Detailed cost modelling: a case study in warehouse logisticsMikko Varila; Marko Seppänen; Petri Suomala
2007 International Journal of Physical Distribution & Logistics Management
doi: 10.1108/09600030710742416
Purpose – The purpose of this paper is to examine the applicability of different drivers for assigning activity costs to products in warehouse logistics environment. Design/methodology/approach – An action research case study in the warehouse logistics of an electronics wholesaler. Data were collected from a single activity which was analysed in depth. Findings – The study illustrates that there may be significant variation in activity costs that cannot be traced with any single transaction‐based driver. Automatic data collection methods can be used to support cost accounting in such a situation. It was clearly demonstrated that in certain environments it is possible to significantly increase the accuracy and versatility of accounting by measuring the actual durations together with other variables. Research limitations/implications – The results are derived from a single company and activity. Practical implications – Gives accountants in environments where data is rich and plentiful examples of methods for analysing the data for obtaining a deeper understanding of the cost behaviour of activities and products. Originality/value – Complements the discussion on activity cost drivers and logistics costing.
Logistical network design with robustness and complexity considerationsYongyut Meepetchdee; Nilay Shah
2007 International Journal of Physical Distribution & Logistics Management
doi: 10.1108/09600030710742425
Purpose – This paper aims to propose a logistical network design framework with robustness and complexity considerations. Design/methodology/approach – The paper defines robustness, complexity, and normalised efficiency of a logistical network. A mathematical model is then constructed based on the conceptual framework and applied to a hypothetical case study with varying robustness requirements. The mathematical model is formulated as an Mixed‐Integer Linear Programming problem. Furthermore, the paper introduces a graph‐theoretic view of the logistical network and presents its topological properties such as average path length, clustering coefficient, and degree distribution. Findings – The results show that logistical network configurations can be obtained with desirable robustness levels whilst minimising cost. The relationships of robustness versus normalised efficiency and complexity are also presented. The results show that relationships between logistical network topological properties and robustness exist, as in other real world natural and man‐made complex networks. Practical implications – Logistical network design is one of the earliest strategic decisions in supply chain management that supply chain managers have to make. Practitioners and researchers typically focus on optimising efficiency and/or responsiveness of logistical networks. It is argued that logistical network designers should also consider robustness and complexity as they are important characteristics of logistical network functionality. The logistical network design frame work successfully incorporates robustness and complexity into design considerations. Originality/value – This paper newly introduces other important performance measures, robustness and complexity, into the logistical network design objective. The design framework is highly relevant and adds value to logistical network designers and managers.
Achieving consumer focus in supply chainsKeivan Zokaei; Peter Hines
2007 International Journal of Physical Distribution & Logistics Management
doi: 10.1108/09600030710742434
Purpose – Supply chain performance is two‐dimensional: efficiency and effectiveness. The purpose of this paper is to further define and explore the demarcation between supply chain effectiveness and supply chain efficiency. Design/methodology/approach – A case‐study research method is adopted in this paper. This contribution discusses an approach for the improvement of supply chain effectiveness, i.e. Supply Chain Kano‐QFD. Findings – A case‐study of the fast moving consumer goods sector is provided which shows how the proposed “Supply Chain Kano‐QFD” technique can be deployed to engage the capabilities and enthusiasm of the firms along the chain to enhance the value of the final consumable. Practical implications – “Supply Chain Kano‐QFD” is an integrative method which helps drive effectiveness by focusing on how the various supply chain members might jointly develop innovative solutions to create unique, individualized sources of consumer value. Originality/value – A review of the existing supply chain literature shows that there is generally a strong focus on efficiency improvements while little attention is given to enhancing the effectiveness of the supply chain offer. The supply chain management literature, however, should evolve to address relevant methods for achieving consumer focus in the context of the supply chain, i.e. supply chain effectiveness.
Electronics industry drivers of intermediation and disintermediationDan L. Shunk; Joseph R. Carter; John Hovis; Aditya Talwar
2007 International Journal of Physical Distribution & Logistics Management
doi: 10.1108/09600030710742443
Purpose – The purpose of this paper is to summarize the current thinking on intermediation and disintermediation, extract candidate drivers for this cycle, capture the expert opinions on what is driving the cycle and determine the quantitative and qualitative conclusions related to the electronics industry supply network integration and requirements for its success. Design/methodology/approach – A series of one‐on‐one expert interviews were conducted to establish the validity of the initial list of drivers and to add to this list based upon their expert knowledge. A web‐based survey followed with the purpose of validating the final dimensions list and assessing the various alternative value propositions that intermediaries should be considering. Finally, a Delphi exercise concluded this research thrust by convening experts in the electronics supply network for a one‐day review of the results and a distillation of the results into expert forecasts of directions and trends. Findings – Any supply chain intermediary must achieve “Operational Excellence” in their chosen field of endeavor for them to remain competitive in the electronics industry. But this condition is a necessary but not sufficient predictor of business success. The intermediary service “Bundles” bring more value than individual cash flow, material flow, information flow or knowledge flow alone. And unbundling one flow from the others does not seem to provide a successful disintermediation platform. Practical implications – The paper provides electronics industry firms an assessment of the fundamental conclusions that must be addressed for this industry to better withstand another industry downturn than it did in the previous recessionary period (2001‐2002). Originality/value – This paper documents the first triangulated research project where knowledgeable experts within the electronics industry supply network were polled to determine the fundamental drivers for the intermediation/disintermediation cycle present in the electronics industry today.