McKesson Corporation, a Fortune 35 corporation, is the world's
largest supply management and healthcare information technology
company. Distribution is a critical component of McKesson's business,
and its pharmaceutical distribution business serves over 30,000
customers through 32 distribution centers with over 2,600 drivers.
McKesson wanted to replace its paper-based delivery process with an
automated system using mobile devices, to improve customer service
levels while reducing costs and improving productivity.
The Challenges
With its paper-based delivery system, McKesson identified several
problem areas that needed to be addressed. For example, each day
drivers received paper schedules and manifests that listed routes,
stops and packages that needed to be delivered that day. At each stop
the driver manually marked off the packages from the manifest and then
had the customer sign the document to confirm delivery. This system was
slow, error prone and resulted in incomplete and inaccurate deliveries.
As a result, McKesson received calls every day related to
delivery errors. At the end of each day, the drivers submitted all of
the signed manifests. These paper records were then archived in a
warehouse or scanned into a document imaging system. This paper-based
system was expensive and did not provide an easy way for McKesson to
confirm delivery information to customers. In fact, it was sometimes
impossible to retrieve the paper proof-of-delivery and McKesson had to
write-off the delivery.
Further, the paper-based system did not provide a way for McKesson to
audit its processes, track packages and confirm that drivers had indeed
delivered their routes accurately and on time. McKesson sought a system
that would provide a closed feedback loop and allow the company to
track the performance of its drivers and delivery process. This is
important because McKesson negotiates rates with its couriers based on
delivery performance and could secure more favorable terms if it could
prove it was meeting performance targets.
Lastly, McKesson wanted a system that would leverage its existing
back-end systems and infrastructure, but would also let the company
publish delivery information to new Web-based systems. McKesson also
wanted a solution that was easy to maintain and extend.
The Solution
After a rigorous evaluation of mobile computing solutions, McKesson
selected M-Business Anywhere as its preferred solution. McKesson
integrated M-Business Anywhere into its existing systems and to run the
application on the ruggedized Symbol SPT 1700 Palm OS device.
McKesson's drivers are located all over the country – and many do not
have continuous access to a wireless network – so the company elected
to implement M-Business Anywhere as an offline application that
connects to McKesson's systems at the beginning and end of each day.
However, there is also the flexibility to use the application in a
wireless mode.
Each morning, drivers receive their route information, including stop
and manifest information, by synchronizing their mobile devices using
M-Business Anywhere. Once a driver arrives at a stop, he/she scans the
barcode of each package to reconcile it against the manifest. Then the
driver captures an electronic signature as proof-of-delivery. This type
of automated manifest reconciliation using barcode scanning and
enforced work rules is a much more accurate way of delivering packages
than manually checking against a paper document.
For example, M-Business Anywhere will generate a warning message and
tone if a driver tries to deliver a package that belongs to another
stop. Also, drivers are required to designate any undelivered packages
as missing, damaged or refused. With M-Business Anywhere, McKesson has
dramatically reduced incomplete and misdirected deliveries. Customer
calls for delivery errors have dropped to nearly zero. At the end of
each day, drivers synchronize their devices again and upload the
delivery information and customer confirmations to McKesson's back-end
systems. McKesson can use this information to audit the delivery
process with management reports and identify any problem areas. This
has increased on-time deliveries and reduced delivery errors.
McKesson has also used this information to negotiate more favorable
rates with its couriers, as well as reduce proof of delivery
write-offs. McKesson was able to quickly deploy and integrate the
solution into its back-end systems. M-Business Anywhere's
standards-based architecture allowed McKesson to accomplish this
deployment and integration quickly using existing Web based tools.
McKesson estimates that M-Business Anywhere helped introduce the
product a year earlier than expected.
