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In 1969, Adrian Dalsey, Larry Hillblom and Robert Lynn came up with a way to reduce the turnaround time in as far as the shipping business is concerned; they did this by flying the bills of landing to their ports of destination ahead of time. The company started by transporting documents between the cities of San Francisco and Honolulu. With time, the business grew to become a door-to-door express mail service that served the entire Pacific region. A few years later, DHL began an expansion plan that saw it begin to serve Japan, the Philippines, Australia and Singapore. In 1974, the company began serving Europe, and in 1976, the Middle East was incorporated. Service in Latin America started in 1977 followed by Sub-Saharan Africa in 1978. It was not until 1983 that DHL started developing its network in the United States. Over the years, the company has grown to become arguably the best in its line of business. In December 1998, the company achieved a major milestone when it was named by Global Finance Magazine as the “World’s Most Global Company” (Boberg 2002). This essay seeks to take an in-depth look at the company’s core business and the connection with its capabilities.
Core Processes of DHL
DHL is part of the Deutsche Postal World Net Group, which takes a global approach to sustainability. Despite DPWN’s global approach, individual companies are allowed to develop their own approaches to meet their own set standards, and the Group recognizes its impact on the environment. DHL is a world leader in international express, air freight and overland transport. The company’s business and systems have been developed in accordance with the principles of business process management. The company has employed the use of process modeling in the last decade or so to not only document but also design and communicates its business processes. Just like any other service company, the core product of DHL is a process, and what makes it stand out is how well the company executes the process. Therefore, information is of utmost importance. The company needs information to manage and improve its internal processes. The information is also necessary to enable the company to provide their customers with the opportunity to manage their processes (Smith 2001).
The DHL Process Follows Six Distinct Steps:
- Initiation: this in essence marks the project’s formal beginning.
- Design: this refers to the formal arrangement regarding how the project will be approached, as well as its deliverables.
- Planning: after consensus has been built, what follows next is the creation of a detailed plan.
- Execution: this comes after a detailed planning and preparation process has been carried out. At this stage, the project becomes actualized.
- Closing: at this stage, gradual phase-out and preparation of deliverables take place. .
- Handover: this marks the project’s formal end (Pandey et al., 2008).
DHL’s Customer Satisfaction Process
The company’s core business is excellent service delivery of any given product at any given time and regardless of the location. The company’s provides door-to-door services and comprehensive solutions on a global scale. DHL prides itself on being able to improve its services by bearing in mind the demands of the company’s customers in all the markets that it operates. The group’s success is determined by customer satisfaction, and the success of the customers is inseparable from that of the company. It also aims to develop long-term partnerships with the clients. These partnerships will lead to long-term success for both the company and its clients. DHL prides itself on having adequate knowledge of their clients, the markets that the company operates in, as well as the competition; all the above has helped the company become a trend-setter in the market (DHL).
DHL respects the varied cultural values of the countries they operate in. Openness plays a big role in promoting integration and success of the group. The company relies on facts and analyses to make decisions. DHL also learns from the successes and failures of both internal and external best practices from all the employees. Clearly set priorities also help the company determine further course of action. The priorities include success of DHL customers and overall success of the group, including each organizational group and people involved. To achieve this, cooperation between all the parties involved - both internally and externally - is required (DHL).
The company also strives to act in an entrepreneurial manner; and this is what constitutes the group’s spirit. Individual responsibility is demanded and promoted at all times. One of the greatest pillars of DHL has been their loyal employees; these people are motivated and always strive to perform their best. The company strives to attract, develop and retain such employees. The executives are expected to be top achievers and they should also act as role models in as far as technical and interpersonal skills are concerned. Economic success and individual success are recognized and rewarded. Integrity is paramount in the organization, for it determines the way the people work within the group and also how the company as a whole relates with its business partners, shareholders and the general public. All employees have an equal opportunity for personal development in accordance with individual performance and regardless of gender, culture or religion; discrimination is not tolerated (DHL).
DHL is looking for ways that business process management products can assist in integrating its own services into the services offered by other organizations. The company’s offerings are customer specific and based on the configurations of the basic services of the company. For instance, some customers are offered a DHL-managed ‘return and repair’ service. Poor communication, especially in remote areas, makes it virtually impossible to manage everything centrally, thus causing the company to seek balance. To do this, key process steps need to be identified, while avoiding information overload, especially at the center (Smith, 2001).
The success of DHL can be attributed to local decision-making. Balancing localization support is, therefore, an important design decision. Even though vertical support given functions, core systems are generally oriented towards core process management. Function-specific applications are in a way coupled with a message-based infrastructure, which is responsible for the movement of information between them. As customers demand a more global view of DHL, the government has developed an architecture, whereby vertical task-specific applications are supported by shared information services. The organization has also learnt that process interfaces are necessary to facilitate a separation of concerns, particularly in the design and implementation of specific business processes in a complex environment (Smith, 2001).
Global Facts and Figures
Number of employees: about 285,000
Number of offices: 6,500
Number of aircrafts: 420
Number of vehicles: 76,200
Number of countries covered: more than 220
Number of destinations covered: 120,000
Number of shipments per year: 1.5 billion (Pandey, 2008).
Core Services of DHL
The company combines a range of systems and services in a bid to deliver a response that is globally replicable to the challenges facing inbound supply chain, especially in the automotive manufacturing sector. The strength of the company rests on its ability to come up with collaborative solutions, particularly between manufacturers and suppliers. This enhances agility in the supply chain and enables the group’s customers to concentrate on their businesses’ core areas. Warehousing and order fulfillment operations work to bridge the gap between what the business has and what the business’s clients need. For this to happen, the flow of information must be ideal. This level of control enables one to enjoy such benefits as consistency in operations, reduced investments in fixed assets and the ability to respond rapidly to various changes, especially in demand (DHL Inbound to Manufacturing).
DHL Supply Chain
DHL is renowned for offering fast and reliable express and forwarding services all over the globe. In addition to that, the company is also a pioneer in developing supply chain solutions. The company’s supply chain aims to achieve a competitive advantage that is also sustainable for the customers by ensuring that their products can reach the market in a fast and more efficient manner. It also provides a variety of industry-specific solutions in the entire supply chain. These solutions include planning, production and delivery stages. The company also offers after sales solutions that are guaranteed to work in any environment, regardless of how demanding it is (Supply Chain).
DHL prides itself on having the ability to employ the expertise that the company has in the industry and supply chain. This enables the company to convert complex customer requirements into flexible solutions to instantly meet the challenges of the customers. This makes them understand the issues faced by their customers and also anticipate their logistical needs. The group also offers excellent operations in a manner that is consistent by providing their customers with solutions that help improve their businesses. The commitment to a disciplined approach in quality assurance, performance measurement, continuous process improvement, project and environmental management together with innovation ensures that this company stays competitive in the global market (Supply Chain).
Customers of DHL can rely on the group to tap into their local insight and global scale, thus providing value in every aspect of the company’s supply chain. The company facilitates worldwide sourcing at an affordable cost; furthermore, the solutions also offer support to client companies who are venturing into relatively new markets. The company ensures that its local presence is reliable, while its global reach provides real growth opportunities. Unlike other companies, DHL is a name that can be trusted in all areas of its operation. DHL also has a competitive edge because the group works directly with customers, and in most cases with management teams. This helps many companies relocate from the traditional areas of manufacturing to such low-cost sourcing hubs as China, Eastern Europe, Latin America, and India. The company also thinks from the perspective of customers and works to understand the business and industry operations in order to help them improve their business models. DHL is always informed about local markets and growth trends, and whatever the company learns will be of benefit to the customers, because they offer opportunities and solutions (Supply Chain).
DHL offers transformational outsourcing deals meant to tackle large and critical issues caused by either internal or external factors; these results in increased value for the group’s customers. The customers can benefit from supply capabilities, transformational management skills, as well as a flexible resource base coupled with effective leadership driven by the will to succeed. For the outsourcing to be successful there has to be a strong relationship between the parties involved. The two also have to share a common vision, risks and rewards, goals, as well as incentives aimed at exceeding expectations together with a collaborative approach; therefore, partnership is necessary in such an endeavor (Supply Chain).
Before putting forward a solution, DHL makes a point of understanding the issues underlying the customers’ issues and needs. Businesses may seek solutions to business problems and not necessarily problems regarding supply chain. DHL also helps these companies identify key customers, growth objectives, competitive issues and profitability goals. DHL has over the years come up with numerous innovative solutions, especially in chain management. These solutions are tailor-made and based on models that have been tried and proven to work; these solutions go a long way in reducing the risk, time and time of implementation (Supply Chain).
DHL has invested heavily in technology and complies with the stringent security procedures and industry regulations. The availability of IT visibility tools that offer track-and-trace provides the opportunity to intervene whenever the need arises. In addition, DHL has the technologies, people and infrastructure that are capable of managing end-to-end distribution on a global scale. This creates a ‘zero gap’ supply chain which guarantees quality assurance and product integrity. It also offers visibility together in terms of source and status (Supply Chain).
Interviewee: Principal Architect DHL Systems
Interview Setting: Interview conducted online via Skype at 2:30 PM on Thursday afternoon
(Start of Interview)
Interviewer: What differentiates DHL and its core processes from other companies in the market?
Interviewee: The core product of our company in itself is a process, and the manner in which it is executed is what makes us stand heads and shoulders above the competition.
Interviewer: What would make a company want to work with DHL?
Interviewee: The reasons are many; most importantly, we have the skills, expertise, experience and global reach to cater for all logistical needs of companies, regardless of their size or location. Furthermore, these companies will also be better placed to gain from the exchange of managerial ideas that have been tried and tested.
Interviewer: What challenges does DHL face?
Interviewee: Challenges are numerous but the most prominent one is political instability in some of the countries we operate, especially in the Middle East and North Africa. We have, however, been able to surmount these challenges, and this has provided us with a learning experience.
Interviewer: Thank you for your time
Interviewee: Most welcome.
DHL has proven over the years to be the trend-setter in as far as logistical solutions are concerned. This company owes its current position to the fact that it recognizes global partnerships, employee responsibility and embracing technology. Respect for the various cultures that the company operates in has also led to the success of the company. Moreover, the need to understand their customers and putting the customers’ needs and interests first has played a critical role in the overall performance of the company.