DSC Logistics: Focusing on the Process
Over the years, many fine voices—W. Edwards Deming, Eliyahu Goldratt, Taguchi, Michael Hammer and James Champy—have emphasized examining and improving business management processes. The reason they, and others, place such importance on process is to counter some companies' tendencies to fixate on disparate details, personalities, or other matters peripheral to their essential business interests.
That's why it is refreshing to profile DSC Logistics, a third-party logistics provider based in Des Plaines, Ill. DSC focuses an enormous amount of attention on its own internal processes and the external processes of its customers and partners.
"DSC Logistics has invested substantially in process management to ensure a reliable and high level of service," says John Fieldman, the company's vice president of enterprise integration. "We have hired a very strong process leader and we have worked hard on improving processes over the past several years. We have flow diagrams for our major processes; we have a process improvement group. We seek to train and continuously retrain employees, and upgrade our process management."
DSC Logistics uses process management as a management tool. The company examines and conceptualizes work within the terms of process. By concentrating on processes rather than procedures, DSC holds its people responsible for results.
DSC Logistics employs more than 2,400 people and operates 20 distribution centers for consumer package goods customers such as Pillsbury, Nabisco, Philip Morris, Unilever, and Best Foods. DSC moves their product inbound, and warehouses it, if necessary. The company will sometimes do packaging, or other value-added services, then ship the product outbound to retailers such as Wal-Mart and Kmart.
When DSC works with its customers, it likes to "get into their shoes" in terms of what they want and how they operate, Fieldman says.
"The key is to know our customers' requirements. It is part of our service and value proposition," he notes. "Understanding our customers' basic needs, as well as the variations on those needs, is part of the value that we provide.
"For instance, every customer has its own monthly, quarterly or annual business and sales cycles," Fieldman says. "DSC is able to flex up or flex down, depending on volume and other factors."
While its size and numbers don't put the company in the league of a FedEx, for example, it does weigh in as a heavy by the standards of many in the logistics and supply chain world.
As DSC Logistics continues to grow, its distribution centers remain essentially independent. To meet the challenge of integrating and standardizing its internal processes, the company relies on John Fieldman.
"I head the IT department, and my title—vice president of enterprise integration—reflects the context within which the department exists," Fieldman explains. "The point of integration is to look at what DSC needs to do to operate at an enterprise level. IT is obviously essential to integration, but integration is not merely an IT challenge; other things have to be done.
"The whole world is turning into information," Fieldman notes. "To me it seems there is some kind of mathematical relationship between the need for physical goods and the physical world—trucks, warehouses, inventory, forklifts—and capital and information. The better the information, the less investment is needed. There's some kind of tradeoff between these elements.
"The reality is that we cannot have all physical goods or all information. We have to eat the actual cereal, we can't eat the information," he says.
DSC Logistics uses interconnected logistics applications to convert data into meaningful information that can be used at all levels of the organization. DSC maintains a centralized "Datamart"—a source of knowledge and experience-based information on all aspects of a company's business.
To manage its information, DSC relies heavily on AS400s. "We have AS400s in almost all our distribution centers. We also have AS400s in our data center for a good deal of our applications as well as other file servers," Fieldman says.
"In addition, we recently converted a data warehouse to Oracle, and we are commencing a substantial systems project called ILS—Integrated Logistics System. This involves implementing a suite of applications from Irista Software, a subsidiary of HK Systems."
For more information on DSC Logistics, visit the web site at www.dsclogistics.com.