1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
101
102
103
104
105
106
107
108
109
110
111
112
113
114
115
116
117
118
119
120
121
122
123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139
140
141
142
143
144
145
146
147
148
149
150
151
152
153
154
155
156
157
158
159
160
161
162 
management
Page 55
Page 56
If you've noticed an error in this article please click here to report it so we can fix it.
matters by John Darker, AMBIM
Transport and distribution consultants
No 8. British Road Services
Consultancy services introduced by BRS Ltd to buttress its marketing approach may portend similar exercises by other transport operators. Specialist advice yields large savings in distribution.
MUCH INTEREST was aroused when British Road Services, some two years ago, set up a consultancy department to reinforce their marketing attack. If some established consultancy firms were rather unhappy about a development that might seem to smack of State-subsidized competition—a veritable Trojan Horse operating from within the transport industry—many informed observers saw it as a logical development. There were many precedents in industry whereby large firms set up their own internal consultancy division, as an alternative to the regular use of costly outside consultants. What was wrong, therefore, in BRS establishing a well-qualified team of transport experts to examine its own internal administrative problems and the distribution problems of major customers or potential customers?
The BRS initiative has since been taken up by other sizeable transport organizations. It is being considered by one medium-sized contract-hire firm. In State-owned trans. port, "Transmark" is the business name of Transportation Systems and Market Research Ltd, a company formed by the British Railways Board to "co-ordinate, concentrate and develop in a modern image the consultative and advisory services which British railway experts have for many years. been affording to, and sharing with, other transport undertakings all over the world".
Of course, the principals of many transport firms could claim to offer their particular expertise to customers and potential customers. Consultancy services in transport and distribution require staff who are capable of objectively analysing problems to come up with viable solutions. It is unlikely that a working road haulier would have the time to spare from his run-of-themill problems to methodically investigate the distribution problems of a customer firm, bearing in mind the complexity of , distribution today and its interaction with many management disciplines. Road transport, however, is changing fast. The availability of more highly trained staff will alter the picture. Mr Lynn M. Jones, research and consultancy manager of BRS, says the consultancy scheme, which began as a free service, attracted so many inquiries that the policy now is to charge fees. These are "a bit under the market rate at £250 to £350 per consultant week" but fees are refundable if substantial additional business accrues to BRS Ltd as a result. Currently, a number of projects are being undertaken on a fee-paying basis and one or two projects, started some time ago, which are felt to be specially important, are to be completed without fees being charged.
Tough assignment
Inter-factory transport links designed to connect production or assembly plants with clockwork precision and reliablility are a regular feature of BRS operations. One of the toughest assignments dealt with by BRS consultants involved the movement of car bodies made in Birmingham to Midland car factories. The distances involved, with a main traffic stream of a mere 15 miles and subsidiary flows up to 50 miles, were small. Seventy specialized vehicles were employed on the work. The bodies were moved on demountable stillages and a main problem was the prompt return of stillagcs to the body maker's factory. For the operation to be profitable, intensive operation of vehicles and drivers was essential. Practical difficulties often prevented this. The customer was far from satisfied with the service given. BRS was equally unhappy because the operations, tying up a great deal of capital equipment, were u npro fitable.
The BRS consultancy team, with the full co-operation of the other parties involved, closely studied the actual operations. The reasons for poor equipment utili7ation were brought to light when it was seen that the particular car factories were not always in a position to accept the bodies produced to their order. The carrier, as middleman, was being blamed because of deficiencies in the overall phasing of production control—a highly complex business in the car production industry. In effect, BRS provided buffer storage on wheels or stillages and besides being embarrassingly expensive this was demonstrably not satisfying the needs of the factory managements.
The problem did not call for an extensive operational research study, though this approach was useful. Said Lynn Jones: "We couldn't influence the production cycle but we could investigate the causes of production fluctuations."
Control system BRS told the customer executives that an agreed system of control was essential. The carrier must be able to say to a local factory that if any more of a particular body type was tendered for delivery it would jeopardize the production and subsequent movement of other body types needed by other factories. "We'd tried to tell those concerned at working level the consequences of their orders but only when statistics were produced was it possible to get more understanding. We were able to tell the customer management that we could provide 95 per cent cover with the existing equipment and facilities subject only to the introduction of improved control and communications."
This analytical approach is a classic example of the need for intimate cooperation between carrier and customer. It is highly relevant to profitable road haulage operations, especially to hauliers working for large industrial groups operating complex production control systems and with limited warehousing capacity.
In the BRS study it led to a new approach to pricing. There was an appreciation by both sides that initially there had been some misjudgments of the criteria. The quoting of a price per body moved was thought to have been a mistaken approach by BRS. A better approach would have been to raise a standard charge on the specialized equip ment provided, with a smaller movement charge for the bodies.
As a direct result of the consultancy study changes in pricing structure were agreed with the customer. Improved control and communication procedures were introduced. A much friendlier attitude was created. The service given was more satisfactory to the customer and BRS profitability improved.
It should be emphasized that in the district involved, local BRS management contributed their invaluable special knowledge to the improvement in operations sought by the customer. Lynn Jones stresses that teamwork produced the results; it Would be unfair to single out the consultants alone in pointing to the successful outcome. The collaboration of customer executives was equally important.
One of the advantages of the BRS consultancy exercise is that the small team of "resident" experts can be supplemented whenever necessary by adding specialists from the districts. If a problem involves traffic with special problems—and in a sense all traffic does—a person with day-today experience of operating and handling techniques joins the team. Such additions help to associate the district managers with headquarters: there would be much disadvantage to the organization, nationwide, if district managers felt they were likely to be bypassed by direct consultations and investigations by hq-based consultants and major customers.
Canadian study One recent project studied by BRS' consultants concerned road/rail interchange in a large operation. The mechanical handling specialist reviewed the practicability and cost factors in the many alternative systems —gantry cranes, swing lift cranes, fork-lift trucks and side-transfer systems. Consultants spent several days in Canada evaluating the side-lift device ultimately chosen.
So far, no independent haulage contractors have sought the advice of BRS consultants. Mr. Jones thought it unlikely to happen but a specific request for advice would be considered on its merits.
From time to time internal consultancy studies are undertaken, usually at the request of district managers. The problems needing a solution are not, of course, routine ones. There is a long history of internal audit procedures within BRS so the availability of more specialist advice has not created any difficulties with staff at local level.
Of the two dozen or so external projects undertaken since Mr Kieren Fielding launched the DRS consultancy venture in 1969, all have been within the specialized field of physical distribution. Mr Fielding, now BRS head of marketing, still oversees the consultancy work. He and Mr Jones both feel that concentration on a limited field means that high standards of both practical and theoretical expertise are assured.
Method of working
How does BRS consultancy work? Following an initial inquiry from a client, a consultant will visit the firm and spend up to several days reviewing the problems and the extent of consultancy work involved. No charge is made for this initial survey. A proposal is then put to the client outlining the areas most likely to lead to reduced cost or increased profit potential. A typical proposal would be for re-assessing the distribution system from the point of despatch at the factory and would include advising on the following:— El The number, size and location of regional warehouses.
O The means of tninking, whether by own vehicle, contract hire, general haulage or rail.
O The number and location of delivery vehicles, and whether these should be owned, hired, or leased.
O Whether, and where, to use local carriers rather than one of the above alternatives.
O The types and sizes of vehicle, palletization, and handling methods employed.
O The best methods of controlling the operation.
Some clients would not need all these aspects covered, while others might need advice in other areas—for instance, on the operation of warehouses, or on the introduction of work study standards.
Cost estimate The cost of the work is estimated, based on the figure of between £250 and £350 per consultant week, but quoted to the client as a fixed price for the job. Naturally, with consultancy an adjunct of marketing, BRS hope that the additional traffic obtained will justify their waiving fees. Failing that, the new fee-charging will go some way to making the consultancy exercise viable in "cost-centre" terms.
Here are some examples of consultancy jobs: 1. Restructuring a complete distribution system involving hazardous goods in the chemicals field. The scheme recommended will save the client 20 per cent of his distribution expenses.
2. Designing a scheme for providing an oil company with substantial extra capacity for seasonal and emergency work by setting up a pool of specialized trailers, with trained drivers and units available as required. This scheme also offered the client very substantial reductions in cost over previous arrangements.
3. Designing a national distribution scheme for a consumer product which eliminated the need for regional stockholding; this was achieved by intensive operation of strategically based vehicles.
4. Establishing and installing work standards by use of work study techniques for a fleet operated by a client company.
5. Redesigning a complete distribution scheme for an importer of a bulk commodity, involving the design of a completely new road/rail operating concept, and novel systems of unit-load handling.
The foregoing gives an idea of the scale of some consultancy work undertaken by BRS Ltd. None of the projects mentioned could occur without the full co-operation of customer ,firms. It is a reasonable assumption that all sizeable freight transport firms must become more "integrated" with the activities of their customers. Communications will play an increasingly important role. The deployment of spare transport capacity in the most effective manner calls for a greater awareness of industry's and transport's problems and potential.