Expediting in regard to the supply chain or procurement is a strategy to ensure that goods and items which are purchased arrive in a timely fashion and meet quality control standards.

Sometimes expediting is done by an external ‘expediter’ or it can be done within the procurement department.

The expediting role is simple; goods will be checked as to their progress and opportunity to achieve the programmed delivery date. Typically the expediter has to ensure that they meet all targets, including quality, safe packaging, arrival times and are exactly to the specification that was agreed between the supplier and the customer.

 

Use Of Expediting

expedite process

Expediting can be time intensive and this can produce a drain in resources. However despite this it’s a common process and is symptomatic of various issues within the supply chain.

Despite expediting being time intensive the costs of using an expediter can be typically absorbed against the cost of late delivery – often the cost of the expediter is insignificant when compared to penalty clauses bestowed by customer contracts.

 

Different Types of Expediting

While all companies will treat their expediting processes in subtly different ways (including the control of the expeditor that can range from being a procurement to an operational role) the basic task remains the same.
Expediting is typically a form of project management with the most intensive form of expediting effectively ensuring that the supplier carries out all tasks and activities and that the supply of goods meets the required timescales. This form of producing “day plans” can be very intensive and requires both close collaboration with the supplier and timely communication.

Whilst many forms of expediting may just be in practice a routine phone call to the supplier to verify that deliveries are still on track – day planning, whilst intensive can be extremely useful in complex programs where timely delivery is crucial (either from a financial perspective of other) and that advanced knowledge of supplier issues (in order that they can be mitigated) can become a key management tool.

 

The Importance Of Your Expedite Process

expediting the processes

As a business owner, you know that the expediting of raw materials, parts, systems, and subsystems in inbound logistics is common. But it is a necessary evil for many companies. After all, there are many reasons for expediting, These include missed contracted delivery dates, damage to stock, supplier-related issues, and tight customer requirements.

When you are purchasing these materials, the expediting can be burdensome and stressful. The reality is that many stakeholders that rely on delivery dates are involved in this process, especially when parts are critical. And even though “chasing” suppliers is not a job a buyer is supposed to do, it ends up doing so most of the time.

You probably already had to handle a lot of revised delivery dates. From the absence of a formal process to the use of different forms of communication at the same time, you, as a buyer, need to deal with many different challenges. This is why it is so important to implement a common process, have good relationships between suppliers and buyers, and make sure that the organization has a policy for escalation is a good start toward improving the expedite process. However, when the company determines the root cause, it can reduce and mitigate expediting problems over the long term.  

The Expedite Process And Challenges

communication

Most companies tend to place purchase orders for materials based on their production schedules as well as on their MRP system’s inventory. Sometimes, a company may need to place a purchase order that still needs to be produced. And in case the company doesn’t have all the materials or required parts on hand to produce and ship the order, it will also need to order them from a different company. And this ends up affecting your company. 

The reality is that many small or mid-sized companies do not have a real-time tracking tool to record expedite requests, track response times and measure actual delivery improvements. The procedures in this part of the supply chain are often unstructured. On some occasions, buyers receive multiple phone calls or e-mails from the same person, or multiple individuals. Buyers don’t know whether the expedite is important or not, and often there are no rules for escalation. There might be no record of how many expedites have been requested, no idea of the current status, or estimates of the time and effort expended by stakeholders. It’s difficult to assess how well the supply chain is responding, and gauge the amount of wasted employee time due to duplicate requests. 

If you think about it, the entire company is affected. With all this, the ones that are representing your company are often frustrated because they cannot effectively respond to their customers.

So, and overall speaking, companies need to be able to determine the following:

  • Number of expedites received per week, by buyer
  • Mean time to respond to a request
  • Number of open expedites
  • Number of closed expedites
  • Number of successful expedites.

Some suppliers send buyers a list with all their orders and the status of the ones that they haven’t delivered yet. The buyers might need to update this information in their information system manually. Some suppliers might not send the buyer a status list, further complicating the work of the buyer, who now needs to follow up on the orders.

Here’s A Practical Example

automate-expeditions

Let’s say that Company X decided to create a custom form to track expedites. This was done in Oracle order entry and attached to the order itself. Then, the salesperson went into the order-entry form and clicked on the part number and expedite form icon in the ribbon. The form was auto-populated with the part, quantity and manufacturing location. When sent, it would transmit a system-generated e-mail to relevant parties.

The reality is that the customer service needed to know 3 things about the expedite: 

  • the customer who requested it
  • the requested shipping date
  • the tier level of the customer. 

This was a vital step in the process. After all, the company couldn’t add the cost effectively since it didn’t provide the same level of service to all customers in all situations. So, it needed a way to differentiate expedites based on the importance of the customer and the urgency of the need.

Expedites were tiered, with the tier going up if the company did something wrong, based on standard criteria related to customer or level of need:

Tier 1 (lowest): An expedite was done if there was no system date given for the part (lead time infinity). If the customer requested a better date but did not meet Tier 2 or 3 criteria, the customer was advised, and the system generated an estimated ship date that was the best date the company could promise at that time. The line was committed to the system.

Tier 2 (medium): Delays caused by missed ship date, a line being down, significant impact on the project timeline, or an order for a strategic account were reasons for this level of expediting.

Tier 3 (highest): Company error, missed committed dates and multiple triggers from Tier 1 or Tier 2 for order value greater than $100,000 were reasons for this level of expediting.

Upon receiving a response to the expedite, customer service changed the scheduled ship date and committed the line. The customer service representative who did so was tagged in the system, and a daily report was generated for follow-up. If a commitment was missed, the representative automatically did another expedite and changed the tier level to the next highest tier. When the new scheduled ship date was received from manufacturing, the customer was contacted. Depending on the tier, the company would pay for expedited freight to the customer location.

Manufacturing was also notified via system-generated e-mail when an expedite was entered into the system. It was responsible for reviewing and communicating back to customer service an improved scheduled ship date, with a response due in 24 hours or less. If production promised a commitment, it was expected to meet it; if not, it had to have a reason why it missed that commitment.

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