International Journal of Physical Distribution & Logistics Management

George A. Zsidisin; Jeffrey A. Ogden; Thomas E. Hendrick; Mark A. Clark

2003 International Journal of Physical Distribution & Logistics Management

doi: 10.1108/09600030310492751

It is increasingly accepted that the chief purchasing officer (CPO), as the highest ranking member of the purchasing and supply management (PSM) function, is a resource that can add strategic value to the firm. Delineating the organizational and human capital factors that determine CPO compensation packages can help firms maintain their competitive advantage by attracting and retaining talent in this position. Although an extensive literature base examines executive compensation, such research at levels below the CEO is sparse. Based on the rich literature discussing executive compensation as well as a survey of Fortune 500 CPOs, examines the influence of organizational and human capital on CPO compensation from a resource‐based view of the firm. The organizational capital characteristics of annual sales, purchases as a percent of sales, and the number of reporting levels between the CPO and CEO were found to influence CPO compensation significantly. Somewhat surprisingly, CPO age was the only human capital factor of those tested (years in PSM, education level, CPM certifications) that significantly influenced compensation.

Yogesh Gupta; P.S. Sundararaghavan; Mesbah U. Ahmed

2003 International Journal of Physical Distribution & Logistics Management

doi: 10.1108/09600030310492760

This paper deals with finding economic order quantity, number of orders to be placed and/or the time to place each order for four different special types of problems that may be encountered in practice. The first problem ( Problem 1a ) assumes a fixed planning horizon and a perishable product such as Christmas trees or fashion merchandise whose value deteriorates as the item gets aged. Under constant demand assumption, solution for this type of problem is worked out by capturing the deterioration in value by increasing holding cost. The second problem ( Problem 2 ) has the same assumption as the first, except that the demand is assumed to increase as we move forward in time. The third problem ( Problem 2a ) is a restricted version of the second, which allows a specific number of integer orders during the planning horizon. The fourth problem ( Problem 3 ) allows the ordering cost to increase as time progresses. All formulae derived can be easily applied to find numerical answers. The answers may have to be adjusted to reflect container size, minimum order quantity and any other restriction not modeled, or to take into account any violation of the model assumptions.

Sara Lonn; Julie Ann Stuart

2003 International Journal of Physical Distribution & Logistics Management

doi: 10.1108/09600030310492779

In this paper, manufacturer dealer return policies are examined for high volume part sales for long‐life cycle products. Exclusive suppliers often use simple returns policies for high‐value products to persuade their independent dealers to stock and price items aggressively. For low‐value products, a return policy problem occurs; dealer requests for low‐value returns are routinely rejected. Because a manufacturer may make over 500 return request decisions per day, a fast algorithm is required. Two fast algorithms that evaluate multiple factors are presented and tested for six months against dealer inventory requests at heavy equipment manufacturer, Caterpillar, Inc. The results show that the proposed algorithms may eliminate nearly 1,000 back‐orders per month. The results indicate that exclusive suppliers can modify their return policies to improve service to customers by analysing not only product value, but also inventory level and lead‐time.

Tage Skjoett‐Larsen; Christian Thernøe; Claus Andresen

2003 International Journal of Physical Distribution & Logistics Management

doi: 10.1108/09600030310492788

Presents a theoretical framework for analysing interorganizational collaboration. Argues that Collaborative Planning, Forecasting and Replenishment (CPFR) should be viewed as a general approach to coordination of processes between participants in a supply chain, rather than following a slavish step‐by‐step model, as suggested by the organization Voluntary Inter‐Industry Commerce Standards (VICS). This approach demands a deeper analysis of both integration depth and scope of various collaboration forms. This is done primarily from a theoretical perspective, but supported by an empirical study of Danish companies’ attitudes towards interorganizational collaboration.