Using Tools & Technologies to Mature a Returns Management Process

Spinnaker Proprietary & Confidential. 2014 All Rights Reserved
Using Tools & Technology to Mature a
Returns Management Process
Maturity Curve Webinar
Part II: Tools & Technology

Delana Lensgraf
• Research Content Specialist
• Returns Management Community
Coordinator
– LinkedIn Returns Management Leadership
Exchange
– CrowdHall
– Spinnakermgmt.com
Welcome
House Keeping
Feel free to message me with any questions – we will address these during the Q&A session.
Questions that can’t be addressed due to time constraints will be addressed in the Spinnaker
Returns Management Leadership Exchange on LinkedIn.
2

• Founded in 2002 to help global clients transform
their supply chains – forward & reverse
o Demonstrable Results
o Long-term, Impactful Relationships
o 95% Repeat Clients
• Provide a unique combination of Supply Chain
Consulting, Technology Enablement and Execution
Services
• Experienced staff with relevant Supply Chain
Management experience
Spinnaker approaches each engagement with
Integrity and an unmatched focus on Client Success Inc. 500 List
“Fastest Growing US
Private Companies”
in 2008 and 2009
by Inc. Magazine
3
Spinnaker Overview
Supply Chain
“Pros to Know”
by Supply & Demand
Chain Executive
Magazine
Green Award
by Supply & Demand
Chain Executive
Magazine

• Introductions
• Goals for the Session
• Tools & Technology in the RM Maturity Curve
• Enterprise Returns Management Tools
• Stand Alone Returns Management Software
• Key Takeaways
• Q&A
Agenda
4

• Sharon has more than 20 years of
executive and managerial leadership
experience in Manufacturing,
Distribution/Logistics, IT, and Service
operations spanning large and small
domestic and global organizations.
• As a former CIO, Sharon has a unique
view of the importance of robust tools
to support successful operations.
• Sharon leads Spinnaker’s
Implementation and Change
Management Services team.
• Paul has over 25 years of business
experience, with 14 years of Reverse
Logistics experience.
• Paul works with manufacturers,
distributors, retailers and 3rd party
service providers to solve product
return challenges.
• Paul works with companies to
architect and implement returns
processes and systems utilizing the
Andlor Reverse Logistics Management
System, BacTracs.
Introductions
Paul Rupnow is a Partner with
Andlor Logistics Systems.
Sharon Nelson is the VP of
Spinnaker’s SAP Practice.
5

• Paul is a senior executive with over 20 years of
leadership experience in Repair Operations,
Reverse Supply Chain, Retail Returns
Management, and Sustainability.
• Paul co-leads the Returns Management
Consulting Practice for Spinnaker with a focus
on End to End Returns Management Strategy,
Reverse Supply Chain Design, and Corporate
Social Responsibility.
Your Webinar Emcee (MC)
Paul Adamson is Director & Co-Lead
of the Returns Management Practice
6

Why Are We Here?
Remember, it’s about recovery, not about cost.
If somebody will process for 10₵ /unit less, but cannot properly execute
an RTV for a $500.00 item, you didn’t save 10₵ , you lost $499.90!
Rob Saper, OfficeMax, RLA Las Vegas 2013
The Impact of the Customer Returns Experience
- 85% of customers WILL NOT shop with you again if the return process
is not convenient
- 95% of customers WILL shop with you again if the return process is
convenient
Independent Study - Harris, RLA Las Vegas 2013
…at least a 40% processing saving by companies who had mapped their
processes… also experienced a 20% higher recovery rate on returned
products.
Prof James Stock, University of South Florida
7

• To help webinar attendees understand the value of developing a
technology roadmap specific to returns management
• To provide a non-partisan view of tools and technology utilized to manage
mature returns processes
• To demonstrate real world applications of returns management solutions
• To create a platform that generates quality Q&A
Goals for the Session
8

Returns Management Maturity Curve
9

Typical Architecture of a Mature Returns Mgmt
System
It All Starts with the Customer
10

Beginner’s Typical Architecture
11

System Impacts
Examples of business processes that often have unique system
requirements for returns management.
12

• WHAT PART OF YOUR RETURNS
MANAGEMENT PROCESS SUFFERS
FROM THE GREATEST TECHNOLOGY
CHALLENGE?
 Planning
 Receipts
 Customer Crediting
 WMS Interoperability
 WIP/Inventory Management
 Dispositioning
Flash Poll
13

Spinnaker SAP, Sharon Nelson
14

Enterprise Returns Management SAP Return for
Credit
Call from
Customer
Order
Number
Known
Configurable
Material
???
Create Return Sales
Order with reference
to original sales order
(RMA#=SO#) Material
& Pricing Info copied
from ref. SO
Inbound Delivery
Order (auto) created
Return Material Arrives
– Create PRG against
the inbound delivery
order
Create a Credit Memo
against the Customer
record
Create Return Sales
Order using a material
specific dummy
material (RMA#=SO#)
Contact Sales Person
to change the quantity
on the sales order
Sales Person inputs
total amount against
the dummy material
Customer Returnable
Material Received
Receiving Staff
receives component
and updates QTY
received and sends it
to Sales for amount
Receiving Staff creates
PGR – Dummy material
explodes into
components
Returnable Material
Comes In
Inbound Delivery
Order (auto) created
Create a Credit Memo
against the Customer
record
YY
Standard or Special
Order Product
Return for Credit
15

16
Enterprise Returns Management SAP – Collect
Costs for Rework & Return to Stock

17
Enterprise Returns Management SAP – Collect
Costs for Rework & Return to Stock
 May be used to return units to stock, by customer specific storage location or general
 Sales orders used to re-sell refurbished goods. Cost collected on Work Order specific to unit

18
Enterprise Returns Management – SAP Product
Re-Manufacturing

19
Enterprise Returns Management – SAP Product
Re-Manufacturing

 All processes shown use standard SAP functionality with custom order types:
 Order Taken
 Credit Processed
 Inventory Updated, FG or RM level
 Remanufactured/Refurbished Order Priced/Invoiced
 Items tracked to customer as specific to Sales Order/Work Order
 Option to store good by customer specific locations
 Challenges include:
 Costing (if location of product manufacturing location is different than rework location)
 Planning Parts for Rework Processing
 Pricing rules for customer specific rework If other than cost plus
 Centralized storage of Warranty Terms if Rework Location is Centralized
 Enforcement/Management of Global Trade Compliance Requirements
 Sorting Process for Mixed Goods Receipt by Customer
Enterprise Returns Management – Challenges
20

Andlor, Paul Rupnow
21

BacTracs Reverse Logistics Management System
(RLMS) Overview
Reverse Logistics Management System
Self Serve
RMA Request
Status Lookup
and Emails
Returns Data
Integrator and
Web Services
RMA / Returns
Triage/
Disposition
Inventory
WIP and FG
Test/Repair
Refurbish
ShipmentsReceipts
Real Time Analysis Grids and BI
Alerts, Notifications
Processing Rules Engine
22

BacTracs RLMS Integration w/ERP & Partners
23

Cell Phone OEM: Reverse Logistics Data Control Tower
for Customer Service, RMA & Repair Management
ERP
Returns Management
System
Data Control Tower
Tracking/Status
Receipt Data
Repair
Partner
Self Serve
RMA Request
Call Center CSR
RMA
Status Lookup
and emails
Returns
Data
Integrator
and Web
Services
Repair Data
Shipment
Data
Real Time Analysis Grids
Alerts
Feature & Goals:
1. Customer Satisfaction, Updates and Visibility
2. Share, Manage, Control and Monitor RMA and Repair Data
3. Flexible, Powerful Real Time Reporting Grids and Alerts
Unit Repair
Data Record
Unit Repair
Data Record
RMA (ASN)
Web Service
24

3rd Party Returns Processor: High Volume, One
Touch Receiving, Credit, Triage, Disposition
ERP
Returns Management System
Data Control Tower
Returns
Data
Integrator
and Web
Services
1. Receive to RMA
2. Disposition Rules Engine
Returns
WIP
Inventory
To Refurb
To Bulk Resale
To Scrap
Put Away
to Directed
Location
Disposition Rules by Business Manager
Can Include:
• Item or family
• Cost or Market Value
• Inventory on hand
• Vendor
Return To Vendor
Features & Goals
1. Minimize Touches/ Max Speed
2. Combine Processes
3. Easy to Manage and Monitor Rules of Disposition
Scan UPC
RMA
Receipt /Credit
Web Service
25

• Mature Returns Management Processes Rely on Technology and Tools
– Increase Velocity, Reduce Complexity, Reduce Human Error
 Processing Costs Reduced 6-17% (on average)
 Reduce Crediting Costs
 Quicker Cash Conversion for Secondary Products
• Mature Returns Management Processes Develop Technology Roadmaps
– Assess Current State, Define Desired State, Identify Gaps
• Robust Stand-Alone and Enterprise Tools Exist to Mature the Operation
• Technology Must Be Supported at All Levels of the Organization
Key Takeaways
26

• Future Webinars on Returns Management Maturity
Scheduled
– Next Up: Quality Management Systems in Returns Centers
• Learn More About the Returns Management Leadership
Exchange on LinkedIn
• Today’s Information Will Be Available to Members of our
Linkedin Group
• Request a Returns Management or Technology
Assessment
Last Thoughts
27

Q&A
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Thank You & Contact Information
Sharon Nelson
• VP, SAP Practice
• snelson@spinnakermgmt.com
• 412-733-5062
Paul Rupnow
• Director, Reverse Logistics
• paul@andlor.com
• 604-687-1130
Paul Adamson
• Director, Consulting
• padamson@spinnakermgmt.com
• 512-731-5957
29
Today’s Presentation Will Be Available to Members of our LinkedIn Group
(Returns Management Leadership Exchange)

Using Tools & Technologies to Mature a Returns Management Process

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