物流管理英文课件5 The Development of Outsourced Logistics Provision
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BST 804 Logistics and its Provision
Lecture Five: The Development of Outsourced Logistics Provision
Tuesday 29th October 2019
Professor Robert Mason Room C46, masonrj@ Logistics and Operations Management
‘contract logistics’ and ‘contract distribution’
…have been widely used to describe the organisational practice of contracting-out part of or all logistics activities that were previously performed in-house”
Mangan et al, 2008 p. 28
Benefits of Contracting Domberger, S. (1998))
Title Specialisation
Market Discipline Flexibility Cost Savings
Definition
Assessment
2. Make or Buy …Logistics?
“Whenever a company produces something internally that others can buy
or produce more efficiently and effectively, it sacrifhouse rate
order of 20%.
Costs of Contracting Domberger, S. (1998))
Benefits v Costs Domberger, S. (1998))
• The question is not whether benefits exceed costs
• Some companies outsource for:
• Cost Reasons • Increased Flexibility • To focus on their own core competency • To access technology advances more
rapidly • or a combination of the above
company’s logistics functions”
Coyle et al, 1996 Can be abbreviated to 3PL
Third Party Logistics
Popular Logistics Outsourcing Activities
Transport Warehousing Inventory Control Information Communication Technology Customer Service
production up or down at low cost organisations can change
and rapid rate
more quickly and at lower cost
Lower resource costs of service v Int. studies – savings in the
Concentration on activities which organisation has a distinctive capability
Concentrating on an organisation’s more efficient activities leads to economic benefits
4. There is a spectrum of relationships
Transactional to vertical integration Other arrangements include – partnering, franchises, joint ventures Different relationship arrangements may be an appropriate response to changing
Mangan et al, 2008 p. 28
Defining Outsourced Logistics
Definition
A third party logistics provider is…
“…an external supplier that performs all or part of a
advantage”
Quinn, J., Doorley, T. and Paquette, P. (1990)
Domberger, S. (1998) The Contracting Organisation, Oxford University Press, Oxford, UK
Reasons for Outsourcing
• An additional trend which has impacted logistics service provision is the:
• Growth in outsourcing 2
Introduction
• “Terms such as: ‘logistics outsourcing’; ‘logistics alliances’; ‘third-party logistics; 3PL;
Identifying conditions where purchase is separated from provider
Purchaser focus on outputs and supplier contestability
Ability to adjust scale and scope of Networks of small
Conclusions
Four lessons from contracting theory and practice
Domberger, S. (1998)
1. The incentive factor changes when you move from in-house to out-source
• Rather – how can a contract be drawn up so that the benefits outweigh the costs “How to combine flexibility with control”
• For many activities it seems that this position can be reached - including the provision of logistics
Outsourcing can be defined as: “the transfer to a third party of the management and delivery of a (logistics) process
previously performed by the company itself”
Cardiff Business School 1
1. Strategic Development of Logistics Provision
• Logistics has developed as a result of the increasing demands for advanced logistics services
•Own Transport
•Own Building
•Own Internal Workforce
•3PL Transport
•Internal WMS, Shipping Systems
•Own Management
•Own Building
• Combined inhouse
workforce and contract
circumstances
3. Outsourcing Logistics
Logistics has been one of the most popular activities in recent decades
to outsource and “Buy in”
Defining Outsourced Logistics
Stronger motivation to lower costs; Efficiency will not result in performance shortfalls if quality is readily monitored and
observed by the client.
2. There is a link between input and output
(Selviaridis et al, 2008)
• This lecture introduces and explores the development of outsourced logistics provision
3
Agenda
1. Introduction 2. Make or Buy in Logistics 3. Outsourcing Logistics 4. The Strengths and Weaknesses of 3PLs 5. Key Success Factors in Managing 3PLs 6. Case Study – 3PL 7. The 4PL Alternative 8. Case Studies – 4PLs 9. Conclusions
Conclusions
Four lessons from contracting theory and practice
Domberger, S. (1998)
3. Contracts are relationships
There will always be a trust element – irrespective of how comprehensively the contract is drawn
The more that is invested into the contractual arrangement the more that can be derived;
Benefits should not just be measured by cost reduction – but also in terms of quality, reliability and value derived.
Trust and reciprocity are central to the outcome Trust is vulnerable
- To Changing Circumstances; - Long time to grow trust – little time to destroy it
• Globalisation • Lead time reductions • Customer orientation • Increased attention to robust integrated SCM
• Has led to changing nature of demand for logistics services
Total Internal Asset
Management
Total External Asset
Management
Outsourcing Continuum
•Full Building Ownership
•Own Management
•Own Systems
•Own Internal Workforce
Lecture Five: The Development of Outsourced Logistics Provision
Tuesday 29th October 2019
Professor Robert Mason Room C46, masonrj@ Logistics and Operations Management
‘contract logistics’ and ‘contract distribution’
…have been widely used to describe the organisational practice of contracting-out part of or all logistics activities that were previously performed in-house”
Mangan et al, 2008 p. 28
Benefits of Contracting Domberger, S. (1998))
Title Specialisation
Market Discipline Flexibility Cost Savings
Definition
Assessment
2. Make or Buy …Logistics?
“Whenever a company produces something internally that others can buy
or produce more efficiently and effectively, it sacrifhouse rate
order of 20%.
Costs of Contracting Domberger, S. (1998))
Benefits v Costs Domberger, S. (1998))
• The question is not whether benefits exceed costs
• Some companies outsource for:
• Cost Reasons • Increased Flexibility • To focus on their own core competency • To access technology advances more
rapidly • or a combination of the above
company’s logistics functions”
Coyle et al, 1996 Can be abbreviated to 3PL
Third Party Logistics
Popular Logistics Outsourcing Activities
Transport Warehousing Inventory Control Information Communication Technology Customer Service
production up or down at low cost organisations can change
and rapid rate
more quickly and at lower cost
Lower resource costs of service v Int. studies – savings in the
Concentration on activities which organisation has a distinctive capability
Concentrating on an organisation’s more efficient activities leads to economic benefits
4. There is a spectrum of relationships
Transactional to vertical integration Other arrangements include – partnering, franchises, joint ventures Different relationship arrangements may be an appropriate response to changing
Mangan et al, 2008 p. 28
Defining Outsourced Logistics
Definition
A third party logistics provider is…
“…an external supplier that performs all or part of a
advantage”
Quinn, J., Doorley, T. and Paquette, P. (1990)
Domberger, S. (1998) The Contracting Organisation, Oxford University Press, Oxford, UK
Reasons for Outsourcing
• An additional trend which has impacted logistics service provision is the:
• Growth in outsourcing 2
Introduction
• “Terms such as: ‘logistics outsourcing’; ‘logistics alliances’; ‘third-party logistics; 3PL;
Identifying conditions where purchase is separated from provider
Purchaser focus on outputs and supplier contestability
Ability to adjust scale and scope of Networks of small
Conclusions
Four lessons from contracting theory and practice
Domberger, S. (1998)
1. The incentive factor changes when you move from in-house to out-source
• Rather – how can a contract be drawn up so that the benefits outweigh the costs “How to combine flexibility with control”
• For many activities it seems that this position can be reached - including the provision of logistics
Outsourcing can be defined as: “the transfer to a third party of the management and delivery of a (logistics) process
previously performed by the company itself”
Cardiff Business School 1
1. Strategic Development of Logistics Provision
• Logistics has developed as a result of the increasing demands for advanced logistics services
•Own Transport
•Own Building
•Own Internal Workforce
•3PL Transport
•Internal WMS, Shipping Systems
•Own Management
•Own Building
• Combined inhouse
workforce and contract
circumstances
3. Outsourcing Logistics
Logistics has been one of the most popular activities in recent decades
to outsource and “Buy in”
Defining Outsourced Logistics
Stronger motivation to lower costs; Efficiency will not result in performance shortfalls if quality is readily monitored and
observed by the client.
2. There is a link between input and output
(Selviaridis et al, 2008)
• This lecture introduces and explores the development of outsourced logistics provision
3
Agenda
1. Introduction 2. Make or Buy in Logistics 3. Outsourcing Logistics 4. The Strengths and Weaknesses of 3PLs 5. Key Success Factors in Managing 3PLs 6. Case Study – 3PL 7. The 4PL Alternative 8. Case Studies – 4PLs 9. Conclusions
Conclusions
Four lessons from contracting theory and practice
Domberger, S. (1998)
3. Contracts are relationships
There will always be a trust element – irrespective of how comprehensively the contract is drawn
The more that is invested into the contractual arrangement the more that can be derived;
Benefits should not just be measured by cost reduction – but also in terms of quality, reliability and value derived.
Trust and reciprocity are central to the outcome Trust is vulnerable
- To Changing Circumstances; - Long time to grow trust – little time to destroy it
• Globalisation • Lead time reductions • Customer orientation • Increased attention to robust integrated SCM
• Has led to changing nature of demand for logistics services
Total Internal Asset
Management
Total External Asset
Management
Outsourcing Continuum
•Full Building Ownership
•Own Management
•Own Systems
•Own Internal Workforce