By Fiona Ness on Tue 04 November 2014 in Topical
Last Christmas UPS experienced huge delivery issues which left thousands of customers without their orders in time for Christmas.
At the time these problems were put down to a lack of man power and bad weather conditions, however it would seem that poor demand forecasting was the underlying cause.
UPS are expecting an 11% increase in parcels this year, with 34 million units being delivered on the 22nd December alone – double the average daily number of parcels. With this in mind, not only have UPS announced that they will be hiring a total of 95,000 extra staff (an addition of 45,000 compared to 50,000 last year), but they have also invested heavily in more flexible processing capacity, better communications, and IT.
In particular UPS have highlighted the need to provide their temporary staff with better technology in order to access the fastest routes, customer addresses and provide the information needed to make decisions which in the past have only been handled by permanent staff.
This sharing of core business information across their employee base, as well as stronger communication channels with key customers and in turn better forecasting should enable UPS to limit the errors they have previously experienced during the Christmas period.
Let’s hope that the estimated rise in eCommerce sales of 13% over November and December has also been taken into account and UPS don’t once again have to blame “exacerbated conditions” for undelivered parcels.
What does this mean for you?
Although you might not be a global delivery company, it is clear that UPS made some fairly basic errors last Christmas that should have been avoided.
Although there were issues from a lack of communication to not enough man power, the underlying factor was their inability to accurately identify the demand they would experience. UPS’s investment in better IT and technology will ultimately give them much stronger foundations to improve their processes and deliver the right customer experience.
Improving the efficiency of your business and identifying the areas in which your business is already struggling is vital to ensure you do not encounter the chaos that UPS did. Why wait until a spike in business to find out whether your current resources let alone processes are able to successfully handle the volume required? Especially when sound reporting alone could see this before you do.