A grey DEMATEL approach to develop third-party logistics provider selection criteria

Kannan Govindan*, Roohollah Khodaverdi, Amin Vafadarnikjoo

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Resumé

Purpose - Third-party logistics (3PL) plays a main role in supply chain management and, as a result, has experienced remarkable growth. The demand for 3PL providers has become a main approach for companies to offer better customer service, reduce costs, and gain competitive advantage. This paper identifies important criteria for 3PL provider selection and evaluation, and the purpose of this paper is to select 3PL providers from the viewpoint of firms which were already outsourcing their logistics services. Design/methodology/approach - This study utilized the grey decision-making trial and evaluation laboratory (DEMATEL) method to develop 3PL provider selection criteria. Because human judgments are vague and complicated to depict by accurate numerical values, the grey system theory is used to handle this problem. Findings - The findings revealed the structure and interrelationships between criteria and identified the main criteria for 3PL provider selection. The most important criteria for 3PL provider selection are on time delivery performance, technological capability, financial stability, human resource policies, service quality, and customer service, respectively. Practical implications - The paper's results help managers of automotive industries, particularly in developing countries, to outsource logistics activities to 3PL providers effectively and to create a significant competitive advantage. Originality/value - The main contributions of this paper are twofold. First, this paper proposes an integrated grey DEMATEL method to consider interdependent relationships among the 3PL provider selection criteria. Second, this study is one of the first studies to consider 3PL provider selection in a developing country like Iran.

OriginalsprogEngelsk
TidsskriftIndustrial Management & Data Systems
Vol/bind116
Udgave nummer4
Sider (fra-til)690-722
ISSN0263-5577
DOI
StatusUdgivet - 2016

Fingeraftryk

Logistics
Decision making
Developing countries
Supply chain management
Outsourcing
System theory
Automotive industry
Managers
Personnel
Third party logistics providers
Decision making trial and evaluation laboratory (DEMATEL)
Selection criteria
Costs
Industry

Citer dette

Govindan, Kannan ; Khodaverdi, Roohollah ; Vafadarnikjoo, Amin. / A grey DEMATEL approach to develop third-party logistics provider selection criteria. I: Industrial Management & Data Systems. 2016 ; Bind 116, Nr. 4. s. 690-722.
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A grey DEMATEL approach to develop third-party logistics provider selection criteria. / Govindan, Kannan; Khodaverdi, Roohollah; Vafadarnikjoo, Amin.

I: Industrial Management & Data Systems, Bind 116, Nr. 4, 2016, s. 690-722.

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningpeer review

TY - JOUR

T1 - A grey DEMATEL approach to develop third-party logistics provider selection criteria

AU - Govindan, Kannan

AU - Khodaverdi, Roohollah

AU - Vafadarnikjoo, Amin

PY - 2016

Y1 - 2016

N2 - Purpose - Third-party logistics (3PL) plays a main role in supply chain management and, as a result, has experienced remarkable growth. The demand for 3PL providers has become a main approach for companies to offer better customer service, reduce costs, and gain competitive advantage. This paper identifies important criteria for 3PL provider selection and evaluation, and the purpose of this paper is to select 3PL providers from the viewpoint of firms which were already outsourcing their logistics services. Design/methodology/approach - This study utilized the grey decision-making trial and evaluation laboratory (DEMATEL) method to develop 3PL provider selection criteria. Because human judgments are vague and complicated to depict by accurate numerical values, the grey system theory is used to handle this problem. Findings - The findings revealed the structure and interrelationships between criteria and identified the main criteria for 3PL provider selection. The most important criteria for 3PL provider selection are on time delivery performance, technological capability, financial stability, human resource policies, service quality, and customer service, respectively. Practical implications - The paper's results help managers of automotive industries, particularly in developing countries, to outsource logistics activities to 3PL providers effectively and to create a significant competitive advantage. Originality/value - The main contributions of this paper are twofold. First, this paper proposes an integrated grey DEMATEL method to consider interdependent relationships among the 3PL provider selection criteria. Second, this study is one of the first studies to consider 3PL provider selection in a developing country like Iran.

AB - Purpose - Third-party logistics (3PL) plays a main role in supply chain management and, as a result, has experienced remarkable growth. The demand for 3PL providers has become a main approach for companies to offer better customer service, reduce costs, and gain competitive advantage. This paper identifies important criteria for 3PL provider selection and evaluation, and the purpose of this paper is to select 3PL providers from the viewpoint of firms which were already outsourcing their logistics services. Design/methodology/approach - This study utilized the grey decision-making trial and evaluation laboratory (DEMATEL) method to develop 3PL provider selection criteria. Because human judgments are vague and complicated to depict by accurate numerical values, the grey system theory is used to handle this problem. Findings - The findings revealed the structure and interrelationships between criteria and identified the main criteria for 3PL provider selection. The most important criteria for 3PL provider selection are on time delivery performance, technological capability, financial stability, human resource policies, service quality, and customer service, respectively. Practical implications - The paper's results help managers of automotive industries, particularly in developing countries, to outsource logistics activities to 3PL providers effectively and to create a significant competitive advantage. Originality/value - The main contributions of this paper are twofold. First, this paper proposes an integrated grey DEMATEL method to consider interdependent relationships among the 3PL provider selection criteria. Second, this study is one of the first studies to consider 3PL provider selection in a developing country like Iran.

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KW - Grey systems theory

KW - Supply chain management

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