Results at a Glance
$2.8M
annual savings
94%
on-time delivery
28%
improvement in warehouse cases per hour
$450K
reduction in carrying costs
Client Background
A regional logistics and distribution company serving the energy sector. The company operates warehouses, manages complex inventory, coordinates transportation, and provides value-added services to oil and gas operators.
Challenge
- Cost Pressure: Customers demanding price reductions while input costs rising
- Operational Inefficiency: Warehouse and transportation at suboptimal productivity
- Inventory Management: Excess inventory in some locations, stock-outs in others
- Lack of Visibility: No standardized metrics or reporting
- Process Inconsistency: Each location operated differently
- Customer Service Gaps: Inconsistent delivery performance
- Safety Concerns: Rising incident rates
FlexTek Phased Approach
Phase 1: Assessment & Strategic Roadmap
FlexTek supply chain consultants conducted comprehensive operational assessment:
- Operational Deep Dives at multiple locations observing warehouse and transportation
- Data Analysis to identify productivity gaps and cost drivers
- Process Mapping from customer order through fulfillment
- Benchmarking against industry best practices
- Stakeholder Interviews with managers and frontline workers
- Cost Analysis building detailed profitability models
- Safety Assessment reviewing incidents and practices
Key Deliverables: Current State Assessment, Opportunity Analysis, Strategic Roadmap with 5 workstreams, Business case projecting $2.5M annual savings.
Phase 2: Execution
Our consultant led end-to-end integration across people, processes, systems, and data:
1. Productivity Excellence:
- Redesigned warehouse layouts to minimize travel time
- Implemented labor standards and productivity tracking
- Introduced lean principles
- Optimized route planning and scheduling
2. Cost Optimization:
- Conducted spend analysis
- Negotiated better vendor rates
- Implemented inventory optimization
- Consolidated transportation routes
3. Service Improvement:
- Implemented order accuracy controls
- Established on-time delivery tracking
- Created customer communication protocols
- Developed service level agreements
4. Safety & Compliance:
- Standardized safety protocols
- Conducted safety training programs
- Implemented near-miss reporting
- Enhanced equipment maintenance
Outcome
- Cost Reduction: Achieved $2.8M in annual cost savings (exceeding $2.5M target)
- Productivity: 28% improvement in warehouse cases per hour; 22% improvement in delivery stops per hour
- Service Excellence: On-time delivery improved from 78% to 94%; order accuracy from 92% to 99%
- Inventory Optimization: Reduced carrying costs by $450K
- Safety: Reduced Total Recordable Injury Rate by 40%
- Customer Satisfaction: Net Promoter Score increased by 25 points
- Cultural Shift: Transformed to proactive continuous improvement culture
- Competitive Advantage: Cost position enabled winning new contracts
Key Takeaways
- Comprehensive Approach: Addressing people, process, and technology holistically
- Hands-On Engagement: Consultants work on the floor with operations teams
- Data-Driven: Decisions grounded in operational data and rigorous analysis
- Quick Wins + Long-term: Balanced immediate improvements with strategic initiatives
