Reverse Logistics and Improve Customer Satisfaction

Add comment August 23rd, 2006 David Bush - Iasta

I found the recent article in Global Logistics & Supply Chain Strategies of SupplyChainBrain.com entitled Looking Backward: Sony Ericsson Takes on Challenge of Reverse Logistics to be very interesting. The author, Robert J. Bowman, describes how Sony Corporation and Ericsson AB sought a competitive edge in the mobile-phone market by revamping the handling of returns and repairs.

The article described how Sony Ericsson required a fast, reliable and flexible system to manage parts for phones with a lifecycle of around nine months that would also lower its overall cost structure. It used to rely on a single electronics manufacturing service provider to handle productions, repairs, and logistics, but since the provider was subcontracting freight and brokerage and insisted on doing repairs in Mexico, the relationship wasn’t working.

Sony Ericsson decided to separate repair and logistics into two separate contracts, the first going to Bloomington PTS Electronics Corporation and the second to UPS Supply Chain Solutions. It was a challenge as this required building a system that could handle the sheer volume of product that would work through the system in a real time exchange between all parties involved and required them to absorb UPS Supply Chain Solutions’ knowledge, but it paid off. The company was able to reduce costs and double customer satisfaction levels, an impressive feat.

The article demonstrates that supply chain improvements extend beyond sourcing and distribution and that you should always be on the lookout for new ways to improve your operations.

Entry Filed under: General, Global Supply Issues/Risk, Supplier Performance