The SCOR Framework as a Basis for the Model of the Company’s Logistics Cost and Service Level Optimization
MAGAZINE №4 (99) August 2020
AUTHORS RYBAKOV D.S.
CATEGORY Logistics service management Optimization and mathematical modelling Supply chain planning
ABSTRACT
The current state of management practice is characterized by the presence of a demand to improve the efficiency and effectiveness of logistics processes, on the one hand, and an insufficient level of application of one of the main tools for achieving this goal – optimization modeling, on the other. One of the main reasons of this phenomenon is the lack of a universal basis of the proposed optimization models that does not allow them to be applied widely enough in companies with different business process structures. The aim of the research was to develop a universal, based on the SCOR framework, integrated model for optimizing the logistics service of an enterprise. During the research process, the overview of the developed models for logistics service optimization, the analysis of the limitations of the logistics system optimization models, the adaptation of the map of SCOR process metrics have been carried out; the influence diagram of the optimization model components has been developed; the models of cost optimization and logistics service optimization have been combined into a single integrated optimization model; an algorithm for the optimal solution search has been elaborated; the implementation of the model and algorithm as a program for the solution search has been introduced. As a result, the integrated optimization model based on the components of the SCOR model has been developed, combining the cost and service level optimization models, using the outputs of one model as inputs for another when searching for an optimal solution. Building the optimization model on the basis of the SCOR model components provides universal character of its application, taking into account the set of costs, arising in a logistics system, including indirect ones, and the set of metrics of logistics service reflects the links between functional departments, the ability to maintain a level of total costs at the efficiency frontier, achieving the goal of the profit maximization at the same time, provides a link between the tactical and operational levels of decision-making, which together leads to an increase in the reasonableness and quality of management decisions, and creates prerequisites for the overall optimal functioning of an enterprise logistics system.
Keywords: SCOR optimization Optimization Models optimization modeling logistics service logistics costs logistics processes business process metrics performance indicators KPI
Method of Calculating Inventory Management Parameters for a Model with a Fixed Interval Between Orders Considering Deficit Costs
MAGAZINE №5(88) October 2018
AUTHORS BELOV L.B.
CATEGORY Inventory management Optimization and mathematical modelling
ABSTRACT
This paper is devoted to the development of formal procedures for calculating inventory management parameters for a model with a fixed interval between orders. The urgency of transition from informal methods of regulation of insurance stocks to formal economically justified procedures for calculating their planned values is shown. The article presents an analysis of the concept of "logistics service" in the context of its use in determining safety stock value. The main approaches to determine the target safety stock value depending on the level of logistics service are considered. Difficulties in determining the dependence of logistics service level and financial performance are widely known. In this regard, it is proposed to use the equation of total costs of replenishment and maintenance of reserves, including deficit costs, as a basis for determining the parameters of inventory management based on cost minimization. In this case, the service level is treated as a derived value that corresponds to the minimum total cost condition. A method for determining the parameters of inventory management for a model with a fixed period is developed. The algorithm of calculations is tested on an example.
Keywords:
Logistics Service in Inventory Management
MAGAZINE №2 (79) April 2017
AUTHORS IVANOVA A.V.
CATEGORY Inventory management Logistics service management Optimization and mathematical modelling
ABSTRACT
Russian companies intend to be among the leaders in the international logistics world in order to attract financial investments and labor force. Being monitored on a regular basis by the World Bank the Russian Federation is compared with other countries via several logistics performance indicators. These indicators are mainly focused on the flows movement speed evaluation within the supply chains of a country. Therefore, there are latent opportunities in material flows management to strengthen the position of domestic companies on the international scene. The research extends main review inventory policies transforming main parameters of widely used models in the context of customers’ requirement satisfaction. For this purpose, the methods of economic, mathematic and statistics are implemented. The comparison of five various environmental conditions, among which are the prohibition of stock out, the provision of items available on stock, balance achieving between holding and shortage costs, influence of out-of-stock event and absence of a separate item allows to find out the strictest requirements to the logistics service level.
Keywords:
Logistics Service Development based on Analytical Hierarchy Process
MAGAZINE №3 (74) June 2016
AUTHOR BRODECKIJ G.L., DYBSKAYA V.V., IVANOVA A.V.
CATEGORY Optimization and economic-mathematical modeling Logistics services Management
ABSTRACT
The paper is devoted to a new formal approach to logistics service development optimization in the wholesale business. Logistics service development is required to choose strategic direction of customer service in logistics, to identify key performance indicators of its implementation, and ultimately to make a choice of logistics services package. To solve these problems taking into account the preferences of decision-maker, it is suggested to use the analytic hierarchy process (AHP).
It is a first time that AHP has been employed several times within an optimization model: the approach worked-out consists of two stages. The first stage determines an optimal set of key performance indicators to control the strategic direction of logistics under consideration. The second stage identifies an optimal logistics services package taking into account its impact on the key indicators selected at the first stage.
The approach application is exemplified by a wholesaler that supplies foreign components to domestic manufacturers. Numerical solutions of AHP are shown in the article. The data for calculations are taken from statistical reports of the company at hand
Keywords:
Logistics support of medical equipment handling
MAGAZINE №5 (70) October 2015
AUTHOR
CATEGORY Logistics services Management Reverse logistics
ABSTRACT
The market of medical equipment presented in most cases by foreign-made goods is growing fast. It requires considering the peculiarities of logistics services under the conditions of the medical equipment utilization by medical preventive institutions. The problem is particularly acute for high-tech medical equipment sector. It is shown that the fundamental principles of the order cycle management are unchanged in the case of reverse logistics as well. However the specific material flow managed will lengthen order cycle. Moreover it will have the impact on the complexity and workload of logistics operations. The traditional definition of transactional and post transactional services, which was reflected in the choice of the set of indicators, requires a thorough application. It is especially true for the performance evaluation of services splitted in time-horizon.
Keywords:
Elaboration of the customer service policy from the perspective of logistics
MAGAZINE №4 (69) August 2015
AUTHOR DYBSKAYA V.V., IVANOVA A.V.
CATEGORY Logistics services Management Terminology in Logistics and SCM
ABSTRACT
Logistics service has a significant impact on both the effectiveness of the companies receiving logistics service and the productivity of the companies which provide it. The provision of the common level of service for all customer groups leads to the inefficient use of the available resources of the company: the less profitable customers receive high levels of services, while the most commercially viable ones, on the contrary, get excessively low levels of logistics services. The case like this is the result of a lack of the thoughtful approach to the elaboration of the customer service policy from the perspective of logistics.
The previously published article proposed a new approach to the development of the customer service policy in terms of logistics in the generalized view. Only the first stage “Strategic basis of service policy” was defined in a detailed way. The current article intends to offer the ultimate presentation of the integrated approach to the elaboration of the customer service policy from the perspective of logistics with a detailed description of the other four stages.
The approach established is the result of the generalization, critical analysis and reconsideration of the existing best practices in the development of service policy for the company as a whole, in the formation of logistics service, in the customers’ support provided by service provider, in the consideration of the peculiarities of logistics activities.
The article work out the stages of the elaboration of the customer service policy from the perspective of logistics and reveals the nuances of the development of logistics service. As well, the concept of “standard of logistics service” is refined.
The proposed approach lays the foundations for the logistics service management: to some extent it helps to plan logistics services being provided. Despite the comprehensiveness and systematicity, the approach is flexible to account special features of its application to organizations acting in various business fields. The article demonstrates the transformation of the approach incorporation on the example of the manufacturing and trading companies as well as logistics providers
Keywords:
Methods of logistics service evaluation
MAGAZINE №3 (62) June 2014
AUTHOR IVANOVA A.V.
CATEGORY Logistics services Management Controlling
ABSTRACT
Strategic role of logistics services for companies is determined by direct impact on the customer base of the company, both existing customers and potential ones. It should be recognized that there is no consensus on understanding of the logistics services essence among academic community and practices, but it was revealed the common approach to the way of the level of logistics service determination, which brings together representatives of all parties.
The paper considers two approaches of customer service decomposition into elements and components, as well, some methods to assess logistics service that can be used in business – environment are provided in the article. On the base of materials reviewed, it is proposed the refined procedure of level of logistics services assessment.
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