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A Dissertation Project report entitled as, TITLE: RISKS AND SUCCESS FACTORS OF LOGISTICS OUTSOURCING AuthorGanesh Pathare

SR NO

CONTENTS COVER PAGE ACKNOWLEDGEMENT LIST OF TABLES AND FIGURES

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ABSTRACT KEY WORDS INTRODUCTION/BACKGROUND OBJECTIVES OF THE RESEARCH RESEARCH SIGNIFICANCE RESEARCH LIMITATIONS RESEARCH OUTLINE LITERATURE REVIEW LITERATURE REVIEW STRATEGY THEORETICAL FRAMEWORK OF THE RESEARCH INTRODUCTION TO LOGISTICS ORIGIN OF LOGISTICS LOGISTIC OUTSOURCING BENEFITS OF LOGISTIC OUTSOURCING TYPES OF LOGISTIC OUTSOURCING (3PL 4PL !PL" FUTURE OF LOGISTIC OUTSOURCING LOGISTIC OUTSOURCING MANAGEMENT KEY SUCCESS AND RISK FACTOR IN LOGISTIC OUTSOURCING LOGISTIC OUTSOURCING ACTIVITIES TRANSPORTATION' LOGISTIC ACTIVITY TRANSPORTATION SERVICE MODES A"ROAD B" RAILWAY C"SAE/PORT D" AIR RESEARCH METHODOLOGY INTRODUCTION OF RESEARCH METHODOLOGY RESEARCH PATHWAY METHODOLOGY OF SURVEY SURVEY AS RESEARCH APPROACH METHODOLOGY OF WORKSHOP STRATEGY OF RESEARCH ETHICAL ISSUES OF RESEARCH EMPIRICAL DATA ANALYSIS AND FINDINGS PARTICIPANTS IN THE SURVEY FINDINGS OF SURVEY SUB'CATEGORIES OF TRANSPORT RISKS

3 3.1 3.2 3.3 3.3.1 3.3.2 3.4 3.# 4 4.1 4.2 4.3

4.3.1 4.3.2 4.4 4.# 4.$ 4.! 4.% # #.1 #.2 $ !

FIRST WORKSHOP SECOND WORKSHOP DISCUSSION FINDINGS MANAGEMENT OF TRANSPORTATION RISK INTERIM CONCLUSION OF THE DATA ANALYSIS RISK MITIGATION RESEARCH CONTRIBUTION RESEARCH CONCLUSION BIBLIOGRAPHY/REFERENCES APPENDI(

LIST OF TABLES
1. MOTIVES FOR LOGISTIC OUTSOURCING 2. TRANSPORT GROWTH IN DIFFERENT REGIONS OF INDIA 3. PREFERENCE MODE OF CARGO MOVEMENT IN INDIA 4. GROWTH OF CONTAINER VOLUME IN INDIA 5. ROAD FRIGHT IN INDIA 6. RAIL FRIGHT IN INDIA 7. SEA/PORT FRIGHT IN INDIA

8. AIR FRIGHT IN INDIA 9. PARTICIPANTS IN THE SURVE 1!. RESULTS OF FIRST WOR"SHOP 11. RESULTS OF SECOND WOR"SHOP 12. WOR"SHOP RESULTS 13. CLASSIFICATION OF GENERAL RIS" 14. RIS" MITIGATION

LIST OF FIGURES
1. RELEVANCE OF LOGISTIC OUTSOURCING 2. COST RATIO OF LOGISTIC ACTIVITIES 3. # TOTAL CARGO MOVEMENT 4. CONTAINER VOLUME GROWTH 5. ROAD FRIGHT INDIA 6. RAIL FRIGHT IN INDIA 7. AIR FRIGHT IN INDIA 8. WOR"SHOP $UESTION 9. WOR"SHOP $UESTION 1!. RELEVANCE OF TRANSPORT RIS"S 11. WOR"SHOP $UESTION 12. WOR"SHOP $UESTION 13. WOR"SHOP $UESTION

ABSTRACT) Various sections are involved in the project to confirm the accomplishment of the decent research. Overview of dissertation in accordance to the culture of organization,

framework of the research, detailed awakening of the principles of logistics and transport, scrutiny of the research problem and the foundation of the logistics outsourcing with risks management involved with it in Indian subcontinent. Detailed doctrine gained by official data of the different companies through their websites or from newspapers, articles provided from the related industries is concentrated in the research. opic related secondary data is also elaborated in the research. ransportation activity which is prime economic activity of logistics business within fre!uent"changing regions of #sia that is India is also considered. $areful determination of various books and literature is carried out with respect to reach set research objectives. %rimary data collected with the aid of !uestionnaire generated to carry the survey aimed towards target market and the approaches employed to collect the data is well e&plained in the tertiary section. his section of the study canvasses merits and his section of o demerits of a survey conducted, of work"shops and e&pert interviews.

the study canvasses merits and demerits of a survey conducted, of work"shops.

confirm success of the project ne&t part elaborates the outlook of research, !uestionnaire designing and selection of research approach. %rintouts and emails are the modes used for data collection directly from clients in the !uestionnaire format. 'pon selecting methodology of research dissection of primary and secondary data will be carried out and concentration will be on speculative results generated from the survey, the workshops conducted within the within the project.() e&pert interviews were carried during workshops in supplement of the survey and the workshops. Interviews conducted with respect to get the concept behind the implementation of risk management and e&pectation of risks incidence in transport and logistics services. *&planation of the research !uestion in direction of the research objectives is given in this section. +e&t part continuous with the e&tent of the research objective achieved. ,ast section is constructed to e&plain overall conclusion and suggested recommendations towards the research problem. #chievement of the personnel development during study period, enhancement needed in interpersonal skills and assembling of risk corrective actions are summarized in this section. -irst, an overview of available strategies and kinds of corrective measures is provided. o troubleshoot the transport and other logistics risks, background of probable measures are provided

which enables company representatives to alleviate road transport risks and logistics risks to ensure easy running of company outsourced it. KEY WORDS) ,ogistic Outsourcing .isks, ,ogistic outsourcing .isk and /uccess -actors, ransport .isk in ,ogistic Outsourcing 0usiness. INTRODUCTION/RESEARCH BACKGROUND) his section is introductory topic of research. he concept and entire motive behind

issue of research and selection of the research is elaborated in this section of the study. he Varying customer choices are coming from everywhere and anywhere increasing the competition between organizations in world economy. his situation of huge competition results in rapid competitive communization. Increased shareholder value claimed with e&pected growth and portability. o sustain in competition focus diverted to doing the right thing than doing everything. hese things forces organizations for better concentrated approaches towards market. *valuation of each activity to wrap up its efficacy to provide uni!ue competitive advantage in rapidly growing global market is necessity for every organization. Increased internal investment is provided to preferable areas while rest areas with less importance considered for outsourcing. 1ith respect to 2$orbett, 34456, outsourcing is a management tool which is used to move an organization away from the traditional vertically integrated, self"sufficient structure7 one that is increasingly in effective in today8s high"competitive, performance"oriented environment. he organization draws near a business structure with the aids of outsourcing where it is able to make more focused investments in the areas providing its uni!ue competitive advantage. ,ogistics outsourcing is one of the double time growing areas. 9igh number of outsourcing companies and logistics service providers leads to intensive competition which puts up great troubles in their outsourcing enterprise. o grab better advantage of the outsourcing opportunity outsourcing companies must be aware of success and failure ingredients and the concerns involved. /ince the decade of :48s all or some aspects of the logistic functions were outsourced by high number of organizations and is the reason leads to research topic. Difference between theory and practical implementation in outsourcing is audited in e&isting

research project. $umulatively, these studies suggest that outsourcing companies should take great care in purpose, plan and personnel they choose to outsource an activity. *&planation with clear aim and objective behind the studies along with elaboration of the scope, significance and limitations is provided in this research. *&amination of identification of key success factors along with the risk factors in logistic outsourcing business makes this research full of information. 0rief description of outsourcing and logistics outsourcing included in content of the study. wo logistics activities that are fre!uently outsourced in the supply chain that is transportation and distribution are concentrated in the research topic. ;igration of components and raw materials to the facility and shipment of finished goods to warehouses and other customer locations are the activities run under transportation for manufacturing plant. 1arehousing is the storage of components, raw materials and finished goods, while distribution involves the management of goods on the physical path between production and consumption as stated by 2$oyle << 0ardi *< ,angley, 344=6. #ccording to the project schedule staging may apply to either inbound materials or outbound as the case differs. OBJECTIVES) o identify and study the risk and success factors in ,ogistic Outsourcing 0usiness o study the impact of ransportation /ervice as major logistic outsourcing risk factor on performance of ,ogistics Outsourcing Industry. o study the ,ogistics cost associated in different industries. o study the transportation cost associated with different modes and their choice to choose mode. RESEARCH SIGNIFICANCE)

,ogistics outsourcing with its advantages including reducing operating costs and strengthening the core competitiveness, speeding up organization reconstruction, and improving enterprises8 reaction speed introduced as new type of enterprises operation strategy. 'ncertain e&ternal environment, market changes, and enterprise risks decision and risks management ability produces harmful effects causing large number of outsourcing risks. 9ence implementation of effective logistics outsourcing for enterprises leads to a research subject with immediate corrective actions to identify the success and risk factors. *valuation of logistics outsourcing risks ensures successful completion of logistics enterprises8 outsourcing. *&amination of ways to identify key success factors in outsourcing provided in this paper makes research full of re!uired information. Detailed description of outsourcing and logistics outsourcing is provided in the content of research followed by revising literature relevant to outsourcing. -or better understanding of outsourcing relations and activities this research highlights the set of key success factors for outsourcing with various models in support of these factors proposed by various authors. he significance of the theoretical models used in logistic outsourcing industries are well e&plained with various case studies and e&amples from the logistics industry. define and develop successful logistics outsourcing relationships. LIMITATIONS OF THE RESEARCH) his investigational e&ercise directs tentative path for increased success probability of outsourcing projects and raises many issues for further study of the outsourcing activity. In comparison with large logistics business sectors and organizations sizes study is limited. ;isjudgments and common method variances are the drawbacks of the survey methodology utilized for the purpose. .esearch contributes to development of understanding of outsourcing in identification of areas re!uiring further research though it has certain limitations. /tudy observations suggest that the effect of outsourcing on employee morale and performance is the primary risks to firms. /tudy re!uires more understanding of the specific alterations made to human resources, successful his research also signifies with a discussion of how outsourcing companies might better

implementation and contribution to the outsourcing effort. /econd important finding of the study is that identification of the risk factors by the management of organizations is necessary to ensure the highest level of success. ;ore e&planation of these factors with their corrective measures is re!uired. 1ith time and money some other primary but prompt limitation like project deadline, availability of the data and resources, word limit, unavailability of primary data by companies are included in this section of the research. STUDY OUTLINE' C*+,-./'1 $hapter one will resonates overview of the dissertation, including background of the research, research problem analysis, background of the various logistic service provider organizations and brief introduction of the logistic outsourcing industry. C*,+-./'2 /ection covers entire knowledge of the research problem based on secondary data, which is obtained from the official data published on the websites, in daily news papers, articles of the various organizations providing logistic outsourcing services and authors. o reach the conclusion of the topic with respect to the objectives set in for the research various literatures and books was critically analyzed. C*+,-./'3 %rimary data collected by carrying the survey in target market with help of !uestionnaire is summarized in this section. he !uestionnaire designing, choice of research approach, philosophy of the research with respect to confirm the success of the project is e&plained in the section. %rintouts and emails are sources used for the data collection from the customers directly. C*+,-./'4

%rimary and secondary data collected is scrutinized in this section. .esearch !uestions with respect to the objective of the research are well elaborated. C*+,-./'# *&tent of achievements of research objectives are e&plained in this topic. .ecommendations provided for research problem along with the overall project conclusion forms the part of same topic. LITERATURE REVIEW INTRODUCTION his section involves revision of various literatures with respect to the resources of information with noticing identification of the success and risk factors towards logistic outsourcing services with various academic references, books, official publications of organizations official websites or newspapers and articles. he abbreviations and theories which further e&plained in direction of data to be collect related with the current affair of the research are enclosed in the primary part. 2/aunders hornill ;, 344:6 STRATEGY FOR THE LITERATURE REVIEW he literature search strategy is designed with reference of various libraries literature and internet data obtained by browsing. he data is collected from the internet or from various library materials in order to generate any finding of the research topic according to the set subject standards. he data or information gained from internet and vocabulary is distilled for its efficacy for the absolution of the topic. *ffectiveness of the material is verified by checking the applicability material collected to the research topic. -or current information awareness various logistic business outsourcing literature and journals are reviewed from 344("34(=. ;anual searching of the latest database available is carried to confirm further detail solidification of related material including internet and academic data. >oogle search engine is utilized to access data from internet. In accordance with /aunders et al 2344:6 the 0oolean ,ogic applied to search

the internet by generating the key words and linking them by using three logical operators O., #+D, +O . 2/aunders hornill ;, 344:6 THEORETICAL FRAMEWORK OF THE RESEARCH) Different fragments of reviewed literature subjected to critical analysis and e&traction of information on the $ritical #nalysis of the effectiveness of logistic outsourcing business in Indian continent are as follows. INTRODUCTION TO LOGISTIC OUTSOURCING' ORIGIN OF LOGISTICS he >reek logos, meaning ?speech, reason, ratio, rationality, language, phrase?, and >reek word logistiki, meaning accounting and financial organization derives the term @logisticsA. he militaryBs need to assemble themselves with arms, ammunition and rations during their forward movement from their base originates ,ogistics. ;ilitary officers looking after financial and supply distribution matters are known as logistics in ancient >reek, 0yzantine and .oman empires. ? he branch of military science relating to procuring, maintaining and transporting materiel, personnel and facilitiesA Is the definition for the logistics by he O&ford *nglish Dictionary. 1ith respect to another dictionary definition, logistics is ?the time"related positioning of resources.? In general ,ogistics is commonly considered as a branch of engineering that creates ?people systems? and not the ?machine systems?. #ccording to human resources management, logistics means ?recruiting manpower8s?. $ouncil of ,ogistics ;anagement suggests logistics as backbone including integrated planning, control, realization and monitoring and the necessary information flow with in industrial and trading companies along the complete value"added chain 2and product life cycle6 for the purpose of conforming to customer re!uirements. ;anagement flow of goods from origin to destination point in direction to fulfill the re!uirements of customers or corporations considered in logistic. $onsolidation of information, inventory, warehousing, transportation, material utility, packaging, and often security constitutes logistic. $hannel of the supply chain

contributes to ,ogistics and it adds the value of time and place e&pediency. 2D9, , 34(=6 LOGISTICS OUTSOURCING 'prising 9igh competition in the world economy forces manufacturing and retail firms to outsourcing of their logistics functions. Outsourcing directs the noncore activities to e&ternal supplier and makes companies able to grease company8s resources, spread risks and survival and future growth concern. 0y means of hird party supplier, or contract logistics services companies are e&tending the logistics organization across the boundaries. @ he process of planning, implementing, and controlling procedures for the efficient and effective transport and storage of goods including services and related information from the point of origin to the point of consumption for the purpose of conforming to customer re!uirement. his definition includes inbound, outbound, internal, and e&ternal movementsA is the term coined by he $ouncil of /upply $hain ;anagement %rofessionals 2$/$;%6 in 34(3. 2$ouncil of /upply $hain ;anagement %rofessionals,, 34(=6 he urgency to eliminate the number of warehouses, vehicles and e&cess inventories and to run down shortage, and labor costs favors organizations to outsource their logistic functions. his brings down capital investment and $ompanies able to concentrate on their vital business activities and contribution of the risks. BENEFITS OF LOGISTICS OUTSOURCING # strategic solution to improve the !uality of service and reduce the cost of important non"core processes. he firms are able to focus on their core competencies. 9elps the firms to overcome resource constraints. %rovides for cost saving resulting from better management of the supply chain.

# platform for cross pollination of better available practices. It provides wider geographical coverage.

TYPES OF LOGISTIC OUTSOURCING SERVICES PROVIDERS' T*0/1 P+/-2 L3405-065 (3PL" #ll or part of the company8s logistics functions are carried out by e&ternal supplier known as # third"party logistics 2=%,6 firm. %roviders of services such as transportation, warehousing, distribution, financial services and so on are defined in =%,. integrated firms favoring =%, provider8s growth. T*. .6373806 +19+7-+4.5 3: ;5074 3PL 5;,,<0./5 +/.) *limination of infrastructure investments #ccess to world"class processes, products, services or technologies Improved ability to react !uickly to changes in business environments .isk sharing 0etter cash"flow .eduction of operating costs *&change of fi&ed costs with variable costs #ccess to resources not available in one8s own organization hird party logistics have become useful to reduce costs and spread risks for routine, vertically

#s customer recognizes ="%, provider for activities like transportation and warehousing, they become better applicant for a wide range of service offerings, or value"added services. V+<;.'+11.1 5./906.5 ,/3901.1 =2 3PL ,/3901./5 +/. +5 :3<<3>5)

%ick and pack ;arking, tagging, and labeling %roduct returns and reverse distribution %ackaging and repackaging /alvage and scrap disposal elemarketing

=%, is central provision of products like trucking, warehousing, and distribution, targeted to take over some of the related functions as stock keeping and documentation. =%, holds physical activities such as transportation, warehousing, line haul and the rental of material handling e!uipment.2/angam VC, 344)6 4PL S./906. P/3901./5 he ne&t stage of development of logistics service providers is the 5%, services. his includes, one =%, handling rooted activities of warehousing, inventory management and transportation, and other =%, does processes like 9.D, security and product development. his shifts the work of internal departments to the set of =%,s. Organizations now have to transact with a whole set of =%,s and each needs to be correlated with and associated via personnel and I . he advantage is that the number of transactions and costs are reduced to greater e&tent with the help of this process. Important characteristics that show uni!ueness and set apart the concept of 5%, compared to supply chain outsourcing options available in the market today are as follows. # 5%, delivers a comprehensive supply chain solution # 5%, delivers value through the ability to have an impact on the entire supply chain.

.e!uired results are generated through 5%, operators by carrying out the client8s entire logistics function. his activity involves reduction in cost of physical activities and manages logistics functions and achieving hikes. #nalysis of certain areas advisory solutions where processes can be utilized are provided by 5%,s. Direct involvement in the business processes and strategies of 5%, services providers makes them long"term partners. 2%atric 0urnson, 34((6

3PL ? 4PL @ !PL he Value ,ogistics >roup with concept describing the advanced trend of =%, and 5%, combined is termed as D%,. *ntire logistics chain of the client comes under one service provider through this service. T*. !PL 6376.,$ombination of =%, and 5%, into one is the D%, 2=%, E 5%, F D%,6. D%, provides central services of =%, and 5%, and can commence correctional projects of all services and activities to the clients. GOne contract, one bill8 concept is utilized by D%, as central provision in which on behalf of dealing with several people for different services like outbound, inbound and warehousing, clients now are re!uired to transact with one individual and becomes turnkey solution. 2H$9 >roup,, 34436 THE FUTURE OF LOGISTICS OUTSOURCING C/0-./0+ 10/.6-074 -*. L3405-065 O;-53;/6074 07 I710+ +/. +5 :3<<3>5) U5. 3: IT) *.%, warehouse management system 21;/6, tracking systems and net"based data e&change are the services provided by I I will be inevitable and rapid. 'se of I in India is very huge and is beneficial for logistics. A<<0+76.5) o succeed in =%,, scale and reach are the important ingredients. o grab market"share Indian companies highly focusing towards forming alliances, mergers and joint ventures with multinationals or bigger Indian logistics

providers. $hanging nature of these alliances allows companies to construct alliances and discontinue when not re!uired. I79.5-8.7-) ;oney is essential for infrastructure, I , people, to fulfill liabilities comes out from failure, to repute commitments and insurance claims by sustainable D%,. today, financial institutions and banks are available for that purpose. , (J"34K returns offered by supply chain which among few investments7 result in welcoming of -oreign Institutional Investors and banks. R.4;<+-037) 0usinesses are restricted as India8s current labor laws, laws of customs, e&cise, port formalities, service ta& provisions etc. prevents them from recognizing the value across the chain. ,ow tariff and easy availability of labor restricts development of people on a long"period basis as sufficient time is not given to develop skills. Implant of fresh blood is not possible with the current labor laws. *nterprises will be able to hire people with respect of need when changes in regulations. 1ith spread of awareness of benefits, ,ogistics providers8 services will progress in India. LOGISTIC OUTSOURCING MANAGEMENT o confirm the successful identification of success factors and reduction of logistic outsourcing risk various components of logistic outsourcing risk management re!uired to be considered are as followsL
F;71+8.7-+<5 3: R05A M+7+4.8.7-'

o operate risks and their hidden negative effects must re!uires implementation of the risk management. Otherwise, enterprises could not able to know the risk effects on the profits. 2Cajuter %, 34((6 suggests that in India, law obligates the board of managing directors of limited companies and accordingly the management of companies with other corporate structures to take actions, especially implementing a monitoring system, to rectify risks at prime stage, which hampers the working of the company. he annual audit regulates the undertaken measures. 2Cajuter %, 34((6

F3<<3>074 /.,/.5.7-5 .B,<+7+-037 3: /05A +71 ;76./-+07-2 +<374 >0-* -*. /05A 8+7+4.8.7- ,/36.55. O;-53;/6074 R05A +71 U76./-+07-2 #s per the statement of 2>abler, 34456 framework of decision theory e&plains that risks result from the indeterminate future events, known as sources of risks or uncertainty. In case of certainty, it is confirmed which state of environment will occur while in uncertainty encloses risk largely and uncertainty in the narrower sense, depending on assumptions about the probability of occurrence. Instances of subjective or objective probabilities of are known with respect to risk. 1hen state of uncertainty arises, the decision maker is only aware of the potential states of the situation suggested by 20amberg > $oenenberg # > Crapp ;, 344M6. ;easurable uncertainty, known as risk, is already differentiated from non"measurable uncertainty. here are different ways between the regiments to recognize risk in direction of its effect. -ield of mathematics defines @outsourcing riskA as value"free, and business economics field recognized it as opposite of a @chanceA, thus a potential loss or harm e&plained by 29olzbaur, 34446 T*. /05A 8+7+4.8.7- ,/36.55 Implementation of risk management is unavoidable to wrestle with risks and to achieve corporate goals. Due to several corporate disputes, specific declarations along with regulatory re!uirements e&ist in almost all countries with respect to the analysis, communication and monitoring of risks e&plained by 2Cajuter %, 34((6. risk identification, assessment, mitigation and control as follows. R05A 01.7-0:06+-037 .isk identification step is prime important as risks can be managed after its identification only. Detection of all hidden risks is not possible. #t the same time, he generic management process forms the base for typical risk management process and encloses

benefits and costs have to be balanced as collecting risks leads to costs. 9azardous effects can be occur if several risks bundles together and are not identified previously. 2*berle # O, 344J6 suggests that as fre!uent variations occur in the company, supply chain and environment the risk management process, risk identification should be carried out continuously. Different methods for risk identifications are suggested by .omeike in 344=. *&ample e&plains that interviews, checklists, and /1O analysis for identification of ongoing and obvious outsourcing risks, with failure mode and effects analysis 2-;*#6 targets detection of future and unknown outsourcing risks. herefore, preference is to use a combination of methods as suggested by 2*berle # O, 344J6 o identify risks, risk classification may helpful in the risk identification depending on the applied method. 9owever, risks can be classified in different ways. 1hile disastrous, detracting, marginal and negligible risks depending upon hazard severity are distinguished. /trategic, tactical and operational risks are separated on the planning level by 2/ahasraman +arasimha, 344D6. Depending upon the business type or operational area, $hristopher and %eck in 3445 refers supply, demand, process, control and environmental risks while .ogler in 3443 describes supply, production, distribution, financial and personnel risks. ransport risks are introduced into both supply and distribution risks is then specified as default due to loss of the entire cargo, !uantitative representing partial destruction during transport, costs including increase in transport costs, !uality elaborating damage during transport, and time risks 2delayNearliness of delivery6. 2.ogler /, 34436 During risk analysis, at first by indicating the similarity of occurrence and the possible outcomes of risks these are grouped. he estimation can either be done !uantitatively or !ualitatively. Ouantitative methods to assess risks are used if data availability is enough. hough

!ualitative methods lowers time and efforts may leads to subjective results. -or risk assessment several methods used for risk identification can be utilized, for e&ample brainstorming or -;*#. #gain, it is 5( sensible to utilize a combination of methods from the suggestions of 2.omeike -, 344=a6.

R05A 80-04+-037 his third step of the risk management process is strategy selection and implementation stage. $ompany representatives select strategies and measures and assign priorities to meet the risks depending on the nature of risk, the enterprise, supply chain, and their objectives. $osts of implementation and chances of rebound risks also considered while selecting moderation strategies and measures. #s per the citation of 2%orter, 344D6 a strategy to characterize @the creation of a uni!ue and valuable position, involving a different set of activitiesA, strategy is designed by application of various measures. #vailable strategies and measures to handle risks are concentrated in chapter J. R05A 637-/3< It is the final assessment of the measures applied for their effectiveness during risk control. o patch"up, further measures prescribed especially with respect to changing environment. 0alanced scorecard is the well"known e&ample of application of method respect to risk control step as e&plained by 2Cajuter %, 34((6 2*berle # O, 344J6 /uggests continuance in risk management process because individual risks or the entire risk situation may change with time KEY SUCCESS FACTORS AND RISK FACTORS IN LOGISTIC OUTSOURCING BUSINESS) K.2 S;66.55 :+6-3/5) Ouality manpowerL >rowth of =%, and 5%, services in India forces many trucking and warehousing companies engaged with particular segment to work as overall logistics service providers. Inade!uate skilled manpower available with these companies to operate the entire supply chain. raining of personnel will be essential to the success of these players.

Ceeping pace with technologyL In substructure of the

ransportation, ,ogistics,

1arehousing and %ackaging /ector use of Information echnology 2I 6 is very effective. #ssistance of I in 1;/, ransportation ;anagement /ystem, rack and race, *nterprise .esource %lanning, etc is vital and catalytic. %roduct movement 2.-ID tags for tracking, >%/6, warehousing 21;/6, etc are the areas of logistics becoming strong with use of technology. Organized logistics companies become superior to the unorganized ones with the adoption of technology, and will be crucial to their operations with increased competition. *nhanced operational efficiencyL success of logistics firms. K.2 R05A F+6-3/5) H04*<2 ;73/4+70C.1 +71 :/+48.7-.1 8+/A.-) 'norganized nature observed in the ,ogistics, ransportation, 1arehousing and %ackaging /ector in India. .esource utilization in India is not proper because of the high cost and diverted efforts due to the sliced market. I7:/+5-/;6-;/. 055;.5) he infrastructural inabilities and poor ineffectiveness of roads in India increases the e&penditure on vehicles and lowers the performance. efficiency. L+6A 3: 5-+71+/15 +71 ,/36.55.5 >0-*07 -*. 5.6-3/) Implementation of standard operating procedures in this sector is difficult as firms runs as ownership"based firms. #nd the nature of this sector in India is highly unorganized. R.4;<+-3/2 /.5-/06-0375) .eason behind the restricted growth of container business in India is the highest container transportation charges through railways throughout the world. On the other hand, in road transportation, rushing rise in re!uirement of a certain product, leads to malpractice, transporters make his results in increased operational costs and decreases o survive under constant pressure and the

growing competition, improving operational efficiency will be work key to the

alliances and charges too much to customers as there is no suitable regulations resulted in increased overall logistics costs. L+6A 3: 5A0<<.1 8+7,3>./) he manpower entered in this sector is not entered by choice, so there is lack of personnel interest. ransportation, ,ogistics, 1arehousing and %ackaging /ector are assumed disfigured career option has no attraction for skilled manpower I this is big concern in the case of mi&ed logistics providers. LOGISTIC OUTSOURCING ACTIVITIES' #dvantages and disadvantages of outsourcing with respect to their influence and benefits of logistic outsourcing activity also e&plained in the literature, many papers.

T+=<.'1. M3-09.5 :3/ L3405-065 O;-53;/6074 $ost reduction -ocus on core businessNcore competencies Improvement of service levelNservice !uality $hanges in cost structure 2elimination of fi&ed costs6 >aining fle&ibility Cnow"how transferNusage ,abor considerations $apacity improvementNhandling peaksNcustomer demand Decrease in capital employed #ccess to new I Increase in speed $ompany restructuringNdevelopment of supply chain partnership $entralized facilitiesNdistribution systems ;anagement and political considerations >lobal capabilities *conomies of scale 2realized by service provider6 >aining more cost transparency $hange implementation

S3;/6.' (DUHAMEL F 1&&3"

# fundamental factor in logistics outsourcing contributes $ost reduction and cost related aspects. /econd most mentioned influence for logistics services are core businessNon core competencies and at third the improvement of service level and service !uality. >aining fle&ibility, the transfer of provider8s capability, applications associated with labor or the ability to troubleshoot barriers are the other influences mentioned by fewer authors and also provided by 2Cajuter %, 34((6 Observations from survey conducted suggest that transport, reverse logistics and freight forwarding are the functions fre!uently outsourced in the surveyed companies. Overview of the outsourcing of different logistics functions by manufacturing and trading companies in the various regions of India shown below. #s per available information more than DJK of the local and international transports are carried out by an e&ternal

service provider for every DJ organizations out of (44 in India. /urvey observation suggest that about 34K of these companies outsourced (K"DJK of their household transport 2(JK of the companies for international =4 transport respectively6 from the e&planation of . #s transport does not belong to the main proficiency of manufacturing companies transport is outsourced very fre!uently from the organizations. ransport, freight forwarding, and reverse logistics like areas have a long history of proficiency in the world of logistics service providers. hese functions are outsourced to third parties due to the cost factor criteria suggested by 2Cersten 1 /chrPder ; /inger $ -eser ;, 34((6. F.4;/.'1' RELEVANCE OF LOGISTIC OUTSOURCING SERVICES'

S3;/6.' (K./5-.7 W S6*/D1./ M S074./ C F.5./ M 2E11"

In terms of investment, in third party ware"housing and inventory management investments are negligible or lesser by companies as preference is to regulate prime operations like product customizationNfinalization and logistics I systems. It is the same for invoicing and order processing. $ompanies are often afraid to operate these fields through service providers because these activities mean direct customer contact.

T>3 .<.8.7-5 /.5,3750=<. :3/ /.1;6.1 P/06.5 :3/ <3405-065 5./906.5 07 8+72 6+5.5 +/. +5) -irst, further cost reduction in transport costs is not possible for manufacturing and trading companies. /o they have to adopt alternative ways by reducing costs in areas like inventory and warehouse management, andNor ma&imize the !uality of their goods to gain their competitiveness. /econd, and parallel, logistics service providers has to match strength in pricing and ongoing range of services provided and services as suggested by 2Cersten 1 /chrPder ; /inger $ -eser ;, 34((6 #s the results suggests there is a tendency for outsourcing domestic and international transport services, companies have to aware of future challenges competition. TRANSPORTATION' LOGISTIC OUTSOURCING ACTIVITY) Overview of the classification of transport into logistics and of the players in the transport process is enclosed in this chapter. C<+550:06+-037 3: -/+75,3/- 07-3 <3405-065 here is no specific understanding of the term logistics. he scope of duties which are allocated to logistics and which differ from each other along with numerous e&isting definitions entitles logistics. 2.ussel / 9, 344D6 , defines the term as logistics aims at getting @the right product to the right customer, at the right time, at the right place, in the right condition, in the right !uantity, at the right costA. ransport is collective process which results from the modification of resources into useful goods towards the ultimate consumer involving several steps and is the planning of all these activities and sub"functions with respect to reduce cost, improvise service to the customers and efficient logistics into a process of goods8 movement as suggested by -air and 1illiams, in (:M(. in the future high"!uality

seng, 344J and modified $hang, (::M puts some components of logistics costs as follows. -inding of this analysis is, with charging to 3:.5K of logistics costs, and inventory costs 2(D.5K6, warehousing costs 2(D,4K6, packaging costs 2((.:K6, management costs 2((.4K6, movement costs 2D.MK6 and ordering costs 2J.JK6 transport shows ma&imum costs. he transport costs is almost one"third to total logistics costs. he means of transport, corridors, containers, pallets, terminals, labors, and time are contributed under transport. his figure represents the cost structure of logistics systems and order of importance in improvement processing. 2Caliprasad ;, 344)6

(K+<0,/+5+1 M 2EE$" herefore, among the components of business logistics transport is the major one. ;ovement of goods and products based upon least"cost principle and it influences the results of logistics activities, production and sale as e&plained by seng et al., in 344J. 9igh logistics efficiency, depressed operational cost, improved service !ualities are the indications of the good transport system, though the transport modes share is different. ransport modes constituting the means by which movement is supported are the constitutive element of transport systems.

T+=<..2' T/+75,3/-+-037 G/3>-* >0-* 10::./.7- 831.5 07 I710+ (07 80<<037 -377.5") Y.+/ 2EE2 2EE$ R3+1 1E!# 1#$E R+0<>+2 E.& 1.4 S.+ 3$4 #!% A0/ 4!% $$!

F04;/..2

S3;/6.' 2%rabir D, 34(36 InterpretationL In Indian ,ogistics industry, according to graph road transportation is ma&imally and railway is minimally preferred mode of transportation among all other modes available. .ail transportation is minimal because of lesser area coverage and infrastructural inability. >raph figures shows that ma&imum growth is shown by the railway and sea modes among the increase in all modes of transportation along with annual increase in all modes of transportation. T+=<..3' P/.:.//.1 831. 3: 6+/43 839.8.7-)

M31. 3: T/+75,3/-+-037 A0/ S.+ R+0<>+2 R3+1

P./6.7-+4. 839.8.72.# F 2E F 23 F #4.# F

3:

-3-+<

6+/43

F04;/..3

S3;/6.' 2%rabir D, 34(36 I7-./,/.-+-037) >raph shows that for cargo movement in India by .oads is more favorable mode as compare to the .ail, #ir and /ea modes of transportation. .eason behind is that the roads almost cover all the areas in India than the other mode of transportation. 0est mode of transportation is road because of poor development and services of other modes. One more reason that favors road in India as first choice is that road covers almost all the urban, rural and hilly area in contrast to railway and cargo movement by air is least preferred due to high cost involved.

T+=<..4' G/3>-* 3: 637-+07./ 93<;8. 07 I710+ (87 TEU" Y.+/ 2EE2 2EE3 2EE4 2EE# 2EE$ C37-+07./ 93<;8. (87 TEU" 2.& 3.4 4 4.# #.1

F04;/..4

S3;/6.' (P/+=0/ D 2E12" I7-./,/.-+-037) he graph suggests that with the increased e&port from and import in

India leads to high container volume. 3445 and 344) are the years reflecting ma&imum growth compared to other years in container volume. TRANSPORTATION SERVICE MODES) ROAD) G

T+=<..#' ROAD FRIGHT IN INDIA Y.+/ 1&&# 2EEE 2EE# R3+1 F/.04*- ( INR =0<<037" $1E %4E 143E

F04;/. #.

S3;/6.' (P/+=0/ D 2E12" I7-./,/.-+-037) 1ith the infrastructural improvement movements of goods also increasing day by day and with high area coverage which is presented in above graph. #long with )"M K annual rate, road freights are also improving rigorously. In India, value of road freight industry is nearby I+. (.53 trillion with growth about )"M Kyear as per figures above. Dominating land transport system today is the road transport. @.oad transport has a near monopoly in the distribution of finished products at the lower levels of the supply chain, particularly in the delivery of retail suppliesA is the forecasting by ;cCinnon in 344), p. 3=4. ;anpower e&penditure is near to 5 Kof sales in front of the overall sector average of M"(4K. he industry is disorganized by routine

practice with almost DJK of the single truck operators and almost :4 Kof with turnover of less than I+. (4 million trucking companies. $ompared to the other industries worst working conditions, weak and unstable manpower policies, unfair practices involved, low pay"scale are the reasons for disfavoring employment in sector and are e&ploiting sectors image. 0esides of industry persons >overnment also hasn8t concentrated on the manpower development in this sector. very few institutions. .oad transport system possesses significant advantages over other modes. .oad transport system has following advantages .e!uires lesser capital investment for vehicles, $omparatively easy for new users to gain entry, *nsures that innovations and new technologies can diffuse !uickly through the industry. .elatively high speed of the vehicle. One of its most important attributes is the fle&ibility of route choice. here are no provisions made for driver training, loading N unloading supervisory, proper handling practices for this sector e&cept

2.odrigue < %, 344)6states, these multiple advantages made cars and trucks the modes of choice for a great number of trip purposes and led to the market dominance of cars and trucks for short"distance trips. A19+7-+4.5) .oad network of =.= million km is the second largest globally JJK of total freight movement is via roadways .oads offer wide reach and easy accessibility to even small markets

D05+19+7-+4.5)

9igh cost of transportation +ational 9ighways account for only 3K of the total network but carries 54K of total freight

K.2 D.9.<3,8.7-5) +ational 9ighway Development %roject to upgrade and modernize highways 35,444 km of +ational 9ighways are to be upgraded to fourNsi& lanes. $onnectivity to ports is also being improved R+0<>+2 T+=<. $. ' RAIL FRIGHT IN INDIA

Y.+/ 2EE2 2EE3 2EE4 2EE# 2EE$

R+0< F/.04*- (80<<037 -377.5" 4&3 #1& ##! $E2 $$!

R+0< :/.04*- 07 I710+

F04;/. $

S3;/6.'(P/+=0/ D 2E12" I7-./,/.-+-037) >raph suggests that there is high movement of goods by railway, 0ut restricted at domestic level. RAIL) he Indian .ailways planned to develop ,ogistics %arks QGhubs8 in supply chain parlanceR is a good one. o reduce the supply chain costs plan has potential to accumulate and enlarge the supply chain. -or efficient working of the plan the service concept, service delivery and infrastructure will be well organized for the .ailways ,ogistics %arks. -or the .ailways ,ogistics %ark to count up financial worth to the supply chain, one of the activity of transport means incoming or outgoing, has to be by rail. -or switching the customers from road to rail the Indian .ailways would have to put"in innovative train services. A19+7-+4.5)

/pread over M(,J44 km, railways carries 3JK of total freight movement ,ow transportation cost as compared to roads

D05+19+7-+4.5) 0ulk commodities account for :4K of total freight revenues Infle&ibility to reach deep interiors

K.2 D.9.<3,8.7-5) %hase ( of dedicated freight corridor along >olden Ouadrilateral to be initiated in 344M"4: SEA/PORT' TABLE .!' SEA/ PORT FRIGHT IN INDIA Y.+/ 2EE3 2EE4 2EE# 2EE$ S.+ F/.04*- ( 80<<037 T377.5" 422 4$4 #1& #!%

F04;/. !

S3;/6.' (P/+=0/ D 2E12" I7-./,/.-+-037) ;ovement of goods by the sea is e&plained through above graph. #ccording to the graph with increased international market the movement of the goods by sea also increased. SEA/PORT) (::: " 3444 prices suggest that the contribution of ;arine transport sector is over 4.3K to the country8s >D% at constant prices. >D% has increased contribution of transport sector as the economic activities are growing since last couple of years in India. In the Indian economy shipping industry plays a key role. India has seacoast of around D,J(Dkm is well adopted (3 major and (MD minorNintermediate ports. Vessels having M.53m >ross .egistered onnage 2>. 6 is transported across ports till the end of 1ith December 344). Increased International trade in India carried through ports.

growth of :.J(K against the same period of the previous year prime ports in India

collectively handled 5)=.M5m tons of cargo in 344)"4D. ==.=MK of the overall traffic at major ports between #pril";arch 344D, is contributed by fertilizer contributes to =.45K, and others (D.5:K. #ccording to the %lanning $ommission, with predetermined investment of '/S(D.D billion (Jm >. 2specified in =rd target6 fleet strength is achievable by India8s shipping at the end of 34(("(3. $#>. with growth rate (4.:)K from 344D"4M to 34(("(3, will improve port throughput up to (,44Mm tones. A19+7-+4.5) $heapest mode of transportation he petroleum"oil"lubricants 2%O,6 followed by iron ore contributing (D.=DK, coal (3.:MK, container traffic (J.M5K,

D05+19+7-+4.5) %oor state of inland waterways in the country 9igh turnover time

K.2 D.9.<3,8.7-5) $argo handling capacity of ports to be increased from )44 million tonnes in 344D to (J44 million tonnes by 34(J. AIR) TABLE !.' AIR FREIGHT IN INDIA Y.+/ D38.5-06 (million tonnes" 3EE 34E I7-./7+-037+< (80<<037 -377.5"

2EE2 2EE3

#!# $#E

2EE4 2EE# 2EE$

3!# 4%E #1E

!EE %1E &EE

F04;/. %

S3;/6.' (P/+=0/ D 2E12" I7-./,/.-+-037) continuous increment in movement of goods by air is due to its fast and safe way is suggested by graph. #lso for the international market air mode of transportation is preferred more than domestic market. AIR) (::: " 3444 prices suggest that the contribution of #ir transport sector is over 4.3K to the country8s >D% at constant prices. >D% has increased contribution of transport sector as the economic activities are growing since last couple of years in India. -rom 344("43 to 344)"4D there is elevation in local air cargo traffic with $#>. of (3.M4K and for same period international air cargo traffic runs at $#>. of (=K. In the year 344)"4D cargo traffic is pre"assumed to be more than(.J)m tones noticing growth rate of (5.)JK with respect (.5 m tones during 344J"4).

%lanning $ommission suggests that India8s air cargo movements would fly at over $#>. of ((.JK from 344D"4M to 34(("(3.>ems and jewelry, special chemicals and high"value pharmaceuticals are highly e&ported leads to increase in international air cargo traffic at all Indian airports. A19+7-+4.5) -astest mode of transportation

D05+19+7-+4.5) ,ow freight movement MDK of total freight traffic being handled by airports in metro cities

K.2 D.9.<3,8.7-5) ;odernization of =D operational airports and development of new airports will increase air cargo handling capacity RESEARCH METHODOLOGY) INTRODUCTION he whole section deals with the approaches or methodology practiced to fulfill the objectives of the research with respect to reach interim conclusion. his part of the research hypothetically elaborates the various research techni!ues and preaches utilized by the researcher with the alternative methods used for research purpose. /ection also highlighted with the !uestionnaire designed for data collection, data collection methods, detailed analysis and e&hibition methods of data collected. ,egality, generalizability, ethical as well as moral issues depicted along with the authenticity and techni!ue of phenomenology used for the research is the highlighted elements in conte&t of this part of the research project. his research project section also makes researcher e!uipped with sampling techni!ues used in the research guiding him to speculate key demographic for the research. In order to generate a useful data for the

research with affiliation of survey techni!ue, conduction of workshops and conduction of e&pert interviews, primary and secondary techni!ues are utilized with contempt of !uantitative and !ualitative data as well. 2/aunders hornill ;, 344:6 R.5.+/6* P+-*>+2) 2/aunders hornill ;, 344:6suggests, the prime constituent of project research is the

pathway with which it is accompanied. #s the strategy is used of *&pert interview and 1orkshop conductance the direct source involvement is mandatory for the research pathway to lead smoothly which created need of using inductive research pathway in order to accomplish the research. METHODLOGY OF SURVEY' S;/9.2 +5 + /.5.+/6* +,,/3+6* #s per the suggestions of 2D' # / +#.#/I;9#+ O .#<IV, 34456, if the handouts of

the research !uestionnaire is distributed direct to source and he responded in written format, the techni!ue is speculated as survey techni!ue of data collection. #ccording to 9air et al., 344D, the !uestionnaire is composed of set of !uestions, formatted on paper which is distributed to direct source and accordingly responses are collected in written form. #ccording to 2D' # / +#.#/I;9#+ O .#<IV, 34456in case the fundamentals of the

!uestionnaire are of high !uality and if the interviewer does not need to arbitrate the research pathway is suitable for cognate groups. /ince the researchers are usually not able to interact with the respondents, the !uestionnaire needs to be analyzed by authorities appointed viz. researchers or professionals for relevance of design, formatting and apprehension 2D' +#.#/I;9#+ O .#<IV, 34456 In addition, the way how !uestionnaires are dispersed is associated directly to rate of responses which e&plains the awareness of the researcher. #ccording to the opinion of # /

2D'

# / +#.#/I;9#+ O .#<IV, 34456handouts if distributed hand"by"hand the high

rate of response can be speculated from the respondents. M./0-5 +71 D.'8./0-5 3: 5;/9.25 $ertain ;erits and de"merits come when techni!ues survey is the depicted as research pathway. On the either side some times researcher is un"aware of responses that are loyal or not and are from the correct source. #dditionally, the time re!uired to fill the !uestionnaire is uncertain. On the other hand, 2D' # / +#.#/I;9#+ O .#<IV, 34456 states that survey is regulated with high profile techni!ues that the responses of the respondents should be easily affiliated. In this case, the merits are beneficial than de"merits. he ,iterature by 2D' # / +#.#/I;9#+ O .#<IV, 34456, mentions anonymousness

of the respondents is a merit while answering a !uestionnaire in written form, primarily in cases like topic logistic outsourcing risk management projects. T2,.5 3: 5;/9.2 H;.5-0375 .esearcher has enormous scope of sources with variable dimensions in order to structure the research !uestionnaire as follows" O,.7'.71.1 H;.5-0375 hese types of !uestions are research generative and moderately easy to assemble in order to gather response and are directly relates the respondent to the research. his method is cited when researcher is unaware of the speculated answers. 29ier < %age # /amouel %, 344D6 pointed out that open"ended !uestion is useful for researcher and can motivate the e&perts. In this type of !uestions, the primary need is willingness of the respondent to give authentic information with conte&t of the !uestion, in many cases this type of !uestions do provide leisure information to the researcher but guanine attempt and continuance is

re!uired to be assured by the researcher in order to motivate respondent in favor of providing guanine and authentic information8s. %hrasing of $losed !uestions enables data collection, data input and computer analysis. #ccording to 29ier < %age # /amouel %, 344D6 these are fre!uently used in large"scale surveys for !uantitative studies. Ouantity or information, category, listNmultiple choice, scale, ranking and comple& grid or tables are the e&amples of closed !uestion as per 20la&ter , 9uges $ ight ;, 344)6 C<35.1 I;.5-0375' $losed types of !uestions are very difficult to articulate and infinite with respect to time re!uired. 0ut other elements of data collection like data recommendations and data computing can be completed while articulating them. hese types of !uestions are mainly recommended in large scale data collections surveys 29ier < %age # /amouel %, 344D6. $losed !uestions can make use of the following types of !uestionsL Ouantity or information, category, listNmultiple choice, scale, ranking and comple& grid or table 20la&ter , 9uges $ ight ;, 344)6. hey will enrich the data collection with material like !uantity and !uality speculations, division, variable dimensions, scale and comple& lattice or informative tables. METHODOLOGY OF WORKSHOPS' M.-*313<342 3: -*. >3/A5*3,5 .esearch pathway as workshops methodology for primary data collection from logistic outsourcing industry sector with its merits and demerits is e&plained as follows" W3/A5*3,5 3: :36;5 4/3;,5 +5 + /.5.+/6* +,,/3+6* he group of professional cited from particular industry to be studied is concentrated with respect to their responses, discussion and critics on the conte&t of the issue. /uch workshops are also elaborated and labeled as interactions, group discussions, debates or social events. #ccording to 2*riksson % Covalainen #, 344M6, one or two debate

initiators or pacifiers are appointed with respect to speculate the relevant data from the group of professionals in order to discuss the insights of conte&t of the issue and gather authentic information in order by which respondents response for the debate or particular !uestions asked M./0-5 +71 1.'8./0-5 3: >3/A5*3,5 he rationale of selecting the research pathway with the virtue of citing group of professionals risen the following merits and de"meritsL he workshops are beneficial in case of peoples who are not in favor of personnel interviews. #lso in this type of survey, workers of the firm are get more involved with the conte&t of the issue and starts providing their innovative ideas regarding research conte&t. 'ltimately this techni!ue motivates the thinking of peoples on adroitness and for their affirmations signifies the workshop. 2*riksson % Covalainen #, 344M6 1hile highlighting the de"merits of this techni!ue, primary highlights the undefined end and least speculated result, while many of peoples are not in favor to disclose their ideas in group and willing to plea in personnel interviews. accomplishments of the variable peoples may vary the outcomes. In my case of research the workshop is conducted in two parts, in which first group of professional sorted was local authorities or government peoples while second work shop group cited was company professionals. basis of regular project meetings. wo he workshops are conducted on the different groups with two different he variable

accomplishments were selected with accurate planning to eradicate the outcome variations. he e&pected de"merits of the workshop are counterbalanced by using this techni!ue of two workshops. STRATEGY OF THE RESEARCH) /econdary data collected forms the base for strategy of the research. *&perimental scheme of the research is utilized instead of theoretical scheme, because *&perimental

scheme doesn8t re!uire any collection of primary data. #s the conte&t of the research provides inductive ideas which the theories proposed in regular manner are changed to regular form their definitive manner.. he research is gathering of correlated views and the data accumulated is imagined as contemplation of peoples understanding about conte&t of the research issue, organizations, and customers related to logistic outsourcing and services. hus inductive approach is best suitable for the project. ETHICAL ISSUE OF THE RESEARCH) his section of the research enables us with prime ethical issue that confidential information obtained from the primary source of the organization. o avoid further conspiracies with the sources of data, it is purposefully omitted in the research presentation since the data collected includes the information that comes under the law of company secrecy. he names of the customers as well as e&pertise, managers, workers who had given the interview for the process of data collection also kept secrecy with respect to law of secrecy of personnel information. EMPIRICAL DATA ANALYSIS) he logistical outsourcing risk management in actual logistic business scenario is conferred with reference to imperial data obtained by using various data collection techni!ues e&plained in previous part of the research. he survey techni!ue is used as base to construct research with the help of conducting two workshops with company professionals and local government bodies or unskilled workers with the virtue of speculating the various logistic outsourcing risks and attributes of transportation outsourcing risk as major risk speculated previously in this study and in the end of the task, enteric conclusion is designed in accordance to survey techni!ue used. he project is undertaken with respect to speculate the logistic outsourcing risks in #pril 34(=. he various attributes of the logistic outsourcing risk like risk prominence, he results obtained in empirical management of risks and risk mitigation are studied with the virtue of research background drawn in earlier part of the research. studies of this research are depicted in following section of the research"

PARTICIPANTS IN THE SURVEY he target groups of the empirical study were Indian manufacturers with 33 replies and logistics service providers with (4 replies. %rocurement 2#dministration6, supply chain management 2administration6, logistics 2administration6, controlling 2administration6, business management or member of the management board are the areas in which respondents works. -igure below shows the share of small, medium, and large companies of logistics service providers and manufacturing companies. #ccording to 2Cersten 1 /chrPder ; /inger $ -eser ;, 34((6analysis of majority of replies come from large enterprises while middle type is less interested to respond is carried. In order to carry empirical analysis in Indian ,ogistic ;arket, the market is segmented in two categories viz. logistic service providers and manufacturers. he survey techni!ue of workshop is followed in these two segments and data is obtained from 33 manufacturers and (4 logistic service provider organizations. he following table clearly presents number of responses obtained during workshops when survey is actually cited is market by subdividing above two segments in large scale, small scale and medium scale organizations. +umber of administrative peoples, managers as well as skilled and non"skilled workers responded with enthusiasm in contrast to the statement made by 2Cersten 1 /chrPder ; /inger $ -eser ;, 34((6as large scale industries respond devotion while small or medium scale shows deviation towards academic research8s, he participants in the survey workshop are mentioned in following table created by researcher" P+/-060,+7-5 07 -*. 5;/9.2' T+=<. &. N;8=./ 3: /.5,375.5 D;/074 W3/A5*3,5 % TNT E(PRESS B/+76* INR1#$!$ 1.2#*/5 C38,+72 W3/A5*3, P+/-060,+7-5 C38,+72 S0C. D;/+-037

M+7+4./ S.703/ D0/.6-3/5 1E GATI E8,<32..5 S.703/ D0/.6-3/ O,./+-0375 P;/6*+5. M+7+4./ ! DHL E8,<32..5 D0905037 I;+<0-2 M+7+4./ B/+76* M+7+4./ 11 BLUE DART E8,<32..5 P;/6*+5. M+7+4./ D0905037 I;+<0-2 M+7+4./ S.703/ M+7+4./ & 12 SAFEE(PRES S AGARWAL PACKERS AND MOVERS W3/A./5 A663;7-5 M+7+4./ M+7+4074 D0/.6-3/ S.703/ M+7+4./ B/+76* M+7+4./ W3/A./5

80<<037

INR4#!! 80<<037

2.4#*/5

INR243# 80<<037

1.3#*/5

INR3&4 80<<037

2.3E*/5

INR#EE 80<<037 INR1%E 80<<037

1.#E*/5 3.2#*/5

1E

DTDC

O,./+-037 M+7+4./ E8,<32..5 B/+76* M+7+4./ D0905037 I;+<0-2 M+7+4./ F07+76. M+7+4./ E8,<32..5 P3<06. A;-*3/0-0.5 C38,+72 W3/A./5 G39./78.7B310.5 D/09./5 -/;6A

INR##E 80<<037

1*/5

12

FIRST FLIGHT

INR#EE 80<<037

2.1E*/5

1$

LOCAL BODIES

'

3 -3 4 */5

(C/.+-.1 =2 /.5.+/6*./ 2E13" D05639./2 3: S;/9.2' he survey was initiated in above mentioned segments, by re!uesting the associates to embark their views regarding constructive the outsourcing risks. ;ost of the company representatives consider risk as a potential damage as M4K positive responses occurs against 34Kof negative. Out of all M4K of the associate respondents embarked that outsourcing risks are the conceivable damage while 34K of associates responded outsourcing risks are not potential damage to their industry. 1ith beginning of the survey, the first !uestion introduced as follows"

I5 R05A M+7+4.8.7- I75-0-;-037+<0C.1 07 23;/ C38,+72J

F04;/. &

INTERPRETATION' In accordance to statement of 2D'

# / +#.#/I;9#+ O .#<IV,

34456, the logistic service providers and manufacturers devote same shares in risk management7 the only difference is in their enterprise size ranges. In survey workshop it is visualized clearly that most of the large scale ,ogistic /ervice provider industries do institutionalize Outsourcing risk management in their enterprise, while in case of large scale corporations, only 3N= rd of the corporations do institutionalize outsourcing risk management in their firm. 1ith further progression in survey, another issue is raised, in order to initiate a debate on the conte&t of the research issue as followsL

D3 23; ;5. 8.-*315 -3 +7+<2C./01.7-0:2 /05A5 +5 73/8+< ,+/- 3: 23;/ 638,+72 ,/36.55J

F04;/. 1E

INTERPRETATION' #lmost all :4K participants use tools to identify and analyze risks in their usual business processes while only J:K of the responding enterprises have only an institutionalized risk management. hose respondents who do not have an institutionalized risk management stated that in their daily they processes involves application of risk identification and analytical tools. #ccording to 2Cersten 1 /chrPder ; /inger $ -eser ;, 34((6, assessment of suppliers, financial checks, supplier self" reports, key performance indicators such as delivery reliability, !uality assessment, credit checks and the -;*# are the methods favored for that purpose. 9ighest risk involved is the time risk comprising delay in delivery and second hazardous risk involved is the !uality risk due breakage or damage occurred with the transport.

$ost risk due to increase transport costs is also the major concern as like the !uality risk. Ouantitative risk by partial destruction during transport and default risk arises due to loss of entire cargo contributes to lower e&tent compared to the other risks. ransport risks are sorted by manufacturing companies is presented in figure below. ,ogistics service providers consider time risk as most important along with the costs and !uality risks. #s per the opinion of 2Caluza 0 0lecker , 344J6, @costs, !uality, and timeA are counted as strategic success factors since (:M48s and considered most important. hese three aspects as @magic triangleA of project management. #s in all cases time, !uality and cost risks were regarded most important, study has complete impact of these factors.

RELEVANCE OF TRANSPORT RISKS FOR THE LOG

F04;/. 11

/ource" 2Caluza 0 0lecker , 344J6 In the risk management process, the assessment of risks follows the identification of risks. he reports of MK of the company representatives suggests that #ssessment of the risks is not completed, two dimensions probability of occurrence and amount of damage are !uantified accurately by 54K of the e&perts. 1hen answering this !uestion, it was possible to agree with several statements or to reject them.

R.5;<-5 3: ->3 >3/A5*3,5 'EB-.71.1 +7+<2505 >0-* /.4+/1 -3 -*. 01.7-0:06+-037 3: -/+75,3/- /05A During this research period two workshops on transport risks have been held in <uly 34(=. he details of the workshops as follows 1orkshops targets thoroughly, the results obtained in the survey, with respect to transport risks. Identification of transport risks from the perspective of local bodies including government bodies, police authorities along with company workers etc., is the main objective of the first workshop. transport risks from the companies8 view. DIVERSIONS IN VISION OF THE TWO FIELDS ARE HIGHLIGHTED AND DISCUSSED BELOW. SUBCATAGORIES OF TRANSPORTATION RISKS In order to reach the interim conclusion of about the risks invoked in logistic outsourcing business the workshops are conducted in listed organizations, by subdividing the workshop participants in to categories like unskilled workers viz. truck driver and professional employee8s viz. managers in the organizations, e&ternal risk factors like trucks used for transportation and internal risks factors like company operations. F0/5- >3/A5*3,' In accordance to importance of workshops categorized in previous methodology section of the research, the more potential risk factor identified during first workshop is @ ruck DriversA in accordance to heterogeneity in outsourcing risks. he identified potential outsourcing risk is further classified into status of driver, contemplated behavior of drivers, and un"contemplated behavior of driver as potential outsourcing risks. 1hile in case of outsourcing risk as truck, categories like condition of truck during time of delivery, appended accessories of truck risks are identified under the category internal risks under company point of view category. 1hile analyzing these risks in terms of he second workshop is conducted to detect

company and e&ternal, added advantageous e&ternal risks like environmental risks, behavior of local authority in delivery area, infrastructure of the area categorized are speculated by the participants of the workshop. RESULT OF THE FIRST WORKSHOP' T+=<. 1E. T/;6A D/09./ S-+-. ired 'nder Influence Of #lcohol, Drugs, Illness, ;edicine #ge #nd >ender 9ospitalized o .eplacement "+eed 9ire 1rong Drivers /election *ducation Of Drivers 1rong 9andling Of Dangerou s ,i!uids he s Orders Disobey .egulatio ns o C38,+72 P./5377.< ime %ressureN imetable Defects Defects /teering /ystem Defects al devices Defects 0raking /ystemN$om ponents >aseous *missions Defects Of Of Of ling Of Of 1heelsN ires T/;6A C3710-037 9.*06<. 0ad .oad $ondition s .ow rucks On 0order raffic <am he Of EB-./7+< 3: I7:/+5-/;6-;/.

,ightingN/ign

/uspension Defects Of

Vehicles condition

$hassis *scape -uelNOil Of

I7-.7-037+< =.*+903/

.//+-06 T/;6A -

S;,,<.8.7-+/2

H;8+7 B.*+903/ Disobey .egulatio ns /uicide Drivers $ausing 9ead"On $ollision

O9./<3+1/W.04* EH;0,8.7 Of %hones, Or echnical %roblems railers oo Old Or .ented ,ack ce Of Of achograph +ot %roperly -unctioning /peed ,imiter 1rongly InstalledN-un ctioning ;aintenan

/peedingN9igh /peed 'se ,aptops VNInattention

OvertakingNDangero us Driving ;an oeuvres

,ow Distance .est %eriod ;issing DrivingN1orking ime Documents

DailyN1eekly

.est

ime +ot -ulfilled $argo /ecuring Overweight $ondition Of he

Vehicle

U76375603;5 =.*+903/

.//+-06

E790/378.7 1eather $ondition s 2/trong 1ind, Ice, -og6 1ild #nimals

$argo /ecuring Insufficient Cnowledge raffic .e!uirementsN.isks #bout

%roblems 1ith 0rakes

he

Overweight %oor Driving /kills $ondition Vehicle Of he

2$reated by researcher, 34(=6 1hile conducting the workshop it is observed that many of the workshop participant were not providing much association awhile many of them have not attended workshop, so in order to understand dipper concern of logistic outsourcing risks, is made by the researcher as follows". THE COMPANYKS PERSPECTIVE SECOND WORKSHOP' In accordance to decision made while conducting first workshop, the second workshop is conducted with employees of the organization and local government authorities in target market selected in #ugust 34(=. ;any of the professional operating in logistic outsourcing business are attended this workshop and interim interpretation is drawn as follows" he variable transport outsourcing risks are speculated in this workshop. 1hile conducting second workshop researcher cited that many of the outsourcing risk elements speculated in first workshop are replicated in second workshop as well. In order to conduct second workshop, the transport outsourcing risks are subcategorized into political, environmental, organizational, truck and truck drivers by adding two e&tra elements in the category of e&ternal risks in workshop. he prime potential elements like unskilled truck drivers, appended accessories defects in truck, uncertain environmental conditions and lack of infrastructure advantages like road conditions, access to delivery locations are speculated in second workshop. decision of conducting another workshop with the virtue of company prospective outsourcing risks,

RESULTS OF THE SECOND WORKSHOP T+=<. 11. T/;6A D/09./ C38,+72 Illness Of +on"Optimal Driver -ear ,ose <ob Dishonesty Of Driver 'se #lcohol Distraction 2 V, %hone *tc.6 #bsence Of $oordinatio n 21ith %artners6 ,ow Cnow" 9ow Houng Drivers Of Of o ransport .outing ime %ressure %oor 0usiness .ules #bsence 0ad Information *&change #mong %arties .eputation .isk 1rong 9andling >oods Of #de!uate *!uipment ruck -ailure ;anipulatio n +o $omfortable Of T/;6A 0ad $ondition Of he Due echnical Defects ,oss o Disruption In he $old $hain +o Of # ruck o E790/378.7P3<0-06+< 0ad .oad $hange $onditionsN Decline 2/teep .oads6 +arrow .oads raffic <am In ransit $ountries N a& ,egislation %roblems #t 0order" N $rossing o %roblems 1ith $ustoms +atural $atastroph es 2*arth Ouake, -ire, -lood6 1eather $onditions 1ild $orruption Delay Due Delay Due o 'nprofessi onal 0order 9andling

In he

,egislation

>oods Due

+o %arking /paces %arking /paces N +o /ecured

Information N

Delay Due

,ack

Of Incorrect Documentati on ;indless %rofit" Oriented 0ehavior he $ompany Of N

Information $ustom /ystem Incorrect ,ashing ,oading ,oss >oods During ransport %roblems 1ith Dangerous >oods Of N

#nimals heft 2/ecurity

,abor

*&perience In"Official .ules %roblems During ransport 2%olice Inspection6 Due 'nknown .egulation s #bsence Of Or 0ad $ommunic ation 0etween Driver #nd Owner o

/trikes ,abor .estriction ,oss o Of $rime N

>oods Due /ituation errorism Delay Due o Different 9andling Of %olice Inspection

2$reated by researcher, 34(=6 he political risk factors are speculated in the research during workshop and are cited as corruptions, crime situations in the country which may irrupts risk of damage to goods to be transported, handling of material as well as political scenario between two states or nations plays vital role while crossing the borders of states or nations. DISCUSSION IN ACCORDANE TO TWO WORKSHOPS CONDUCTED'

1hile conducting investigation of workshops conducted researcher cited that the outsourcing risks speculated during first workshop are cause"related viz. appended defective accessories of trucks, time reliable delivery pressure, and impacts of regulatory framework of local authorities in area selected, while in accordance to the second workshop held, many of outsourcing risks identified are effect"related, viz. default risks like environmental conditions, political scenario of the target area, access to the delivery area, infrastructural developments etc. 1hile conducting workshop researcher had introduced to many secondary risks which are less potential hazardous to industry and those are identified as government changes, problems during crossing the borders of state as well as nations, environmental conditions like rainy weather, snow falls, heating temperatures in case of transporting frozen goods etc. scenario and level of developed infrastructure in demographic selected. respect to risk occurs in different cases different intervals. he hazardless of the predicted risks is dependent on the operating government8s political he risks potential in responsible for the damage to industry and it is variable element with hus in order to avoid potential outsourcing risk damages to affect outsourcing business, the strategy of risk management should be institutionalized in the organization in order to follow risk mitigation strategy which is e&plained in further part of the research. FINDINGS FROM WORKSHOP he workshop results are interpreted in this part of the research in accordance to the protocols mentioned in previous section of the research. In accordance to protocols provided, while conducting the workshops, in initial section the general information about the organization is conducted and then workshop initiated with asking the employees about their knowledge on the issue of logistic outsourcing risk and logistic outsourcing risks management is speculated. he interpretations of the results discovered from workshop are cited in ne&t section of the research. MANAGEMENT OF TRANSPORT RISKS WITH THE VERTUE OF WORKSHOPS'

In accordance to work shop conducted, many of professionals during workshop, cited outsourcing risk as hazardous entity element which company operations in pessimistic way during base analysis of company is carried. hus outsourcing risks are speculated as potential damaging element8s that mainly affects the growth of the organization by deviating it from achieving its objectives of growth set. he risk also speculated as an element which provides opportunity of improvement to the organizations, despite it deviated the organization objective by many of professionals. 1hile few workshop participants stated that outsourcing risk as hazardous by means of creating revenue impacts on economic grounds, thus humiliating the financial status of the firm. -ew participants created highlight on impact of outsourcing risk on supply chain management systems in the firm, while many of them created focus on outsourcing risks by e&plaining it in terms of economic, environmental and social elements that affects the organizational operations. In all, the conte&t of the workshop, suggested researcher that, logistic outsourcing risks are hazardous elements of the business and they cause potential damages to the industry operations. he professionals speculated that the risk management is mandatory phenomenon with pursuing the firm towards success of objectives set by the organizations. he table number 5, cited below represents the number of responses gathered during workshop in terms of speculating the major outsourcing risks element and need of risk mitigation major to be followed in accordance are elaborated in further part of the research. 1hile conducting workshop in various organizations, researcher came to hypothesize that M4K of the large scale, medium scale as well as small scale industries have institutionalized risk management function in their firm.

F04;/. 12

(C/.+-.1 =2 /.5.+/6*./ 2E13"

Out of all workshops conducted in different organizations, 3 out of ) manufacturing organization associates responded in the favor of institutionalizing risk management as regular process in their organization, while all of the (3, logistic service providers have responded in favor of institutionalizing outsourcing risk management in their organizations. he manufacturing organizations who have responded negatively regarding the potential of outsourcing risk have adopted the strategy of accepting outsourcing risk as their daily process and they have developed task force in order to mitigate this daily task of outsourcing risks. B.<3> ,+/- 637505-074 +7+<2505 3: 08,3/-+76. 3: A071 3: /3+1 -/+75,3/- /05A5 +71 8.+5;/.5 ;5.1 -3 *+71<. -*.5. /05A5. he researcher had implicated the approach of categorizing outsourcing risk in terms of their importance as per states by the various associate8s responses during workshops. Depending upon the potential damages caused by outsourcing risks as per discussed in previous sections of the research, the outsourcing risks are categorized in four groups

viz. time reliable, !uality of outsourcing, default and !uantitative. he least consolidation is given to the categories !uantitative risks, !uality of the delivery and default risks as transport risk is identified as major logistic outsourcing risks in previous section of the study. .ogler,3443. hese risk and number of responses by the associates are mentioned in following table" T+=<. 12. G/3;, S;=4/3;, EB+8,<.5 N;8=./ O: " T08. #dministratio ns E7-/0.5 ,ocal #uthority %roblems while crossing boundaries ( 4 L

"

D.:+;<-

$ommitment of ,ate Delivery : delivery %olitical +ature and *&ternal factors 2Infrastructur Information *&change e. .oads6A $onversatio n language variations J J

" "

C35I;+7-0-+-09.

(C/.+-.1 =2 /.5.+/6*./ 2E13"

he categorized risks are again subgroup according to their causes which are depicted in above figure. During workshop, total 3M, associates responded the categories of the transport risks and out of that number of responses per category are cited in above table viz. (4 respondents responded @timeA, category as most important risk whose potential damage is very hazardous to their firm while : responded as @defaultA risks are given prime concern in their organization with respect to uncertainties in their business, out of all accordingly J respondents responded !uantitative and !uality risks as most perceived transports risks causing potential damages in their firm. In addition to above differentiated outsourcing risk elements, the professionals associated with workshop responded =) more major risks factors stipulated due to uncertain and most unusual factors, which created a doubt about categories differentiated by the researcher after workshop. he other risks like fuel shortage, damaged infrastructure, along with other organization specific internal risks factors broaden the risk spectrum designed by the researcher. 1hile is cases of some manufacturers , the distinguished transport risk analysis proved as difficult task due to huge network they use for their business around the globe. #lso the authenticity of the information8s provided by the drivers, local authorities as well as workers is also re!uired to be tested as logistic business is entirely majored on time, !uality, !uantity and defaults at the end of delivery rather than what risks might have incurred during the delivery process. In accordance to workshops conducted, the proficiency of the outsourcing risks is identified and it is clear that ):K of the manufacturers and logistic service providers do institutionalize as well as classify the outsourcing risks as their routine business activity.

F04;/. 13

(C/.+-.1 =2 /.5.+/6*./ 2E13"

he workshop conducted provided information about the classification of outsourcing risks are done on ground of its anticipation as follows" " #nticipated risks" ;any of the organizations participated in workshop responded that they implicated supply chain management systems in their firm in order to cite the predictable outsourcing risks. " 'n"anticipated risks" hese risks mainly categorized as per workshop responses are legality of business, strategies used in business, data to day business activities and market scenario. #lso the logistic outsourcing standardization nomenclature used by the third party when logistic is outsources, also arisen as prime outsourcing risk.

-or the workshop e&perts, road transport risks assessment was a difficult task. Only )=K companies do the evaluation of road transport risks rest companies estimate risks in individual cases. -or each company, supply chain and even to each individual risk assessment varies. hese troubles occurring in assessment of road transport risks shows need for action on both the scientific and business side. D3.5 -*. /05A +55.558.7- 6;<-;/. .9+<;+-.1 07 23;/ 3/4+70C+-0375J

F04;/. 14

(C/.+-.1 =2 /.5.+/6*./ 2E13"

he assessment of transport risk also speculated as another difficult task for the organizations as per cited by the associates responded during workshop. ):K of the respondents responded that the outsourcing risks evaluation and assessment culture do operates in their organizations and they asses it in terms of outsourcing risks associated with firm while other do it by the means of individual risk assessment. elaborated in further part of the research. hough the risk assessments and mitigation are the difficult tasks identified for the firms and are

I7-./08 6376<;5037 3: -*. .8,0/06+< /.5;<-5 he participants in the survey conducted within this project estimated adoption of certain transport risks for the logistics sector in general. he results reflected that the time risk 2delayNunseemliness of delivery6 was regarded as the highest risk, followed by !uality 2damage during transport6, cost 2increase of transport costs6, default 2loss of the entire cargo6 and !uantitative risk 2partial destruction during transport6. he respondents rated all specified strategies in the terms of suitability higher than in their actual application during the evaluation of four logistics strategies with regard to their suitability and application ;oreover, the respondents stated that the general importance of supply chain risk management to be increasing considerably over the last years. wo workshops conducted were helpful for deep understanding of the results generated during survey. -irst workshop was aimed to identify transport risks from the perspective of road police authorities and the second workshop aimed at detecting transport risks from the companies8 view. 1orkshops conducted helps in identification of different kinds of risks and their grouping according to the categories truck driver, company, truck, e&ternalNenvironmental and political risks. he local authorities mentioned mainly cause"related risks while the different risks specified by company representatives were either cause"related or effect"related. In identified risks in the field of transport huge number diversity occurs therefore different perspectives consideration is necessary for successful risk management. he risk mitigation measures for the general risk category are classified into two categories as .eactive measures and %roactive measure by many authors in accordance to different objectives set and approached followed by various organizations in mitigating logistic outsourcing risks, In accordance to 2Caliprasad ;,

344)6, the reactive ;easure is mitigation measure that has followed by an organization in order to mitigate the damage occurred due to the outsourcing risk, while %roactive approach is implicated in outsourcing risk management, prior to the damage e&pected due to outsourcing risks. 1hile strategy of distinguishing outsourcing risk as described in earlier paragraph with the virtue of transferring, sharing, reducing, avoiding or accepting the outsourcing risk is elaborated by other authors in order to implicate logistic outsourcing risk management in business. 1hile in some cases objective of risk mitigation still not achieved in accordance to classification and distinguishing made over risk mitigations. In such cases risk mitigation is achieved by implicating strategy reducing the impacts due to occurrence of such risks is implicated in order to avoid the loss of data or reluctance in data to achieve objective of outsourcing risk mitigation. 2Cersten 1 /chrPder ; /inger $ -eser ;, 34((6 In order to set the strategies for the risk mitigation in transportation outsourcing risks, authors further classified risk mitigation measure on the grounds of general outsourcing risk mitigation measures and specific outsourcing risk mitigation measures. #nother class identified by the authors, is procurement type of outsourcing risks 2Cersten 1 /chrPder ; /inger $ -eser ;, 34((6 LOGISTIC OUTSOURCING RISK MITIGATION' M0-04+-037 8.+5;/.5 :3/ 4.7./+< /05A5 he general mitigation outsourcing risk measures are not applicable for the specific class of outsourcing risk mitigation. hey are applied to the general risk arises in supply chain management process. he general risk mitigation measures are depicted in following figure under the subcategories" >eneric Outsourcing risks, %lanning and %revention of $risis, $ommunicationNInformation %olicy and %ersonnel mitigation risk measures. T+=<. 13.

MITIGATION MEASURES FOR GENERAL OUTSOURCING RISKS

G.7./06 P./5377.< /05A5

" #d " -le

"

-urther education in risk management $ross functional teams

C388;706+-0 37 +71 I7:3/8+-037 ,3<062 " /trengthening $ommunication culture *&change of risk relevant Information

P<+77074 +71 P/.9.7-037 6/05.5

"

" "

'se of *arly /igns $ontinues %erformance improvements

"

(C/.+-.1 =2 /.5.+/6*./ 2E13" #nother class identified by the authors, is procurement type of outsourcing risks and measures can be provided for such type of outsourcing risks by dividing it into subclasses as Insurance, -orecasting the risk and planning for measures, Inventory management, $o"operation with supplier, /upplier ;anagements, /upplier make or buy 2Cajuter %, 34((6. he outsourcing risk mitigations for the procurement class are provided in following table, which are subdivide in another major outsourcing risk category identified in this research project as transportation Outsourcing risk and measure can be implemented as depicted in following figure" T+=<. 14.
G/3;, S;=4/3;, C3<<+=3/+-0375 M.+5;/.5 @,ong" erm .elationships 1ith /ervice %roviders #s 1ell #s 1ith $ustomersA C37-/+6I75;/+76. @0onus ;alus /ystem 1ith $ustomerA @$losing Of #n Insurance $ontractA @$oncluding # ransport InsuranceA

O/4+70C+-037+<

@ ransferring ransport .isks 2*.>. M+A. 3/ =;2 P/.9.7-037 R.1;6074 1.<09./2 -08. Incoterms6A @Own ;anagement Of ransportsA @0usiness $ontinuity %lanA - @/hortening Of ,ogistical hrough %ut imeA @%ooling Of 9andling imeA @$hanges In Delivery imesL Deliveries On ime 1ith ,ess rafficA R.1;6074 D.:+;<- R05A5 @9olding #vailable ,ogistical

0uffer $apacityA @ iming ,onger ransport imesA @%roviding 0uffer ime 0etween Delivery

S.6;/0-2

#nd ;anufacturing Of Vendor %artsA @$hoosing ;ean Of ransportN.oute Of ransportN ransport ime 1ith .egard o /afety IssuesA @/ecured %arking /pacesA @%reventingNImproving ;aintenanceN/ervicing Of he ,ogistical *!uipmentN;ode Of ransportA @Improving /afety ;easures -or >oodsL 'se Of /pecial 0ins Designed -or ransport /ecurityA @/upplier8s #uditA @ aking he ,ogistics +etwork Into $onsideration 1hen /electing he ,ocation @9andling Of $argoL *liminatingN .educing +umber Of 9uman *;8+7 InterventionNOf Operating /e!uencesA @ raining -or -uel *fficient Driving

S./906.

,/3901./5

5;,,<0./ 6*+07 1.5047

R.1;6074 P./5377.< 6+,+60-2 D.9.<3,074 /.53;/6.

H;8+7

S.<.6-037 3: .8,<32..5

@.e!uesting $ertificate Of >ood $onductA - @%roactive .eporting Of Delayed ransportsA @.edundancy Of DataA

IT

M370-3/074

@%ositioning /ystem 2 racking #nd racing6A

@;onitoring Of he ransport $hainL #larm

S.6;/0-2

;anagementN/abotage @Door ;onitoring /ystem #nd echnical #larm 20rakes, emperature, yres %ressure, #&le ,oading6A

(C/.+-.1 =2 /.5.+/6*./ 2E13" M0-04+-037 3: 3-*./ /05A5' he other logistic outsourcing risks, which are may arise due to environmental factors, demand and supply factors, ,ogistic operations control factors or logistic Operation process factors are not categorized in this research project are categorized in third class by the researcher and mitigation measure provided accordingly in different articles. RESEARCH CONTRIBUTION) he research carried is proposed to provide the effective contribution for the logistic outsourcing organizations by providing the dynamics of the logistic business in India7 it will also contribute by providing the successful business solutions for the various logistic outsourcing risks which are uncertain in the business. he researcher has provided various majors over the prime logistic outsourcing risk that is transportation, which will contribute the various organizations, to implement these major in their organizations in order to counteract the transportation risk they are facing in their business. he key success factors elaborated in the research will help the logistic outsourcing organizations to ensure the success in their business by effective understanding and implications of the success factors. he research also provided the opportunity for the

future research, by creating a base for the research for identifying risk factors and mitigation over it in other logistic activities like warehousing, packaging, managing movement, ordering. .esearch also contribute by provide majors for prime logistic risk factors like timely delivery, cost of logistic outsourcing, !uality of service to be provided, default loss due to cargo loading, and !uantitative risks in logistic outsourcing business. CONCLUSION) he participants in the survey conducted within this project estimated the relevance of certain transport risks for the logistics sector in general. he results reflected that the time risk 2delay unseemliness of delivery6 was regarded as the highest risk, followed by !uality 2damage during transport6, cost 2increase of transport costs6, default 2loss of the entire cargo6 and !uantitative risk 2partial destruction during transport6. he evaluation of four logistics strategies with regard to their suitability and application showed that the respondents rated all specified strategies in the terms of suitability higher than in their actual application. ;oreover, the respondents regard the general importance of supply chain risk management to be increasing considerably over the last years. he results gained in the survey were deepened with the help of two workshops. 1hile the aim of the first workshop was to identify transport risks from the perspective of road police authorities, the second workshop aimed at detecting transport risks from the companies8 view. #s a result of the workshops, different kinds of risks were identified and clustered according to the categories truck driver, company, truck, e&ternalNenvironmental and political risks. 1hile the risks mentioned by the local authorities were mainly cause" related, the different risks specified by company representatives were either cause" related or effect"related. he huge number of identified risks in the field of transport shows that due to their diversity a successful risk management must consider different perspectives. In addition to the survey and the workshops, si&teen e&pert interviews were conducted. In the e&pert interviews, the focus was set on the implementation of risk management and on possible risks which may occur in transport. 1ithin the interviews, a total of (3= transport risks 2including a large number of multiple risks6 were identified and allocated to groups which specify the type of impact of each mentioned risk. hese groups were time, default 2respectively !uantity6, cost, or !uality of the

transport process. 1ith the virtue of survey techni!ue various interviews are collected from the professionals working in logistic industry, I came to conclude that in spite of many risk factors in logistic outsourcing business, ransportation is identified as major risk source in logistic outsourcing business. ;any modes of logistic outsourcing were studied in the research like #ir, $argo, road and /hip, but out of all that transportation mode is identified as most efficient mode of logistic outsourcing in India, as in India all the parts of the country including rural as well urban areas are accessible by the roads and the prime objectives of logistic outsourcing times, !uality and cost factor base delivery can be successfully achieved with use of road transportation mode. Despite of it, I identified many uncertain logistic risks which are mainly regulatory issues with different local as well as national governments, condition of the driver, condition of the vehicle, conditions of the roads, environmental factors, while using road transportation mode with. #fter collecting various interviews by conducting workshops in various regions of India, I identified key success factors of logistic business like !uality manpower, use of technology, operational efficiency are still lagging behind in India in terms of use of available manpower, technology and training the same with skilled re!uired in handling logistic outsourcing operations. I identified that the logistic industry has facing intense competition within India, which has lowered the business margin for them, and this ultimately affected the use of available resources for them. Due to this intense competition many of the logistic firms are lagging behind in their revenue generation targets and this led them use the traditionally operating tools of logistic outsourcing rather than implement most technologically sound systems in their logistic outsourcing operations. 1ith the conte&t of the research carried and primary and secondary data collected I came to conclude that along with transportation many other risks factors in logistic outsourcing business can be identified and need to be focused intensely by logistic outsourcing solutions providers, which are mainly lack of infrastructure, lack of skilled manpower and technology, highly fragmented and unorganized market, lack of standards and processes within the sector, regulatory restrictions by particular territory by local as well as national government.

1ith the virtue of primary data collected using survey techni!ue by workshop method, I identified transportation is the major logistic outsourcing risk factor which is re!uired to be focused as it cost around D4K of the total logistic cost in business. he entire logistic outsourcing business margin is dependent on transportation business, while other activities like warehousing, packaging etc. are given secondary considerations in terms of margins. /o in order to generate a revenue for the business and ensure success in logistic outsourcing business the four major risk identified, like time, !uality, !uantitative, default 2loss in cargo6, and cost are re!uired to be counteracted by using key success factors elaborated in literature review section of the research. B0=<034/+,*2' (. A8.<0+ R.4+7 2EE3 MR.1;6074 R05A I7 L3405-065M I75-0-;-. O:

T/+75,3/-+-037 M+7+4.8.7-

D.,+/-8.7- O: C090< A71 E790/378.7-+<

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'PERSPECTIVE OF MANUFACTURERSM TOTAL LOGISTIC MANAGEMENT. P3C7+O. U709./50-2 O: E63738065 F+6;<-2 O: I7-./7+-037+< B;507.55 A71 E63738065 P3<+71. 4. G3-C+8+70 K. L374070105 P. V3;C+5 F. 2E1E. T*. L3405-065 S./906.5 O;-53;/6074 D0<.88+) I;+<0-2 M+7+4.8.7- +71 F07+760+< P./:3/8+76. P./5,.6-09.5. S;,,<2 C*+07 M+7+4.8.7-) A7 I7-./7+-037+< J3;/7+< V3<. 1# N3. $ P,. 43%P4#3 #. H+<<1Q/5537 A. SARS--'L+/5.7 T. 2EE4. ND.9.<3,074 L3405-065 C38,.-.760.5 T*/3;4* T*0/1 P+/-2 L3405-065 R.<+-0375*0,5M. I7-./7+-037+< J3;/7+< O: O,./+-0375 T P/31;6-037 M+7+4.8.7- V3<. 24 N3. 2 P,. 1&2P2E$. $. JOHN E. MELLO THEODORE P. STANK TERRY L. ESPER 2EE% MA M31.< O: L3405-065 O;-53;/6074 S-/+-.42M.

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