At Aegis, our clients often call on us to help solve their clients’ problems. In this instance, the client’s distribution network consists of both government-owned and commercial aircraft delivering cargo to numerous locations, on an as-needed basis.
The organization wanted to modernize this system to provide higher-quality customer service, so Aegis was enlisted for our thought leadership and Sales & Operations Planning (S&OP) expertise.
The challenge: Building a case for a modernized distribution network
With an ad-hoc delivery system that made it difficult for end users to predict when their cargo would arrive, the client specifically wanted to design and implement a hub-and-spoke distribution network that would replace its current logistics system to decrease delivery times and increase delivery predictability. Aegis needed to create a comprehensive Business Case Analysis (BCA) comparing the current and future state distribution networks, with a focus on delivery cost, speed and predictability.
Our approach: Data & analytic solutions with a three-tiered, holistic application
Building a BCA required us to conduct a supply chain assessment to identify what is being moved, how it’s being moved and the amount of time and money it takes to complete the circuit. Aegis’ Data & Analytic Solutions team began by modeling the global enterprise to conduct demand forecasting simulations.
We then took that evidence and applied a three-tiered (functional, technical, financial) approach to identify improvements needed to sharpen the client’s competitive edge and attain their objective. Ultimately, this process revealed a vision of the ideal future distribution network, based on real data and accurately forecasted figures.
Throughout the case development, Aegis used Kotter’s change management model to incorporate feedback from all people and parties involved to clearly understand needs, capabilities and expectations. After all, even the most meticulously crafted framework will not produce the desired results unless you have the right people on board.
We were able to blend our knowledge in people-centric business operations and defense transportation/logistics to design a new system covering all aspects of the network — inter-theater and intra-theater transportation flow, the types of cargo being moved, including delivery speed expectations. Next, we identified and recommended the types and numbers of necessary aircraft to meet demand and delivery requirements based on client-defined characteristics including a central logistics hub, multiple second- and third-level locations and minimum delivery needs.
Last, Aegis conducted a network analysis and recommended aircraft types, which also enabled us to estimate flying times, fuel costs and the overall network cost.
The results: Improved demand forecast accuracy by 40%
Throughout this project, Aegis designed a client-defined hub-and-spoke distribution network framework that’s responsive to realistic estimated costs, delivery frequencies and safety protocols. Also, because it is backed by industry analytics and evidence, this federal government enterprise is well equipped to begin the funding request and acquisition processes needed to transform the network and improve customer service.
The Aegis team will stand by, ready and willing to implement the new distribution network when the client is ready.