Delivery Inc.* is one of the main players in the parcel delivery market in the European country Oceania*. More information about the company and the market that it operates in can be found in this video. Delivery Inc. operates on the territory of three European countries and works with its international partners to provide courier services worldwide.
The company has a market share of around 35% and its primary target group is corporate clients. Delivery Inc. focuses strongly on IT in order to ensure the highest quality services for its customers. Delivery Inc.’s information strategy is aligned with its current business strategy. The company brings value to customers through complex software solutions that help to deliver its business objectives. It uses an advanced ERP system to manage and coordinate orders, issue documents, and delivery schedules. Furthermore, the company’s main focus is courier service with an emphasis on expanding the range of its services and network, which is achieved through automated parcel stations. The main source of revenue for Delivery Inc. is its courier services, which account for 93% of the total 11m euros. Corporate customers are the majority users of its services, accounting for 88% of the total revenue.
Due to the fierce industry competition in combination with market growth trends as well as the increasing demand for timely and convenient solutions, the courier company needs to find new ways to respond to the changing nature of e-commerce and logistics industries. The main competitor of Delivery Inc. is Post Delivery* which has a very different business model. It uses franchise agreements and thus is able to provide a far larger network to better serve its main target group – individual clients. In terms of delivery time, Post Delivery scores higher than Delivery Inc.
To keep up with worldwide market trends and to gain a competitive advantage over its main competitor, the company needs to implement a new technology solution for real-time predictive delivery. This change will impact its operations, cost estimates and potentially will improve customer satisfaction, helping the company keep its market leader position.
We propose the company to implement a real-time predictive analysis software (RTPS) that will design the route of the courier in a way that guarantees every parcel to be delivered within a particular two-hour time frame which will be communicated with the customer prior to delivery. A two-hour time frame is chosen because this is the benchmark in the industry when such process is initiated for the first time. The RTPS should be implemented within the current operating software network. The idea is to use historical data about the Delivery Inc.’s operations and customers and combine them with real-time data, such as weather conditions or traffic congestion. RTPS will support employees by drawing the best possible route of the courier based on operational capacity and courier availability in the given region.
This solution will bring some risks, additional costs and efforts along with its benefits. The main associated risk is the possibility that the data stored by Delivery Inc. may not be sufficient to implement an optimal algorithm. However, the expected benefits will bring a significant value added for the company, thus it is highly recommended for the company to consider the proposed solution.
*Please note that fake names are used for this project to protect the company identity.
