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1,[object Object],DEVELOPPING A LOGISTICS PERFORMANCE ASSESSMENT TOOL FOR SMEs: A Closer Look at Logistics Costs…,[object Object],Ruth Banomyong,[object Object],Centre for Logistics Research,[object Object],Thammasat University, Thailand,[object Object]
2,[object Object],Agenda,[object Object],Background,[object Object],Framework Development,[object Object],Methodology,[object Object],Findings,[object Object],Some Comments...,[object Object],A closer look at logistics costs...,[object Object]
3,[object Object],Background,[object Object],Logistics management is recognised as a key opportunity to improve profitability and firms’ competitive performance (Lambert et al., 1998).,[object Object],However, It is important for firms to be able to assess their own logistics performance as a starting reference.,[object Object],Current assessment tools are not user friendly.,[object Object]
4,[object Object],Background,[object Object],The purpose of this presentation is to introduce a logistics performance assessment tool (LPAT).,[object Object],The objective of the LPAT is to measure the performance of a firm’s key logistics activities under different performance dimensions.,[object Object]
5,[object Object],Background,[object Object],The literature on the subject of performance measurement in logistics had common theme (Bowersoxet al., 1989; Byrne & Markham 1991; Keebleret al,. 1999; Griffiset al., 2004): ,[object Object],Most firms do not comprehensively measure logistics performance,,[object Object],Even the best performing firms fail to realise their productivity and service potential available from logistics performance measurement, and;,[object Object],Logistics competency will increasingly be viewed as a competitive differentiator and a key strategic resource for the firm.,[object Object]
Framework: 9 Key Logistics Activities,[object Object],Order processing & Logistics communications,[object Object],Customer service & support,[object Object],Demand forecasting & planning,[object Object],Purchasing & procurement,[object Object],Material handling & packaging,[object Object],Inventory management,[object Object],Transportation,[object Object],Facilities site selection, warehousing & storage,[object Object],Return goods handling and reverse logistics,[object Object],Source: Grant et al., 2006,[object Object],6,[object Object]
Framework: Performance Measurement Dimensions,[object Object]
Framework Development,[object Object]
Dr. ruth  ecr08 lpat-1
Logistics Activities Development Framework,[object Object],10,[object Object]
Methodology,[object Object],A questionnaire was developed based on the logistics activities performance framework. ,[object Object],25 SMEs respondents were selected to answer the questionnaire while one Thai multinational was also requested to answer the assessment questionnaire.  ,[object Object],The 25 SMEs were composed of firms in the automotive sector, electronic, jewelry, furniture, and rubber industry.,[object Object],11,[object Object]
Methodology,[object Object],Respondents understood data requirement well. However only 2 were able to fill the whole questionnaire.,[object Object],Cost data was the most difficult to complete. Respondents with ISO have more available data.,[object Object],Data provided by Thai MNE could serve as a reference point. ,[object Object],12,[object Object]
Findings,[object Object],The data collected was compared with an existing logistics and supply chain benchmarking database,[object Object],http://www.benchmarkingsuccess.com,[object Object],The logistics performance out put based on the 3 performance dimensions are illustrated in the following slides… ,[object Object],13,[object Object]
14,[object Object],Cost KPIs,[object Object],Performance,[object Object],Customer service ,[object Object],0,[object Object],.,[object Object],5 ,[object Object],-,[object Object],5,[object Object],%,[object Object],< ,[object Object],0,[object Object],.,[object Object],5,[object Object],%,[object Object],> ,[object Object],5,[object Object],%,[object Object],cost per sale,[object Object],Procurement ,[object Object],0,[object Object],.,[object Object],5 ,[object Object],-,[object Object],5,[object Object],%,[object Object],< ,[object Object],0,[object Object],.,[object Object],5,[object Object],%,[object Object],> ,[object Object],5,[object Object],%,[object Object],cost per sale,[object Object],W,[object Object],Info processing ,[object Object],0,[object Object],.,[object Object],5 ,[object Object],–,[object Object],5,[object Object],%,[object Object],> ,[object Object],5,[object Object],%,[object Object],< ,[object Object],0,[object Object],.,[object Object],5,[object Object],%,[object Object],O,[object Object],cost per sale,[object Object],R,[object Object],Transportation ,[object Object],1 ,[object Object],–,[object Object],10,[object Object],%,[object Object],< ,[object Object],1,[object Object],%,[object Object],> ,[object Object],10,[object Object],%,[object Object],cost per sale,[object Object],L,[object Object],D,[object Object],Warehousing ,[object Object],0,[object Object],.,[object Object],5 ,[object Object],-,[object Object],8,[object Object],%,[object Object],< ,[object Object],0,[object Object],.,[object Object],5,[object Object],%,[object Object],> ,[object Object],8,[object Object],%,[object Object],cost per sale,[object Object],C,[object Object],Forecasting cost ,[object Object],0,[object Object],.,[object Object],5 ,[object Object],-,[object Object],5,[object Object],%,[object Object],< ,[object Object],0,[object Object],.,[object Object],5,[object Object],%,[object Object],> ,[object Object],5,[object Object],%,[object Object],per sale,[object Object],L,[object Object],Inv holding cost ,[object Object],A,[object Object],0,[object Object],.,[object Object],5 ,[object Object],-,[object Object],5,[object Object],%,[object Object],< ,[object Object],0,[object Object],.,[object Object],5,[object Object],%,[object Object],> ,[object Object],5,[object Object],%,[object Object],per sale,[object Object],S,[object Object],Value damage,[object Object],S,[object Object],0,[object Object],.,[object Object],1 ,[object Object],–,[object Object],3,[object Object],%,[object Object],< ,[object Object],0,[object Object],.,[object Object],1,[object Object],%,[object Object],> ,[object Object],3,[object Object],%,[object Object],per sale,[object Object],Returned goods ,[object Object],0,[object Object],.,[object Object],5 ,[object Object],-,[object Object],3,[object Object],%,[object Object],< ,[object Object],0,[object Object],.,[object Object],5,[object Object],%,[object Object],> ,[object Object],3,[object Object],%,[object Object],cost per sale,[object Object],Disadvantage,[object Object],Parity,[object Object],Advantage,[object Object],= ,[object Object],Group Average,[object Object],= ,[object Object],Top Thai company,[object Object]
15,[object Object],Time KPIs,[object Object],Performance,[object Object],Avg order cycle ,[object Object],7 ,[object Object],–,[object Object],10 ,[object Object],days,[object Object],< ,[object Object],7 ,[object Object],days,[object Object],> ,[object Object],10 ,[object Object],days,[object Object],time,[object Object],Avg procurement ,[object Object],13 ,[object Object],–,[object Object],18 ,[object Object],days,[object Object],< ,[object Object],13 ,[object Object],days,[object Object],> ,[object Object],18 ,[object Object],days,[object Object],cycle time,[object Object],W,[object Object],Avg order processing ,[object Object],1 ,[object Object],–,[object Object],2 ,[object Object],days,[object Object],< ,[object Object],1 ,[object Object],days,[object Object],> ,[object Object],2 ,[object Object],days,[object Object],O,[object Object],cycle time,[object Object],R,[object Object],Avg delivery ,[object Object],1 ,[object Object],–,[object Object],3 ,[object Object],days,[object Object],< ,[object Object],1 ,[object Object],days,[object Object],> ,[object Object],3 ,[object Object],days,[object Object],cycle time,[object Object],L,[object Object],D,[object Object],Avg inventory ,[object Object],6 ,[object Object],hr ,[object Object],–,[object Object],2 ,[object Object],days,[object Object],< ,[object Object],6 ,[object Object],hours,[object Object],> ,[object Object],2 ,[object Object],days,[object Object],cycle time,[object Object],C,[object Object],Avg forecast ,[object Object],N,[object Object],.,[object Object],A,[object Object],.,[object Object],N,[object Object],.,[object Object],A,[object Object],.,[object Object],N,[object Object],.,[object Object],A,[object Object],.,[object Object],period,[object Object],L,[object Object],Avg inventory ,[object Object],A,[object Object],10,[object Object],–,[object Object],40 ,[object Object],d,[object Object],< ,[object Object],10 ,[object Object],days,[object Object],> ,[object Object],40 ,[object Object],days,[object Object],day,[object Object],S,[object Object],Avg material ,[object Object],S,[object Object],> ,[object Object],7 ,[object Object],days,[object Object],1 ,[object Object],–,[object Object],7 ,[object Object],days,[object Object],< ,[object Object],1 ,[object Object],days,[object Object],handling and ,[object Object],packaging cycle time,[object Object],Avg cycle time for ,[object Object],1 ,[object Object],–,[object Object],3 ,[object Object],days,[object Object],< ,[object Object],1 ,[object Object],days,[object Object],> ,[object Object],3 ,[object Object],days,[object Object],customer return,[object Object],Disadvantage,[object Object],Parity,[object Object],Advantage,[object Object],= ,[object Object],‡Group Average,[object Object],= ,[object Object],Top Thai Company,[object Object]
16,[object Object],Reliability,[object Object],KPIs,[object Object],Performance,[object Object],DIFOT,[object Object],80 ,[object Object],-,[object Object],95,[object Object],%,[object Object],> ,[object Object],95,[object Object],%,[object Object],< ,[object Object],80,[object Object],%,[object Object],(,[object Object],CS and Support,[object Object],),[object Object],Supplier In Full and ,[object Object],80 ,[object Object],-,[object Object],95,[object Object],%,[object Object],> ,[object Object],95,[object Object],%,[object Object],< ,[object Object],80,[object Object],%,[object Object],On,[object Object],-,[object Object],Time Rate,[object Object],W,[object Object],Order Accuracy ,[object Object],90 ,[object Object],-,[object Object],98,[object Object],%,[object Object],> ,[object Object],98,[object Object],%,[object Object],< ,[object Object],90,[object Object],%,[object Object],O,[object Object],Rate,[object Object],R,[object Object],DIFOT,[object Object],> ,[object Object],95,[object Object],%,[object Object],< ,[object Object],80,[object Object],%,[object Object],80 ,[object Object],-,[object Object],95,[object Object],%,[object Object],(,[object Object],Transportation,[object Object],),[object Object],L,[object Object],D,[object Object],90 ,[object Object],–,[object Object],99,[object Object],%,[object Object],> ,[object Object],99,[object Object],%,[object Object],< ,[object Object],90,[object Object],%,[object Object],Inventory Accuracy ,[object Object],C,[object Object],Forecast Accuracy ,[object Object],60 ,[object Object],-,[object Object],90,[object Object],%,[object Object],> ,[object Object],90,[object Object],%,[object Object],< ,[object Object],60,[object Object],%,[object Object],Rate ,[object Object],L,[object Object],A,[object Object],Inventory Out of ,[object Object],2 ,[object Object],-,[object Object],10,[object Object],%,[object Object],> ,[object Object],10,[object Object],%,[object Object],< ,[object Object],2,[object Object],%,[object Object],Stock Rate,[object Object],S,[object Object],S,[object Object],< ,[object Object],1,[object Object],%,[object Object],1 ,[object Object],-,[object Object],5,[object Object],%,[object Object],> ,[object Object],5,[object Object],%,[object Object],Damage Rate ,[object Object],Rate of Returned ,[object Object],0,[object Object],.,[object Object],1 ,[object Object],–,[object Object],5,[object Object],%,[object Object],> ,[object Object],5,[object Object],%,[object Object],< ,[object Object],0,[object Object],.,[object Object],1,[object Object],%,[object Object],Goods ,[object Object],Disadvantage,[object Object],Parity,[object Object],Advantage,[object Object],= ,[object Object],‡Group Average,[object Object],= ,[object Object],Top Thai Company,[object Object]
Some Comments...,[object Object],The LPAT tool could still be further simplified to make data collection easier.,[object Object],Key logistics activities are not equal in importance,[object Object],Further refinement of the logistics activities performance framework is needed…,[object Object],17,[object Object]
Some Comments...,[object Object],The objective would be to identify maybe not more than 2 or 3 key logistics KPIs per performance dimension that could illustrate firms’ overall logistics performance.,[object Object],A composite performance metrics is currently under consideration.,[object Object],The development of this tool is an ongoing process.,[object Object],18,[object Object]
A Closer Look at Logistics Cost...,[object Object],Difficult to identify all logistics activity cost. ,[object Object],ABC can support the identification of cost of each logistics costing. However, difficult to implement.,[object Object],Logistics cost ratio per sales is the most common indicator...,[object Object],National Logistics cost?,[object Object],C2C metric to reflect supply chain performance? An example.,[object Object],19,[object Object]
20,[object Object],Logistics costs relationship,[object Object]
Ratio of selected export logistics cost (FOB) in ASEAN,[object Object],21,[object Object],Source: (USAID, 2006),[object Object]
22,[object Object],Export Logistics costs component / Total Logistics costs,[object Object],Procurement,[object Object],Inventory,[object Object],13,[object Object],%,[object Object],4,[object Object],%,[object Object],Export,[object Object],Warehousing,[object Object],45,[object Object],%,[object Object],7,[object Object],%,[object Object],Transport,[object Object],31,[object Object],%,[object Object]
23,[object Object],Macro Logistics Costs Framework,[object Object]
24,[object Object],National Logistics Cost Framework,[object Object]
Thailand Logistics Costs/GDP,[object Object],Source: Ruth Banomyong (2007),[object Object]
26,[object Object],Some Future trends...,[object Object],Macro Logistics cost is increasing,[object Object],Transport cost ,[object Object],Inventory carrying cost,[object Object],Thammasat Annual Logistics Index (3rd quarter),[object Object]
27,[object Object],The C2C cycle in the supply chain:Thai shrimp export to the US,[object Object]
28,[object Object],C2C definitions,[object Object],Source: Farris II and Hutchison (2001),[object Object]
29,[object Object],C2C time (days) in the US,[object Object],Source: MDM (2000)),[object Object]
30,[object Object],The shrimp export supply chain,[object Object]
31,[object Object],Summary of C2C,[object Object]
32,[object Object],Thank you for your attention,[object Object],Questions ,[object Object],& ,[object Object],Answers,[object Object]

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Ecr award 2011 kimberly clark x5
 
ECR Award 2011 Arla-Lenta
ECR Award 2011 Arla-LentaECR Award 2011 Arla-Lenta
ECR Award 2011 Arla-Lenta
 
ECR Award 2011 Valio-Lenta
ECR Award 2011 Valio-LentaECR Award 2011 Valio-Lenta
ECR Award 2011 Valio-Lenta
 
ECR Award 2011 Danone - Regional Chains
ECR Award 2011 Danone - Regional ChainsECR Award 2011 Danone - Regional Chains
ECR Award 2011 Danone - Regional Chains
 
ECR Award 2011 Bacardi-Metro
ECR Award 2011 Bacardi-MetroECR Award 2011 Bacardi-Metro
ECR Award 2011 Bacardi-Metro
 
ECR Award 2011 Pepsi-Metro case
ECR Award 2011 Pepsi-Metro caseECR Award 2011 Pepsi-Metro case
ECR Award 2011 Pepsi-Metro case
 
ECR Demand Nielsen presentation
ECR Demand Nielsen presentationECR Demand Nielsen presentation
ECR Demand Nielsen presentation
 
ECR demand Kantar_category_segmentation
ECR demand Kantar_category_segmentationECR demand Kantar_category_segmentation
ECR demand Kantar_category_segmentation
 
ECR demand Arla_Lenta_cat_man
ECR demand Arla_Lenta_cat_manECR demand Arla_Lenta_cat_man
ECR demand Arla_Lenta_cat_man
 

Dr. ruth ecr08 lpat-1

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