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Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Establishing of MATALAN Middle East Distribution Centre
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Table of Content
Preface to the project .................................................................................................................. 3
1: Initiating the Project
1:1. Purpose ........................................................................................................................... 4
1:2. General Objectives ........................................................................................................... 5
1:3. Specific Objectives ........................................................................................................... 5
1:4. Tasks & Responsibilities .................................................................................................. 5
2: Planning the Project
2:1. Work Breakdown Structure (WBS) ................................................................................... 7
2:2. Schedules – Project Calendar ......................................................................................... 8
2:3. Critical Path Analysis ....................................................................................................... 9
2:4. Resources Allocation & Budgeting ................................................................................. 11
2:5. Staffing ........................................................................................................................... 13
2:6. Communication Plan ...................................................................................................... 14
2:7. Contact Information ........................................................................................................ 15
2:7. Risk Management Methodology, Risk Response Plan & Risk Analysis .......................... 16
3. Execution the Project
3:1. Execution of the Project Plan ......................................................................................... 17
3:2. Status Report: Project Execution Plan (PEP) ................................................................. 18
3:3. Change Log: .................................................................................................................. 19
3:4. Quality Management in Project Execution ...................................................................... 19
4. Delivering the Project
4:1 Documents Transfer ........................................................................................................ 19
4:2. Training & Releasing of Staff .......................................................................................... 19
4:3. Releasing of Other Resources ....................................................................................... 20
4:4. Project Closure & Lessons learned ................................................................................ 21
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Preface
One of the leading fashion retailer in United Kingdom “MATALAN” made it’s
overseas debut in the Middle East Region in the year 2008. Currently operating 03 retail
stores in UAE, & 01 in Jordan with an expansion plan of 16 more retail stores across the
region by 2015. MATALAN is solely distributed in the Middle East by the Business
Trading Company (BTC), Doha, Qatar and the business unit has named “MATALAN
Middle East”.
“MATALAN Middle East” interests in supporting new stores opening and its
continues supplies, improving store replenishment process and reducing supply chain
costs by operating a “Central Distribution Center (CDC)” for the Middle East region.
Herein the proposed set up calls “MATALAN Middle East Distribution Centre” or
“MATALAN MEDC”.
The management of “MATALAN Middle East” wishes to consider the outsourcing
option fulfilling the said logistics requirements.
In this report “MATALAN Middle East” discuss the complete Project Life Cycle
(PLC) by four phases: - Initiation - Planning – Execution - Delivering & Closure.
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Phase 01: Initiating the Project
1:1.Purpose:
Establish a Regional Distribution Centre (MEDC) for MATALAN Middle East &
outsource its management” to 3rd party logistics (3PL) in-order “MATALAN Middle East”
to focus on their co-business activity of Retailing”
NOW: Existing Logistics Set-up of Matalan Middle East:
THEN: Projected Logistics set-up of Matalan Middle East:
MEDC JAFZ - UAE
Stores in
Jordan
Stores in
Saudi
Arabia
Stores in
Oman
Stores in
UAE
Stores in Bahrain Stores in Qatar
Stores in
Kuwait
MATALAN
CDC - UK
Arabian Centre - Dubai UAE
Lamcy Plaza - Dubai UAE
Al Baraka – Jordan
MATALAN CDC - UK Dalma - Abudhabi UAE
Arabella – Jordan
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
1:2: Generic Objectives:
a. Find the best fit cost module to run the operation.
b. Discover the most efficient operation process to manage the Logistics Activities.
c. Select the most reliable service provider / s for a long term business partnership.
1:3: Specific Objectives - Activities to be outsourced:
a. Establishing & Operating the DC of MATALAN Middle East
b. Inbound Transportation, Sea, Air & Land
c. Distribution of goods to MATALAN stores within UAE territory
d. Distribution of goods to MATALAN stores across Middle East region / Out of UAE
1:4. Tasks & Responcibilities:
(Definitions: - SMT: Senior Management Team, COO: Chief Operating Officer,
HRD: Human Resources Department, HRM: Human Resources Manager, LogD:
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Logistics Department, LogPM: Logistics Project Manager, LC: Logistics Coordinator,
SUP: Supplier / service provider, LegD: Legal Department, CLO: Chief Legal
Officer, PA: Personal Assistant)
Responsibility
# Task Department Owner
1 Implementing of the Logistics Department to MATALAN ME SMT COO
2 Recruiting of a Logistics Project Manager HRD HRM
3 Recruiting of Logistics project staffs HRD HRM & LPM
4 Project scope walk through for project team members LogD LPM
5 Analyze & possible solution / solutions definition LogD LC / LPM
6 Identifying potential suppliers & initial discussions LogD LPM
7 Creating the RFQ / RFP LogD LPM
8 RFQ /RFP Distribution LogD LC
9 Technical support to suppliers for proposals submission LogD LC
10 Rate analyzing & short listing most convenient proposal / s LogD LPM
11 Further negotiations for rates with shortlisted supplier / s LogD LPM
12 Selection of service provider / s LogD LPM
13 Drafting of Service Contracts LogD & SUP/ s LPM / SUP
14 Contracts Review LogD & SM COO
15 Official Contract signing LegD CLO
16 Go Live LogD & SUP/ s LPM
17 Closure LogD LPM
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Phase 02: Planning the Project:
2:1. Wrok Breakdown Structure (WBS):
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
2:2. Schedules:
Project Calender:
Description Start Date
Duration Days End Date
Implementing of the Logistics Department (LD) to MATALAN ME 1-Feb 28 1-Mar
Recruiting of a Logistics Project Manager (LPM) 10-Feb 42 24-Mar
Recruiting of Logistics Coordinators (LC) 31-Mar 14 14-Apr
Project scope walk through for project team members 30-Apr 7 7-May
Analyze & possible solution / solutions definition 30-Mar 21 20-Apr
Identifying potential suppliers & initial discussions 2-Apr 35 7-May
Creating the RFQ / RFP 20-Apr 21 11-May
RFQ /RFP Distribution 12-May 3 15-May
Technical support to suppliers for proposals submission 15-May 21 5-Jun
Rate analyzing & short listing most convenient proposal / s 6-Jun 4 10-Jun
Further negotiations for rates with shortlisted supplier / s 11-Jun 14 25-Jun
Selection of service provider / s 25-Jun 7 2-Jul
Drafting of Service Contracts 7-Jul 14 21-Jul
Contracts Review 22-Jul 7 29-Jul
Official Contract signing 1-Aug 4 5-Aug
Go Live 15-Aug 30 14-Sep
Closure 15-Sep 7 22-Sep
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Project Calender on Gantt Chart:
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
2:3. Critical path analysys:
Critical path:
B:E:G:H:I:J:K:L:M:N:O:P:Q
42+ 21+21+3+21+4+14+7+14+7+4+30+7 = 195 Days
Start
2
3
4 5
7
6 8 9 10 11 12 13 14 15 16 17 18
A=28
B=42
C=14 D= 7
E=21
F=35
G=21 H= 3 I=21 J= 4 K= 14 L= 7 M=14 N=7 O=4 P=30 Q=7
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
2:4: Resources Allocation & Budgeting:
Project Resource / Month Feb March April May June July Aug Sep Oct
Human Resource Executive (HRE) 0.00 1.00 1.00 0.00 0.00 0.00 0.00 0.00 0.00
Logistics Project Manager (LPM) 0.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 0.00
Logistics Coordinator (LC) 0.00 0.00 1.00 2.00 2.00 2.00 2.00 2.00 0.00
Cost Plan
HRE @ $2725 Per Month $0 $2,725 $2,725 $0 $0 $0 $0 $0 $0
LPM@ $ 6800 Per Month $0 $6,800 $6,800 $6,800 $6,800 $6,800 $6,800 $6,800 $0
LC@ $ 2000 Per Month $0 $0 $2,000 $4,000 $4,000 $4,000 $4,000 $4,000 $0
Equipment for LPM Office Set-up $0 $1,200 $1,200 $1,400 $1,400 $1,400 $1,400 $1,400 $0
Consumables $0 $250 $250 $250 $250 $250 $250 $250 $0
Total per month $0 $10,975 $12,975 $12,450 $12,450 $12,450 $12,450 $12,450 $0
Cumulative cost $0 $10,975 $23,950 $36,400 $48,850 $61,300 $73,750 $86,200 $86,200
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
2:5. Staffing:
Organization Breakdown Structure (OBS):
Additional Information on OBS & its advantages:
Simple & straightforward staffing solution deploys to the project since the “Logistics
Project Manager” who acts as the entire project head with his / her subject specialty of
Logistics & Service Outsourcing. His / Her subordinates are experienced Logistics
coordinators in the same “Logistics” industry and carrying out specific tasks assigned by
“Logistics Project Manager”.
Though the project cost is bit high due to hiring of experienced individuals for junior
functions in the project, it gives a great advantage for the “After Project Operation
Management” of MATALAN Middle East Logistics Department.
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
2:6. Communication Plan:
#
Communication Activity
Communication Method
Audience Frequency Leader Deliverables
1 Kick-off meeting
Face to face COO, Project Team
Once LPM Objectives and A to Z project plan
2 Progress review Face to Face Project Team
Monthly LPM Progress, Difficulties & Possible solutions
3 RFQ Drafting Face to Face Project Team
Start & End
LPM Contents, templates of quotations
4 Discussion with suppliers
Face-to-Face
Sales & Marketing people of Suppliers
Once per Supplier
LPM Identify potential and capable suppliers
5
Distribution of RFQ to potential suppliers
E-Mail Service Suppliers
Once LC
Provide completed RFQ including quotation templates, Submission cut offs AND follow-up for acknowledgement
6
Technical Support to Suppliers in submitting proposals
Telephone, E-mail, face to face as required
Service Suppliers
As required
LC
Provide technical information about the project & expectation
7 Cut-off remind E-Mail Service Suppliers
Once LC Reminding of the proposal closing dates
8 Receiving of Proposals
E-Mail From Supplier
Once LC Receiving of complete proposal
Report continued to next page
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
#
Communication Activity
Communication Method
Audience Frequency Leader Deliverables
9 Acknowledgement E-Mail Service Suppliers
Once LC
Acknowledging of the proposals in professional manner
10 Discussion with shortlisted suppliers
Face-to-face Shortlisted Service Suppliers
As required
LPM
Negotiating rates, processes, and understanding the reliability.
11
Briefing to COO of the final selection methodology & it's Outcome
Face-to-face COO Once LPM Achievement & further actions
12
Announcing of the selected service provider / providers
Selected Service Supplier / Suppliers
Once LPM
Appreciation of the proposal & status of selection
13 Contract t Drafting Meeting
Face to face
Selected Service Supplier / Suppliers
Twice LPM Contract Drafting & Reviewing
14 Operation Ramp-up Meeting
Face to face
Project Team, Selected Service Supplier/ suppliers
Twice LPM Understanding of the deliverables
15
Project Closure Meeting
Face to face & E-Mail
Project team
Once COO Final Review & Appreciation
Contact information of the project office:
Project Manager, MATALAN Middle East Logistics & Logistics Service procurement
project. Lamcy Plaza, Dubai. Tel: +971553774117, [email protected]
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
2:7. Risk Management Methodology:
Risk Response Plan:
Risk Category Possible Risks Involved Proposed Solution
Responsible Department & Individual to
Manage the risk
1 Staffing Risk Leaving of project staffs in between the project
Contracts with Employees not to leave until the project end
HR- HRM
2 Technical Risk Getting select of one single supplier for all the services
Try best to select multiple service suppliers for keep the service competition
LD - LPM
3 Organizational Risk
Possible influence for the final decision in selecting suppliers that effect the project outcome against expectation
Clear & high level order from Senior Management for influential positions to leave along the decision making practice to COO & LPM
SMT - COO
4 External Risk Cross leaking of tender information by staff to other suppliers
Educate project members on laws of tender management
SMT - COO
Risk Analysis:
Risk Probability Severity Detection Difficulty When
Staffing Risk Medium High Low Throughout
Technical Risk Medium Medium Law Finalization
Organizational Risk Medium Medium Medium Post-finalization
External Risk High High High Post-finalization
Risk
Categorizing
Risk
Identification
Risk Response
Development
Risk
Control
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Phase 03: Execution of the Project
3:1. Executing the Project Plan:
Upon completion the planning stage, below are the activities that wish to carry-out by
project team to execute the project.
a. Creating of the RFQ / RFP:
A well defined document that include organization background and its product,
services wish to outsource, expectations, its service level, KPI methodology &
cost model. expected. Proposals are called in CPPC (Cost plus percentage of
cost) basis.
b. Response to RFQ / RFP:
Dully completed proposals that covers the expectation defined on the RFQ /
RFP.
c. Selecting of Suppleir/ suppliers:
A well designed selection process to followed to select the best fit service suplier
/ suppliers to each service. All shortlisted suppliers will be allowed to
demonstrate their proposed operational processes face to face with project team.
The steering committee (COO & LPM) who finally decide whom to offer
contracts with considering various factors. Project team suggestions were highly
considered in the stearing comitee decision.
d. Announcing of the selected service supplier / suppliers:
All the participants will be addressed by MATALAN Middle East on the status of
their proposals. Selected supplier / suppliers will be invited for the further steps of
the project and unsuccessful proposals will be notified with a thanking letter for
participation.
e. Creating of Contract / s:
Individual contract will be signed with suppliers for each service. Contracts to be
designed collectively with Matalan Logistics Project Team & respective supplier
with using standard terms and conditions of both parties. Each contract will be
split to THREE parts.
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Part One: Responsibilities & legal bindings in acoordance with organization,
industry & UAE laws.
Part Two: Service level agreement (SLA) that provides complete services and its
level of delivery.
Part Three: Key performance Indicators (KPI) & matrix that monitor the SLA
effectively. A process of applying financial penalties will be imposed for key
activities in services that effect the Matalan Business in a failure of the service.
3:2. Status Report – Project Execution Plan (PEP):
- The major activities of the project delivarables will be monitored by the PEF
Green Achieved
Ongoing
Failed in terms of on time achieving
# Task name Start date
End date Status
A Resources Arrangement
A:1: Implementing of the Logistics Department 1-Feb 1-Mar Green
A:2 Recruiting of a Logistics Project Manager (LPM) 10-Feb 24-Mar Green
A:3 Recruiting of Logistics Coordinators (LC) 31-Mar 14-Apr Green
B Major Tasks / Activities
B:1 Creating the RFQ / RFP 20-Apr 11-May Green
B:2 RRFQ /RFP Distribution 12-May 15-May Green
B:3 Rate analyzing & short listing most convenient proposal / s 6-Jun 10-Jun Green
B:4 Selection of service provider / s 25-Jun 2-Jul Green
B:5 Drafting of Service Contracts 1-Aug 5-Aug Green
B:6 Go Live 15-Aug 14-Sep Green
B:7 Project Ends 22-Sep Green
-
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
3:3. Changes & Log:
- Any changes in the plan or original circulars must be logged -
#
Change Requires
Reason for Change
Change Approved
Change Communicates to
Date change Communicates
Date change Effects
1 N/A N/A N/A N/A N/A N/A
2
3
`
3:4. Quality Management in Project Execution:
In this project, the quality expected are “delivering tasks on time, applying industrial best
practices in selecting service suppliers for better outcome & controlling the
confidentiality on rate proposals” that submitted by multiple suppliers for same service.
Activities that carried-out to control quality are:
- Holding periodic inspection
- Ensuring authorized approaches and processes are followed
Phase 04: Delivering of Project
4:1. Documents Transfer:
Upon completion the documentation specified in 3rd stage, below listed documents will
be transferred with required authorizations to close the project.
- Dully signed contracts including SLA & KPI.
- Operation commensment approval & instruction.
- Billing & banking information.
4:2. Training & Releasing of staff:
As described in the “staffing” stage (2:4.), individuals that involve the project, “Logistics
Project Manager & two Logistics Coordinators” shall move to the newly established
logistics department of Matalan Middle East. They will continue with the organization as
the monitoring team of outsourced services. This is one of the major reason for select
experienced subject specialists as project team members at the beginning of project.
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
Logistics Project Manager:
Moves to the organization management team as “Regional Logistics Manager” for
Matalan Middle
Logistics Coordinator (LC) - Warehousing:
Moves to the organization as it is “LC – Warehousing” to monitor the outsourced
activities related to warehousing operation, and function reports to the Logistics
Manager”.
Logistics Coordinator (LC) – Freight Movement & Distribution:
Moves to the organization as it is “LC – Freight Movement & Distribution” to monitor the
all the freight movements and function reports to the Logistics Manager”.
The budget to accommodate them in the organization already set before begin the
project as (setting up of logistics department to Matalan Middle East) and therefore the
project budget shall no longer continues for accommodating them.
Further more, there will be no special training for the staff who carry-out the operation
since services are outsourced to subject specialist organizations. Selected 3PL
organizations shall arrange own training programs for their employees who involve for
the project carry-out.
4:3. Releasing of Other Resources:
Other than man power resource that discussed above in 4:2, the only resource remain
to be released by end of the project is the project office that cost $1200/- a month. The
proposed logistics department will be relocated to the DC service provider’s office as an
Logistics Implant starting from 1st October.
Establishing of MATALAN Middle East Distribution Centre
Project of Tharanga Jayalal – Supply Chain Solutionist
January 2011
4:4. Project Closure & Lessons learned:
The project will be closed by end of September exactly as projected in critical path
analysis within 195 days.
Lesons to be learned:
- Identifing of streanths and weeknesess of service supliers while the project
period in-order manage them in efficiant manner after completing the project.
- Build relationship in the project stage with the service supliers for a better &
long term business relationship.
- Understand the Service Level Agreements (SLA) & study them thourioughly
at the project duration in-order to manage / monitor KPI after outsourcing te
services to supliers.
- Identify best operation practices and various cost models that proposed by all
propasals (dispite of selected or not) that submitted to apply those while the
operation is running in future.
- The major finding will be a secondary solution and potential service supliers
within rejected proposals, if need in future use for an event of service failure
from selected suplier / supliers.