Parcel - October 2008 - (Page 38)

on the mark “The system is the solution.” -AT&T One of the most influential books that I have read is Michael Gerber’s The E-Myth: Why Most Small Businesses Don’t Work and What to Do About It. Essentially, Gerber suggested that a business should be designed around systems rather than around people. He used franchises as an example. The vast majority (75%) of franchises succeed, compared to non-franchise businesses, which mostly fail. The reason franchises thrive is because they have clear operations manuals and procedures that specify every detail of running the business. I thought about applying this strategy to shipping operations. Many naïve executives have the misconception that shipping is simple. Over my 35-year career of observing thousands of shipping operations, I have come to the conclusion that no two shipping operations are the same. It is true that the majority of companies have to accomplish the same basic functions of packing, weighing and labeling. But every organization does it slightly different. It is in the nuances that mistakes are easily made. As the architect by mark taylor, MBA, DLP Ludwig Mies van der Rohe said, “God is in the details.” A company can earn an exceptional reputation by exceeding customers’ expectations or ruin its reputation by failing to satisfy its customers. What some people fail to realize is that in shipping, a single miscommunication or one wrong keystroke can result in an error. Shipping is the last chance to make a good lasting impression with a customer. Shipping mistakes are costly. Research at Texas A&M University found that the average shipping error costs $50 to correct, on both the shipping and receiving ends. This does not take into account the added costs of damaged customer relations. As Warren Buffet said, “It takes 20 years to build a reputation and five minutes to lose it.” A typical business often discovers that it is spending $30,000 or more annually to correct inaccurate shipments. Fixing mistakes could mean picking up freight charges, manually adjusting invoices, handling customer service calls, issuing call tags, and paying for lost goods. Many businesses simply cannot afford to make a single mistake in the shipping department. Some companies are shipping parts needed for emergency repair or kits for timed events where an error can cost thousands of dollars. Other organizations ship surgical instruments directly to hospitals for operations; in some of these cases, a missed shipment can mean life or death. 38 October 2008

Table of Contents for the Digital Edition of Parcel - October 2008

Parcel - October 2008
Editor's Note
What Would Augello Say?
Best Practices Survey Results
Going with the Flow
Is Your Parcel Network Optimized?
Last (Mile), but Not Least
Moving From Manual to Automated Fulfillment
A Race for Excellence
Making Ends Meet
Is Your Job Killing You?
Software Selection Demystified
Controlling Costs
On the Mark
Product Profile
New Products & Services
Advertiser Index
Wrap Up

Parcel - October 2008