De-expedite and Prioritize
Written by Andrew Goldman for Gaebler Ventures
While most businesses know how to expedite product when a rush delivery is needed, few companies fully take advantage of de-expediting. Prioritize your orders in order to better manage your demand.
Everyone in business knows the term expedite.
When we need something faster than usual, we pay extra costs to have the product rushed to us. When we are behind on a customer or order or try to help a customer out, we expedite the product and rush it through our system. What can be equally important, but often ignored is the process of de-expediting.
De-expediting is the process of moving orders that are not critical to the backburner in order to facilitate the expediting process. By understanding the balance between expediting and de-expediting you can avoid overloading your workforce and facilities while still getting rush orders out the door.
Prioritization is a necessary component of a smooth Operations planning process. By prioritizing our work and jobs that need completion, we can better balance our work schedule while appropriately completing jobs at the correct time. Without prioritization, each customer order is treated the same, regardless of the importance, size or due date of the order.
There are many different ways to prioritize work. Some companies give their larger customers special treatment and organize their work priority with their big customers coming first. Others manage their priorities by profit margin or by volume.
Regardless of how you choose to prioritize you work, it's important to incorporate multiple factors including cost, profit, customer service and due date. You should treat all orders seriously and all customers with importance. When your capacity is limited, however, you need to have a priority system in place.
There are many reasons why we might have to expedite a product or service. It's possible that the customer messed up and we are doing them a favor. It's also possible that we have made a mistake and need to rush the product. It is important to remember that if we are the ones who made the mistake, it is of the utmost importance that the product is delivered correctly and on time to the customer the second time around.
When you expedite a product, you are rushing it through the system ahead of its normal lead time. This usually means that it is being put onto the schedule in lieu of something else. This is where the de-expedition and prioritizing process comes into play. Rather than just adding the expedited product to the schedule and overloading our employees and facilities, you should delay a product that is capable of being delayed (de-expedite).
For example, if I needed to rush an order of computer chips due in two weeks. There might be an order for computer chips on the schedule that's not due for three months.
By de-expediting the three month order, you can have a balanced workload. If no orders can be de-expedited, then you need to use your priority system to determine what will be put on hold, or make a decision to use overtime or subcontract the work.
If your company has a chronic problem of late deliveries, seriously analysis and change needs to take place. It is possible that your lead times need to be extended or additional capacity needs to be added. In general, you should aim to reduce your lead times to better respond to customer demand.
Andrew Goldman is an Isenberg School of Management MBA student at the University of Massachusetts Amherst. He has extensive experience working with small businesses on a consulting basis.
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