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Colegio de San Juan de Letran

COLLEGE OF BUSINESS ADMINISTRATION AND ACCOUNTANCY
Intramuros, Manila

A CASE STUDY ON TRANSPORTATION

Case Study presented to the

College of Business Administration and Accountancy
Of
Colegio de San Juan de Letran
Intramuros, Manila.

In Partial Fulfillment of the Requirements

for the Subject of
ENT 115 – Logistics Management

Submitted by:

Delos Reyes, Justine Manule

Despi, Nicole T.
Guillermo, Angelica Denise S.
Martin, King Christian E.
Yumol, Rhodora Andrea

DECEMBER 02, 2021

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I. EXECUTIVE SUMMARY

AFG is a market leader in the production of branded beverages. The company keeps a
total of 25 stock-keeping units on hand. It has three manufacturing plants in the Philippines:
Luzon, Visayas, and Mindanao. Every manufacturing facility has its own Distribution Center.
AFG has a total of 20 licensed truckers, with ten in Luzon and five each in Visayas and
Mindanao. The Distribution Center is made up of a DC manager, Dispatch Supervisor, two
dispatchers, office staff, and DC personnel who are contractual employees for five months. Each
DC has an average of 15 contract employees. AFG Corporation has had a strong sales
performance during the last four months. This can be attributable to a variety of causes,
including new product launches, successful promotion, and superior Outbound Logistics
performance, among others. Despite this excellent performance, truck owners are worried that
dispatchers, notably the Dispatch Supervisor, who are regular employees, prefer chosen truckers
when assigning or distributing approved SO for loading. 

The goal of this case study was to avoid a major dispute regarding partiality toward
particular drivers, which could have a negative influence on the company's outbound logistics
operations. It also addressed the causes of the aforementioned claim affecting some of the
company's employees, how to avoid the aforementioned dispute, which could have an influence
on the outward logistics operation, and what methods the organization should use to avoid the
stated conflict. The researchers suggested that, due to reports of AFG dispatchers and DC
supervisors favoring specific drivers, external audits are highly recommended to minimize
disputes between the AFG organization and truck owners. An unbiased examination of how
employees work, particularly with third parties, can assist HR in determining whether certain
activities are appropriate, legal, and efficient. If the claim is proven, a personnel rotation program
is recommended. Changes in procedures can be made by rotating one staff member to another.
Building solid relationships with all accredited truck owners takes time, therefore this is a long-
term strategy. Maintaining safety, minimizing needless allegations, and assuring work quality are
all advantages of setting clear criteria for staff when working with truckers. An HR audit requires
spending time and money to undertake a thorough investigation of the company's HR practices.
Utilizing an external audit ensures that perhaps the audit is not biased; however, the audit may
also be extensive. AFG can use this technique to figure out who among its employees like certain
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trucks and whether or not this assertion is true. It can also aid in the avoidance of a possible
conflict.

II. STATEMENT OF THE PROBLEM

AFG is a market leader in the production of branded beverages. The company keeps 25
stock keeping units on hand. It has three manufacturing plants in the Philippines: Luzon,
Visayas, and Mindanao. Every manufacturing facility has its own Distribution Center. AFG has a
total of 20 accredited truckers, with 10 in Luzon and 5 each in Visayas and Mindanao. The
Distribution Center is made up of a DC manager, Dispatch Supervisor, two dispatchers, office
staff, and DC personnel who are contractual employees for five months. Each DC, on average,
employs 15 contractual employees.

AFG Corporation has had a strong sales performance during the last four months. This is
attributable in part to new product introductions, effective advertising, and great Outbound
Logistics performance. Despite this strong performance, drivers and coordinators said that truck
owners fear that Dispatchers, particularly the Dispatch Supervisor, who are normal employees,
are reportedly favoring some truckers when it comes to assigning or distributing approved SO for
loading.

This case study aims to avoid severe disagreement over favoritism toward some truckers,
which may have an impact on the company's outbound logistics operations. This specifically
wanted replies to the following questions:

1. What are the likely causes of the aforementioned claim affecting some of the
company's employees?

2. How can this disagreement, which may have an impact on the outbound logistics
operation, be avoided?

3. What tactics should the organization employ to avert the aforementioned conflict?

Keeping this dispute to a minimum and resolving those that do develop is critical for the
success of any organization. In the transportation sector, this can be a particularly problematic
issue. The longer people have to work together, the more likely there will be conflict.
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III. CAUSES OF THE PROBLEM

In the logistics industry, distribution staff and truck drivers are constantly in contact.
They are both vital links in the supply chain and, in some ways, cannot exist without one
another. Both parties want things to run smoothly. Truckers hoped they could come to DC
whenever it was convenient for them and their schedules, load up fast, and move on to the next
pick up. The aforementioned disagreement can emerge for a variety of causes. These are some
examples:

a. Dispatchers and DC Supervisors must make ethical judgments when they accept gifts
from some of the truckers in exchange for a smooth transaction on their end.

b. Discrimination against other truckers

c. Disagreement on Professional Level. Dispatchers and DC Supervisors may disagree

with other truckers when they have to make a decision, and they may disagree passionately and
end up fighting; as a result, there are times when they will work in favor of other truckers who do
not quarrel with them.

It's critical to be ready for more serious sorts of conflict. At the absolute least, AFG must
reprimand them and keep a close check on them in the future. Only by putting an end to this
practice by any means necessary can conflict be avoided.

IV. DECISION CRITERIA AND ALTERNATIVE SOLUTIONS

This case study has addressed the causes of the accusation that dispatchers and the DC
Supervisor favored certain trucks. Here, we must concentrate and make recommendations for
choice criteria and alternative options for the AFG company.

1. Establishing a clear standard. Setting norms can help to address many of the problems
that arise. These are criteria that allow managers to assess future, present, or previous activities.
They can be measured in a variety of ways, including physically, quantitatively, and
qualitatively. In the first step of choosing what to control, the AFG corporation must establish
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the targets, set the tolerances for those targets, and specify the timing of those targets in
accordance with the organization's goals. It may also reflect specific activities or behaviors
required to fulfill organizational goals, such as maintaining strong relationships with all
accredited drivers. 

2. Employees are being audited externally. Conducting a periodic workforce audit is a

proactive means of addressing employee-related concerns before they become problems beyond
the reach of AFG's competence. Human resource audits are critical for avoiding legal and
regulatory responsibility that may develop as a result of an organization's HR policies and
procedures. It entails detecting concerns and solving problems before they become
unmanageable. It is a chance to evaluate what a company is doing effectively as well as how
things could be done differently, more efficiently, or at a lower cost. 

3. Employee Rotation Scheme Regardless of the rules and specialists in place, friction
will inevitably emerge between employees and drivers who must operate alongside each other on
a daily basis. However, the organization can reduce it by shifting which employees are allocated
to which others on a regular basis. By rotating personnel, the organization reduces the chance for
individual pairs of workers to receive preferential treatment from one another. 

V. RECOMMENDATION, SOLUTION, IMPLEMENTATION, JUSTIFICATION

External audits are highly advised to minimize dispute between the AFG corporation and
truck owners due to allegations of favoring some truckers by AFG dispatchers and DC
supervisors. An independent examination of how employees work, particularly with third parties,
can assist HR in determining whether specific practice areas are acceptable, legal, and effective.
If this accusation is proven, an employee rotation program is recommended. Changes in
procedures are possible by rotating one staff to another. This is definitely a long-term strategy, as
it takes time to establish positive relationships with all accredited truck owners.

1. The benefits of establishing defined standards for employees while

working with truckers include maintaining safety, avoiding unnecessary allegations, and
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ensuring work quality. The introduction of standards, on the other hand, forces workers to
adapt their practices and reduces productivity by requiring extra procedures.
2. An HR audit entails investing time and money to conduct a thorough
examination of the firm's HR policies, practices, processes, and strategies in order to
safeguard the organization, create best practices, and find areas for improvement. An
advantage of having an external audit is that the audit will not be prejudiced; yet, the
audit may be lengthy.
3. Through this technique, AFG may determine who among its staff is
favoring certain trucks and whether or not this claim is accurate. It can also help to avert
a potential disagreement. This, however, can be costly and time consuming.

VI. EXTERNAL SOURCING

https://www.chegg.com/homework-help/questions-and-answers/case-2-afg-
leading-manufacturer-branded-consumer-food-total-200-brand-maintains-around-600-
q54595937

https://www.homeworklib.com/answers/1482440/case-2-afg-is-a-leading-
manufacturer-of-branded