Self Assessment

Dealer Back Order Management &

Suggested Practices

Dealer Back Order Management Self Assessment

Questions
1.0 Introduction & Executive Summary ............. 2
2.0 Self Assessment and Suggested Practices. 2

Caterpillar Inc. https://dealer.cat.com/Advisor

THE INFORMATION HEREIN IS THE PROPERTY OF CATERPILLAR, INC. AND/OR ITS SUBSIDIARIES. WITHOUT
JUN 08 WRITTEN PERMISSION, ANY COPYING, TRANSMITTAL TO OTHERS, AND ANY USE EXCEPT THAT FOR WHICH IT 1 of 7
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 Dealer Back Order Management
Self Assessment -------------------------------------------------------------------------------------

1.0 Introduction & Executive Summary

Dealers can go through this self assessment of their own back order management
processes to find gaps between their process and what is suggested. Dealers can then
reference the Best Practice document to develop ideas to improve their back order
management processes.

2.0 Dealer Back Order Management Self Assessment

Performance Measures

1. What metrics are utilized to track the performance of how effective the dealer is
managing their back orders?

• Cost measure?

• Internal Customer Satisfaction measure?

• External Customer Satisfaction measure?

• Velocity measure (i.e. how quickly back orders are resolved)?

Suggested Practice: The best practice suggestion is that dealers are ascertaining the
customer/shop “need by date” and making sourcing decisions in order to meet the need
by date. If dealers have SMART sourcing, they can measure their Complete Order Fill
by customer required date. Dealers can control costs by placing stock orders whenever
possible that still meets need by date. Therefore, it is advisable that dealers measure
COF by Customer Required Date, emer srv fee as a % of sales, and % of emergency
dollars converted to stock as a % of total emergency dollars ordered. It is also a
suggested practice to participate in a transactional survey to identify how well the dealer
proactively communicates to their customers regarding the status of backordered parts.

Structure/Parameters

1. Does the dealer consider themselves centralized, decentralized, or regionalized

regarding back order management? What specific responsibilities do these
back order expeditors have?

Suggested Practice: Central or regionalized back order management is a suggested

practice to streamline communication between the dealer and customer services and
within the dealer regarding back ordered parts. Only the back order expeditors should
be allowed to contact customer services so that customer services is able to devote
most of their time to filling problematic backorders. All other persons at the dealership
should contact the BO expeditor with questions so that the BO expeditor can identify if
any counter training is necessary to enable the dealer to more effectively answer
Caterpillar Inc. https://dealer.cat.com/Advisor
THE INFORMATION HEREIN IS THE PROPERTY OF CATERPILLAR, INC. AND/OR ITS SUBSIDIARIES. WITHOUT
JUN 08 WRITTEN PERMISSION, ANY COPYING, TRANSMITTAL TO OTHERS, AND ANY USE EXCEPT THAT FOR WHICH IT 2 of 7
IS INTENDED, IS PROHIBITED.
 Dealer Back Order Management
Self Assessment -------------------------------------------------------------------------------------
customer calls without having to contact the BO expeditor (example: to obtain shipping
info which is readily available in OTV).

2. What is the philosophy regarding auto-release capability of persons within the

service department?

3. Is there a standard for profiles of service persons’ auto release capabilities? If so,
what are the parameters regarding dollar value, stock vs. non-stock, returnable
vs. non-returnable? (Check User Control (MNTPCUSR) and/or store paramaters
(MNTPCSTP)

4. What is the philosophy regarding auto-release capability of persons on the

counter?

5. Is there a standard for profiles of counter persons’ auto release capabilities? If

so, what are the parameters regarding dollar value, stock vs. non-stock,
returnable vs. non-returnable? (Check User Control - MNTPCUSR and/or store
paramaters - MNTPCSTP)

Suggested Practice: It is suggested that the dealer have a strategy for why/who is
auto-release capable and that these are standard across the dealership. Auto-release
parameters can be set differently for counter vs. shop, returnable vs. nonreturnable, by
dollar limits, or internal transfers only. If the BO analyst spends a majority of their time
releasing transfers or releasing backorders to their facing facility without doing any
maintenance on the order (changing sourcing or shipping instructions), the back order
expeditor is adding little value and auto release parameters should be examined to allow
internal transfers and releasing to the first facility and then canceling short.

6. If the dealer is centralize/regionalized, out of X lines the BO analyst manually

sources to daily, what % are (please track for one day if unknown):
:
Release w/ maintenance Released – no
maintenance
Sourced to facing facility
Internal transfers
Not available at facing
facility

Suggested Practice: This analysis will help determine if a change in auto-release is

advisable for your dealership (if large % of orders are released with no maintenance)

7. Is the dealer utilizing any cancel short logic/standard parameters (See

MNTPCEMBO, Search Instr field. Utilizing C 01)?

Caterpillar Inc. https://dealer.cat.com/Advisor

THE INFORMATION HEREIN IS THE PROPERTY OF CATERPILLAR, INC. AND/OR ITS SUBSIDIARIES. WITHOUT
JUN 08 WRITTEN PERMISSION, ANY COPYING, TRANSMITTAL TO OTHERS, AND ANY USE EXCEPT THAT FOR WHICH IT 3 of 7
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 Dealer Back Order Management
Self Assessment -------------------------------------------------------------------------------------
Alternate Order Types

1. What is the dealer philosophy on the following customer stock order programs: Hot
Stock, X orders, or E to S orders? If these are being utilized, who is placing these
orders and to what extent are the programs being used?

Suggested Practice: The suggested process is to utilize Hot Stock or change order
class from E to S. Ask ADSD-N parts operations team to run analysis to determine how
well the dealer is utilizing these programs by store.

Expediting/Customer Services Processes

1. By Store, who contacts customer services? For what reasons (if applicable)?

Suggested Practice: Only the back order expeditor should be contacting customer
service. This helps drive questions to the internal expert so that customer services can
stay focused on finding material to fill back ordered items. The back order expeditor will
be able to identify if many persons are asking the same questions that can be answered
via already existing information (ex: tracking through OTV) and thus, internal training can
be completed. Also, the dealership should have a defined process to escalate customer
pain as a result of parts availability internally to bring in the Caterpillar PSSR, Parts
Manager, or VP of Parts when appropriate.

2. How is the dealer contacting customer services? Phone? Email? CID web?

Suggested Practice: CID web is the suggested way to contact customer services. It
save the dealer time and creates efficiencies. It eliminates chances for error and provide
the dealer with more frequent updates on their back ordered part by email updates.

3. If not utilizing CID web, why?

4. Under what conditions is Customer Services contacted? (i.e. for every emergency
back order, only when requested by the service department, only for DOWN orders,
only when there is no ESD)

Suggested Practice: DOWN & MEGA orders are proactively expedited immediately by
customer services. If the dealer has an emergency order which becomes a Caterpillar
back order with no visible availability and no ESD, the dealer should enter a CID web
ticket immediately after order release to Caterpillar Dealers should be placing a CID web
ticket (or contacting customer service) for every emergency CBO right after the order is
released to customer services searches for material to fill the back order quickly.

5. When information is obtained from Customer Services, who is that information

shared with regarding that back ordered part? How is it communicated?

Caterpillar Inc. https://dealer.cat.com/Advisor

THE INFORMATION HEREIN IS THE PROPERTY OF CATERPILLAR, INC. AND/OR ITS SUBSIDIARIES. WITHOUT
JUN 08 WRITTEN PERMISSION, ANY COPYING, TRANSMITTAL TO OTHERS, AND ANY USE EXCEPT THAT FOR WHICH IT 4 of 7
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 Dealer Back Order Management
Self Assessment -------------------------------------------------------------------------------------
Suggested Practice: Dealers should have a proactive way to communicate ESDs on
back ordered items to the shop & counter every day. It is recommended that a report is
shared daily and resides in a place that all dealer persons could access if needed
(online). If updates are received through out the day, the dealership should have a
process to communicate the update to all appropriate persons.

6. If the expeditor receives an unacceptable ESD from customer services, is there a

standard escalation process that is followed both internally and with Caterpillar?

Suggested Practice: The proper escalation process is for the dealer to first, request
ESD improvement, if not available, then for the dealer to request escalation to the
customer service supervisor. At that time, dealers should be identifying alternative
options internally. If no alternative options exist and customer pain is felt as a result, a
Parts Availability customer pain template should be submitted to the VP of Parts which
should be shared with the PSSR. Discussions of parts good will should follow as
appropriate.

7. How does the dealership keep track of all previous communication (internal &
external) regarding back order parts?

Suggested Practice: back order analyst should have a system which allows them to
easily access the history and status of a back ordered part.

8. When a part is not available in the US to fill the dealer back order and customer
services is contacted, which options to fill the dealer back order does the dealer
assume that customer services checks?

Suggested Practice: Customer services checks WW supply chain availability, returns,

DPIS and production.

9. What options will be explored when specifically requested?

Suggested Practice: Customer services can look up higher and lower levels, can
request a One Time Only direct ship, or recent dealer sales.

10. What alternative solutions to fill the back order are explored by the dealer? (i.e. used
part options, higher/lower levels) What systems are used to explore these options?

Suggested Practice: Dealers should have a formal process with defined roles and
responsibilities for who checks alternative solutions to fill the back order. Options should
include: higher/lower levels, cat used, non-one-to-one reman options, DPIS, Caterpillar
surplus, and vintage parts. If all other options have not resulted in identifying an option,
the dealer should contact their TC to determine if there are other parts that will work

Tracking & Visibility

1. Is the Dealer using OTV? If so, who is using it and what for? If not, how is
Caterpillar availability checked and tracking information found?
Caterpillar Inc. https://dealer.cat.com/Advisor
THE INFORMATION HEREIN IS THE PROPERTY OF CATERPILLAR, INC. AND/OR ITS SUBSIDIARIES. WITHOUT
JUN 08 WRITTEN PERMISSION, ANY COPYING, TRANSMITTAL TO OTHERS, AND ANY USE EXCEPT THAT FOR WHICH IT 5 of 7
IS INTENDED, IS PROHIBITED.
 Dealer Back Order Management
Self Assessment -------------------------------------------------------------------------------------
Suggested Practice: OTV is a safe source for ESDs and tracking information regarding
back ordered parts. It is recommended that all persons which answer customer inquires
should be able to look up tracking information in OTV.

Additional Questions
1. How is shipment method being determined and by whom?

Suggested Practice: shipping method should be determined by least cost option that
meets customer need by date.

2. Is the dealership gathering customer/service department need by date before

ordering parts from Caterpillar? If so, how is this communicated to the person
releasing the order to Caterpillar?

Suggested Practice: On Time In Full utilizes SMART sourcing which allows dealers to
capture customer need by date on each counter/shop document. If the dealer does not
have SMART sourcing, the need by date can be communicated in the document notes.

3. Is the dealership utilizing header/document notes? For what purpose?

Suggested Practice: It is usually easier for the back order analyst to view notes if they
are on the document and not the header, especially if the back order expeditor uses
printed DBS/ANTARES reports.

4. How does the BO expeditor know that action is needed regarding a dealer back
order? What reports are used to manage back orders? Who is working those reports
& what specific actions are being taken as a result?

Suggested Practice: Dealers should have a process to action back order immediately.
This can be done by reacting to printed back order notification or monitoring the DBS
MNTPCEMBO screen.

5. Regarding DBS & ANTARES back order exception notifications, is the Dealer
printing All or Exceptions or None?

Suggested Practice: Dealers should only print exceptions or no paper at all.

Caterpillar Inc. https://dealer.cat.com/Advisor

THE INFORMATION HEREIN IS THE PROPERTY OF CATERPILLAR, INC. AND/OR ITS SUBSIDIARIES. WITHOUT
JUN 08 WRITTEN PERMISSION, ANY COPYING, TRANSMITTAL TO OTHERS, AND ANY USE EXCEPT THAT FOR WHICH IT 6 of 7
IS INTENDED, IS PROHIBITED.
 Dealer Back Order Management
Self Assessment -------------------------------------------------------------------------------------

ANTARES “exception” indicator”

DBS “exception” indicator”

Caterpillar Inc. https://dealer.cat.com/Advisor

THE INFORMATION HEREIN IS THE PROPERTY OF CATERPILLAR, INC. AND/OR ITS SUBSIDIARIES. WITHOUT
JUN 08 WRITTEN PERMISSION, ANY COPYING, TRANSMITTAL TO OTHERS, AND ANY USE EXCEPT THAT FOR WHICH IT 7 of 7
IS INTENDED, IS PROHIBITED.