Case study of benchmarking practices in 3PL company AIC logistic services ltd.

Abstract

On December 1, 2010, Mr. Prasad, solution lead, AIC logistics services was in a meeting with their long term client Chennai Motor Company. AIC has been the logistics partner in many of Chennai Motor Company's businesses and the relationship between the two firms has been a long and profitable one. Mr. Sundar from Chennai Motor Company said, "Prasad, we are thinking about outsourcing the light assembly process in our genset business and we are looking for a reliable firm that can provide us with service. Can you suggest anyone who can fit the bill?" Mr. Prasad thought for a while and replied "Give a week's time, I'll think of someone". The meeting ended amicably, but it got Mr. Prasad thinking. He understood that the light assembly business was the process of fitting up a bare engine with child parts to make it functional before being transported to the client site for installation. The process seemed simple enough, but the real challenge was in inventory management. Can AIC Logistics venture into the light assembly business? Their parent company AIC & Sons was already an industry leader in the tools and parts manufacturing business; will it be possible to combine the capabilities of their tools business and their logistics business to create a value addition to their client? Mr. Prasad had a week to investigate this option and give an answer to Chennai Motor Company.