i only need the Data Collection Planning sheet

Precision Delivery Inc. Case Study

Precision Delivery Inc. (PDI) is a package pickup and delivery service for homes and small businesses.

PDI specializes in packages 50 pounds or less and has a full-price rebate policy for any pickup or

delivery made outside the customer-designated 15-minute window. PDI advertising proudly states,

Pickup and delivery at your convenience, not ours.

PDI has facilities at 2 locations, Downtown and Suburbia, each servicing customers withing a 15-mile

radius with pickup and deliveries made by truck or bicycle. Customers designate a 15-minute window

for their packages to be picked up or delivered. PDI charges customers $5 per package plus $1 per

pound (50-pound maximum).

PDI Sales Operators receive pickup and delivery requests by phone from customers. Dispatchers issue

instructions to Field Operators for pickups and deliveries. To ensure prompt service, Dispatchers plan

for 30 minutes of travel time, one way, for each pickup or delivery and target arrival time for the

start of the 15-minute window. Under current procedures, travel time in excess of 45 minutes will

result in a rebate and travel time less than 30 minutes results in idle time for the Field Operator. Field

Operators return directly to the dispatch facility after each pickup or delivery.

A subcontractor who offers bike and truck time on demand supplies Field Operations. PDI pays only

for round-trip road time and idle time at the customer destination. PDI accountants have calculated

the Field Operations variable cost for delivery, pickup, and idle time at $7.5/hour for bicycles and

$15.00/hour for trucks. All other costs are fixed at $5,000 per week. Pickups and deliveries are made

Monday through Friday, 8:00 a.m. to 4:00 p.m. Recently, Sales Operators have reported a noticeable increase in customer concern for the timeliness

of deliveries and pickup. In response, Sales Operators were instructed to remind customers of the

PDI price rebate policy.

Additionally, a short survey was sent out to a small group of established customers. Survey results

disclosed an appreciation of price rebates, but a preference for deliveries within the promised 15-

minute window.

PDIs CEO sole shareholder, Pat Hunter, is concerned about customer satisfaction and profitability.

Although financial results have been consistent over the last year, Pat believes the current return on

sales (ROS) of 11% must increase to more than 20% to avoid shutting down the business and more

than 30% to grow the business. Pat wants to know how PDI can increase ROS while maintaining or

increasing customer satisfaction.

Last month, PDI had the following results:

Sales $58,500

Sales after Rebates $49,100

Field Operations Trip Cost (Variable) $18,900

Field Operations Idle Time Cost (Variable) $ 3,600

Gross Margin $26,600

General and Administrative (Fixed) $20,000

Profit Before Tax $ 6,600

PDI Project Proposal Worksheet

Team Name: Margin Makers

Project Title: Improve the PDI field operations process for package pickup and delivery.

Problem Statement: PDI gross margin is insufficient to sustain business operations and create growth.

The current field operation process for package pickup and delivery results in sales rebates and idle

time that degrade gross margin.

Goal Statement: Reduce sales rebates and idle time by 85%.

Business Case and Estimated Benefits: An 85% reduction in sales rebates and idle time will increase

gross margin by roughly $11,000 per month and increase ROS to roughly 30%.

Benefit Calculations or Basis:

Prior month sales rebates = $9,400

Prior month idle time = $3,600

85% reduction = $11,050 per month

Executive Project Approval Board Use Only

Approval: Yes? No?

Verified Benefits Amount: $11,050 per month in gross margin

Data Collection Planning Sheet (1) Question to (2) Name of Data (3) Operational Be Answered Required Definition (4) Related Measures (5) Collection (Stratification) Plan Where: When: Who: How: Where: When: Who: How: Where: When: Who: How: Where: When: Who: How