Leveraging the supply chain flexibility of third party logistics - Hybrid knowledge-based system approach

Nowadays, intensified globalization and consequent competitive pressures have reemphasized the importance of third party logistics (3PL) in managing logistics processes as well as customer and supplier relationships within the supply chain management (SCM). However, 3PL providers and their upstream and downstream parties within the whole chain have usually interacted as disconnected entities in the logistics performance management process. Despite the increased interest in using and improving logistics information systems, the number of researchers investigating the design and implementation of this process in close detail is still very small. This paper proposes an intelligent performance measurement system (K-LPMS) for measuring the performance of 3PL providers and their upstream and downstream supply chain partners. With the help of K-LPMS, 3PL providers are capable to fulfil different customer’s supply chain service requirement through accessing the capability of each SC partners and reconfigure SC network. This paper describes the structure of K-LPMS and its features. The results of testing and applying the tool in companies are presented. This paper concludes by discussing the implications of this research for managers, and identifying directions for future research. 2007 Elsevier Ltd. All rights reserved.