Michael A. Haughton

Recent Reforms in Customs Administrations

Positioned at the nexus of import/export flows, customs authorities represent a significant node in a firms global supply chain network. In light of the traditional need for physical inspection of goods by customs authorities, the significance of this node is often viewed in terms of its potential disruption to the network flow. Customs reforms that aim to facilitate the international flow of goods (trade facilitation) are thus easily regarded as measures to reduce the supply chain inefficiencies of these disruptions. The readiness with which the resulting improvements can be envisioned and have been cited contrasts sharply with the limited research into the corresponding potential challenges involved in global logistics management. This papers primary purpose is to deduce the nature of these challenges, not only for practice in the area of global logistics, but also for research in that area, an area in which the significance of customs authorities has received little treatment. Systematic qualitative analyses of existing and proposed reforms based on the trade facilitation philosophy provide the bases for the deductions.

Examining the business case for shipper participation in Canada–USA trade security programmes

Among Canadian shippers involved in Canada–USA trade, uncertainty about costs and benefits has been cited as a possible explanation for the relatively small number of them that have sought approval to participate in Free and Secure Trade (FAST), a central bilateral trade security programme between the two countries. This study addresses this uncertainty with quantitative analysis to examine the business case for an individual Canadian shipper’s participation in FAST. The study shows how a shipper’s operating parameters influence the strength of the business case. A key study finding is that unless the needless costs that carriers incur from serving non-participating shippers are passed back to those shippers, the business case is significantly weakened. The study also finds that, like cost transfers from carriers, the rate of FAST approval of competing shippers is a very powerful economic incentive for an individual shipper to subscribe to the FAST programme.

Closed-loop supply chain network design under disruption risks: A robust approach with real world application

Abstract In today’s globalized and highly uncertain business environments, supply chains have become more vulnerable to disruptions. This paper presents a stochastic robust optimization model for the design of a closed-loop supply chain network that performs resiliently in the face of disruptions. The proposed model is capable of considering lateral transshipment as a reactive strategy to cope with operational and disruption risks. The objective is to determine facility location decisions and lateral transshipment quantities that minimize the total supply chain cost across different disruption scenarios. A Lagrangian relaxation algorithm is developed to solve the robust model efficiently. Important managerial insights are obtained from the model implementation in a case study of glass the industry.

The benefit of information sharing in a logistics outsourcing context

The goal of this article is to examine the value of information sharing in outsourcing of logistics activities. Our examination is in the context of a fairly complex network in which location and capacity of carriers are considered. The current research also examines the moderating effect of network settings on the benefit of information sharing. A core component of our methodology is use of computational experiments to provide a variety of logistics network conditions under which we investigate information sharing value. The investigation involves comparing two strategies, namely full and no information sharing. Underlying the experiments are procedures to optimise the network under each strategy. The procedures are based on exact methods that combine integer linear programming with exhaustive enumeration. To gauge the robustness of the insights, we applied formal analysis of variance techniques to the data from the numerical experiments. The obtained insights are helpful to managers for selecting appropriate logistics service providers and level of information exchange.

The efficacy of exclusive territory assignments to delivery vehicle drivers

Abstract A supporting logic for having a vehicle driver exclusively assigned to serve the same territory on every delivery trip is the deepening of the driver’s knowledge of the territory and the customers therein. This contributes to the driver’s proficiency in serving that territory. However, in situations of randomness in day-to-day customer demands, the choice of exclusive territory assignments entails the sacrifice of sub-optimal route configuration. This study quantifies the extent of that sacrifice in order to depict the cost implications of exclusive territory assignments vis-a-vis tactics that keep pace with day-to-day demand fluctuations by allowing for flexibility in the assignments. The study’s analysis of exclusive territory assignments covers those that involve territory sharing among a team of drivers.

Tackling complexities of cyclic inventory routing under conditions of limited modelling and computing capacity

This paper presents a tractable approximation method for reliably finding near-optimal solutions to the cyclic inventory routing problem (IRP) without requiring the specialised modelling skills and computing technology to deploy more exact solution approaches. Together with simultaneously attaining high solution quality and efficiency, the methods contribution to the IRP literature stems from modelling transportation cost in a way that parsimoniously captures (a) complexities of estimating vehicle requirements and (b) the heretofore ignored phenomenon of possible correlation between customer locations and demands. An extensive set of computational settings to test the methods performance indicated that vis-à-vis a well-founded benchmark from the literature, the average gap in cost is just slightly above 1%, with a worst-case gap of 4.8% across all settings.

Flow Control in Capacity-Constrained Queueing Systems with Non-Stationary Arrivals

In this paper, we present a flow control policy to address the problem of service capacity constraints in queueing systems that face non-stationary customer arrival rates. The studied system concerns commercial trucks arriving at international border checkpoints for processing. Based on an extensive range of numerical examples, we quantify how the flow control policy of bringing arrival rates more in line with available capacity affects customer-oriented metrics and measures of efficiency in service capacity resources. We also quantify the expectations that the policy would place on arriving customers. How these quantitative outcomes are influenced by contextual parameters such as the pattern of customer arrivals and the tightness of capacity constraints is also clarified.

Traffic control in Canada-USA border checkpoint operations: impacts on supply chain velocity, infrastructure spending, and national security

In this paper, we examine the traffic control tactic of reducing the amplitude of hour-to-hour arrival rate of commercial traffic at border checkpoints between Canada and the USA. In particular, we use a simulation study to show that this tactic can facilitate attainment of two important government priorities: minimise unnecessary investment to expand border infrastructure and minimise the risk of trans-border supply chains being targets of or conduits for harm to national security. We also demonstrate the tactics potential to improve the performance of trans-border supply chains through reduced border delays. As well, we discuss issues concerning what would be expected of trucking companies in order for the tactic to be successfully implemented.

An alternative tactic to deal with the contingency of driver absenteeism

On any given workday, unexpected absence of drivers calls for emergency operational tactics to ensure completion of planned deliveries of merchandise to customers. A typical tactic in the workforce scheduling literature is to rely exclusively on a pool of workers who were not scheduled for work; that is, full-time off-duty drivers and part-time drivers. Concerns about the expense of maintaining a staff of part-timers prompt consideration of alternative tactics. This study proposes one such alternative. It minimizes the part-time pool by reassigning routes among drivers who show for work. In multi-route vehicle routing problems, the prospect of this alternative arises because cost-minimizing patterns of travel distances across routes often allow one driver to do extra work by handling more than one route (subject to time-window and workload constraints). By considering costs such as overtime rates when drivers perform extra (emergency) driving duties and the cost to maintain part-time staff, this study tests the efficacy of the aforementioned alternative. Its efficacy is confirmed by the fact that it is less costly than the typical tactic: while the typical tactic adds just over 22% to driver payroll, the proposed alternative adds a noticeably smaller cost of just under 15%.