Business strategy and operational improvements for Indian global express company

A top-five global express company, based in India, had established a presence in the international and domestic air express business. In an attempt to tap into the large domestic road express segment, the company recently acquired a local company in the domestic road business.

Challenge
Although the company’s international air express business segment was performing quite well with a sizeable market share, the domestic air express segment had been experiencing negative earnings and decreasing revenue for the past two years. Because of this decrease, coupled with its entry into the domestic road segment, the company asked A.T. Kearney to help them understand their market opportunity across the business road and air segments (size, growth, competitive intensity, regulations, etc.). And they wanted a business strategy best suited for their expertise in the external environment.

Additionally, the company wanted the team to identify improvement initiatives across all elements of domestic road operations. It was essential for them to be able to transform the acquired company and achieve synergies in customer base and operations.

Approach
A thorough assessment was prepared of the domestic road and air business segment, including detailed market size and growth estimates, customer feedback, competitor profiles, and the company’s historic performance. Based on this knowledge, the team identified specific business initiatives that the company could focus on to establish itself as a leading domestic player.

An additional approach was adopted to identify operational improvement initiatives in the domestic road business. It comprised hub/depot observations, data gathering and analysis, client management and operations personnel interviews, and competitor benchmarking. Twelve opportunities were identified and assessed to improve service levels and productivity, which spanned service offerings, pick-up and delivery, line haul and hub & depot operations.

Results
The company redefined their business direction – aiming to compete in a limited fashion in the domestic air segment and to be the fastest service provider in the road segment. Focused customer segments were also identified across road and air, which helped the company maintain profitable growth.

The operational assessment with 12 improvement opportunities, including quick wins and longer term initiatives, delivered ~€ 0.5 -0.6Mn revenue enhancement potential and significant potential savings. Additionally, the team identified key initiatives for integration to deliver synergies for the company.

Contact

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