Resilience of logistic service providers facing a port strike: a case study

The purpose of this thesis is to study the impact of a port strike on companies that perform as logistic service providers in a supply chain (SC), here denominated 3PL (third-party logistic providers). These companies are highly dependent on ports to perform their activity, since they provide international services. Consequently, a disruption in a port can seriously impair their business. A stevedores’ strike is one of the possible disruptions that can affect ports. This study aims to analyze the negative effects caused by this disruption, and what strategies 3PLs may implement in order to keep their performance levels stable and have a quick recovery time. Within this objective, the first step will be to establish a theoretical context about the maritime port’s sector and 3PLs in a SC context, to then expand the concept of a resilient SC, and finally to develop a theoretical framework in order to better contextualize the case study. Subsequently, the impact of a port strike will be quantified by using a case study comprising three companies, covering the areas of land and sea distribution and port operations. Information from primary sources was assembled in two phases: first via e-mail and, in a second phase, through a personal interview. The information from secondary sources was obtained through television news, internet and conferences, enabling its cross-analysis. Finally, by analyzing the collected data, it will be possible to draw conclusions about the measures carried out by each company to minimize the negative effects of the strike, thus contributing to a more resilient SC. As a conclusion, a stevedores’ strike will create a snow-ball of negative effects in the SC, degrading all relevant KPIs (key performance indicators) of the 3PLs under study. No mitigation and contingency strategies available proved really effective to reduce the negative effects of a port strike disruption

Reprint of "The impact of mergers and acquisitions on shareholders' wealth in the logistics service industry"

Logistic service providers are facing significant challenges in recent years due to intensified competition and ever-increasing customer expectations for cohesive high-standard services at low cost. To cope with these developments many companies aim for external growth to realize operational efficiencies and exploit productive opportunities of new markets and diversified services. Accordingly, 2015 has even become the most active year for mergers and acquisitions in logistic service industry. However, studies examining the post-merger performance effect and its determinants are scarce. Consequently, this paper takes up this issue by analysing a sample of 826 transaction announcements taken place between 1996 and 2015 and their performance effect in terms of short- and long-term abnormal shareholder returns. The results reveal, that although overall transactions exhibit significant positive abnormal returns, post-merger performance for the acquiring companies differs considerably according to the logistic services offered. In the short-term trucking, railway, 3PL and air cargo companies experience significant positive abnormal returns of about 0.6%-2.6%, while sea freight carriers realize only marginal effects and CEP companies do even not show any significant reaction. In the long-term, railway and 3PL companies realize a significant abnormal return of about 20%-24%, while trucking, sea freight and air cargo carriers do not exhibit significant returns and CEP companies do even experience significant losses of about -17%. Overall, diversifying transactions of established full-service providers outperform focus-increasing transactions of specialized operators

Disruptions in International Trade: A Perspective on Ports of Entry and Supply Chain Resilience

United States (U.S.) ports of entry (POEs) and supply chains (SCs) have a prominent trade relationship with a growing desire to improve their operational capabilities. Though trade deals like the U.S.-Mexico-Canada (USMCA) agreement have facilitated trade between these countries, U.S. Customs and Border Protection (CBP) at POEs have also increased security inspections, following the September 11th incident, which have impacted international and global SCs. More recently, the COVID-19 pandemic has caused labor shortages at both sea and land POEs, increasing vessel and commercial vehicle congestion. These POE disruptions have also propagated into the third-party logistics (3PL) of SC networks, which has increased transportation costs. In this thesis, we explored operational improvement strategies from the perspectives of the public sector (i.e., U.S.-Mexico POEs) and the private sector (i.e., 3PL SC networks). The goal of this study was to understand the relationship between transportation disruptions and international trade

Sustainable supply chain network design integrating logistics outsourcing decisions in the context of uncertainties

Les fournisseurs de services logistiques (3PLs) possèdent des potentialités pour activer les pratiques de développement durables entre les différents partenaires d’une chaîne logistique (Supply Chain SC). Il existe un niveau optimal d'intégration des 3PLs en tant que fournisseurs, pour s’attendre à des performances opérationnelles élevées au sein de toute la SC. Ce niveau se traduit par la distinction des activités logistiques à externaliser de celles à effectuer en interne. Une fois que les activités logistiques externalisés sont stratégiquement identifiées, et tactiquement dimensionnées, elles doivent être effectuées par des 3PLs appropriés afin d’endurer les performances économiques ; sociales ; et environnementales de la SC. La présente thèse développe une approche holistique pour concevoir une SC durable intégrant les 3PLs, dans un contexte incertain d’affaires et politique de carbone. Premièrement, une approche de modélisation stochastique en deux étapes est suggérée pour optimiser à la fois le niveau d'intégration des 3PLs, et le niveau d'investissement en technologies sobres au carbone, et ce dans le contexte d’une SC résiliente aux changements climatiques. Notre SC est structurée de façon à capturer trois principales préoccupations du Supply Chain Management d’une entreprise focale FC (e. g. le fabricant) : Sécurité d’approvisionnement, Segmentation de distribution, et Responsabilité élargie des producteurs. La première étape de l'approche de modélisation suggère un plan stochastique basé sur des scenarios plus probables, afin de capturer les incertitudes inhérentes à tout environnement d’affaires (e. g. la fluctuation de la demande des différents produits ; la qualité et la quantité de retour des produits déjà utilisés ; et l’évolution des différents coûts logistiques en fonction du temps). Puis, elle propose un modèle de programmation stochastique bi-objectif, multi-période, et multi-produit. Le modèle de programmation quadratique, et non linéaire consiste à minimiser simultanément le coût logistique total espéré, et les émissions de Gaz à effet de Serre de la SC fermée. L'exécution du modèle au moyen d'un algorithme basé sur la méthode Epsilon-contraint conduit à un ensemble de configurations Pareto optimales d’une SC dé- carbonisée, avant tout investissement en technologie sobre au carbone. Chacune de ces configurations sépare les activités logistiques à externaliser de celles à effectuer en interne. La deuxième étape de l'approche de modélisation permet aux décideurs de choisir la meilleure configuration de la SC parmi les configurations Pareto optimales identifiées. Le concept de Prix du Carbone Interne est utilisé pour établir un plan stochastique du prix de carbone, dans le cadre d'un régime de déclaration volontaire du carbone. Nous proposons un ensemble des technologies sobres au carbone, dans le domaine de transport des marchandises, disposées à concourir pour contrer les politiques incertaines de carbone. Un modèle stochastique combinatoire, et linéaire est développé pour minimiser le coût total espéré, sous contraintes de l’abattement du carbone; limitation du budget, et la priorité attribuée pour chaque Technologie Réductrice de carbone (Low Carbone Reduction LCR). L'injection de chaque solution Pareto dans le modèle, et la résolution du modèle conduisent à sélectionner la configuration de la SC, la plus résiliente aux changements climatiques. Cette configuration définit non seulement le plan d'investissement optimal en LCR, mais aussi le niveau optimal d’externalisation de la logistique dans la SC. Deuxièmement, une fois que les activités logistiques à externaliser sont stratégiquement définies et tactiquement dimensionnées, elles ont besoin d’être effectuées par des 3PL appropriées, afin de soutenir la FC à construire une SC durable et résiliente. Nous suggérons DEA-QFD / Fuzzy AHP- Conception robuste de Taguchi : Une approche intégrée & robuste, pour sélectionner les 3PL candidats les plus efficients. Les critères durables et les risques liés à l’environnement d’affaires, sont identifiés, classés et ordonnés. Le Déploiement de la Fonction Qualité (QFD) est renforcé par le Processus Hiérarchique Analytique (AHP), et par la logique floue pour déterminer avec consistance l'importance relative de chaque facteur de décision, et ce, conformément aux besoins logistiques réels, et stratégies d'affaires de la FC. L’Analyse d’Enveloppement des Données (DEA) Data Envelopment Analysis conduit à limiter la liste des candidats, uniquement à ceux d’efficiences comparables, et donc excluant tout candidat moins efficient. La technique de conception robuste Taguchi permet de réaliser un plan d'expérience qui détermine un candidat idéal nommé 'optimum de Taguchi' ; un Benchmark pour comparer les 3PLs candidats. Par suite, le 3PL le plus efficient est celui le plus proche de cet optimum. Nous conduisons actuellement une étude de cas d’une entreprise qui fabrique et commercialise les fours à micro-ondes pour valider la modélisation stochastique en deux étapes. Certains aspects concernant l’application de l’approche sont reportés. Enfin, un exemple de sélection d’un 3PL durable pour s’occuper de la logistique inverse est fourni, pour démontrer l'applicabilité de l'approche intégrée & robuste, et montrer sa puissance par rapport aux approches populaires de sélection.The Third-Party Logistics service providers (3PLs) have the potentialities to activate sustainable practices between different partners of a Supply Chain (SC). There exists an optimal level of integrating 3PLs as suppliers of a Focal Company within the SC, to expect for high operational performances. This level leads to distinguish all the logistics activities to outsource from those to perform in-house. Once the outsourced logistics activities are strategically identified, and tactically dimensioned, they need to be performed by appropriate 3PLs to sustain economic, social and environmental performances of the SC. The present thesis develops a holistic approach to design a sustainable supply chain integrating 3PLs, in the context of business and carbon policy uncertainties. First, a two-stage stochastic modelling approach is suggested to optimize both the level of 3PL integration, and of Low Carbon Reduction LCR investment within a climate change resilient SC. Our SC is structured to capture three main SC management issues of the Focal Company FC (e.g. The manufacturer) : Security of Supplies; Distribution Segmentation; and Extended Producer Responsibility. The first-stage of the modelling approach suggests a stochastic plan based scenarios capturing business uncertainties, and proposes a two-objective, multi-period, and multi-product programming model, for minimizing simultaneously, the expected logistics total cost, and the Green House Gas GHG emissions of the whole SC. The run of the model by means of a suggested Epsilon-constraint algorithm leads to a set of Pareto optimal decarbonized SC configurations, before any LCR investment. Each one of these configurations distinguishes the logistics activities to be outsourced, from those to be performed in-house. The second-stage of the modelling approach helps the decision makers to select the best Pareto optimal SC configuration. The concept of internal carbon price is used to establish a stochastic plan of carbon price in the context of a voluntary carbon disclosure regime, and we propose a set of LCR technologies in the freight transportation domain ready to compete for counteracting the uncertain carbon policies. A combinatory model is developed to minimize the total expected cost, under the constraints of; carbon abatement, budget limitation, and LCR investment priorities. The injection of each Pareto optimal solution in the model, and the resolution lead to select the most efficient climate resilient SC configuration, which defines not only the optimal plan of LCR investment, but the optimal level of logistics outsourcing within the SC as well. Secondly, once the outsourced logistics are strategically defined they need to be performed by appropriate 3PLs for supporting the FC to build a Sustainable SC. We suggest the DEA-QFD/Fuzzy AHP-Taguchi Robust Design: a robust integrated selection approach to select the most efficient 3PL candidates. Sustainable criteria, and risks related to business environment are identified, categorized, and ordered. Quality Function Deployment (QFD) is reinforced by Analytic Hierarchic Process (AHP), and Fuzzy logic, to consistently determine the relative importance of each decision factor according to the real logistics needs, and business strategies of the FC. Data Envelopment Analysis leads to shorten the list of candidates to only those of comparative efficiencies. The Taguchi Robust Design technique allows to perform a plan of experiment, for determining an ideal candidate named ‘optimum of Taguchi’. This benchmark is used to compare the remainder 3Pls candidates, and the most efficient 3PL is the closest one to this optimum.We are currently conducting a case study of a company that manufactures and markets microwave ovens for validating the two-stage stochastic approach, and certain aspects of its implementation are provided. Finally, an example of selecting a sustainable 3PL, to handle reverse logistics is given for demonstrating the applicability of the integrated & robust approach, and showing its power compared to popular selection approaches. Keywords:Third Party Logistics; Green Supply Chain design; Stochastic Multi-Objective Optimization; Carbon Pricing; Taguchi Robust Design

The future of the logistics industry in the European Union : an outlook to 2032 supported by current and upcoming market trends

This work project develops an outlook for the future of the logistics industry in the EU until 2032 and provides strategic recommendations for logistics managers. An analysis of the transactional and contextual environment is conducted based on primary and secondary research to generate future scenarios. The stability of the geopolitical and economic landscape and the density of the technology network are identified as critical uncertainties. Based on that, future scenarios are developed. Strategic short- and long-term options are recommended for different scenarios. Finally, early indicators are developed, helping industry stakeholders to monitor the environment and anticipate which scenario unfolds

Outsourcing of activities related to international transportation of system packages for ships in Havyard

Confidential until 3 January 201

Development and Analysis of Performance Measurement Indicators Utilized by Third Party Logistics Service Providers

Performance is important part of a company’s operations as it describes how well company is fulfilling its goals. Supply chain and logistics connect the product to a consumer from the manufacturer via different actions and actors. Transportation is required from sourcing of raw material through production to the delivering of finished products to end users, as also seen in reverse logistics. This thesis combines these two aspects related to performance and its measurement in third-party logistics transportations. Performance and its measurement have been researched a lot but most of the time research are related to financial point of view. Environmental performance is usually used to measure performance in green logistics. Logistics performance together with environmental performance has not been research specially in third-party logistics. The focus in this thesis is to research performance from environmental and logistics point of view and especially have third-party logistics service providers as a main research area. Research question of this thesis is: What are the key performance indicators utilized by third-party logistics service providers in measurements? The objectives for this research question are to find out what performance indicators and key performance indicators third-party logistics service providers use in their transportations environmental and logistics measurements. In addition, objectives include to finding out why are these indicators chosen. Last objective is to develop and propose alternative solutions for performance measurement and indicators. This research is based on qualitative interview with an open-ended questionnaire as the data collection method. The interview has been built around theoretical framework what has been formed from central findings of the literature review. Literature review is consisted of three parts which cover the main topics of the study which are third-party logistics service providers, performance measurement and performance indicators. The interview was conducted with one company, so the sample size is 1 as questions were answered from a company-wide perspective. The results showed that the significance of company goals is major in performance measurement and indicators as company goals guides indicators selection. Instead importance of performance measurement system in indicators selection can be stated to be quite minor. Results also pointed out environmental performance to be highlighted in performance measurement and especially in performance indicators.Suorituskyky on tärkeä osa yritysten toimintaa, sillä se kuvaa kykyä suoriutua tavoitteiden toteuttamisessa. Toimitusketju ja logistiikka yhdistävät tuotteen valmistajalta kuluttajalle eri toimijoiden ja toimintojen avulla. Kuljetuksilla on avainrooli toimitusketjussa ja logistiikassa sillä kuljetuksia tarvitaan useisiin eri toimintoihin tuotannon alusta aina tuotteen toimittamiseen loppuasiakkaalle kuin myös paluulogistiikkaan. Tämä tutkimus yhdistää nämä kaksi aspektia ja tutkii tekijöitä, jotka liittyvät suorituskykyyn ja sen mittaamiseen kolmannen osapuolen logistiikan kuljetuksissa. Suorituskykyä ja sen mittaamista on tutkittu paljon, mutta useimmiten tutkimukset ovat olleet talouden näkökulmasta. Ympäristön suorituskyvyn mittaukset ovat yleensä kohdistuneet vihreään logistiikkaan. Logistista suorituskykyä yhdessä ympäristön suorituskyvyn kanssa ei ole tutkittu erityisesti kolmannen osapuolen logistiikassa. Tämän vuoksi tutkimuksen pääpaino on suorituskyvyn mittaaminen erityisesti ympäristön ja logistiikan näkökulmasta ja keskittyen erityisesti kolmannen osapuolen logistiikan palveluntarjoajiin. Tämän tutkimuksen tutkimuskysymys on: Mitkä ovat tärkeimmät suorituskykyindikaattorit, joita kolmannen osapuolen logistiikkapalvelujen tarjoajat käyttävät mittauksissa? Kysymyksen tavoitteena on saada selville mitä ympäristön ja logistiikan suorituskyvyn indikaattoreita kolmannen osapuolen logistiikkapalvelujen tarjoajat käyttävät ja mitkä niistä ovat avainindikaattoreita. Lisäksi tavoitteena on selvittää, miksi nämä indikaattorit on valittu sekä tehdä kehitysehdotuksia suorituskyvyn mittaamiseen ja indikaattoreihin. Tämä tutkimus on laadullinen tutkimus, jossa datankeräysmetodina on avoimia kysymyksiä sisältävä haastattelu. Haastattelu on rakennettu teoreettisen viitekehyksen ympärille, joka taas on muodostettu kirjallisuuskatsauksen keskeisimmistä löydöksistä. Kirjallisuuskatsaus koostuu kolmesta osasta, jotka kattavat tutkimuksen pääaiheet. Nämä osat ovat kolmannen osapuolen logistiikan palveluntarjoajat, suorituskyvyn mittaaminen ja suorituskyvyn indikaattorit. Haastattelu toteutettiin yhden yrityksen kanssa ja kysymyksiin vastasi yksi työntekijä koko yrityksen näkökulmasta, joten tutkimuksen otoskoko on 1. Tutkimuksen tulokset osoittavat, että yrityksen tavoitteiden merkitys on suuri suorituskyvyn mittaamisessa ja indikaattoreissa, sillä nämä tavoitteet ohjaavat indikaattoreiden valintaa. Sen sijaan suorituskyvyn mittausjärjestelmien merkitys indikaattoreiden valinnassa jäi hieman epäselväksi. Lisäksi tulokset osoittivat ympäristön suorituskyvyn korostuvan suorituskyvyn mittaamisessa logistiseen suorituskykyyn nähden