Activation of supply relationships : a study of main providers in the Turku logistics cluster

Företag inom industri och handel väljer allt oftare att låta ett logistikföretag sköta stora delar av sina logistiska processer. Logistikföretagen i sin tur överlåter utförandet av enskilda tjänster, som t.ex. olika typer av transport, till olika samarbetspartners inom branschen. I avhandlingen studeras hur logistikföretag går till väga då de väljer vilka av deras samarbetspartners som ska engageras för att delta i utförandet av ett logistiktjänstepaket, en arbetsprocess som här kallas aktivering. Fokus ligger på aktiveringens innehåll och de faktorer som inverkar på hur den går till och vilka samarbetsparter som kommer att engageras. Arbetet bygger på nätverksansatsen för studier av företagsrelationer på industriella marknader. Aktiveringsprocessen uppfattas som en rätt ordinär, rutinmässig verksamhet i företaget, men den kan också förväntas inverka på hur företagets samarbetsnätverk utvecklas över tiden, genom att vissa relationer förstärks medan andra försvagas. I den empi riska undersökningen deltog 29 logistikföretag i Åboregionen som utgående från ett diskussionsunderlag fick berätta om hur de går till väga vid aktivering.

Role of Capabilities in Purchasing and Supply Management Performance

The objective of this thesis was to study the role of capabilities in purchasing and supply management. For the pre-understanding of the research topic, purchasing and supply management development and the multidimensional, unstructured and complex nature of purchasing and supply management performance was studied in literature review. In addition, a capability-based purchasing and supply management performance framework were researched and structured for the empirical research. Due to the unstructured nature of the research topic, the empirical research is three-pronged in this study including three different research methods: the Delphi method, semi-structured interview, and case research. As a result, the purchasing and supply management capability assessment tool was structured to measure current level of capabilities and impact of capabilities on purchasing and supply management performance. The final results indicate that capabilities are enablers of purchasing and supply management performance, and therefore critical to purchasing and supply performance.

Management of commercial property derived risks in the market context of the Russian Federation

The objective of the thesis is to examine the current state of risk management and to determine an appropriate risk management policy for commercial property derived risks in the Russian branch of a Finnish retail trade company. The employed research methodologies are comparative in-depth interviews and empirical value at risk analysis, including portfolio risk decomposition to determine the inter-currency characteristics. For a multinational retail trade company, the commercial property derived risks open up as a diverse combination of financial and non-financial risks with four distinctive interest groups. The research results indicate that geographical diversification across currency regimes provides diversification benefits. The Russian ruble is the most significant single risk component when considering the net investments outside the euro-zone. Decreasing the Russian ruble and Swedish krona exposures are the most effective methods to reduce translation derived risk. Exchange rate volatility varies over time according to idiosyncratic currency regime characteristics, and cost-effective risk management requires comprehensive analysis of the business environment. Profound and proactive risk management methods are found to be pivotal for companies with cross-border operations in order to succeed among international competitors.

Benefits and challenges of supply chain finance business process automation : A case study in ING Bank

Supply chain finance, a financial product provided by the bank, has gained increasing attention and popularity over the last few years. Supply chain finance helps the corporate clients to optimize their financial flows along the supply chain. One characteristic of supply chain finance is that it aims to provide automated solutions. Therefore, the business process automation of supply chain finance is a very interesting and important topic for study. In this study, the business process automation of supply chain finance within the case organization, ING, is analysed. The purpose is to: (1) Identify the benefits to understand the importance to automate supply chain finance business process; (2) Find out the existing automation degree in the supply chain finance business process within the case bank to see what’s the situation now and how to improve in the future; (3) Discover the challenges in the further automation of supply chain finance business process. Firstly, the study finds out that supply chain finance business process automation can bring many benefits to the bank. Automation can improve productivity by using less time and human labour in the business process, and by providing scalable solutions. Automation can also improve quality of the service by reducing the human errors. Last but not least, automation can improve internal governance by providing enhanced visibility of the business process. Because of these potential benefits, many banks are actively seeking solutions to automate their supply chain finance business process. Then, the current automation situation with the case bank is analysed with the help of business process modelling. The supply chain finance business process within the case bank can be further divided into several sub processes: daily transaction, buyer sales and setup, supplier onboarding, contract management, customer services and supports, and contract termination. The study finds out that the daily transaction process is already a highly automated, which is carried out through the web-based trading platform. However, for other business the automation degree is relatively low. Among these business processes, supplier onboarding is most needed for further automation. Then, some solutions are also suggested to automate the supplier onboarding business process. In the end, the study also foresees some challenges during the further automation of supply chain finance business process in the case bank. Some suggestions are also given to deal with these challenges.

Enterprise applications migration to the cloud: risks and opportunities

Millions of enterprises move their applications to a cloud every year. According to Forrester Research “the global cloud computing market will grow from a $40.7 billion in 2011 to $241 billion in 2020”. Due to increased interests and demand broad range of providers and solutions have appeared in the market. It is vital to be able to predict possible problems correctly and to classify and mitigate risks associated with the migration process. The study will show the main criteria that should be taken into consideration while making decision of moving enterprise applications to the cloud and choosing appropriate vendor. The main goal of the research is to identify main problems during the migration to a cloud and propose a solution for their prevention and mitigation of consequences in case of occurrence. The research provides an overview of existing cloud solutions and deployment models for enterprise applications. It identifies decision drivers of an applications migration to a cloud and potential risks and benefits associated with this. Finally, the best practices for the successful enterprise-to-cloud migration based on the case studies analysis are formulated.

Ulkomaalaisen yrityksen verkostosuhteet Venäjällä

Tutkimuksen tavoitteena on konkreettisen yritysverkoston avulla selvittää, minkälaisia ovat ulkomaalaisen yrityksen potentiaaliset kumppanit ja yritysten väliset suhteet Venäjällä. Toisena tavoitteena on kuvata käytännön työelämään sopivalla menetelmällä riittävän kokonaisvaltaisesti yritysverkoston kumppanit sekä kumppaneiden ja kärkiyrityksen väliset suhteet. Samalla tarkastellaan yritysten välisten suhteiden riskejä. Selvitysmenetelmällä pyritään nopeuteen ja ketteryyteen ja sen tavoitteena on lisätä ulkomaisen johdon käsitystä yritysverkostosta johdon päätöksentekoa varten. Tutkimus jakaantuu teoria tarkasteluun ja yhden Venäjällä toimivan ulkomaisen yrityksen osto-osaston verkostoa selvittävään empiiriseen osaan. Teoriatarkastelussa selvitetään erilaisia lähestymistapoja ja laajempia viitekehyksiä yritysverkostojen tutkimukseen. Teoriatarkastelun perusteella valittiin viitekehykset yrityskumppaneiden ja yritysten välisen suhteen sekä riskien arviointiin. Empiirisen osan tutkimus toteutettiin haastattelukyselytutkimuksena perustuen näihin viitekehyksiin. Yrityskumppaneita ja yritysten välisiä suhteita tarkastellaan tilastollisin menetelmin ja riskejä arvioidaan laadullisella tutkimusotteella. Tutkimustulokset vastaavat monelta osin liiketoimintakulttuurista ja –ympäristöstä saatua kokemukseen ja tutkimustietoon perustuvaa käsitystä. Verkostoitumisen kulmakivet ovat hyvin toimivat ja määritellyt vaihdannan liiketoiminta- ja tukiprosessit, hyvin tunnetut kumppanit ja tälle perustalle rakennetut sosiaaliset suhteet sekä liiketoimintaympäristöön ja –kulttuuriin soveltuvat yhteistyökompetenssit. Tutkitun yritysverkoston yhteistyösuhteet voidaan jakaa hierarkkiseen organisaatiokumppanuuteen, toimittajakumppanuuteen, luottamukseen perustuvaan markkinaehtoiseen suhteeseen ja opportunistiseen markkinasuhteeseen. Hyviä yhteistyökumppaneita ja –suhteita löytyy taustaltaan erilaisista toimittajista. Tutkimuksessa käytetyt viitekehykset toimivat hyvin erityisesti yrityskumppanin arvioinnissa. Yritysten välisen suhteen arviointiin käytetyn viitekehyksen ongelmat liittyivät lähinnä erilaiseen liiketoimintakulttuuriin ja käsitykseen yritysten välisestä strategisesta suhteesta. Riskit liittyivät toimitussuhteeseen useammin kuin omaan organisaatioon tai toimittajaan.

Supply chain performance management system

The purpose of the study is to determine general features of the supply chain performance management system, to assess the current state of performance management in the case company mills and to make proposals for improvement – how the future state of performance management system would look like. The study covers four phases which consist of theory and case company parts. Theoretical review gives understanding about performance management and measurement. Current state analysis assesses the current state of performance management in the mills. Results and proposals for improvement are derived from current state analysis and finally the conclusions with answers to research questions are presented. Supply chain performance management system consists of five areas: perfor-mance measurement and metrics, action plans, performance tracking, performance dialogue and rewards, consequences and actions. The result of the study revealed that all mills were quite average level in performance management and there is a room for improvement. Created performance improvement matrix served as a tool in assessing current performance management and could work also as a tool in the future in mapping the current state after transformation process. Limited harmonization was revealed as there were different ways to work and manage performance in the mills. Lots of good ideas existed though actions are needed to make a progress. There is also need to harmonize KPI structure.

Value added logistics in supply and demand chain : COSTFIX : New operation model for maintenance material logistics in paper industry

This research report illustrates and examines new operation models for decreasing fixed costs and transforming them into variable costs in the field of paper industry. The report illustrates two cases – a new operation model for material logistics in maintenance and an examination of forklift truck fleet outsourcing solutions. Conventional material logistics in maintenance operation is illustrated and some problems related to conventional operation are identified. A new operation model that solves some of these problems is presented including descriptions of procurement and service contracts and sources of added value. Forklift truck fleet outsourcing solutions are examined by illustrating the responsibilities of a host company and a service provider both before and after outsourcing. The customer buys outsourcing services in order to improve its investment productivity. The mechanism of how these services affect the customer company’s investment productivity is illustrated.

The effects of location, feedstock availability, and supply-chain logistics on the greenhouse gas emissions of forest-biomass energy utilization in Finland

Forest biomass represents a geographically distributed feedstock, and geographical location affects the greenhouse gas (GHG) performance of a given forest-bioenergy system in several ways. For example, biomass availability, forest operations, transportation possibilities and the distances involved, biomass end-use possibilities, fossil reference systems, and forest carbon balances all depend to some extent on location. The overall objective of this thesis was to assess the GHG emissions derived from supply and energy-utilization chains of forest biomass in Finland, with a specific focus on the effect of location in relation to forest biomass’s availability and the transportation possibilities. Biomass availability and transportation-network assessments were conducted through utilization of geographical information system methods, and the GHG emissions were assessed by means of lifecycle assessment. The thesis is based on four papers in which forest biomass supply on industrial scale was assessed. The feedstocks assessed in this thesis include harvesting residues, smalldiameter energy wood and stumps. The principal implication of the findings in this thesis is that in Finland, the location and availability of biomass in the proximity of a given energyutilization or energy-conversion plant is not a decisive factor in supply-chain GHG emissions or the possible GHG savings to be achieved with forest-biomass energy use. Therefore, for the greatest GHG reductions with limited forest-biomass resources, energy utilization of forest biomass in Finland should be directed to the locations where most GHG savings are achieved through replacement of fossil fuels. Furthermore, one should prioritize the types of forest biomass with the lowest direct supply-chain GHG emissions (e.g., from transport and comminution) and the lowest indirect ones (in particular, soil carbon-stock losses), regardless of location. In this respect, the best combination is to use harvesting residues in combined heat and power production, replacing peat or coal.

Assessment of purchasing maturity in spare parts supply chain

To describe the change of purchasing moving from administrative to strategic function academics have put forward maturity models which help practitioners to compare their purchasing activities to industry top performers and best practices. However, none of the models aim to distinguish the purchasing maturity from the after-sales point of view, even though after-sales activities are acknowledged as a relevant source of revenue, profit and competitive advantage in most manufacturing firms. The maturity of purchasing and supply management practices have a large impact to the overall performance of the spare parts supply chain and ultimately to the value creation and relationship building for the end customer. The research was done as a case study for a European after-sales organization which is part of a globally operating industrial firm specialized in heavy machinery. The study mapped the current state of the purchasing practices in the case organization and also distinguished the relevant areas for future development. The study was based on the purchasing maturity model developed by Schiele (2007) and investigated also how applicable is the maturity model in the spare parts supply chain context. Data for the assessment was gathered using five expert interviews inside the case organization and other parties involved in the company’s spare parts supply chain. Inventory management dimension was added to the original maturity model in order to better capture the important areas in a spare parts supply chain. The added five questions were deduced from the spare parts management literature and verified as relevant areas by the case organization’s personnel. Results indicate that largest need for development in the case organization are: better collaboration between sourcing and operative procurement functions, use of installed base information in the spare parts management, training plan development for new buyers, assessment of aligned KPI’s between the supply chain parties and better defining the role of after-sales sourcing. The purchasing maturity model used in this research worked well in H&R Leading, Controlling and Inventory Management dimensions. The assessment was more difficult to conduct in the Supplier related processes, Process integration and Organizational structure –dimensions, mainly because the assessment in these sections would for some parts require more company-wide assessment. Results indicate also that the purchasing maturity model developed by Schiele (2007) captures the relevant areas in the spare parts supply as well.

Impact of reliability of supply on long-term development approaches to electricity distribution networks

The Finnish electricity distribution sector, rural areas in particular, is facing major challenges because of the economic regulation, tightening supply security requirements and the ageing network asset. Therefore, the target in the distribution network planning and asset management is to develop and renovate the networks to meet these challenges in compliance with the regulations in an economically feasible way. Concerning supply security, the new Finnish Electricity Market Act limits the maximum duration of electricity supply interruptions to six hours in urban areas and 36 hours in rural areas. This has a significant impact on distribution network planning, especially in rural areas where the distribution networks typically require extensive modifications and renovations to meet the supply security requirements. This doctoral thesis introduces a methodology to analyse electricity distribution system development. The methodology is based on and combines elements of reliability analysis, asset management and economic regulation. The analysis results can be applied, for instance, to evaluate the development of distribution reliability and to consider actions to meet the tightening regulatory requirements. Thus, the methodology produces information for strategic decision-making so that DSOs can respond to challenges arising in the electricity distribution sector. The key contributions of the thesis are a network renovation concept for rural areas, an analysis to assess supply security, and an evaluation of the effects of economic regulation on the strategic network planning. In addition, the thesis demonstrates how the reliability aspect affects the placement of automation devices and how the reserve power can be arranged in a rural area network.

Risk Assessment of a Supplier in the Pharmaceutical Industry

The topic of this Master’s Thesis is risk assessment in the supply chain, and the work was done for a company operating in the pharmaceutical industry. The unique features of the industry bring additional challenges to risk management, due to high regulatory, docu-mentation and traceability requirements. The objective of the thesis was to generate a template for assessing the risks in the supply chain of current and potential suppliers of the case company. Risks pertaining to the case setting were sought mainly from in-house expertise of this specific product and supply chain as well as academic research papers and theory on risk management. A questionnaire was set up to assess the found risks on impact, occurrence and possibility of detection. Through this classification of the severity of the risks, the supplier assessment template was formed. A questionnaire template, comprised of the top 10 risks affecting the flow of information and materials in this setting, was formulated to serve as a generic tool for assessing risks in the supply chain of a pharmaceutical company. The template was tested on another supplier for usability and accuracy of found risks, and it demonstrated functioning in a differing supply chain and product setting.