2017 Cardinal Health Team Project

REGIONAL PARCEL CARRIER STRATEGIC ASSESSMENT

The Challenge:
Cardinal Health’s non-asset based freight management business unit, OptiFreight Logistics, provides logistics solutions to hospitals, pharmacies, ambulatory surgery centers, and clinical laboratories to control and reduce their freight costs. Today, the business leverages a single national carrier to manage customers’ small parcel shipments.

The Solution:
The Tauber team recommended a market rollout and organizational transformation plan to launch and expand the regional carrier offering. Further, pricing and risk mitigation strategies were developed to ensure success of the regional carrier strategy. By implementing the new regional carrier strategy, OptiFreight Logistics could realize an additional $35.2M in annual gross profit with 50.7% volume growth over five years. Moreover, customers can achieve, on average, a 25.8% reduction in transit time on ground shipments. Overall, the regional carrier offering enables OptiFreight to become a comprehensive logistics solutions provider and strengthens their position as the leading freight management provider in healthcare.

Read the 2017 Cardinal Health Team Project Executive Summary in the 2017 SPOTLIGHT! book.

Student Team:
Atakan Tin–EGL (BSE & MSE Industrial and Operations Engineering)
Brooks Williams–Master of Supply Chain Management

Project Sponsors:
Chris Mathew–Director, Same Day Services
Korey Yoo–Manager, Service Development

Faculty Advisors:
Luis Garcia-Guzman–College of Engineering
Jim Price–Ross School of Business


About Tauber Team Projects:

The 2017 Tauber Team Projects resulted in $575 million in savings according to sponsoring company calculations, an average of $18.5 million per project over 3 years.

Each two to three person Tauber Team consists of graduate engineering, MBA, and/or MSCM students. Along with receiving high-level corporate support from the sponsoring company, each team is advised by a College of Engineering and a Ross School of Business faculty member and overseen by a Tauber Institute Co-Director. The projects begin on-site in May and continue for 14 weeks.  Students present the results of their projects and compete for over $40,000 in scholarships at the U-M Tauber Institute's annual Spotlight! event, held each September in Ann Arbor, Michigan.  Spotlight! provides outstanding opportunities for students and corporate partners to establish relationships while exploring innovations in operations and manufacturing.
 
Access Spotlight! book for project details.
2017 Cardinal Health Team
2017 Cardinal Health Team