• • • data accuracy. order decreasing lagtimes, data tomultipledepartments, neously communicateorder simulta- is ableto DIRECTV Through theFedExnetwork, DIRECTV with By integratingFedExsystems and its subscribers. and its bothprocess for DI error andstreamliningthe Internet orphone—reducing own returnshipmentsviathe conveniently arrangetheir API enablescustomersto Integrated FedExNetReturn minimum capitalinvestment. created ascalablesolutionwith DIRECTV outsourcing warehousing, fulfillment, Explosive Growth. FedEx HelpsDIRECTVHandle and FedExrapidly systems and and increasing RECTV speeding ® efficiency efficiency Streamlined Streamlined processes processes increased increased shipping 500 boxes per month to operations were initially set up to support operation. Existing fulfillment and return acquisition required a greater scale distribution projects but the Primestar DIRECTV had managed small equipment efficiency Streamlined processes increased to help handle the demanding transition. in the past, the company turned to FedEx of FedEx shipping and stock management Pleased with the reliability and flexibility fulfillment and returns procedures. DIRECTV had to completely rethink remote control. , digital set-top boxes, and DIRECTV requisite the subscriber each send to have would DIRECTV customers, these transfer to order 24-month plan for the conversion. In a established DIRECTV and subscribers, customer base by approximately 2 million equipment. converting Primestar’s subscriber dealing directly with end customers in begin to DIRECTV for necessary was it DIRECTV’s major competitors—in 1999, Electronics acquiredPrimestar—oneof Hughes company parent when But electronic storesandindependentdealers. third-party retailers such as major was sold to customers primarily through service DIRECTV receive to equipment businesses across the country. Initially, programming selection to homes and extensive an offers company the founding in 1994. With over 225 channels, television satellite systems since its DIRECTV, Inc.,hasbeenselling efficiency efficiency Streamlined Streamlined processes processes increased increased With so many customers to convert, DIRECTV’s expanded purchase The charge for units sold and to the FedEx to both DIRECTV’s invoicing system to shipping. The data is simultaneously sent product is picked and packaged for the where WMS, the to FedEx via FedEx. The order information progresses customer database—itissentdirectlyto Primestar the case, center,this in or sales channel—third-party reseller, call capital investment. quickly ramp up operations with minimum warehousing also helped DIRECTV existing systems and outsourcing inventory management. Networking supply chain visibility for efficient existing system, the company can achieve DIRECTV’swith data warehousing systems. By integrating shipping and computer disparate between exchange network (VAN) that enables information FedEx and (WMS), System Management Warehouse a Synapse, networked stocking and shipping process that response, FedEx created a high-volume shipping and warehouse capacities. In both increase to needed DIRECTV skipping a beat.” shipments a day to 10,000 per day without solution that took us from handling 25 “FedEx respondedbycreatingascalable Director, IT Business Relationship Group. explains Jerry Littman, DIRECTV to DIRECTV service within 24 months,” subscribers convert to had Primestar,we practically overnight. “When we acquired volumes would drastically increase, the acquisition meant that shipping customers andthird-partyresellers.But FedEx Net FedEx When an order is initiated from the To manage higher shipping volumes, ® Ship Manager Workstations using ® . FedEx Net is a value-added a is Net FedEx . DIRECTV

CASE STUDY The FedEx Supply Chain Solution.

Ship Manager Workstation. Concurrently input into the system when the return transmitting order information to all order is created. Because each package is involved departments expedites the assigned a FedEx tracking number, both shipping process by eliminating internal DIRECTV and its customers will be able lag times. When the order is ready for to monitor their returns in route back to distribution, a shipping label is created and the warehouse. “We want to make the a tracking number is assigned. As each customer experience as easy as possible,” RESULTS SUMMARY order is filled, a confirmation e-mail can explains Littman. “With integrated FedEx be sent to the recipient with all the NetReturn API, the returns process will The effects on shipping and tracking information, so that be smoother for us as well.” DIRECTV’s supply Returned orders are handled in one of chain were immediate. the reseller or customer can track the two ways. If it is an undeliverable item, By using FedEx Net to order in real time—24 hours a day—on simultaneously fedex.com. the FedEx fulfillment center receives and communicate among DIRECTV ships equipment directly to restocks the item into inventory. Using the the WMS, FedEx Ship sales partners and end customers. Orders order number, returns are logged into the Manager Workstation, can be shipped as either individual parcels WMS. The WMS sends the returns and DIRECTV’s or in bulk for cost-efficiency and easier information through FedEx Net to invoicing system, both handling in transit. Each shipment is DIRECTV’s Order Management System order and inventory assigned a “license plate” with all the (OMS) to speed customer credit. accuracy increased necessary shipping information and a If the return is damaged or needs while cycle times consolidated tracking number, as well as a repair, the customer either calls decreased. “With vendor ID code and order serial numbers. DIRECTV’s customer service or goes to FedEx Net, we’re able Access to this detailed information the corporate website to initiate a return. to process up to enables resellers and DIRECTV to DIRECTV creates a return order through 13,000 orders in one reference or track orders by multiple FedEx NetReturn API by uploading shift,” explains Littman. pieces of information. License plating also customer information directly from its “By sharing helps identify customer activation, as well OMS. A return label can either be sent information, we can as speed credit on order returns. over the Internet for the customer to print eliminate lag times and and drop off the package at an authorized get maximum Returns management completes the FedEx drop-off location; or DIRECTV efficiency with cycle can dispatch a FedEx courier to print a minimum manpower.” DIRECTV also integrated FedEx return label at the customer’s location and NetReturn API to streamline the returns pick up the package for return delivery. and repairs processes and further enhance The return is then sent directly to customer service. FedEx NetReturn API DIRECTV’s repair facility where the is a customizable returns management FedEx Signature Proof-of-Delivery solution that simplifies the returns process triggers the customer financial settlement for both a company and its customer. By process for the returned item. Once the integrating FedEx NetReturn API into its item is repaired, the repair facility sends system, DIRECTV is able to automate and an Advanced Shipping Notice (ASN) to monitor returns by enabling customers to DIRECTV and the FedEx fulfillment arrange their returns electronically. center through FedEx Net. The FedEx Shipping and tracking information is fulfillment center receives and processes DIRECTV

the repaired products as inbound adapt to our needs as fast as our plans inventory that is placed into stock for change. I don’t think any other company future fulfillment. Throughout this could do that for us.” closed-loop process, DIRECTV The introduction of FedEx® Home maintains product visibility to facilitate Delivery, a residential delivery service, operations planning, improve inventory provides additional customer service management, and increase customer opportunities. As the number of direct-to- satisfaction. customer shipments increases, DIRECTV is considering cost-efficient shipping and Growing bigger and better home delivery by appointment—without With its 9.8 million-subscriber base sacrificing reliability or customer service. increasing by the day, DIRECTV is One of the country’s fastest growing confident it is equipped to handle future suppliers, DIRECTV growth. Alliances with key retailers shows no sign of slowing down. “We’re have brought in even more customers expanding into more markets now than ever and DIRECTV now sells direct to these before,” says Littman. “As we create consumers. “With FedEx, I know we more opportunities for growth, we’ll count can handle any sudden increase,” says on FedEx to help us keep ahead of our Littman. “FedEx has proven its ability to competition.”

ORDER MANAGEMENT PROCESS

Orders for satellite equipment are sent from various channels directly to DIRECTV.

Order information is sent via FedEx Net from DIRECTV's Order Management System to the Warehouse Management System.

Order information is simultaneously sent to both DIRECTV’s invoicing system and to the FedEx Ship Manager Workstation.

The order is picked and packed in the FedEx fulfillment center. The FedEx Ship Manager Workstation calculates a shipping rate, assigns a tracking number, and generates a shipping label.

Shipment status information is sent to DIRECTV's Order Management System where it is available to handle customer inquiries.

The package is picked up by FedEx, scanned, and delivered to the customer.

Warehouse Management System Third party reseller Invoicing OR

DIRECTV Order FedEx Net Management System Customer

FedEx Ship Manager Workstation shipping labels Delivery of product

Information flows

Physical flows Customer callsDIRECTV RETURNS PROCESS Service torequestareturn Return ordercreatedthrough through DIRECTVwebsite Customer requestsreturn The FedExfulfillmentcenterreceivesandprocessesrepairedproductsasinboundinventorythatisrestockedforfuturefulfill The itemisrepairedandanAdvancedShippingNotice(ASN)senttoDIRECTVFedExfulfillmentcenterthroughNet. The returnissenttotherepairfacilitywhereFedExSignatureProof-of-Delivery(SPOD)triggerscustomerfinancialse or, theFedExcourierpicksupshipmentatcustomer'slocationandprintsreturnshippinglabelforcustomerswhoc Customers canautomaticallyprinttheirownshippinglabelsviatheInternetanddropoffpackageatanauthorizedFedExdr FedEx NetReturnAPIuploadscustomerinformationdirectlyfromitsOrderManagementSystem. Customer callsDIRECTVServiceorvisitswebsitetoinitiateareturn.createsreturnorderthroughFedExNe FedEx NetReturnAPI in oneoftwoways: Physical flows Information flows OR FedEx NetReturn API label viatheInternet FedEx courierprints return shippinglabel Customer prints return shipping OR Return delivery of product Management System DIRECTV Order FedEx SPOD repair facility DIRECTV ASN ment. ttlement processforthereturneditem. ASN alled intheirreturnviaphone. op-off location; DIRECTV tReturn API. DIRECTV FedEx Net fulfillment center FedEx

CASE STUDY