7-1 Final Project Milestone Three: Life Cycle
Instructions

Submit your discussion of the life cycle management (Section III) of your business product, service, or other idea from your business plan in the Marketing and Strategy course.

For additional details, please refer to the Final Project Guidelines and Rubric document and the Milestone Three Guidelines and Rubric document.

Operationalization in L.S Starrett Company

“The Rebranding of Starrett’s Transportation Department Project.”

Introduction

Efficient business operations in Starrett Company require the streamlining of all functions, especially in the transportation, shipping, and distribution departments. Rebranding the transportation department will ensure lean processes in the company’s supply chain. This will reduce operational costs; minimize the nonvalue adding activities, while maximizing the profit margins and growth of the company. The sustainability and growth of companies are achieved when operations maximize the profit margins while reducing the operational costs (Alena Kocmanová, 2011). It is, in that case, the rebranding of the transportation, shipping, and distribution channels require ‘revisiting’ to avoid duplicated functions and the presence of nonvalue adding activities. The rebranding involves introducing an integrated system and the introduction of driverless trucks. In this project, the life cycle of rebranding the transportation department will follow the typical life cycle phases involved in supply chain management and project management.

Life Cycle 

Rebranding the transportation department in Starrett Company will change various aspects of the department and not completely get rid of its purpose and mandate. The transportation, distribution, and shipping functions may seem different; however, some services are similar, repetitive, and maybe nonvalue adding. In that case, the life cycle of the rebranding will involve developing an integrated system that facilitates the movements of the driverless trucks as well as keeping track of the transactions (ClA, 2019). For the success of introducing the driverless vehicles in Starrett’s transportation department, the integrated system development and life cycle must involve adequate security and requirements. Thus, the life cycle of the integrated system will include specifications, planning and procurement, development and testing, implementation, operations and maintenance, and finally, termination and disposal (Campara, 2011).

The life cycle functioning of the integrated system includes order making, processing, releasing, closing, delivery. In this life cycle, the developed integrated system should integrate all the functions in the shipping, transportation, and distribution departments in these five functions.

In the initial function, customers or Starrett stores make the orders in the system; this information is re-laid in the three departments. Next, processing of the order is conducted, whereby the warehousing is notified of the order, payment transactions are approved, and packaging begins immediately. All the information concerning the amount of products, addresses, and payment transactions are recorded and visible in all the departments (Behrouz Zarei, 2013). Once the processing is completed, releasing the driverless trucks commences whereby the integrated system feeds the driverless truck with the relevant details such as names, types of products, delivery time, and the destination. After that, the releasing function takes place, and the system begins to track the movement of the truck (Bernstein, 2017). Once the driverless truck is released, the order remains open and closed at the same time.

The order is open until the delivery function is conducted; however, during the closing phase, issues such as closing the transaction codes and the files on the addresses, packaging, and inventories. The final stage is delivery or service rendering, which is the most critical aspect of the life cycle. It is vital because it evaluates the performance and success criteria of the rebranding project. Service delivery should be conducted effectively to manage the possible risks of late deliveries, damaged, lost, or missing products, and overall customer satisfaction (Behrouz Zarei, 2013). Thus, the main aspects of the delivery function include follow up on delivery time, state of the products, and customer feedback. Once that function is completed, another order is made, and the life cycle keeps moving.

The rebranding of the transportation function will undergo four primary life cycles namely, introduction, growth, maturity, and eventual decline or rebirth.

At the introduction phase, the launching of the system and driverless trucks will begin, and the project team will introduce the rebranded transportation, shipping, and distribution departments. The primary purpose of this project is to reduce the operations costs in the transportation system, integrate the shipping, transportation, warehousing, and distribution functions, reduce the nonvalue adding costs by getting rid of the duplicated functions, and facilitating and tracking the motion and movements of the driverless truck. Thereby during the introduction phase, the performance and results may be both positive and filled with uncertainties (Dempsey, 2018). Therefore, the project team, especially the R&D team, will need to develop unique implementation, reception, and marketing strategies. Thus, the R&D team will continuously work to ensure better marketing and sustainability strategies are developed for longer economic life. The project will cause many challenges, such as laying off some workers, canceling contracts with various outsourced transportation firms, employee resistance, and possible lack of expertise to operate the new integrated system (ClA, 2019). On the brighter side, once the reception is positively taken among employees, the future of the project will result in admirable monetary and nonmonetary benefits. The integrated functions may reduce operational costs by at least 10% while increasing the sales and profit margins.

While introducing the changes, adequate staff training and explaining will be conducted to ensure all employees and stakeholders understand the changes that will take place in their usual norms. This will increase the understanding and knowledge of the systems, new operational features, and reduce employee resistance (Alena Kocmanová, 2011). More importantly, feasibly, the project will take up much capital to develop and continuous promotion and maintenance costs. The ROI in this stage is not expected to be high, but over time, the benefits will begin to rise. Introducing disruptive technologies (driverless trucks) in transportation, shipping, and distribution functions will also act as a service differentiation among the competitors in the industry (Coccia, 2017). Driverless trucks will reduce delivery time, reduce human-related accidents, and increase the number of deliveries made in a day. This will result in maximized customer satisfaction and experience as the complaints of late deliveries and damaged products will reduce or end ultimately. The company will also benefit from the increased deliveries made and reduced costs of operations.

At the growth stage, the transportation, shipping, and distribution departments should begin documenting successful or negative feedback related to the autonomous trucks and the integrated system. It is at this stage that the set success criteria are developed and weighed against the outcomes to determine the performance and future projections. Customer complaints are expected to reduce, the customer base is expected to expand, and the customer-corporate relationships are maturing (Dempsey, 2018). Moreover, the deliveries are expected to increase, which should translate to sales and revenues. The system performance should be picking up whereby, the integration will ensure that information and transactions are tracked and shared easily in the three functions. For instance, consider a situation whereby a driverless truck is set to leave the Athol manufacturing plant and is required to deliver products to a customer in New York.

Once the customer’s order is placed, the information such as the names, addresses, contacts, and delivery details such as locations are easily visible to transporters and distributors. Thus, the integrated system will ensure that essential information is easily relayed that will enable in setting the driverless truck and monitoring its movement until it reaches the client or customer. The growth phase requires an increased ROI to maintain the operations and fund the growth (Peter FitzRoy, 2012). The increased ROI will be acquired from the increased delivery trips, reduced outsourcing transportation service, and the reduction of nonvalue adding activities.

At the maturity stage, business and operational stabilization are expected. The life cycle of the system design is expected to stabilize, and the expected annual growth is 5%. At this point, the uncertainties of the future are addressed as the operations run smoothly with steady and predictable revenues and sales. At this stage, the transportation departments are remodeled and running smoothly (Bernstein, 2017). However, being mature, it is the most appropriate to make effective changes in the mode of operations, technologies used, and system upgrades to maintain operational sustainability, survival, ensure rebirth and not a decline. Competition is likely to increase from new entrants and mature companies; thus, requiring a unique and robust sustainability strategy. All Starrett stores and locations should have stabilized the driverless truck operations in their activities and more investment opportunities exploited.

Finally, the transportation departments are likely to be faced with losses due to competition on delivery services, and the widespread utility of autonomous vehicles. In addition, macroeconomic factors such as regulatory issues and constraints will play a vital role in the decline of the efficiency of the driverless trucks in the company. As discussed earlier, it is clear that adopting disruptive technologies such as driverless trucks is some countries is a challenge (Coccia, 2017). For instance, in the developing countries, the drag in technology and lack of adequate supporting appliances becomes a challenge. Secondly, regulatory issues such as the accident responsibility claiming policy remains a dilemma that may result in court cases and fines. Some companies are expected to have better services, products, and operational techniques. In response, through the R&D team, the company will keep researching on the most appropriate and new technologies to use to maximize its business drivers. This may result in the decline of the driverless trucks but lead to the renewal and rebirth of more modern and advanced methodologies (Peter FitzRoy, 2012). However, the future growth of the company is not expected to be affected negatively by the changes and introduction of new and advanced technologies.

Profit Generation 

Profit generation opportunities once the integrated system and the driverless trucks are introduced will increase highly. The areas of profit generation will target people, processes, and technology. However, to ensure that the profits are maximized, the company must incur costs and charges when implementing the project and remodeling its shipping, transportation, and distribution functions. To begin with, the business drivers and rationale for this integrated system is to reduce the operations costs in the transportation system, integrate the shipping, transportation, warehousing, and distribution functions, reduce the nonvalue adding costs by getting rid of the duplicated functions, and to facilitate and tracking the driverless trucks motion and movements (ClA, 2019). These business drivers and the rationale behind this business outline some of the potential cost-saving opportunities. The cost-saving opportunities, in this case, include the presence of value chain management of corporate services and products and maximized quality and lean operations.

People are vital assets and sources of profit generation. These people include employees and customers. The customers are sources of profits as they make the purchases and sustain the purpose of the business. Thus, rebranding and remodeling the transportation departments will enhance and influence customer purchase behaviors (Peter FitzRoy, 2012). Currently, the customers’ feedback is negative with complaints such as late deliveries, damaged, lost, and missing products. With the driverless trucks and the integrated system, customer satisfaction and experience are expected to change and rise positively. Driverless trucks reduce the delivery time by at least 15% of the ordinary trucks and save energy highly. Complaints about late deliveries will be addressed, which in turn will increase customer experience and satisfaction. In return, customer loyalty is enhanced, thus increased purchasing behavior. On the other hand, employees are the brand ambassadors, drivers, and determinants of the company’s success. Introducing the integrated system will reduce the backlogs, loss of information, and maximize transparency and information sharing. This will increase productivity and performance among employees to conduct transactions easily and readily accessible to information. Increased productivity and accuracy increases the profit margins in the company.

Implementing the driverless trucks and integrated system will result in efficient and effective processes and operations. Information sharing will ensure seamless communication and interaction among departments. Maximized efficiency and effectiveness of the processes result in transparency, accuracy, productivity, and high performance. These aspects are essential in generating profits in a company. Automation of the process will make the operations easy and information sharing accessible. High performance and quality of services will reduce the identified complaints and increase customer purchase behavior, sales, and, eventually, revenue and profit margins (Peter FitzRoy, 2012). Finally, investing in new technology such as automated systems and disruptive technologies such as IoT, Big Data, and driverless vehicles will reduce the operational costs of corporate operations and maximize profits and sales. These new technologies ensure operations and processes in a company are leaner, thus eliminating nonvalue adding activities (Coccia, 2017). Driverless trucks will reduce outsourcing and salary costs while maximizing the delivery trips and customer satisfaction; these aspects increase the profit margins and sales, which is essential and core in the company.

Value chain management is an integral aspect when cost saving in a business. It initiates the integration of all resources. In the transportation department, value chain management is likely to be achieved from an integrated system and the presence of driverless trucks. The system will integrate the shipping, transportation, warehousing, and distribution functions and reduce the nonvalue adding costs by getting rid of the duplicated functions. Integrated systems and functions reduce wastes in the company, thus added value (Behrouz Zarei, 2013). Similarly, maximized quality and lean operations will highly save costs in the company by eliminating nonvalue adding activities, duplicated functions, and wasteful activities in the transportation department.

Phase-Out Plan 

The final step in the rebranding project of Starrett’s shipping, transportation, and distribution departments is the phase-out plan. An excellent phase-out plan ensures the sustainability of the project idea lives on and is entirely successful. Thus, the phase-out plan, in this case, involves four main steps, namely handing over deliverables to the operations, the annunciation of the EOL and redistributing resources, documentation of results and record-keeping, and review and follow up activities.

Once the project is completed, all deliverables will be handed over to the newly formed department and control turnover done. At this point, the department can weigh against the set requirements, specifications, and assume responsibility and oversight of the new aspects. Once that is completed, the head of the company will ensure flexible and adequate resource distribution in all departments (Behrouz Zarei, 2013). The current workforce will be redistributed into respective functions, especially since many employees may be laid off or transferred to other departments. The remaining employees will be trained and equipped with adequate tools, skills, and knowledge of the most effective operational techniques. Thirdly, all elements, results, and records will be documented for future reference and audit purposes. Moreover, documenting acts as a form of quality control of the project and ensures all guidelines are retained for reference.

Finally, the review and follow up activities are critical, as they will determine the success and sustainability levels of the project and transportation department. Follow up activities will involve periodic and weekly monitor and evaluation of progress and performance. However, following up is accompanied by post-implementation reviews, making it a conclusive and comprehensive package (Peter FitzRoy, 2012). The reviews will help identify areas of improvement, reviews the expectations and deliverables against the outcomes, and determine the change and risk management strategies to put in place. All these steps ensure sustainability and increased economic life of the project and Starrett as a company.

References

Alena Kocmanová, M. D. (2011). Corporate sustainability: Environmental, social, economic and corporate performance. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Vol 59(7):203-208.

Behrouz Zarei, S. A. (2013). Exploring the Business Model Aspects of Transportation Information Systems. 1-5.

Bernstein, R. (2017, March 17). 5 System Development Life Cycle Phases. Retrieved from https://online.concordia.edu/computer-science/system-development-life-cycle-phases/

Campara, N. M. (2011). Learn more about System Life Cycle: Knowledge of system as an element of cybersecurity argument. System Assurance.

ClA. (2019, June 4). L.S. Starrett Company. The Wall Street Journal, p. pp: 1.

Coccia, M. (2017). Disruptive Technologies and Competitive Advantage of Firms in Dynamic Markets. SSRN Electronic Journal, 3-15.

Dempsey, B. (2018, January 11). Business Life Cycle Spectrum: Where Are You? Retrieved from Forbes: https://www.forbes.com/sites/theyec/2018/01/11/business-life-cycle-spectrum-where-are-you/#107b4c48ef5e

Peter FitzRoy, J. M. (2012). Strategic Management: The Challenge of Creating Value. New York: Routledge.