Logistics and Distribution Project - DTDC

1. 1. The Effectiveness of Logistics, Distribution and Customer Satisfaction 1 Amrita

Vishwa Vidyapeetham INTERNSHIP PROJECT 2011 Project done by Avinash Heston,
Student of Amrita University.
2. 2. The Effectiveness of Logistics, Distribution and Customer Satisfaction 2 List of
Figures The following table shows the list of figures present in the research project:-
The Flow of Consignments •Page : 16/26 •Type : Chart •About : It shows the Flow
of consignment from source to delivery point. Factors affecting Transportation
Segments •Page : 20 •Type : Chart •About : Different Factors affecting the
transportation of consignments and their shares. Mode of Loading and Unloading
Preference •Page : 22 •Type : Chart •About : Mode in which consignments are
loaded and unloaded. Main Goal of the Company •Page : 24 •Type : Chart •About :
Employees response to the main goal of the company. Material Damage Source
•Page : 27 •Type : Chart •About : The question 'Where' is answered, keeping the
material damage source in mind. Employee's Needs Satisfaction Scale •Page : 31
•Type : Chart •About : Employee's need satisfaction scale answered in YES/NO.
3. 3. The Effectiveness of Logistics, Distribution and Customer Satisfaction 3 Chapter 1
Introduction 1.1) The Topic „The Effectiveness of Logistics, Distribution, and its
relation to Customer Satisfaction‟ 1.2) Reason for the Selection of the topic
Marketing, based on its definition, is the whole idea of the business. It should not
be assumed as a basic process of sales and distribution alone. The area of Logistics
and Distribution is considered a very important sub-sector of the Marketing
segment. In the current era of business, Customer satisfaction is given top most
priority because customers decide the fate of the product or service, unlike earlier
times where-in the sellers and distributors had a monopolistic control over the
products or service. Therefore, the fate and survival factor of a business lies on the
hands of the customers. When Logistics and Customer satisfaction are taken as
dependant factors, many hidden flaws and facts can be derived, and thus solutions
can be processed and outsourced so as to improve the overall productivity and
sustainability of the Business sector. Hence, the logistics department plays a vital
role in distributing the products/Services to the clients, thus attaining overall
„end-customer satisfaction‟. 1.3) Why is the topic important to the company TO
BUILD A PLATFORM FOR DEVELOPMENT, GROWTH AND INFRASTRUCTURE DTDC
Courier and Cargo Ltd is a service sector company, primarily focusing on Courier
services. It is one of the leading Express distribution companies in India covering
both domestic and international services. A Courier company‟s foremost clients are
its Customers and Customer satisfaction remains a primary priority to the company.
Logistics and Distribution channels play a key role in the functioning of the company
and on-time delivery is the main goal
4. 4. The Effectiveness of Logistics, Distribution and Customer Satisfaction 4 of the
company, which results in client satisfaction. Thus, problems associated with the
distribution and end-customer reactions based on the accuracy of the delivery can
be solved by deriving the link between the former and the latter. The Logistics
department handles the Movement of Goods/Products/Service Packages from one
place to another. It ensures that the goods which are received for delivery are
distributed effectively and efficiently, at the specified time period. Management of
 distribution channels are an essential platform for the company to function in an
optimum manner. 1.4) Learning from the Study The logistics sector itself, is a
competitive yet complicated part of the ever-growing market. It is a third-party
service sector which acts as an intermediary between sender and receiver of
consignments, thus proving it to be an important section in business world. Its
relation with its valued customers promotes its growth and sustainability. It plays a
crucial part in the transfer of goods from one place to another, within the specified
time, thus creating an initiative which does not compromise on the time factor.
Customer relation plays a major key in service sector business since the
functionality of the service should be flexible according to the needs and desires of
the customers.
5. 5. The Effectiveness of Logistics, Distribution and Customer Satisfaction 5 Chapter 2
Organization Profile 2.1) Industry Profile The Third-Party-Logistics provider (TPL) is a
firm that provides a one stop service to its customers of outsourced or „third party‟
logistics services for the part, or all of their supply chain management functions.
Third party logistics providers specialize in integrated operation, warehousing and
transportation services that can be scaled and customized to customer‟s needs
based on market conditions and the demands and delivery service requirements for
their products and materials. According to the Council of Supply Chain Management
Professionals, TPL can be defined as “A firm that provides multiple logistics services
for use by customers. Preferably, these services are integrated or „bundled‟
together, by the provider. Among the services, TPL provides transportation,
warehousing, cross-docking, inventory management, packaging, and freight
forwarding”. 2.2) Company Profile 2.2.1) About the Company and It’s Formation.
DTDC Courier and Cargo Ltd. is one of the leading express distribution companies in
India covering both domestic and international services. Incorporated in the year
1990, DTDC is in its 20th year of operations in India. It has a large delivery network
covering close to 10,000 pin codes giving its customers the best reach in the country.
Its efficient international network spans over 24 global destinations supported by its
own offices in US, UK and Dubai and associate offices in all the important global
destinations. Head quartered in Bangalore DTDC has its Zonal offices in Bangalore,
Mumbai, Delhi and
6. 6. The Effectiveness of Logistics, Distribution and Customer Satisfaction 6 Kolkata
supported by 300 plus own offices and over 4000 channel partner offices spread
across the country delivering over 100 million shipments every year. Company has
the state of art IT infrastructure to support their operations and has built many
customized applications for its corporate clients. Under the able leadership of Mr.
Subhasish Chakraborty, the founder chairman of the organization, DTDC has an
efficient team of management professionals who are working round the clock
delivering value to their customers. DTDC has been innovating constantly to provide
products and services that meet customers current and future needs. Today you
will find DTDC offering wide range of services like Express courier, cargo, end to end
supply chain solutions, Retail services like ticketing solutions, bill payments, Mobile
& DTH top ups apart from Training supply chain professionals through its supply
chain training institute. DTDC‟s Customer profile cuts across the industry verticals
covering banking, insurance, telecom, manufacturing and IT. Company provides
excellent solutions for E commerce business and has capability of seamless
 integration of applications with the customer providing efficient transaction and
database management. DTDC has strategic equity participation by ADAG group.
DTDC plans to consolidate its growth and its vision is to interface with customers
more often in their value chain by offering wide range of products and services.
2.2.2) Business Focus DTDC focuses primarily on Courier services and Cargo
[Logistics] services. It is a service sector company, implementing importance on
satisfying the customer‟s delivery of consignments to its designation, ranging from
documents to heavy freights. The Vision and Mission of the company is as follows:-
a) Vision
7. 7. The Effectiveness of Logistics, Distribution and Customer Satisfaction 7 - To be
the most admired and successful Express Distribution Company in India by meeting
and exceeding our customer‟s expectation of services. b) Mission - To focus on
Customer Loyalty and make it a goal of our organization. - To encourage our people
for adoption of new technologies, processes and systems for improved, reliable and
speedy service. - To relentlessly monitor to reach a minimum net service level of
98% delivery. c) Quality Policy - Satisfied internal customers, external customers
and Business Associates - Continual Improvements in products, processes, services
and quality management systems. - Satisfied, motivated and committed employees.
2.2.3) Some of the clients of DTDC a) The Telecom Sector Clients Airtel Aircel
Vodafone b) Bank clients Axis Bank Citi Bank HDFC Bank BOB c) IT Clients
8. 8. The Effectiveness of Logistics, Distribution and Customer Satisfaction 8 ABB
Bharat Forge BHEL Thermax d) Other Clients Sony Philips Dell 2.2.4)
Distribution Network of DTDC The Company owned branch typically covers a
specific range of pincodes, which have been predetermined for purpose of effective
deliveries. Coverage of the pincode rage is handled by way of assigning a dedicated
franchisee for each pincode, who covers the geographical expanse falling under the
subject pincode. The overall performance of the deliveries for the range of pincodes
assigned is taken care of by the DTDC branch. The company‟s main distribution
network covers places like Ahmedabad, Bangalore, Bhubaneshwar, Chennai, Cochin,
GGR, HHPJ, Hyderabad, Indore, Kolkata, Mumbai, Nagpur, North Delhi, Northern RO,
Patna, Pune, South Delhi, UP. 2.2.5) DTDC’s Products and Services a) DTDC Plus
9. 9. The Effectiveness of Logistics, Distribution and Customer Satisfaction 9 i) Features
of DTDC Plus - Assured Next Business Day Delivery - 100% money back guarantee if
not delivered within committed delivery period. - Tamper-proof Security pouch,
SMS/Email Alerts b) DTDC Blue i) Features of DTDC Blue - Assured Second Business
day delivery. - 100% money back guarantee if not delivered within committed
delivery period. - Service to locations beyond DTDC plus lanes - Tamper-proof
security pouch. DTDC also offers services such as Student express package, DTDC
lite as well.
10. 10. The Effectiveness of Logistics, Distribution and Customer Satisfaction 10 Chapter
3 Research Objectives and Scope of Research 3.1) Problem Definition 3.1.1)
Evaluation of Revenue Dimension of the Logistics/Distribution Department.
Revenue can be defined as the Income of the company or firm. Revenue is required
for the business to grow and diversify, thus enabling the business to attend to its
day to day functions and objectives. The overall profitability of DTDC mainly
depends upon the choice of transportation available for the company such as
trucking, air or by train etc. In DTDC, revenue generation is mainly through the
 transportation and warehousing of consignments for its respective clients. In a
normal company behavior, transportation is regarded as a cost for the company.
Whereas, in case of Third-party-logistics providers, transportation is considered as a
revenue earner as well as a cost for the company, since the cost incurred for hiring
transportation, is thoroughly billed to the clients themselves, during the period of
booking. 3.1.2) Customer Reach, Reaction and Satisfactory levels with the service
provided. For any business to prosper and grow, it requires a source from which
revenue can be derived. And for any profit-making business firm, its main source of
revenue is its customers. In case of DTDC, customers are also termed as
„Consignment Clients‟. While a consignment is received by DTDC Premium services,
it checks whether the pin code of the destination is compatible with its delivery
options. After verification and approval, it will be sent to the designated location,
and within the specified time period. The Time-
11. 11. The Effectiveness of Logistics, Distribution and Customer Satisfaction 11 factor
decides the satisfactory levels of the clients. If the consignment reaches the location
within or at the specified time, the customer will be satisfied with the service and if
not, a complaint is registered and the entire amount paid by the client for using the
service is refunded, if the client claims for it. 3.1.3) Problems related to the Logistics
segments/Distribution channels, such as Domestic and International Segments. The
proximity of problems within the logistics department may vary but it so remains
that the Connectivity issues shares a higher ground, initiating problems in the daily
functioning of the company. Due to human or non-human disturbances, the
performance on the delivery of goods may deteriorate, thus causing problems to
the consignment holders. If such issues are recognized by the company before the
actual delivery, it will be duly notified to the clients in advance. While availing
delivery options like the PEP (Premium Express Products),they develop alternative
solutions or delivery plans so that the consignments reach its destination in or on
time. Even though such alternative solutions are implemented, it cannot be
declared as a fool-proof system. 3.1.4)Matching Branch performance with Delivery
performance. Branch Performance and Delivery performance are two diverse, yet
co-related aspects. The delivery performance mainly deals with the status of the
consignments. All the activities which the consignment goes through, such as
transportation of the goods, delivery to the branch office, reaching the customers,
can be considered as the delivery performance. The branch performance, on the
other hand, includes operations performance, delivery performance, and the
overall performance of the company.
12. 12. The Effectiveness of Logistics, Distribution and Customer Satisfaction 12 3.2)
Objectives of the research project 3.2.1) Primary Objectives TO UNDERSTAND THE
PROBLEMS RELATED TO THE LOGISTICS DEPARTMENT a) To understand DTDC’s
position – Commensurate to market area. Most of the companies consider
Transportation and Travel charges as the company‟s incurred EXPENSES. In case of
Courier companies, such as the DTDC, Transportation and Travel are filtered out as
the main source of REVENUE for the company. Every business firm aims at
maximizing their profits and focuses on the attainment of satisfaction to their
customers with their products or service. Hence, customer satisfaction remains the
main goal of DTDC as well. b) Problems related to international and domestic
segments. DTDC is head quartered in Bangalore, having its Zonal offices in Mumbai,
 Delhi and Kolkata, supported by 300+ own offices and over 4000 channel partner
offices spread across the country delivering over 100 million shipments every year.
The Company has the state of the art IT infrastructure to support their operations
and has built many customized applications for its corporate clients. Although a
perfect, fool-proof system cannot be achieved, the proximity of discrepancies is
although high for such a vast system. This in-turn leads to problems related to
international and domestic segments. 3.2.2) Secondary Objectives TO KNOW THE
SATISFACTORY LEVELS OF THE CUSTOMERS WITH A BRIEF SAMPLE BASE a) To know
the satisfactory levels of the customers. „Customer is King‟; an important saying in
the market world. Customers are the primary organs deciding the fate of the
products and services given out by the
13. 13. The Effectiveness of Logistics, Distribution and Customer Satisfaction 13
manufacturers and service providers. If the customers are not satisfied with the
products which they buy or the services which they avail to, the survival of the
business is at stake and it would be forced to accept closure, due to extensive
losses.
14. 14. The Effectiveness of Logistics, Distribution and Customer Satisfaction 14 Chapter
4 Research Methodology and Limitations 4.1) Research Plan The Research plan is
based on the project topic, „The Effectiveness of Logistics, Distribution, and its
relation to Customer Satisfaction‟. In order to derive the problems related with
logistics, distribution and end-customer satisfaction, the Research plan for the
project mainly involves direct contact with the respective employees of DTDC. DTDC
is a Third-party-logistics provider, mainly concentrating on Transportation,
Warehousing and Delivery of consignments from and to their clients, thus proving it
to be a service based company. Services, unlike goods, are intangible commodities
and hence, services should be rendered with flexibility in accordance with the type
of customer. While involving in a research with a service sector company, one of the
efficient ways of conducting a research is by maintaining a thorough contact with
the employees of the company, as they would be most aware of the problems faced
by the company. Alternative research plans, such as questionnaire distribution and
Telephonic conversations would be implemented, for deeper penetration into the
company‟s root cause of the problems, as mentioned in the Problem definitions.
The following table [table 1.1] shows the basic research plan: [TABLE 1.1: Basic
Research Plans] • To know the present condition of the company in the service
sector. • To know the problems faced by the logistics department of the company
while dealing with its varied customers • To know the employee's opinion about the
logistics department, its functions and the problems faced by it on its day to day
operations. • To enlighten the importance of the Logistics department and its
importance to its customers. • To contact and derive information from the
corporate sector(Top Level management) regarding the functioning of the logistics
department and to enlighten the company's relation with its customers.
15. 15. The Effectiveness of Logistics, Distribution and Customer Satisfaction 15 4.1.1)
Preliminary Investigation - DTDC is a Third-party Logistics provider, providing
multiple logistics services for use by its customers. Preferably, these services are
integrated by the provider. Among the services, DTDC provides transportation,
warehousing, cross-docking, inventory management, packaging, and freight
forwarding. - The main focuses of the logistics department of DTDC are its
 customers, particularly prioritizing the Industrial customers and their large-scale
goods, which is to be transferred by the company to the specified location by the
customer and within the specified period. - One of the primary issues faced by
DTDC is the problem related with transportation. Since courier and logistics services
function with the time factor and have clients who prefer or want their
goods/consignments on time, the mode of transportation and channels are often
given high rank of importance and disturbances in the channels of transportation,
which includes human or non-human disturbances, can be a cause to loss of goods
or revenue for the company. - There exists considerable difference between the
branch performance and delivery performance. - Normal Courier service differ
extensively as when compared to Logistics services, in which the former focuses on
small-scale delivery whereas the latter concentrates more on large-scale delivery of
goods to its customers, mainly the industrial customers. - The restrictions
implicated by DTDC on certain goods/products transfer and delivery such as
Explosives, Gaseous, Flammable liquids, Flammable solids, oxidizers and organic
peroxides, radioactive material, Corrosives etc. Such goods or products possesses
16. 16. The Effectiveness of Logistics, Distribution and Customer Satisfaction 16
hazardous characteristics and are categorized by the IATA in the Dangerous Goods
Regulation. - The following chart [chart 4.1.1] shows the flow of consignments from
one Location [L1] to another location [L2]:- CHART [4.1.1 : Flow of Consignment]
4.1.2) Explorative Study Solution to a particular problem faced by any company
cannot be fool-proof, although the amount of loss can be greatly reduced. Reducing
cost, and at the same time gaining an average above the costs (Profit) can increase
the sustainability,i.e the life of the business and hence promotes growth. When the
scenario of DTDC is considered, the problem lies with its reach to the consignment
clients. If we take a look at the root cause of the problem, Transportation and
warehousing are highlighted, where-in Transportation takes up a larger share in the
root cause of the problem. The issues related to Warehousing extents only to a
particular limit, where the problem lies with the loading and unloading time-gaps,
which would, as a result, disturb the flow of transportation. Hence, transportation
remains the primary problem faced by the company. The major problems related to
Transportation and customer reach are as follows:- FRANCHIS ES-L1 BRANC H-L1
APEX- L1 APEX- L2 BRANC H-L2 FRANCHIS ES-L2
17. 17. The Effectiveness of Logistics, Distribution and Customer Satisfaction 17 a)
Environment Disturbances, leading to breakage in the flow of consignments from
one place to another, be it via Air, Road etc b) Human errors, such as delayed
delivery, which would lead to refund and resultantly, unsatisfied customers. c)
Unloading and Loading time gaps. If the unloading and loading time gaps increase
more than the proposed. Approximated time needed to finish the function; it would
lead to delay in transportation as well. d) Miscellaneous; problems related to traffic,
incorrect address of the addressee etc. When a third party logistics provider is
compared with a normal business firm concentrating on FMCG or other products,
the former needs to imply more attention to its clients because of the direct
customer relationship, which is needed for service based companies, unlike the
latter which approaches intermediaries for distributing its physical products to its
customers. Hence, losses can be greater when a service company is involved with
its clients. In case of DTDC, if a courier doesn‟t reach its destination on time, it
 would result in complete refund, thereby increasing the overall cost of delivery and
also a loss to the company, and finally, an unsatisfied client. 4.2) Research Design
4.2.1) Developing the Research plan : The basic design for researching a Service
sector company is by interacting with the employees and labourers of the company,
and as such, the current research project follows a similar pattern of direct
interaction, such as Personal meetings, group discussion and personal interviews.
With such research patters, direct data can be derived with minimal deviations
regarding the company‟s functionality and sustainability. In order for verifying the
information derived by the methods mentioned, Questionnaire sampling technique
would also be used so as to gain those date which could not be verified with the
main research methods.
18. 18. The Effectiveness of Logistics, Distribution and Customer Satisfaction 18
4.2.2)Collection of Data a) Secondary Data b) Primary Data 4.3) Sampling Plan
Sampling Plan Base points Info Sampling Units 20 Sampling Technique Random
Sampling Method Research Instrument Questionnaire Contact Method Direct
Contact 4.4) Sample Size : 15. 4.5) Data Collection Instrument Development :
Employees of DTDC. 4.6) Research Limitations a) Limited Base Time for the project b)
Vast Geographical coverage c) Extensive customer base Web References Existing
Company reports 3rd party references Personal Interviews Questionnaires Group
Discussions
19. 19. The Effectiveness of Logistics, Distribution and Customer Satisfaction 19 Chapter
5 Data Analysis, Interpretation and Presentation The short yet elaborate sample-
sized research on DTDC‟s current scenario has given a better understanding on the
company‟s basic functions and its major problems related to distribution (Logistics
Sector) of its services to the customers. Every system has a weakness and attaining
stability on the system‟s weakness can lead to correction and sustainable
functioning of the system. DTDC, a service sector company, faces problems related
to attainment of an effective system, which can reduce the risks and additional
costs faced by the company on its day to day operations. 5.1) About the Research
The key areas of research focus mainly on the problems faced by the company,
particularly the problems in the company‟s logistics sector and its customers. The
Logistics sector is the developing wing of the company and hence, enlightening the
problems which can possibly occur in such a sector would and possibly could
improve its growth rate and sustainability. Since courier companies face stiff
competition, it has to look into the cracks in its operations and fill them up before it
loses out its potential and existing customers. Efficiency can only be attained by
developing a system which can be closely related to a „fool-proof system‟. 5.2) The
Research Output 5.2.1) Factors affecting Transportation of Consignments.
Transportation for DTDC‟s consignments holds the largest share of risks. It is also
the area which contributes, on a large scale, to the company‟s overall revenue.
Larger the risk, possibility for earning higher profits remains high, even though a
loss might have double the effect on the company‟s operations and its reputation.
The Problems pertaining to the distribution channels increases the chances of loss
for the company. If the company loses a client, the loss remains permanent due to
non-attainment of satisfaction by its customer. According to the questionnaire
20. 20. The Effectiveness of Logistics, Distribution and Customer Satisfaction 20 analysis,
it is observed that out of all the distribution errors such as Environmental
 disturbances, errors caused by man, unloading and loading gaps, Human errors
cause most of the problems in the transportation and distribution of
services/consignments to its prospective customers. Human errors mostly occur in
the Transportation of the consignments to its designation. An automated system for
transportation and distribution of consignments is a cost-intensive approach and
hence, the company follows manual labour, thus cutting down the costs as when
compared to an automated system for handling the consignment. Perfection cannot
be attained in manual labour since this type of work is done by human hands.
Hence, problems such as improper timing of consignment arrival or departure,
improper verification of address of the customers etc, lead to possible loss and
damage, thus threatening the company‟s reputation. CHART [CHART 5.1] shows the
different factors affecting the transportation segment of the company:- [CHART 5.1]
0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 Environmental Disturbances Human Errors Unloading
and Loading Gaps Others
21. 21. The Effectiveness of Logistics, Distribution and Customer Satisfaction 21
According to the table, Human errors cause most of the problems in the
transportation segment, followed by the discrepancies occurring in the unloading
and loading gaps. Under the unloading and loading gaps, both machine and manual
labour occur simultaneously. The Loading and unloading gap refers to the time
period between receiving, directing and sending the consignment to its prescribed
location. The company fixes a time during which the consignment should be
received, processed and sent to the next transit/ultimate customer. When it is not
processed nor sent or delayed, it causes problems in transportation of
consignments since the customer would be unable to receive his goods on or before
time. Hence, unloading and loading gaps play an important part in the
transportation sector and discrepancies can lead to possible loss of consignment
and its client. 5.2.2) The Loading and Unloading Cycle Preference One of the most
important sectors in distribution is the Loading and Unloading sectors. It is here
where the consignments are received from different branches/apexes. Once the
consignments are received, the address of the addressee and related information
are processed and once this process is over, the consignment is transported to its
client/customer who awaits its delivery. The time between the loading and
unloading cycle is called the Time Gap and this time is the most crucial time factor
for the company. Any discrepancies occurring under this Time Gap can lead to
possible delay or loss of consignment, thus a loss for the business enterprise. Some
of the Courier companies such as DHL, Fedex etc, use extensive automated system
for loading and unloading of consignments, thus reducing the amount of human
errors, even though the initial cost for setting up a high tech solution for their
consignment handling, is particularly very high. Such automated systems are
prominent in Europe and other developed regions. DTDC, being a leading domestic
courier and cargo company, It applies its focus on a system which gives more
priority to labour rather than a complete, automated system for the handling of
consignments. a) Positive Aspects of a labour intensive approach:- - Adaptable to
change - Labour intensive approach leads to reduced costs.
22. 22. The Effectiveness of Logistics, Distribution and Customer Satisfaction 22 b)
Negative Aspects of labour intensive approach:- - Human errors are comparatively
prone as when compared to automated machine work. - The Labours are able to
 perform the work as per directions but are not aware of the question such as „why
are they doing it‟ The Chart [chart 5.2.2] given, shows the preference of employees
on the basis of the mode of Loading or Unloading systems. [CHART 5.2.2] According
to Chart [chart 5.2.1], a majority of the employees prefer manual labour with a
semi- automated system. This increases the adaptability and acceptability of the
system. When such a mode is initiated for the loading and unloading cycles, it will
lead to considerable reduction in cost as when compared to a fully automated
system. When a change is required in the existing system of loading and unloading,
the change can be accepted easily and adapted due to the 0 1 2 3 4 5 6 7 8 Mannual
Labour Automated System Mannual Labour with Semi-automated system Others
Loading and Unloading Cycle System
23. 23. The Effectiveness of Logistics, Distribution and Customer Satisfaction 23
presence of the manual labour. Thus, such an approach will lead to efficiency and
adaptability due to the presence of both Manual labour and a semi-automated
system (System which is operated partially by the existing labour force). Minority of
the lot has selected the option of Manual Labour and none for an automated
system fearing very high initial cost for setting up of the machines and related
accessories. 5.2.3) the Main Goal of the Company A Business firm‟s main aim is to
attain maximum customer satisfaction. Since it is the era of „Customer is King‟,
customer‟s interests are given more priority as when compared to older beliefs
such as „Monopoly‟ or „Maximum Production‟. A firm‟s well-being lies in the hand
of its customers. A firm, when found to be producing a product or service below the
customer‟s expectation, it will lead to loss in business and hence result in a
complete shut-down of its activities, because of the fact that it cannot generate
revenue from its activities, due to dissatisfied customers. Henceforth, most of the
companies fix their primary goal as „Customer Satisfaction‟. Even though when a
company selects such a primary goal, there is always a hidden goal. The hidden goal
of the company can be regarded as their primary goal, even though it is not
mentioned in their mission or vision. It can be only understood only when a
researcher works within the company premises, thus understanding its true goal
and actions taken to attain them in accordance with their exposed goal.
24. 24. The Effectiveness of Logistics, Distribution and Customer Satisfaction 24
According to the given CHART [CHART 5.2.3], DTDC‟s main goal is customer
satisfaction, like any other business firm. This is just the exposed goal. Most of the
correspondents have selected „customer satisfaction‟ as their choice, in reference
with the goal of the company. But some of the employees have also selected
„Customer satisfaction & reduced costs‟ as their choice. This enlightens the fact
that a company may possess a hidden goal, which can also act accordingly with its
primary goal. In case of DTDC, the hidden goal is to reduce the costs incurred by the
company, while meeting the needs and wants of its customers. A company can give
its priority to its customers but it cannot abandon the fact that costs are being
incurred for meeting the needs and wants of the customers, and for its day to day
operations. Thus a company must look out for itself, in order to ensure its
sustainability. A company such as DTDC, has its customers to attend to, but at the
same time, it should also ensure that the costs are reduced so as to impute to their
future growth and survival. 0 1 2 3 4 5 6 Maximum Revenue Customer Satisfaction
 Reducing Costs Customer Satisfaction & Reduced costs 0 6 1 4 Main Goal of the
Company
25. 25. The Effectiveness of Logistics, Distribution and Customer Satisfaction 25 5.2.4)
Material Damage Source Before getting into material damage source, we should
know about the company‟s basic structure through which the materials passes on.
The DTDC Company is divided into 3 different function based segments which is as
follows:- a) Franchises – The Franchise sector is the place where the consignments
are booked by the company‟s clients. The delivery of the consignments is also done
in the franchise sector. Hence, it can be concluded that the franchise sector forms
the lower management level of the company, on the basis of decision making and it
forms the highest level of management, on the basis of consignments delivery and
booking. b) Branch(can be a Transit) – The Branches of DTDC are responsible for
receiving the consignments from the franchises and then sending it to the nearest
Apex sector. The branch also performs a reverse function where in the
consignments, which have already passed through the chain of segments in a
different locality and which is to be delivered in the current chain, are delivered to
the concerned franchises for final delivery of consignments. It forms the middle
level of management. c) Apex – The apex sector of DTDC is where the consignments
arrive and are sorted out for final delivery. It is here where the goods are received
from the branches of the consignment origin and are sorted out for delivery, as per
specification of the client (The clients submit the necessary details at the franchises)
and are finally sent to the Apex of the locality where the consignment is to be
delivered. d) Corporate Office – It is the head office of DTDC, where Policies and
plans are made and given for implementation. It forms the highest level of
management of the company. It does not indulge in the physical functioning of the
courier but derives policies, procedures and plans for better functioning and growth
of the company.
26. 26. The Effectiveness of Logistics, Distribution and Customer Satisfaction 26 The
Following figure shows how the consignments travel from one area to another.
[FIGURE 5.2.4 A] Material damage can occur in an automated system as well a
manual system comprising of labour. The damage can occur due to several
environmental factors as well. The magnitude of damage varies with each situation.
Even when the organization structure is taken into consideration, damages can
occur either in the branch, or in the transits etc. There exists no fool- proof system
which can avoid all types of damage. Hence, measures can only be taken to reduce
the risk of damage or to counter with the situation when damage occurs. In DTDC,
the consignments travel through different branches, apexes and transits to reach its
final destination. While the consignment passes through different levels, there are
high possibilities for the consignment to attain damage, due to improper handling
of consignments. According to the given chart [Chart 5.2.4 B],
27. 27. The Effectiveness of Logistics, Distribution and Customer Satisfaction 27 [CHART
5.2.4 ‘B’] 80% of the employees have agreed to the fact that most of the
consignment damage occur in the transit areas. It is not because of the improper
functioning of the transit, but due to the increase in the number of loading and
unloading cycles. When consignments pass through a large number of transits
before reaching its destination, it has to be unloaded and again loaded to the
designated truck/plane etc. When the consignments are loaded and unloaded,
 material damage is likely to occur, thus leading to temporary or permanent damage.
Most of the employees recommend reducing the number of transits so as to avoid
material damage. Reducing the number of transits reduces the number of loading
and unloading cycles, thus reducing the risk of damage. 80% 5% 5% 10% Material
Damage Source Transits Apex Franchises Branch Offices
28. 28. The Effectiveness of Logistics, Distribution and Customer Satisfaction 28 Chapter
6 Findings, Suggestions and Conclusion 6.1) Findings based on Research 6.1.1)
Findings about the Company a) DTDC, i.e. Desk To Desk Courier, is a third-party
logistics and courier provider, providing customized courier services to its clients,
giving high importance to the time factor. The company focuses primarily on
satisfying at least 98% of its consignment deliveries to be successful in a fiscal year,
and thus, this remains as their primary goal, indirectly indicating a high customer
satisfactory level. b) The company satisfies a majority of its customers/clients with
its renowned, premium products such as DTDC Plus and DTDC Blue. It also focuses
on normal-income clients with products such as DTDC Lite. c) Normal business firms
follow a downward-flow trend where-in the ideas and concepts are passed on from
the top level management to the lower levels in the management hierarchy. In
DTDC, there is an upward-flow trend where-in the ideas are taken from the lower
levels of the management to the higher levels. Such a system is necessary due to
the fact that the lower levels of the management are comparatively more closely
inclined with the company‟s customers. Since it is a service sector company, it has
to adapt itself with the changing consumer needs and requirements and hence, the
lower levels of management are the ones who are more aware of the real market
situation. d) According to the observations based on the sample, the Employees of
the company are satisfied with their workloads given by the company. Hence, the
company has a healthy working environment, although in certain cases the
29. 29. The Effectiveness of Logistics, Distribution and Customer Satisfaction 29
employee‟s needs or wants are neglected due to priority of business goals over the
employee‟s personal objectives. e) Service Companies often rely on their
customer‟s feedback so as to bring in changes, thus leading to a much better
platform for effectiveness. DTDC spares no expense in considering the feedback
from its valued customers, although the cost incurred by the business is also taken
into conclusion. In Short, It follows „Customer Satisfaction with reduced costs‟. f)
The overall functionality of the company is good, although improvements can be
made so as to attain the status of „Optimum functionality‟. 6.1.2) Suggestions as
per Sample Observation a) Suggestions for the developing Logistics sector -
According to the observations, the logistics sector of the company has commenced
on its business, starting off in the year 2010. Even though it just started off with its
functioning, it faces stiff competition from companies like TCIXPS, Gati and Safe
Express. Developing the basic infrastructure for a strong foundation would be a
start. - In the current Scenario, the company uses manual labour extensively and a
mechanical system to support its labours. This leads to an increase in consignment
damages due to human errors. Developing an automated system would bear high
initial costs but in the future run, it can reduce possible loss for the business firm,
since mechanical errors are comparatively lower. For example, The weighing of
Consignments is manually done, thus increasing the time taken for consignment
 processing. Even though an automatic system for weighing the consignment is
developed and bears a high initial cost tag, it would in-turn reduce the time
30. 30. The Effectiveness of Logistics, Distribution and Customer Satisfaction 30 gap
between loading and unloading, thus enabling a more precise and on- time delivery.
b) Suggestions for the Company as a whole - Staff related learning programmes
should be given more importance (referring to the labour force) since human errors
are the most prominent problem causing factor in the unloading, loading and
transportation of consignments to its customers. Hence, steps should be taken so as
to improve the knowledge of the staff regarding basic precautions regarding
consignment handling and verification. This step can improve the staff‟s knowledge
and thus, reduce the risk coming under Human errors. - One of the primary
problems which the company faces is the distribution channel problem, basically
regarding transportation of consignments. Even though there exists no fool-proof
system for avoiding all barriers while transporting the consignments, effectively
utilizing technology (giving more importance to technology), such as the GPS system
for traffic based reports can be commenced so as to avoid blockage in consignment
delivery. Such a system would also provide immediate alternatives so as to avoid
possible consignment non-delivery and thus, avoiding loss for the company. This
leads to an increase in customer satisfactory levels and also earns revenue for the
business. - It has been noted that as the number of transits increase, the risk of
consignment damage is high. When consignments are loaded and unloaded more
number of times in different transits, it can lead to consignment damage, either
permanent or temporary. Reducing the number of transits can avoid material
damage.
31. 31. The Effectiveness of Logistics, Distribution and Customer Satisfaction 31 - A
company would remain empty in majority if its employees are not present.
Employees form the backbone of any company. They are responsible for the growth
of the company. Hence, the employee‟s needs and wants should also be satisfied so
as to gain employee support, which would be beneficial for the company as a whole.
The Company should make sure that the employee‟s needs should be molded in
such a manner that it goes in tune with the company‟s objectives and goals.
Monetary and Non-monetary incentives should be given so as to boost the
employee‟s working ability. The Chart below shows the information provided by
the employees of the company. [Chart 6.2.1] [CHART 6.2.1] A company would
always have to face risks, either externally or internally. But more the risk they face,
their possibility for earning higher profits also increases. Every factor, either a minor
or a major factor, must be taken into consideration so as to bring out the full
potential of a company, thus reaping essential benefits for its sustenance in the
growing industry of business. 0 2 4 6 8 10 Yes No Are Employee needs satisfied?
32. 32. The Effectiveness of Logistics, Distribution and Customer Satisfaction 32 Chapter
7 The Limitations 7.1) Project Limitations The Time period for the project given was
narrow, thus restricting further and detailed analysis of the company‟s functioning,
environment and its prospective markets. Continuous verification and clarification
of project related queries were possible, but only to a certain extent due to
communication barriers. A constant methodology could not be adopted due to the
variances in the project analysis, due to the fact that the project research was duly
based on a service sector company. DTDC is a domestic and international courier
 service company. Hence, the sample size required to conduct the research was
rather large. Due to restrictions, a smaller sample size had to be proposed, which
does not give the exact environment of the company‟s operations and its customer
satisfactory levels. 7.2) Company Limitations Due to the Intern tag, certain areas
such as Company Operations meeting etc were restricted.
33. 33. The Effectiveness of Logistics, Distribution and Customer Satisfaction 33 DTDC
has a large number of branches, apex and transits. In order to individually research
on their functions, the time period given for completion of the project was not
sufficient enough. Working hours had to be adjusted due to the location of the
branch, which was assigned for the research. Detailed analysis on the customer
base and customer satisfaction was not possible due to a large customer base.
34. 34. The Effectiveness of Logistics, Distribution and Customer Satisfaction 34 Chapter
8 References / Bibliography 8.1) Sample Questionnaire QUESTIONNAIRE By Avinash
H, Student of Amrita University. DTDC RESEARCH PROJECT Employee Name :
________________________________________ Employee
Occupation :_________________________________________ QUESTIONS JUST
FOR YOU (?) 1) Does the company satisfy a majority of its customers? A) Yes B) No 2)
Are you comfortable with your daily workloads? A) Yes A) No 3) Does the company
give priority to its employees needs? A) Yes B) No 4) Do you think distribution
channel problems, related to transportation, can be minimized? A) Yes B) No HOW
(if yes):
35. 35. The Effectiveness of Logistics, Distribution and Customer Satisfaction 35 5) Is
customer satisfaction the ultimate goal of the company? A) Yes B) No 6) Do you
think setting-up more branches would boost the company’s revenue, rather than
relying on franchises? A) Yes B) No 8) Is the Company working on its optimum
functionality? A) Yes B) No 9) Are customers feedback taken into consideration by
the company? A) Yes B) No 10) Which of the following shares a larger pie on
problems affecting the company? A) Transportation B) Warehousing 11) Which of
the following factors, under the transportation segment affects its functionality the
most? A) Environmental Disturbances B) Human Errors C) Unloading and Loading
Gaps D) Miscellaneous Please Mention, if your option is D :
36. 36. The Effectiveness of Logistics, Distribution and Customer Satisfaction 36 12) If a
consumer is not satisfied with the products/services provided by the company,
which type of company gets most affected with the situation as mentioned? A)
FMCG Companies B) Service Sector Companies C) Government Organizations D)
Others(Please Mention) : 13) Which Factor is given the highest priority in relation
with Customer Reach? A) Franchise booking agent’s behavior to its clients B) The
Time Factor, starting off with Booking and ending with Final delivery C) Policies
made by the corporate office based on previous year’s performance D) Loading and
Unloading Cycles. 14) Which combination of work-force works well with the
company’s requirements for loading and unloading cycles? A) Manual Labour B)
Automated System C) Manual Labour with a Semi-automated system D) Others
(Please Specify): 15) Possible material damage happens in the __________ . A)
Transits B) Apex C) Franchises D) Branch Offices
37. 37. The Effectiveness of Logistics, Distribution and Customer Satisfaction 37 16) Will
the event ‘PEP 20-20’ bring a boost on the company’s overall functionality? A) Yes B)
No 17) Which factor, out of the ‘uncontrollable’ situation, affects the daily
 operations of the company? A) Harsh weather conditions B) Political Issues C)
Traffic D) Government Policies 18) To improve Customer satisfaction, which of the
following options can be initiated? A) Increasing the number of Franchises in
different parts of the domestic area B) Increase the number of hired vehicles C)
Initiate more line of products which enhance speed and accuracy in delivery D)
Initiate more number of owned offices of the company in different localities for
better reach. 19) Should staff-improvement programmes be given higher priority, as
when compared to the current scenario? A) Yes B) Not needed 20) Main Goal of the
company, according to you. A) Maximum Revenue attainment QUICK THINK
38. 38. The Effectiveness of Logistics, Distribution and Customer Satisfaction 38 B)
Customer Satisfaction C) Reducing costs to attain marginal profit D) Attaining
Customer Satisfaction with reduced costs. 8.2) Web References
www.wikipedia.com • Search Query : Courier/Marketing/Logistics • Information
about : What is courier?/Logistics www.google.com • Search Query : DTDC •
Information about : Desk To Desk Couriers www.dtdc.in • Search Query : Company
Profile and related info. • Information : Co Profile/Industry
Profile/Products/Services/Vision/Mission.