Development and Practical Application of Hybrid Decision-Making Model for Selection of Third-Party Logistics Service Providers
The 23rd International Multi-Conference “Reliability and Statistics in Transportation and Communication” (RelStat’23): Abstracts 2023
Aleksandrs Kotļars

Nowadays approach of outsourcing logistics operations to third parties is becoming widely used because businesses find it more efficient to concentrate on and allocate own resources, including personnel, equipment, and finances, to core business activities, should it be production, sales and marketing, or value creation. At the same time, companies nowadays compete not only by their products, but also by their supply chains. That is why, effective governor, such as thirdparty logistics service provider, is needed for business to build and sustain competitiveness. Taking this into consideration, need for effective collaboration and partnership strategy is becoming vital for many businesses and third-party logistics service providers. By looking at contemporary supply chain management from different angle, it is being observed, that trend of integration of information and communication technologies has been constantly increasing, and importance of proper data management and analysis for building sustainable supply chain solutions is undisputable. That is why, there is a certain need to implement modern decisionmaking techniques and models also for building partnership between customers and logistics service providers. These techniques must be based on data management and should substitute several traditional decision-making methods. The problematic discussed in this study is following. Traditional decision-making techniques, that are generally widely discussed in professional and academic environments, are functionally limited and must be adjusted to solving specific task – selection and evaluation of logistics service providers. These techniques must be based on contemporary tools and information. Also, there is a need for wider methodology of building partnership with logistics service provider, that is not only limited by selection process, but also must contain a framework for decision-making. The aim of this study is to develop a modern, industry-oriented decision-making model for selection of strategic logistics service providers. Main tasks of this study include: to perform critical analysis and comparison of multiplecriteria decision-making methods; to adapt decision-making framework for specific needs of selection of third-party logistics service providers; to collect and analyse industry data related to procurement projects; to develop modern decision-making model for selection of logistics service providers; to perform practical application of developed decision-making model based on collected industry data. The key novelties of this study are developed methodology for collection of industry data for decision-making process; developed hybrid decision-making model for selection of thirdparty logistics service provider, as well as application of the model. As the result, developed decision-making model for selection of 3PL service providers includes 6 main steps, which are: collection of data from statistical reports of key performance indicators; establishing linkage between decision-making elements; estimating weights (importance) of evaluation criteria; benchmarking of logistics service providers; definition of ideal solution; prioritization of logistics service providers. Practical application of decisionmaking model proved to be reliable, based on scenario of European fourth-party logistics procurement project.


Keywords
logistics service providers, 3PL, multi-attribute decision-making, decision-making model
Hyperlink
https://tsi.lv/wp-content/uploads/2023/10/relstat-2023_abstracts.pdf

Kotļars, A. Development and Practical Application of Hybrid Decision-Making Model for Selection of Third-Party Logistics Service Providers. In: The 23rd International Multi-Conference “Reliability and Statistics in Transportation and Communication” (RelStat’23): Abstracts, Latvia, Riga, 19-21 October, 2023. Riga: Transport and Telecommunication Institute, 2023, pp.45-46. ISBN 978-9934-622-05-2.

Publication language
English (en)
The Scientific Library of the Riga Technical University.
E-mail: uzzinas@rtu.lv; Phone: +371 28399196