit time as compared to the rail. The average of the transit time of rail is 7.6 days and the standard deviation of the transit time of rail is 2.3 days. The performance of the train is 75 to 80 percent; however, the performance of the truck is 98 to 99 percent.
Answer # 5
Vehicle damage
The damage creates a delay in the purchase of the vehicles because when the vehicles will become damaged, it takes a time to repair and the delivery of the vehicle will be delayed. The damage rate of the truck delivery contains 0.45 percent; however, the damage rate of the vehicles from the rail delivery is 0.92 percent. The driver of the truck is responsible for the damages to the vehicles. It is essential for the company to write down all the damages on the receipt of delivery. Through the truck delivery, the expected damage rate for the new retailer will be 3.2 vehicle damage per year, which is calculated as (720*0.45%); also, the damage of the vehicles by using the rail delivery will be 6.6 which is calculated as (720*0.92%). The above analysis shows that the truck delivery is better than the rail delivery and the new retailers have to consider the truck delivery in order to reduce the damage rate of the vehicles. The truck delivery of vehicles is more consistent as compared to the rail delivery. The damage rate of the truck is $653 to the retailer, which is calculated as (3.2 vehicles x $204) however the per vehicle damage cost will be $0.91 to the retailer which is calculated as ($653/720). The damage rate of the rail is $1584 to the retailer, which is calculated as (6.6 vehicles x $240) however the per vehicle damage cost will be $2.2 to the retailer which is calculated as ($1584/720). So that it is essential for every new retailer to choose the truck delivery method in order to reduce the damage rate.
Answer # 6
Recommendation
After the analysis of the cost, transit time and the damage of the vehicles, it is clear that the truck is suitable for the new retailers. The rail transporters will be impacted by this decision because it will minimize the use of rail in the delivery of the vehicles.
In the underlying table, +1 sign shows the satisfactory and the -1 sign shows the unsatisfactory. After the evaluation of the underlying table, it is obvious that the truck delivery is suitable for the new retailers because it consumes less cost and less time as compared to the rail. Also, the damage cost of the truck delivery is at lowest as compared to the rail. If the new retailer wants to save their cost so they must use the truck delivery services. Also, the truck services will reduce the transit time of the vehicles so that the retailers can easily sell the vehicles without the wastage of the time. The damage rate of the new retailers will also reduce.
References
Baykasoglu, A. & Kaplanoglu, V. (2011). Evaluating the basic load consolidation strategies for a transportation company through logistics process modeling and simulation. IJDATS, 3(3), 241. http://dx.doi.org/10.1504/ijdats.2011.041333
Ben-Zvi, T., Rohmeyer, P., & Lombardi, D. (2015). Strategic Positioning, Centrality and the Impact on Company Profitability. WJM, 6(1), 183-192. http://dx.doi.org/10.21102/wjm.2015.03.61.14
Fischer, C., Fischer, T., & Tibken, B. (2011). The Autonomous Recognition of Left Behind Passengers in Parked Vehicles. SAE International Journal Of Passenger Cars - Mechanical Systems, 4(1), 509-522. http://dx.doi.org/10.4271/2011-01-0582
Xue, Q., Chen, C., & Chen, K. (2011). Damage and loss assessment for the basic earthquake insurance claim of residential RC buildings in Taiwan. J Build Appraisal, 6(3-4), 213-226. http://dx.doi.org/10.1057/jba.2010.23
