Managing uncertainty in logistics service supply chain

TLDR

In South China, small and medium‑sized 3PL providers lack systematic information handling, creating uncertainties in business processes due to insufficient decision‑making data. The study proposes ILIMS to efficiently manage information flow among logistics supply‑chain parties, integrating processes and increasing transparency to reduce uncertainty. ILIMS is proposed to manage information flow and provides a wireless Internet channel for 3PLs to communicate with suppliers and customers, as illustrated in a local case study. Using ILIMS reduces supply‑chain uncertainty and significantly improves overall order‑fulfilment performance.

Abstract

Many third party logistics (3PL) providers in South China are small and medium-sized companies and lack of systematic mean on handling information. Uncertainties are created in the business processes due to insufficient information for decision-making. In this study, a logistics information system called Integrated Logistics Information Management System (ILIMS) is proposed. It aims to manage the information flow efficiently between the involved parties in the logistics supply chain through integrating business processes and increasing information transparency to reduce uncertainty. In addition, it provides an effective channel for the 3PL providers to communicate with different contracted suppliers as well as customers through wireless Internet applications. A case study of applying ILIMS in a local 3PL company is discussed. By using this generic system, supply chain uncertainty that associates with the logistics processes can be reduced and leads to a significant performance improvement in the overall order fulfilment process.