Serco Case Study

Total Logistics was appointed by FTSE100 service company Serco to provide logistics support for the London Cycle Hire scheme (Barclays Cycle Hire), an initiative pledged by the Mayor of London as part of his election manifesto. The scheme launched successfully in July 2010 and was positively received by the public, with one million journeys made in the first 10 weeks of operation.

The Challenge

The scheme, designed to encourage a healthier way of getting around London, as an alternative to tube or bus, comprises 400 docking stations, with 10,000 docking points and 6,000 bikes around the capital. Serco was awarded the contract by Transport for London (TfL) to establish and operate the scheme, and partnered with Public Bike Service Company (PBSC), suppliers of the kit used for the Montreal cycle hire scheme, to provide the physical assets. Serco enlisted Total Logistics to develop the logistics plan for the installation phase and to help appoint a third party logistics (3PL) partner to carry out the receipt, consolidation and distribution of the PBSC equipment.

Total Logistics support to the project was focused on four key stages:

• Preparing a logistics plan to support the receipt, assembly and delivery of docking stations, bikes and software to the street for installation
• Managing the tender process to select a suitable staging warehouse and operator to receive, store and assemble the assets
• Monitoring the operators performance on behalf of Serco for the duration of the contract
• Preparing a launch plan to distribute all of the cycles to the docking stations overnight prior to the launch.

The Solution

Initiation phase: logistics planning

After collating the proposed receipt and installation of equipment schedules, Total Logistics developed a movement and space plan to provide the requirements specification for a staging warehouse. Total Logistics advised as subject matter experts throughout the project.

Development: staging warehouse

Total Logistics ran a competitive warehouse tender, resulting in Kuehne & Nagel (K&N) being appointed as the preferred 3PL supplier. K&N was selected due to the quality of its service offering and competitive and flexible pricing structure. The logistics operation was located in Harlesden, supporting the operational base in Islington, which made it easy for regular face-to-face meetings and progress updates.

Monitoring: 3PL performance

Total Logistics developed a framework of Key Performance Indicators (KPIs) to monitor K&N’s service, performance and cost. These KPIs were reviewed on a weekly basis. Total Logistics managed the schedule to evolving requirements and altered the workload accordingly.

The launch: cycle distribution

Due to the high profile nature of the project, the launch required 4,400 bikes to be delivered to the docking stations overnight, ready for the system to go-live at 6am on the day of the launch. Total Logistics developed a number of options to ensure distribution was achievable and developed a transport model to provide efficient resource levels and timing of tasks to allow a delivery schedule to be produced.

Total Logistics supported the distribution process and the required 4,400 cycles were in place across over 300 docking stations ready for the official launch by the Mayor of London at 07.30am on Friday 30th July.

By the morning of the launch, over 12,000 members were signed up to the scheme with over 6,000 keys activated.

Les Beaumont, project director at Total Logistics, said: “This has been a really exciting project; everyone who worked on it was privileged to be a part of such a revolutionary scheme and it has certainly stretched our team’s thinking. It’s not every day that we are asked to develop a plan to manage such a high-profile operation with only one overnight opportunity for success.”

Alan Stannard, Contract Director, Serco, commented: “Total Logistics proved a great support through the complicated logistics process and the team’s expertise played an invaluable part in the successful launch of the scheme.”

Opinions of the scheme from members of the public on twitter and in the press on launch day:

@ollymagoo: Just went out for a ride and was very impressed.………. …Getting it out of the dock was very easy, as was finding somewhere to dock it at the end - in fact, on a twenty-minute pootle around the Barbican area, I passed many more docking stations than I'd expected.

@DisgruntledScientist: I've tried it three times already today, and I think it's great. Got from home to the Borough, then out to Bankside at lunch time and back. "Had my first go on London cycle hire. Brilliant, intuitive bike that you feel rather grand riding. A massive, thumping 10/10 from me!”

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