BENCHMARKING LOGISTICS PERFORMANCE

Case Assignment
Read the following articles:
Chan, Felix T. S., Chan, H. K., Lau, Henry C. W., & Ip, Ralph W. L. (2006), An AHP approach in benchmarking logistics performance of the postal industry, Benchmarking, Bradford 2006, Vol. 13, Iss. 6, pg 636.
Anonymous, (2008 Dec) Time to take stock of the supply chain, Logistics Manager, London: p. 34.
Many practices can continue almost as a habit without anyone actually sitting down and thrashing out the rationale for each process or operation. DHL understands that its success and that of its clients are intrinsically linked to efficiency and effectiveness of operational processes. Sharing the value delivered through these improvements between the partners is a key enabler in driving out cost. “Within the retail and consumer group at DHL Exel Supply Chain, we’ve already held almost 100 Process Improvement/DMAIC workshops this year, which have contributed to continuous improvements and identified effectiveness equating to pound 4m.”
Another tactic for cutting supply chain costs is to look at the whole value chain—physical flows, information, financial flows, systems, business structure/silos, culture, etc. “We offer our customers these as ‘Value Chain Assessments’ (VCA), where a customer may have a broad question—where is the risk in my supply chain? Where are my major costs and how can I impact them? Answering these questions is often easier said than done as many in-company logistics or supply chain managers lack visibility beyond their own supply chain operations. We can fill in the gaps in the picture—especially with today’s highly complex and extended retail supply chains. With a wide range of clients, 3PLs can provide benchmarking and information on best practice drawn from a range of industries, as well as practical deliverable solutions. Our VCA methodology challenges our customers to embrace change—but it also challenges our own teams to do likewise. Success is not in the delivery of VCA report—it’s in being a catalyst to deliver benefits to our customers.”
In an essay of 3–4 pages, answer the following questions:
1.    Explain why a two-stage benchmarking methodology that utilizes performance evaluation metrics followed by continuous improvement metrics could be a useful tool for achieving a competitive advantage.
2.    Discuss why the inclusion of the second phase, related to continuous improvement, represents a step forward from traditional benchmarking approaches.
3.    Evaluate the general adequacy of the major performance criteria used in the AHP article for assessing logistics applied to other types of organizations. Feel free to suggest additions or modifications in the performance criteria if you believe there are inadequacies in the current criteria.
4.    Describe the role a 3PL could play in implementing an effective benchmarking approach.
Assignment Expectations
Display an in-depth understanding of the role of benchmarking, the metrics that can be used in benchmarking to assess best practices, and how the benchmarking process is integrated into the strategic management effort. Display a critical assessment of the benefits and limitations of the two phases of a double Analytic Hierarchical Process approach to benchmarking. Use critical thinking, clarity of logic, and synthesis of the current course materials with previous courses in assessing the relationship of the AHP approach to a continuous process improvement initiative.
Submit your assignment for grading by the end of the module.

BENCHMARKING LOGISTICS PERFORMANCE
Required Reading
The following two articles are used in the Case study and provide a good overview of benchmarking metrics and their implications:
Anonymous, (2008 Dec) Time to take stock of the supply chain, Logistics Manager, London: p 34.
Chan, Felix T. S., Chan, H. K., Lau, Henry C. W., & Ip, Ralph W. L. (2006), An AHP approach in benchmarking logistics performance of the postal industry, Benchmarking, Bradford 2006, Vol. 13, Iss. 6, pg 636.
The following provides a good historical perspective of benchmarking:
Gilmour, Peter, (1999) Benchmarking supply chain operations; International Journal of Physical Distribution & Logistics Management; Bradford: 29:4, pp 259-266 (1999).
The following article provides insights into the role benchmarking can play in comparisons at the international level:
Smyrlis, Lou, (2006 Nov/Dec) Supply Chain Benchmarking, Canadian Transportation Logistics, Don Mills: Vol.109, Iss. 11; pg. 60, 3 pgs.
Optional Reading
The following article describes a recent effort by the Supply Chain Council to provide its members with comparative benchmarking information. I have included this as an option for those who might wish in the future to gain access to this data:
Dibenedetto, Bill, (2007, Apr 23), Keeping SCOR, Journal of Commerce, New York, pg. 1.

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