What are major factors influencing the elogistics adoption

1
What are major factors influencing the
e-logistics adoption?

• E-logistics is the mechanism by which supply
  chains make use of internet capabilities to
  automate logistics processes to effectively plan
  and control the efficient flow and storage of
  component parts, inventory, finished goods, and
  essential information from the point of origin to
  the customer while strictly conforming to
  customer requirements.

2
Background of e-logistics

• ? E-logistics allows for the efficient and
  timely flow of essential information and
  knowledge between the supply chain partners.
• ? One important function of e-logistics includes
  supplying real time access and true supply and
  demand information for making business decisions.
  
• ? Another important function of e-logistics is
  to supply real time visibility of the supply
  chain for all trade partners along the e-supply
  chain.
• ? The ultimate goal of e-logistics is improved
  customer service at lower costs.

3
Factors influencing e-logistics adoption

• Management Support
• Firms E-readiness
• Technology Requirements
• Financial Costs
• IT skills and Training
• Cultural Change

• Customer Satisfaction
• Firm Size
• Business Process Change
• Internet
• Globalization
• 3PLs

4
Management Support

• The first and most important step in the adoption
  of an e-logistics system is to obtain the full
  support of management at the operational and
  executive levels. Management will need to develop
  a clear vision of the e-logistics system and work
  to bring about change in current processes.
  Management that is committed and understands the
  importance, strategic value, and benefits of
  investing in an e-logistics system is an
  important tool in keeping the development of the
  new process on target when failures occur. It
  will be easy for developers to get off track when
  problems occur if the firm does not have in place
  a committed management team to put the developers
  back on track.

5
Firms E-readiness

• The firms e-readiness is an important factor
  concerning the ability to adopt an e-logistics
  process and also an important determinant of the
  firms overall e-business capabilities.
• ICTs (Information and communication technologies)
  are critical success factors and have the ability
  to increase productivity and collaboration with
  business partners along the supply chain. In
  order to take advantage of the advances in ICTs
  and opportunities presented through e-business
  firms must have in place advanced internet based
  business solutions including network equipment,
  skilled employees, and security maintenance
  programs.
• The ability to transfer existing logistical
  functions into e-logistics will allow the firm
  the capability to much more efficiently access
  raw data available from globally dispersed trade
  partners and process the data into useful
  information.

6
Technology Requirements

• The logistics sector manages a vast amount of
  information daily. Through the use of IT firms
  are able to gather and process information more
  efficiently.

• Barcode readers
• Scanners
• Hand Held Computers
• Networks
• PDAs
• Bluetooth technology

7
Financial Costs

• A major factor influencing e-logistics adoption
  is the high expenses involved in purchasing the
  essentials needed. To get started it takes a
  significant amount of capital to purchase
  warehouses, merchandise, delivery trucks,
  computers, and software.
• Technology such as barcodes, barcode readers,
  scanners, hand held computers, bluetooth
  technology, and advanced networks are very
  expensive.

8
IT Skills and Training

• A major barrier to e-logistics adoption is the
  level of education and training of the firms
  workforce.
• Technology such as databases store bits of
  information but they are not capable of
  processing and manipulating the data into useful
  and beneficial information to the firm like the
  human mind.
• Moving to digital delivery of information
  requires new technical skills and training to
  include IT skills and organizational change
  management skills to aid in the firms
  transformation of current logistical processes
  into technologically advanced e-logistical
  processes.

9
Cultural Change

• The current culture of the firm is a definite
  factor that can influence the adoption of
  e-logistics.
• In order for the firm to be successful in
  changing of current processes the firms
  employees must be fully committed. By improving
  on the employees competencies the firm will be
  able to motivate them to work harder and enhance
  their commitment to change. Employee support is
  very important due to the fact that the updating
  of current processes will affect the status quo
  of current operations.

10
Customer Satisfaction

• In todays technologically advanced and fast
  paced marketplace customers are demanding real
  time information concerning the status and the
  location of their goods with the hopes of
  preparing for any interruption in the supply
  chain.
• Through the use of the internet customers are
  able to access their suppliers e-logistics
  system to track their order status to better
  manage production schedules. E-logistics greatly
  enhances customer satisfaction by improving the
  firms ability to manage customer requirements
  for shipping of goods and improved cost savings
  over a typical logistics system.

11
Firm Size

• Factors that influence e-logistics adoption for
  smaller firms include management resources,
  financial resources, and time.
• Smaller firms tend to enjoy a more flat
  organizational structure which includes fewer
  levels of management which lead to managers
  performing multiple tasks for the firm. The
  managers of smaller firms are more tied to the
  day to day running of the firm which leaves
  little time for upgrading their own skills or
  planning new processes.
• Smaller firms are more likely to suffer from cash
  flow problems and have less resources to devote
  to expansion of technologies and current
  processes.

12
Business Process Change

• The ability or the willingness of management to
  change or update current business processes is a
  factor that influences e-logistics adoption.
• In order for the firm to be successful they must
  put aside the old way of doing things and update
  current business models.
• The firm must move forward from the old way of
  doing things due to the fact that the recipe for
  success in the current global marketplace has
  drastically changed.

13
Internet

• The growth of the internet has expanded the field
  of E-commerce and has had a major influence on
  the adoption of e-logistics.
• Through the use of the internet firms are able to
  easily access supply chain partners around the
  world.
• By utilizing the e-supply chain concept firms are
  able to share information with trade partners
  much more effectively through the internet.
• In an attempt to improve customer service
  e-logistics services are being moved from the
  firms private network to the internet.
• The convenience of tracking orders over the
  internet allows customers the flexibility of
  anticipating and preparing for supply issues that
  may arise.

14
Globalization

• Globalization has had a major role in the
  influencing of e-logistics adoption.
• While the global marketplace may be the solution
  to the search for cheaper materials and component
  parts the cost savings are only apparent if there
  are efficient, timely, and dependable logistical
  functions available to get the goods to the
  intended customer.
• An efficient e-logistical network provides for
  the effective and uninhibited flow of materials
  and information between all essential trade
  partners along the supply chain.

15
Third Party Logistics Providers (3PLs)

• With todays increased competition and shrinking
  profit margins management is looking for ways to
  cut costs and improve the effective utilization
  of the firms assets.
• In an attempt to cut costs many firms that have
  adopted e-logistics functions are outsourcing
  these activities to 3PLs.
• Today 3PLs are seen as strategic business
  partners along the supply chain who can offer
  improved e-supply chain performance and thereby
  lend the supply chain partners a competitive
  advantage.
• By outsourcing to 3PLs firms can avoid tying up
  precious resources and capital in IT equipment,
  warehouses, and trucks.
• With increased globalization 3PLs can provide
  e-logistics firms services like customs clearance
  and border crossing.

16
Conclusion

• This paper has identified several major factors
  that are both internal and external to the firm
  that have had an influence on e-logistics
  adoption. This paper has also illustrated the
  growing importance of e-logistics as a core
  competency in order to efficiently bring together
  trade partners along the supply chain in order to
  improve collaboration and lend the firms a
  sustainable competitive advantage. Many firms are
  quickly realizing the importance of e-logistics
  as a critical tool in aiding the firm to grow and
  be successful in todays e-commerce marketplace.
  As supply chain partners become more
  geographically dispersed throughout the world
  e-logistics will continue to play an important
  role in bringing together the production
  activities of the supply chain partners to ensure
  that products are being delivered to the intended
  customer while at the same time adhering to
  strict production schedules. E-logistics is
  instrumental in improving collaboration among the
  trade partners along the supply chain which will
  likely lead to further development and adoption
  of e-logistics and global trade. E-logistics is
  clearly a most important tool in todays global
  marketplace and will likely benefit firms by
  increasing international trade and e-commerce.