Lauri Ojala

Connecting to compete 2012 : trade logistics in the global economy - the logistics performance index and its indicators

This is the fourth edition of Connecting to Compete: Trade Logistics in the Global Economy. It features the Logistics Performance Index (LPI), which the World Bank has produced every two years since 2007. The LPI measures the on-theground efficiency of trade supply chains, or logistics performance. This year’s edition covers 160 countries.

Logistics and financial performance: An analysis of 424 Finnish small and medium‐sized enterprises

Purpose – To explore the present logistics performance of Finnish small and medium‐sized enterprises (SMEs) and to analyse the relationship between logistics performance and financial performance in these firms.Design/methodology/approach – The dataset comprises 424 SMEs that participated in a nationwide Finnish logistics survey in 2006. Logistics performance measures were derived from the survey data, and based on these values logistically top‐performing firms were identified within different industry groups. The financial performance of these firms was then examined vis‐a‐vis their industry peers using financial reports‐based data.Findings – The results imply that the overall level of logistics performance among the examined companies might be at such an elementary level that no statistically observable positive linkage between logistics performance and financial performance exists. The group of firms for whom logistics is a key source of competitive advantage in this sample is small and therefore stati...

Effects of geographic dispersion on intra-firm supply chain performance

Purpose – This article aims to quantify and analyse empirically how the geographic dispersion of a firms supply chain impacts on intra‐firm supply chain performance.Design/methodology/approach – Generalised linear modelling is utilised to analyse a sample of 95 large manufacturing companies operating in Finland.Findings – Results indicate that the increased geographic dispersion of the upstream supply chain results in higher costs of warehousing and logistics administration. On the downstream side, inventory costs, inventory days of supply, and cash‐to‐cash cycle time tend to increase due to geographically dispersed sales network. Increased geographic dispersion in the upstream and downstream supply chain results in the decline of perfect orders, and increases order fulfilment cycle time. However, the increased dispersion of the production network reduces order fulfilment cycle time. The results also indicate that the larger the firm, the better it can alleviate the negative implications of dispersion on...

Priorities and determinants for supply chain management skills development in manufacturing firms

Purpose – The purpose of this paper is to find out the current SCM skill development priorities in manufacturing firms and how the structural properties of the supply chain translate into demand for SCM skills in manufacturing firms.Design/methodology/approach – An internet survey was designed and conducted. The responses of 154 manufacturing companies operating in Finland were analysed through descriptive statistics and regression analyses.Findings – The supply chain management skills with an inter‐organisational focus tend to have a higher development priority than the skills with an intra‐organisational focus. The top five skills for development are: demand forecasting and supply planning; sourcing and supplier management; customer and distribution channel management; production planning and control; and information systems for logistics and production planning. Structural properties of the supply chain seem to have an effect on skills that are related to supply chain design and information flow infras...

Logistics outsourcing and company performance of SMEs

Purpose – The purpose of this paper is to explore the current state of and future expectations concerning the usage of the outsourcing of logistics operations in small‐ and medium‐sized enterprises (SMEs), and to analyse and quantify the relationships between logistics outsourcing, costs and performance, financial performance, and the company context.Design/methodology/approach – The data were 223 manufacturing and trading SMEs from the Finnish logistics survey combined with detailed financial report‐based data, both referring to the year 2008. Statistical analyses including ANOVA and factor analysis were applied.Findings – Transport activities are excessively outsourced. Most companies report no outsourcing of order processing and invoicing, and half of them have not outsourced logistics IT systems. Outsourcing is expected to grow in all areas with strongest expectations in materials management, value‐added services, and in IT. The logistics costs for companies engaging in the medium level of outsourcing...

Logistics outsourcing, its motives and the level of logistics costs in manufacturing and trading companies operating in Finland

This article explores the various aspects of logistics outsourcing in companies operating in Finland. The aim is to identify the connection between outsourcing, its motives and logistics costs. The data comprise a survey sample of 299 manufacturing and trading firms. Descriptive statistical analyses, analysis of variance and factor analysis were applied. Transport activities are outsourced to a large extent. The majority of companies manage most other logistics operations in-house. The outsourcing of product customisation, inventory management and warehousing is expected to become more common in the future. Cost savings together with flexibility and customer service were found to be the major motives for outsourcing. A connection between logistics costs and logistics outsourcing was identified: companies with higher levels of outsourcing are experiencing lower levels of logistics costs compared to those with lower levels of outsourcing or none at all.

Changing Logistical Patterns and Policies in Northern Europe

For individual transport customers in Europe, the trend is towards smaller shipment sizes and higher frequencies. At the same time, a considerable reshaping of the transport industry through mergers, acquisitions and alliances, particularly in road freight and freight forwarding industries has taken place. These changes, together with construction of new road and rail arteries, large multimodal load centers in freight transport and an ever‐increasing importance of information technology are changing the pattern of European freight transport. These issues, together with a brief look at transport policy development and implementation, and standpoints in the ongoing European Community (EC) membership negotiations are addressed in this article from a North European point of view.

EDI: An Advantage or Disadvantage for Remotely‐situated Countries?

Information technology in its various forms is one key component in the effort to increase efficiency in the transport industry. Electronic data interchange (EDI), especially, in its various forms, promises to be one of the key techniques in mastering the growing volume of information. Considers whether remotely (from the markets) situated countries will benefit after the introduction of EDI, with specific discussion of the Nordic countries. No specific data collection phase was conducted for this study, which is conceptual. However, during the last five years both researchers have conducted extensive empirical research in the field, which is covered here.

The effect of low-cost country sourcing on supply chain administration cost

While the key advantage of low-cost country (LCC) sourcing is in low prices, other aspects of conducting sourcing from these countries remain problematic. This research quantifies the effect of LCC sourcing on the cost of supply chain administration, and examines the possible role of firm size and industry in this relationship. The research draws on survey data, with respondents from manufacturing firms operating in Finland. The results indicate that the supply chain administration cost among manufacturing firms seems to rise with the increase in LCC sourcing. The results also suggest that companies in technologically intensive industries experience higher costs, whereas firm size does not have an effect on costs. The research contributes to the debate on the cost-related effects of LCC sourcing, by offering quantified results that can be used as the reference point for managers contemplating the pros and cons in increasing the share of LCC sourcing.

National-level logistics costs: an overview of extant research

No comprehensive review of macro-logistics cost research is currently available. Thus the aim of this paper is to elucidate where logistics cost research is conducted, to identify research methods, and to present the logistics costs in identified extant research. Altogether 66 textbooks, scientific journals, case studies, and other studies were reviewed. The three dominant methodological approaches were statistics-based studies, survey-based studies, and case studies. Of the reviewed studies 37.9% employed a case study methodology, 34.5% questionnaires, and 27.6% statistics. Most studies (79.2%) were multi-theme studies that discussed a number of themes, while 20.8% of reviewed studies concentrated on a single theme. Three identified metrics of reporting logistics costs were absolute costs (currency), as a percentage of sales or turnover, and as a percentage of GDP. Understanding logistics performance allows evaluating and targeting policy efforts to be developed over time and across countries.