Importance (%) 23% 19% 19% 15% 15% 9% 100% CRITERIA--> Rates On-time Delivery Re
ID: 397037 • Letter: I
Question
Importance (%)
23%
19%
19%
15%
15%
9%
100%
CRITERIA-->
Rates
On-time Delivery
Reliability
Capability
Flexibility in modes
Capacity
Score
ABC Freight
70
95
95
90
100
80
Rough Ryder
100
90
90
85
80
85
Choice Trans
95
100
100
90
70
75
X-Country
80
90
80
100
75
90
Royal Shipping
75
95
85
80
95
100
M&M Trucking
80
90
90
95
90
85
We have a new client, Jelson Industries. This company is a distributer of garden equipment. They are asking us to help them with a recommendation for a Transport Carrier strategy for the upcoming year. Here is the situation: Julie Malone, VP of Operations at Jelson, has determined that the company would like to obtain one-year contracts with two carriers to provide for the shipping needs across the four modes (excluding pipeline) since they ship using the four main modes for various products and to various locations across the country. They have identified the best six national carriers that are capable and flexible in using the four modes, based on prior experience. I met with Ms Malone and her team and together we have identified six evaluation criteria to create a scorecard for decision making. And we have determined the importance weighting of each criteria. Also, after long and careful analysis and debate, we have scored each carrier on each criteria using a 100-point scale. The best carrier on each criterium receives the score of 100 and then each of the other carriers are compared and given a relative score. The table is provided below. For example, Rough Ryder has the best (lowest) rates across its modes of shipping and has been scored 100. ABC Freight has the worst (highest) rates and is scored a 70 in comparison to Rough Ryder. The other carriers are scored somewhere in between based on each’s comparative rates. The same process was used for the other criteria. Just before I sent you this assignment, I received an updated quote from M&M, which has provided a new proposal for its rates based on a contract for one year (stating their original quote did not consider the possibility of a guaranteed quantity.) This new proposal put M&M Rates at 95%, comparable to those of Choice Transport. Your Deliverable: a report that • Provides an analysis and recommendation for which two carriers are the prime candidates for the annual contracts to lock in the rates; Do two analyses: o First analyze the data with the original data from M&M o Second analysis using the new information from M&M o What is your final recommendation and why? • Discusses your analysis and results o What do the different weightings mean of the six criteria? Do they make sense? o Discuss the six criteria (attributes) and how they relate to the four modes of transportation, i.e., OTR, rail, air, and water Be sure to use APA format to cite any references that you use in this report. As always, I am available if you have any questions. Danforth Swenson, PhD VP and Managing Director DATA INCLUDED BELOW CRITERIA
Importance (%)
23%
19%
19%
15%
15%
9%
100%
CRITERIA-->
Rates
On-time Delivery
Reliability
Capability
Flexibility in modes
Capacity
Score
ABC Freight
70
95
95
90
100
80
Rough Ryder
100
90
90
85
80
85
Choice Trans
95
100
100
90
70
75
X-Country
80
90
80
100
75
90
Royal Shipping
75
95
85
80
95
100
M&M Trucking
80
90
90
95
90
85
Explanation / Answer
The problem can be analyzed by the weighted score method to compare the alternatives. Calculate the weighted score for each factor (i), by multiplying factor weight (Wi) with alternatives (j) rating (Rij) of factor. Then, for each alternative, find the sum of product (Wi × Rij) calculated for each factor and select the alternative having the highest total score.
Importance (%) (Wi)
23%
19%
19%
15%
15%
9%
100%
Alternatives (j)/CRITERIA (i)-->
Rates
On-time Delivery
Reliability
Capability
Flexibility in modes
Capacity
Weighted Score
ABC Freight
70
95
95
90
100
80
87.9
Rough Ryder
100
90
90
85
80
85
89.6
Choice Trans
95
100
100
90
70
75
90.6
X-Country
80
90
80
100
75
90
85.05
Royal Shipping
75
95
85
80
95
100
86.7
M&M Trucking
80
90
90
95
90
85
88
Weighted score for ABC freight is calculates as follows:
(Wi)(Ri1) = (23%)(70) + (19%)(95) + (19%)(95) + (15%)(90) + (15%)(100) + (9%)(80) = 87.9%
Highest weighted score is 90.6 for Vendor – Choice trans
Second highest weighted score is 89.6 for vendor – Rough Ryder
Thus, according to original information the contract should be made with Choice trans and Rough Ryder.
Information update by M&M Trucking:
The rating of M&M trucking for the rates criteria is revised to 95%. Thus, the weighted score of the M&M trucking will revise as follows:
(Wi)(Ri6) = (23%)(95) + (19%)(90) + (19%)(90) + (15%)(95) + (15%)(85) + (9%)(88) = 91.45%
According revised information, the selection of vendors will be changed, since M&M trucking’s weighted score is highest now.
Thus, according to updated information the contract should be made with M&M Trucking and Choice Trans.
The different weights to criteria represent the importance level of that criteria for organization. For example, service rates, on-time delivery, and reliability play important role in the performance of operations of organization.
Importance (%) (Wi)
23%
19%
19%
15%
15%
9%
100%
Alternatives (j)/CRITERIA (i)-->
Rates
On-time Delivery
Reliability
Capability
Flexibility in modes
Capacity
Weighted Score
ABC Freight
70
95
95
90
100
80
87.9
Rough Ryder
100
90
90
85
80
85
89.6
Choice Trans
95
100
100
90
70
75
90.6
X-Country
80
90
80
100
75
90
85.05
Royal Shipping
75
95
85
80
95
100
86.7
M&M Trucking
80
90
90
95
90
85
88