Mitigating uncertainty in logistics outsourcing with ERP systems

Outsourcing is a common strategy for companies looking for cost savings and improvements in performance. This has been especially prevalent in logistics, where warehousing and transporting are typical targets for outsourcing. However, while the benefits from logistics outsourcing are clear on paper, there are several cases companies fail to reach these benefits. The most commonly cited reasons for this are poor information flow between the company and the third party logistics partner, and a lack of integration between the two partners. Uncertainty stems from lack of information, and it can cripple the whole outsourcing operation. This is where enterprise resource planning (ERP) systems step in, as they can have a significant role in improving the flow of information, and integration, which consequently mitigates uncertainty. The purpose of the study is to examine if ERP systems have an effect on a company's decision to outsource logistics operations. Along the rapid advancements in technology during the past decades, ERP systems have also evolved. Therefore, empirical research on the subject needs constant revision as it can quickly become outdated due to ERP systems having more advanced capabilities every year. The research was conducted using a qualitative single-case study of a Finnish manufacturing firm that had outsourced warehousing and transportation operations in the Swedish market. The empirical data was gathered with use of semi-structured interviews with three employees from the case company that were closely related to the outsourcing operation. The theoretical framework that was used to analyze the empirical data was based on Transaction Cost Economics theory. The results of the study were align with the theoretical framework, in that the ERP system of the case company was seen as an enabler for their logistics outsourcing operation. However, the full theoretical benefits from ERP systems concerning extended enterprise functionality and flexibility were not attained due to the case company having an older version of their ERP system. This emphasizes the importance of having up-to-date technology if you want to overcome the shortcomings of ERP systems in outsourcing situations.

State of logistics and transport in the Baltic Sea region in 2025

The world’s pace of change is accelerating and new innovations, inventions and technologies come about every day. Change is unavoidable. It is difficult to keep up and even more difficult to prepare for the future. Even though it is not possible to know exactly what will happen in the future, by studying futures people can better anticipate what might lie ahead. By making decisions and realizing the consequences of their choices today, people and governments are able to actively decide how they will act in the future. Both opportunities and pitfalls lie ahead, which encourages actors to make more farsighted decisions. The Baltic Sea region is an interesting area for futures studies. It comprises 11 nations and more than 100 million inhabitants and entails countries with advanced, high-income economies, like Finland, Germany and Denmark, and developing economies, like Russia, Latvia and Lithuania. The western, eastern, northern and southern parts of the region are separated by the Baltic Sea, which at the same time represents a barrier and a facility for trade and travel between the countries belonging to the region The purpose of this study was to uncover the most probable future of transport and logistics in the Baltic Sea region in 2025 by using the Delphi method. Altogether 109 responses were collected in two separate instances from experts in all the Baltic Sea region countries, 56 of whom were defined as academic respondents and 53 of whom business respondents. Only minor differences in the opinions of academic and business experts were discovered, and the larger differences lie between eastern and western response groups. The Baltic Sea region is a very heterogeneous region and the division is clearest between East and West, which differ in political, economic, social, technological and environmental aspects. The probable future of the Baltic Sea region presented in this study is coherent with previous studies on the same subject. The future of the Baltic Sea region in terms of logistics and transport looks quite bright according to the experts who participated in the study. Trade volumes will grow and the importance of logistics and transport to the competitiveness of the region will increase. Respondents from eastern countries seemed to be more optimistic about the future in general. Most differences between opinions could be explained by the gap in technological and infrastructural development between the East and West. As eastern countries are less-developed in some parts of their economies, it is easier for them to improve the technical condition of infrastructure by merely catching up with the western countries.

Networks and partnerships in third party logistics service production

Third party logistics, and third party logistics providers and the services they offer have grown substantially in the last twenty years. Even though there has been extensive research on third party logistics providers, and regular industry reviews within the logistics industry, a closer research in the area of partner selection and network models in the third party logistics industry is missing. The perspective taken in this study was of expanding the network research into logistics service providers as the focal firm in the network. The purpose of the study is to analyze partnerships and networks in the third party logistics industry in order to define how networks are utilized in third party logistics markets, what have been the reasons for the partnerships, and whether there are benefits for the third party logistics provider that can be achieved through building networks and partnerships. The theoretical framework of this study was formed based on common theories in studying networks and partnerships in accordance with models of horizontal and vertical partnerships. The theories applied to the framework and context of this study included the strategic network view and the resource-based view. Applying these two network theories to the position and networks of third party logistics providers in an industrial supply chain, a theoretical model for analyzing the horizontal and vertical partnerships where the TPL provider is in focus was structured. The empirical analysis of TPL partnerships consisted of a qualitative document analysis of 33 partnership examples involving companies present in the Finnish TPL markets. For the research, existing documents providing secondary data on types of partnerships, reasons for the partnerships, and outcomes of the partnerships were searched from available online sources. Findings of the study revealed that third party logistics providers are evident in horizontal and vertical interactions varying in geographical coverage and the depth and nature of the relationship. Partnership decisions were found to be made on resource based reasons, as well as from strategic aspects. The discovered results of the partnerships in this study included cost reduction and effectiveness in the partnerships for improving existing services. In addition in partnerships created for innovative service extension, differentiation, and creation of additional value were discovered to have emerged as results of the cooperation. It can be concluded that benefits and competitive advantage can be created through building partnerships in order to expand service offering and seeking synergies.

Service offering classification for logistics services

This thesis studies the development of service offering model that creates added-value for customers in the field of logistics services. The study focusses on offering classification and structures of model. The purpose of model is to provide value-added solutions for customers and enable superior service experience. The aim of thesis is to define what customers expect from logistics solution provider and what value customers appreciate so greatly that they could invest in value-added services. Value propositions, costs structures of offerings and appropriate pricing methods are studied. First, literature review of creating solution business model and customer value is conducted. Customer value is found out with customer interviews and qualitative empiric data is used. To exploit expertise knowledge of logistics, innovation workshop tool is utilized. Customers and experts are involved in the design process of model. As a result of thesis, three-level value-added service offering model is created based on empiric and theoretical data. Offerings with value propositions are proposed and the level of model reflects the deepness of customer-provider relationship and the amount of added value. Performance efficiency improvements and cost savings create the most added value for customers. Value-based pricing methods, such as performance-based models are suggested to apply. Results indicate the interest of benefitting networks and partnership in field of logistics services. Networks development is proposed to be investigated further.

Supporting employer branding by inbound marketing in Russia

The objective of this study is to understand how employer branding can be strategically supported by inbound marketing in Russia. Furthermore, the aim is to examine the special features of inbound marketing in Russia, as well as to learn what the most useful inbound marketing channels are in the Russian context. The theoretical background of this study is built from employer branding and inbound marketing literature. Inbound marketing is currently lacking a profound research on the topic and thus, this study contributes to the inbound marketing literature as well. The empirical data of this research is collected via three qualitative expert field interviews. The interviews were conducted between January and February 2014. Furthermore, a thematic content analysis was used in the process of analyzing the research results. Both the employer branding and inbound marketing are growing their importance in Russia. The results of this study suggest that a combination of employer branding and inbound marketing can bring companies competitive advantage over others in the Russian market. It is, however, crucial to first understand the peculiarities of the inbound marketing in Russia before taking it to the employer branding context. This study provides a framework for inbound marketing tools in Russia. The proposed framework takes into careful consideration the cultural factors affecting the selection of the inbound marketing tools in Russia. Furthermore, the results of this study suggest how inbound marketing could be successfully combined with employer branding in Russia in order to strengthen the employer brands in the Russian market. However, these results are mainly applicable in the Russian context. Therefore, additional research is needed in order to understand the relationship between the employer branding and inbound marketing in other cultural settings or in particular fields of business.

The radio frequency identification technology in the supply chain management: a case of a big logistics company

Nowadays global business trends force the adoption of innovative ICTs into the supply chain management (SCM). Particularly, the RFID technology is on high demand among SCM professionals due to its business advantages such as improving of accuracy and veloc-ity of SCM processes which lead to decrease of operational costs. Nevertheless, a question of the RFID technology impact on the efficiency of warehouse processes in the SCM re-mains open. The goal of the present study is to experiment the possibility of improvement order picking velocity in a warehouse of a big logistics company with the use of the RFID technology. In order to achieve this goal the following objectives have been developed: 1) Defining the scope of the RFID technology applications in the SCM; 2) Justification of the RFID technology impact on the SCM processes; 3) Defining a place of the warehouse order picking process in the SCM; 4) Identification and systematization of existing meth-ods of order picking velocity improvement; 5) Choosing of the study object and gathering of the empirical data about number of orders, number of hours spent per each order line daily during 5 months; 6) Processing and analysis of the empirical data; 7) Conclusion about the impact of the RFID technology on the speed of order picking process. As a result of the research it has been found that the speed of the order picking processes has not been changed as time has gone after the RFID adoption. It has been concluded that in order to achieve a positive effect in the speed of order picking process with the use of the RFID technology it is necessary to simultaneously implement changes in logistics and organizational management in 3PL logistics companies. Practical recommendations have been forwarded to the management of the company for further investigation and procedure.

Value of Information Logistics Integration in Digital Business Ecosystem

Digital business ecosystems (DBE) are becoming an increasingly popular concept for modelling and building distributed systems in heterogeneous, decentralized and open environments. Information- and communication technology (ICT) enabled business solutions have created an opportunity for automated business relations and transactions. The deployment of ICT in business-to-business (B2B) integration seeks to improve competitiveness by establishing real-time information and offering better information visibility to business ecosystem actors. The products, components and raw material flows in supply chains are traditionally studied in logistics research. In this study, we expand the research to cover the processes parallel to the service and information flows as information logistics integration. In this thesis, we show how better integration and automation of information flows enhance the speed of processes and, thus, provide cost savings and other benefits for organizations. Investments in DBE are intended to add value through business automation and are key decisions in building up information logistics integration. Business solutions that build on automation are important sources of value in networks that promote and support business relations and transactions. Value is created through improved productivity and effectiveness when new, more efficient collaboration methods are discovered and integrated into DBE. Organizations, business networks and collaborations, even with competitors, form DBE in which information logistics integration has a significant role as a value driver. However, traditional economic and computing theories do not focus on digital business ecosystems as a separate form of organization, and they do not provide conceptual frameworks that can be used to explore digital business ecosystems as value drivers—combined internal management and external coordination mechanisms for information logistics integration are not the current practice of a company’s strategic process. In this thesis, we have developed and tested a framework to explore the digital business ecosystems developed and a coordination model for digital business ecosystem integration; moreover, we have analysed the value of information logistics integration. The research is based on a case study and on mixed methods, in which we use the Delphi method and Internetbased tools for idea generation and development. We conducted many interviews with key experts, which we recoded, transcribed and coded to find success factors. Qualitative analyses were based on a Monte Carlo simulation, which sought cost savings, and Real Option Valuation, which sought an optimal investment program for the ecosystem level. This study provides valuable knowledge regarding information logistics integration by utilizing a suitable business process information model for collaboration. An information model is based on the business process scenarios and on detailed transactions for the mapping and automation of product, service and information flows. The research results illustrate the current cap of understanding information logistics integration in a digital business ecosystem. Based on success factors, we were able to illustrate how specific coordination mechanisms related to network management and orchestration could be designed. We also pointed out the potential of information logistics integration in value creation. With the help of global standardization experts, we utilized the design of the core information model for B2B integration. We built this quantitative analysis by using the Monte Carlo-based simulation model and the Real Option Value model. This research covers relevant new research disciplines, such as information logistics integration and digital business ecosystems, in which the current literature needs to be improved. This research was executed by high-level experts and managers responsible for global business network B2B integration. However, the research was dominated by one industry domain, and therefore a more comprehensive exploration should be undertaken to cover a larger population of business sectors. Based on this research, the new quantitative survey could provide new possibilities to examine information logistics integration in digital business ecosystems. The value activities indicate that further studies should continue, especially with regard to the collaboration issues on integration, focusing on a user-centric approach. We should better understand how real-time information supports customer value creation by imbedding the information into the lifetime value of products and services. The aim of this research was to build competitive advantage through B2B integration to support a real-time economy. For practitioners, this research created several tools and concepts to improve value activities, information logistics integration design and management and orchestration models. Based on the results, the companies were able to better understand the formulation of the digital business ecosystem and the importance of joint efforts in collaboration. However, the challenge of incorporating this new knowledge into strategic processes in a multi-stakeholder environment remains. This challenge has been noted, and new projects have been established in pursuit of a real-time economy.

The advantages and disadvantages of logistics centralization and decentralization from employee’s perspective

Tämän tutkimuksen tarkoituksena on havainnoida keskittämisen ja hajauttamisen hyötyjä ja haittoja logistiikassa, ja selventää mitä tekijöidä tulee huomioida näiden kahden rakenteen väliltä valitessa. Tutkimus kokoaa molempien rakenteiden hyödyt ja haitat hyödyntämällä sekä haastateltujen työntekijöiden osaamista ja mielipiteitä että aiheeseen liittyvää kirjallisuutta. Päätavoitteena on lisätä ymmärrystä siitä, miten organisaatiorakenne vaikuttaa logistiseen toimintaan.