Question

Hermès is a pan-European courier company with over 40 years’ experience in the business.
It operates primarily in the United Kingdom, Austria, Germany, Italy, and Russia.
In the United Kingdom, Hermès handles more than 245 million parcels a year. It relies

on the growing “gig economy” employment trend with over 10,000 self-employed cou-
riers and a network of 4,500 Parcel Shops. Hermès provides door-to-door services for

any leading retailers including Next, ASOS, John Lewis, and Tesco.
With a large and disparate workforce, planning and control is the key element in
ensuring that the network remains effective and robust. Hermès needed a way to move
the day-to-day management of their U.K. courier network to decision makers on the
ground. Given the unpredictable demands on th courier network, Hermès needed to

be able to reallocate delivery rounds quickly if one courier was overloaded and an-
other in an adjacent area had capacity to take up the extra work.

In the United Kingdom, there are 1.8 million unique postcode addresses. Hermès
has allocated the 10,000 couriers to a number of these postcodes. The network is,
therefore, extremely granular and subject to enormous changes on a daily basis. While
initially employing a centralized system to create and update courier rounds, Hermès

realized this was time consuming and that the delivery maps produced became out-
dated by the time the couriers started their deliveries. Hermès needed a management-
planning tool to optimize its network and assess what-if scenarios.

In designing the new tools, Hermès decided to opt for a dynamic online mapping
system that allowed them to create, view, organize, and manage the courier rounds.
The key elements include the viewing tools (allowing users to visualize the territories
and courier rounds), the planning and operations tool (allows field management to
change the structure of territories and submit their suggestions for approval), and
the scenario planning tool (allows the central operations team to optimize and model

territories to identify any possible efficiencies to the structure). The new planning sys-
tem enables the 200 field managers to make subtle and real-time adjustments to their

operative areas on a local and tactical level. It also allows the central management a
chance to look at the impact and effectiveness of the changes and then approve the
changes in a matter of minutes.
The key benefits of the new planning tools had a direct and positive impact on the
goals of the organisation. There were operational savings (expenses and delivery costs
were cut) and an improvement in service performance and efficiency. Courier turnover
dropped as network members had a more even workload. It provided a holistic view
of the network, allowed peak planning, and a continuous review of the network. Field
managers can access the system via an iPad and they can make and see their planning
changes immediately.

The new planning system is scalable; so as Hermès continues to grow, they recog-
nize the need to make continuous and significant changes to their network structure.

The system allows Hermès to visualize and identify existing and potential problems
and model solutions for them. The system allows Hermès to pledge that every parcel
entering the U.K. Hermès network by December 21, 2016, would have at least one
delivery attempt, or Hermès would refund the delivery charge.53
DISCUSSION QUESTIONS
8-14. How can a planning and mapping software help Hermès to achieve a 95
percent first-time delivery target?
8-15. How can planning ensure that Hermès continues to meet its delivery targets in
the future and at times when there is bad weather or high peak-demand?

Answer 1

Answers

8-14

In this role, technology is adopted in a manner that promotes and improves the use of technologies even in the area of market distribution, so this would mean that the use of a forecasting and modeling device or tools will be of considerable significance in this context. A good tool for planning and mapping will be like the GIS tools used in mapping places, and so on.

Thus, when it comes to enhancing the delivery transition to a reach target of 95 percent point, it should be noted that planning and mapping software will help to minimize wasted time, this is a technology, so time can be saved in a way.Firstly, mapping all the areas where distribution is carried out is useful, it helps to define the locations in terms of distance and time to be there, this is a very valuable process that can be improved by careful preparation, thereby promoting operation, knowing all the places where distribution should be performed and so on, and therefore the ways in which the program will be more effective and reliable.

Often critical in data collection is the planning and mapping tools, as well as the requisite contextual information as far as Hermes' operations and business are concerned, thereby maintaining protection for the information collected as well as data. This is easy and can be used by simply doing or performing a data retrieval assignment and information is used for any future necessities. As a technical development, however, it is known that work will be made easier, cheaper and quicker than the program used to be applied instantly.

8-15

Planning is management's most significant feature. This function is required at all management levels. This means all organizational activities will become meaningless when planning is not executed. Given the growing size of organisations and the need to ensure that all everyday targets are achieved, both in periods of poor weather and high demand, the value of this role has become more important.

Planning assists in making sure the uncertain future becomes certain. With the aid of preparation potential future improvements are expected and various events are prepared in the best possible way. A sales-target survey can be undertaken with proper planning to find out the rate of customer base expansion. By this way, the organization will optimize its output resources to satisfy potential demand for volumes. Planning also helps to predict times where a particular commodity has high peak seasons. For example, with proper planning, Hermes Company can anticipate that periods of cold months require the production of heavy wool wear. It is therefore in a position to meet high peak jacket and heavy clothing demands.

To Hermes, careful preparation ensures the organization may define its strengths and limitations. Planning will also help them understand their competitors strengths and weaknesses. As that allows them to build a strategic edge over their rivals. Competitive advantage will mean lowering their cost of production and being able to compete on the commodities market. With a deity fighting superiority Hermes will achieve its selling targets.

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