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Sample Cost of Quality Calculations

Calculating the cost of quality is a tricky task. This article offers example calculations and perspectives from other organizations attempting to quantify the value of quality within their businesses.

Type: Benchmarks and Metrics  Topics: Quality Control, Business Excellence, Quality, Measurement, Measurement, Quality Assessment, Quality Measurement  Processes: 1.1.3.2 Create baselines for current processes, 1.1 Define the business concept and long-term vision, 1.1.3 Perform internal analysis, 1.1.3.3 Analyze systems and technology, 1.3.4 Establish high-level measures, 1.0 Develop Vision and Strategy, 1.3 Manage strategic initiatives, 12.1.1.1 Establish performance measures, 12.1 Create and manage organizational performance strategy, 12.1.1 Create enterprise measurement systems model, 12.1.1.2 Establish performance monitoring frequency, 12.1.1.3 Set performance targets, 12.2.1 Conduct performance assessments, 12.0 Manage Knowledge, Improvement, and Change, 12.2 Benchmark performance, 4.1.9 Develop quality standards and procedures, 4.0 Deliver Products and Services, 4.1 Plan for and acquire necessary resources (Supply Chain Planning), 4.2.4.4 Monitor quality of product delivered, 4.2 Procure materials and services, 4.2.4 Appraise and develop suppliers, 4.4.4 Ensure quality of service, 4.4 Deliver service to customer  Industry: Aerospace, Computers, Construction, Electronics, Machinery, Machinery Equipment, Mining, Non-Profit, Research Organization, Semiconductors, Service (General) 
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Big Changes Can Lead to Big Results

The pharmaceuticals division of Reliance Industries had an inefficient physical distribution process that was resulting in financial losses.

Type: Articles and White Papers  Topics: Process Reengineering, Business Excellence, Process, Shipping, Supply Chain Management, Logistics, Supply Chain Planning, Distribution, Order Management, Inventory Management, Process Improvement, Warehousing, Outbound Transportation  Processes: 4.1.5.3 Determine finished goods inventory requirements at destination, 4.1 Plan for and acquire necessary resources (Supply Chain Planning), 4.1.5 Plan distribution requirements, 4.0 Deliver Products and Services, 4.1.5.8 Calculate destination dispatch plan, 4.1.1.3 Define outsourcing policies, 4.1.1 Develop production and materials strategies, 4.1.5.9 Manage dispatch plan attainment, 4.1.6.3 Establish transportation management constraints, 4.1.6 Establish distribution planning constraints, 4.1.7 Review distribution planning policies, 4.1.8.4 Identify performance trends, 4.1.8 Assess distribution planning performance, 4.4.3 Provide service to specific customers, 4.4 Deliver service to customer, 4.4.3.2 Dispatch resources, 4.4.3.3 Manage order fulfillment progress, 4.5.1.2 Design logistics network, 4.5 Manage logistics and warehousing, 4.5.1 Define logistics strategy, 4.5.3 Operate warehousing, 4.5.4 Operate outbound transportation, 4.1.5.10 Calculate destination load plans, 4.1.5.13 Manage capacity utilization  Industry: Pharmaceutical 
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Turnaround of a Business Through the Transformation of Physical Distribution

An inefficient process design only breeds inefficiency!

Type: Presentations  Topics: Business Transformation, Business Excellence, Process, Shipping, Supply Chain Management, Logistics, Supply Chain Planning, Distribution, Outbound Transportation  Processes: 4.0 Deliver Products and Services, 4.1.5 Plan distribution requirements, 4.1 Plan for and acquire necessary resources (Supply Chain Planning), 4.1.8 Assess distribution planning performance, 4.4 Deliver service to customer, 4.5.1 Define logistics strategy, 4.5 Manage logistics and warehousing, 4.5.3 Operate warehousing, 4.5.4 Operate outbound transportation  Industry: Pharmaceutical 
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Turnaround of a Business Through the Transformation of Physical Distribution (Slides)

An inefficient process design only breeds inefficiency!

Type: Presentations  Topics: Business Transformation, Business Excellence, Process, Shipping, Supply Chain Management, Logistics, Supply Chain Planning, Distribution, Outbound Transportation  Processes: 4.0 Deliver Products and Services, 4.1.5 Plan distribution requirements, 4.1 Plan for and acquire necessary resources (Supply Chain Planning), 4.1.8 Assess distribution planning performance, 4.4 Deliver service to customer, 4.5.1 Define logistics strategy, 4.5 Manage logistics and warehousing, 4.5.3 Operate warehousing, 4.5.4 Operate outbound transportation  Industry: Pharmaceutical 
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The Role of Benchmarking in Client Engagements (Slides)

Benchmarking is a powerful tool for consulting and professional services firms.

Type: Presentations  Topics: Benchmarking, Business Excellence, Project Management, Organization and Management  Processes: 1.1.2.2 Capture and assess customer needs, 1.1 Define the business concept and long-term vision, 1.1.2 Survey market and determine customer needs and wants, 12.2.3.3 Measure performance against benchmarks, 12.2 Benchmark performance, 12.2.3 Conduct process benchmarking, 12.2.4.2 Establish benchmarks, 12.2.4 Conduct competitive benchmarking, 12.2.4.3 Measure performance against benchmarks, 12.2.5 Conduct gap analysis to understand need for change and degree needed, 12.0 Manage Knowledge, Improvement, and Change, 4.1.2.2 Collaborate with customers, 4.1 Plan for and acquire necessary resources (Supply Chain Planning), 4.1.2 Manage demand for products and services, 4.4.3 Provide service to specific customers, 4.0 Deliver Products and Services, 4.4 Deliver service to customer  Industry: Consulting/Consultants, Professional Services/Business Services 
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The Role of Benchmarking in Client Engagements

Benchmarking is a powerful tool for consulting and professional services firms.

Type: Presentations  Topics: Benchmarking, Business Excellence, Project Management, Organization and Management  Processes: 1.1.2.2 Capture and assess customer needs, 1.1 Define the business concept and long-term vision, 1.1.2 Survey market and determine customer needs and wants, 12.2.3.3 Measure performance against benchmarks, 12.2 Benchmark performance, 12.2.3 Conduct process benchmarking, 12.2.4.2 Establish benchmarks, 12.2.4 Conduct competitive benchmarking, 12.2.4.3 Measure performance against benchmarks, 12.2.5 Conduct gap analysis to understand need for change and degree needed, 12.0 Manage Knowledge, Improvement, and Change, 4.1.2.2 Collaborate with customers, 4.1 Plan for and acquire necessary resources (Supply Chain Planning), 4.1.2 Manage demand for products and services, 4.4.3 Provide service to specific customers, 4.0 Deliver Products and Services, 4.4 Deliver service to customer  Industry: Consulting/Consultants, Professional Services/Business Services 
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Using Customer Service to Optimize Inventory

APQC's perspective on best practices in using customer service to optimize inventory, featuring case examples from Deere and Stryker.

Type: Best Practices and Business Drivers  Topics: Inventory Management, Supply Chain Management, Logistics  Processes: 4.4.3 Provide service to specific customers, 4.0 Deliver Products and Services, 4.4 Deliver service to customer 
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Supply Chain Definitions and Key Measures

These definitions and key measures provide deeper detail about the processes outlined in category 4.0 Deliver Products and Services of APQC's Process Classification Framework (PCF) .

Type: Tools and Templates  Topics: Supply Chain Management  Processes: 4.0 Deliver Products and Services, 4.1 Plan for and acquire necessary resources (Supply Chain Planning), 4.2 Procure materials and services, 4.3 Produce/Manufacture/Deliver product, 4.4 Deliver service to customer, 4.5 Manage logistics and warehousing 
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Supplier Relationship Management-Heinz Case Study

Heinz Ketchup is the flagship brand of food manufacturer H.J. Heinz Company (Heinz).

Type: Case Studies  Topics: Lean, Business Excellence, Quality, Purchasing, Supply Chain Management, Procurement, Supplier Relationship Management, Six Sigma, Supplier Partnerships  Processes: 4.2 Procure materials and services, 4.0 Deliver Products and Services, 4.4 Deliver service to customer  Industry: Food/Beverage/Restaurant 
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Speed to Market: Attracting and Retaining Customers

In today's marketplace, speed and innovation, as they relate to meeting customer needs, are prominent factors in determining an organization's success.

Type: Reports and Books  Topics: Customer Service, Customer-focused Processes and Functions, New Product Development, Product Development, Innovation  Processes: 2.1.2.2 Identify potential new products and services, 2.1 Manage product and service portfolio, 2.1.2 Define product/service development requirements, 4.4.3 Provide service to specific customers, 4.0 Deliver Products and Services, 4.4 Deliver service to customer 
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