Case Study

To reduce
Wellspring Transport Cost

Honey Comb : Travel and Hospitality

Process : High Transport Cost
Location : TCS Wellspring Mumbai
Prepared by : Herzel Simon

19 August 2019 TCS Confidential

Table of Contents

1. Project Charter

2. VOC – CTQ flow

3. Baseline performance

4. Stratification factors

5. Graphical representation based on stratification factors and inference

6. AS-IS flow diagram

7. Improved “ To- Be” flow diagram

8. Fishbone diagram

9. List of solutions ( arrived through brainstorming with the team)

10. Status of Solution Implementation

11. Result after Solution implementation

12. Control Plan

13. Conclusion / Lessons learnt

Structured Problem Solving TCS -Internal

1. Project Charter
Problem Statement : Goal Statement:

To reduce Transport cost per associate from Rs 1472

High Transport cost at Wellspring Vikhroli, to Rs.1300 by August’09.
Mumbai DC which is at Rs. 1472 per associate.
This high amount affects individual WON
profitability which in turn affects company
profitability.
Period : 1st April 07 – 31st Jan 09.
Source : Wellspring Transport (Admin)

Project
Project Plan
Plan :: Project Team:

Herzel Simon Team Member

Rahul Nikam Transport Coordinator
Michelle Athaide Mentor
Quality Representative Asha Badgeri
Kundan B Black Belt

Structured Problem Solving TCS -Internal 2

2. VOC and CTQ
Voice of the customer Key customer issue

High Transport cost at Wellspring Vikhroli,

Mumbai DC affecting individual WON profitability
which in turn affects company profitability.
High transport
Period – 31stat
:1st April 07cost Wellspring
Jan 09. Vikhroli To increase Company Profitability

Critical customer requirement

Critical to Quality

Reduce Transport cost Transport cost

Structured Problem Solving TCS -Internal 3

3. Baseline Performance
Name of the metric ( with unit of measure) : Transport usage / Spend

Month wise average

2000 1899
1800 1664
1574 1517
1600 1477 1455 1432 1460
1407 1337 1389 1394
1670
1400 1588
1500 1412 1469 1411
1200 1379 1386 1392 1413
1000
800
600
400
200
0
7 7 7 7 7 7 7 8 8 8 8 8 8 8 8 8 8 9
TH r-0 -0 n-0 l-0 -0 -07 t-0 v-0 -07 -0 -0 r-0 r-0 -0 n-0 l-0 -0 -08 t-0 v-0 -08 -0
N y g p c n b y g p c n
O Ap Ma Ju Ju Au Se Oc No De Ja Fe Ma Ap Ma Ju Ju Au Se Oc No De Ja
M
From the above we could gather that the there is a decrease in cost.

Structured Problem Solving TCS -Internal 4

 4. Stratification Factors
Comparision of Per Associate cost for Car and Bus from Apr’ 07 to Jan ‘09

Total Average/Associate
Transport Cost , Wellspring Vikhroli Amt.

42 2000
1899
41 1800
1670
1588 1517
40 1500 1600
1664 1469 1460
39 1574 1412 1379 1411 1389 1392 1394 1413
Value in lacs

1477 1455 1400

1407 1337 1432 1386
38
1200
37
1000
36
800
35
600
34
33 400

32 200

31 0
Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan-
07 07 07 07 07 07 07 07 07 08 08 08 08 08 08 08 08 08 08 08 08 09
Period

From the above we could gather that the total car cost is growing rapidly during the period Apr 07 – Jan
09,however the cost per associate is reduced from Rs.1899 in Apr 07 to Rs.1517 in Jan 09.

Structured Problem Solving TCS -Internal 5

4 Stratification Factors

1) Billing amount for Car –Month wise from April 07 to January 09

2) Billing amount for Bus – Month wise from April 07 to January 09
3) Headcount at Vikhroli DC from April 07 to January 09

Structured Problem Solving TCS -Internal 6

 1) Billing amount for Car –Month wise from April 07 to January 09

BILLING AMT (Cars) Cost/Associate (CAR)

Car Cost

3595
26.2 3600
25.7 3500
25.4 25.2
3436 3449 24.8 3400
3318 3300
Cost in Lacs

3223 3200
22.2 22.1 22.2 22.2 22.2
3100
21.6 21.4 3060 21.3 21.2
2971 2978 3000
20.4 20.3 20.7
20.3 2900
20.0
19.4 2841
19.2 2774 2773 2794 2772 2800
18.8 2736 2730 2710 2740 2755
2718 2704 2700
18.0 2619 2618 2600
Nov-07

Nov-08
Jun-07

Jan-08

Jun-08

Jan-09
Jul-07

Jul-08
Apr-07

Aug-07

Sep-07

Dec-07

Feb-08

Mar-08

Apr-08

Aug-08

Sep-08

Dec-08
Oct-07

Oct-08
May-07

May-08
Period

From the above we could gather that the total car cost is growing rapidly during the period Apr 07 –
Jan 09,however the cost per associate is reduced from Rs.3595 in Apr 07 to Rs.2775 in Jan 09.

Structured Problem Solving TCS -Internal 7

 2) Billing amount for Bus – Month wise from April 07 to January 09

Bus Cost BILLING AMT (bus) Cost/Associate(BUS)

18.0 13.7 16.8 16.6 1200

16.2 16.6 16.5 16.6 16.6 16.3
13.3 15.5 15.5 15.0 15.2
16.0 15.7 15.7 14.9 14.9 14.7
1090 14.1 14.2 14.2 1000
14.0
12.0 800
908 964 916 939 904 945 922 901 876 862 842
10.0 836 892 871 862 868 784
745 756 757
600
8.0
6.0 400
733
4.0
200
2.0
0.0 0
Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan-
07 07 07 07 07 07 07 07 07 08 08 08 08 08 08 08 08 08 08 08 08 09
Period

From the above we could gather that there is not much change in Bus cost however cost per
associate is reduced from Rs.1090 in Apr 07 to Rs. 842 in Jan 09.

Structured Problem Solving TCS -Internal 8

 3) Headcount at Vikhroli DC from April 07 to January 09

Headcount Headcount Vikhroli DC

3500 3225 3272 3253

3057 3094 3113 3094
2927
3000 2836
2670 2670 2734
2540 2576 2477
2452
2500 2347 2364
2112 2203
2000 1875 1932

1500

1000

500

0
1- 1- 1- 1-Jul- 1- 1- 1- 1- 1- Jan- Feb- Mar- Apr- May- Jun- Jul-08 Aug- Sep- Oct- Nov- Dec- Jan-
Apr- May- Jun- 07 Aug- Sep- Oct- Nov- Dec- 08 08 08 08 08 08 08 08 08 08 08 09
07 07 07 07 07 07 07 07
Period

From the above we could gather that the headcount has grown sizeable number from 1875 in Apr 07
to 3253 in Jan 09.

Structured Problem Solving TCS -Internal 9

5. Graphical Representation

Cost for transport

Transport cost for Jan 09

3000000 2600000

2000000 1400000
1000000

0
Car Cost Bus Cost
Cost

From the above we could gather that the major factor contributing to the high transport cost is car
cost which need to go in southward direction

Structured Problem Solving TCS -Internal

5 Graphical Representation

Causes of high cost

Cause of High Transport cost

5000000 4000000
Cost in Lacs

4000000
3000000
2000000
800000
1000000 100000
0
Free Transport Home Pick & Territorial
Drop at 21:00, boundaries
21:30, 22:00
Causes

From the above we could gather that free transport to associates constitutes Rs 40 lacs Home pick
up & drop contributes Rs 8 lacS & territorial boundaries not defined as Rs1 Lac. The causes of high
transport, home pick up, drop & Territorial boundaries are a Subset of free transport.

Structured Problem Solving TCS -Internal

5B. Graphical Representation
Cost Reduction

Cost Reduction

1200000 1000000
Cost in Lacs

1000000 800000
800000
600000
400000
200000
0
Free Transport Home Pick & Drop

From the above we could gather that we can reduce cost by:
10 Lac (25%) if a nominal charge of Rs.500 is levied for associates using the transport facility.
Rs. 8 Lac (20%) can be saved by converting 21:00,21:30,22:00 hrs Home pick up & 22:00 hrs Home
drop by car to Hub transport by bus.

Structured Problem Solving TCS -Internal 12

6. Fishbone

Man Material

D river C o st .

Fluctuation in diesel cost

Noo Territrial
N T erritrial
Boundaries
B o undaries

Non
N o nChargeable
C hargeable

High Transport Cost

Inadequate information provided by associates

Shift Timings Last minute cancellations

Billing Structure
Lo cal shift ho urs

Last minute requests

fro m asso ciates.

Due operational reasons communication

Gap
Method Mother Nature

Structured Problem Solving TCS -Internal 13

7. List of Solutions

Root Cause Solution

1 Free transport Associates to pay a nominal fee for transport
2 Home pick-up for 2100 hrs. , Start bus services from hubs.
2130 hrs. and 2200 hrs. (approx.
45 cars)

3 Home drop for 2200
(approx. 80 cars)
4 Policy states home pick and
drop time as 2100 to 0600
5 Territorial boundaries not defined
for pick ups & drops
6 Shift timings
hrs. Start bus services from hubs
Change the policy for home pick-up and drop to 2230 hrs. to 0600 hrs.
Define areas of residence during recruitment. eg: Ambernath, car drop
takes 130 kms.
While finalizing shift timing, we need to see how car transportation can
be reduced. As per current policy, where (from 2100 hrs. to 0600 hrs.)
home pick-up and drop is provided, we should avoid shift starting &
ending between 2100 hrs. and 0600 hrs.(except operational needs)
All managers, transport team and WFM team to sit together to finalize
shift timings

Structured Problem Solving TCS -Internal

7. Supporting for Solutions
S.N Root Cause
1 Legal point of view
2 Other BPOs on Home pick up
& drop
3 Position of other BPOs on
territorial boundaries.
Structured Problem Solving
Solution
There are guidelines by NASCOM about night drop for lady associates but
timing is not mentioned.
Mumbai Shops & Establishment Act restricts women from working after
2000 hrs.
Mumbai Factories Act also restricts women from working after 2000 hrs.
In 2005, Central Govt. granted permission to some of the industries for
women to work in late night shifts with security measures to be adopted by
companies (this included IT industry).
WNS BPO (3000 plus employees) which is next door to TCS at Vikhroli
gives bus drop for 2200 hrs. shift to hubs and bus pick-ups for shift starting
at 2200 hrs.
Kale Consultancy at Andheri, around 400 -450 BPO employees gives bus
drops to hubs for shift leaving at 2200 hrs.
Many BPOs have restricted areas of residence while recruiting, for
example, WNS
TCS -Internal
8. Implementation

Sl. no Activity To improve what Who When How Status

Tweak various shift To reduce number Process All should meet Not
By May
timings . of trips by Bus & owners, and fix shift started
end
1 Car timings
WFM,Tra
nsport
departme
nt
2
Change Policy To be able to stop Tcs Meet , discuss
By May
for home pick home pick up at corporate & approve Not
end
& drop. 21:00, 21:30, 22:00 team policy change started
hrs & home drop at
22: 00 hrs

Limit the territorial To limit long distance HR team By May HR head to Not
3
boundries at the pick ups & drops in end take a call started
time of recruitment future

Start nominal
4 charge of Rs.
500 to all To reduce transport cost by HR team Hr head to take a call Not
20% By May
associates end started
availing
transport

Structured Problem Solving TCS -Internal 16

8. Implementation Continued….

Sr. no Activity To improve what Who When How Status

If it is drastically less Meeting’s

5
To study then to share their Decision By May between Not
TCS best practices, If it is to be end transport started
eserve car lot more then try to taken by departments of
spend per share our best V.K both
employee practices with them, Raman &
may prove cost executed
effective for any one by Admin
&
Transport
6

7 .

Structured Problem Solving TCS -Internal 17

9. Conclusion and Lessons Learnt
Conclusion:
Cost can be reduced through the following ways:
1. A nominal fee can be levied from each associate using the transport facility.
2. Collate various shift timings to arrive at one shift timing (eg 0900hrs and 0930hrs) can
be started at 0915hrs.
3. Start and end time of shift can be changed in order to reduce the home drops and
home pick ups.
4. Home pickup at various time from 2100hrs , 2130hrs and 2200hrs. Home drops at
2200hrs to be changed to hub pickup and drops.

Lessons Learnt
Pareto Analysis
Graphical Representation
Brainstorming Techniques
Solutioning Techniques
Presentation skills
Basic Skills of Exels

Structured Problem Solving TCS -Internal 18

Thank You

19 August 2019