A Data-Driven Decision-Making Model for the Third-Party Logistics (3PL) Industry

Abstract

The evolution of the supply chain has resulted in a growth in the usage of technology and data generated and distributed within the industry. Third-party logistics (3PL) companies operating within the supply chain industry are not maximising the capabilities of data to make well- informed decisions. The purpose of this paper is to address this gap and to develop a prescriptive, theoretical model for data-driven decision-making (DDDM). To address the gap, a literature review of DDDM in 3PL industry and in other contexts was conducted. The proposed model is built based on the consideration of existing DDDM models and frameworks; data and data analytics principles to collect, store, manage and analyse data; and the Cynefin framework. Existing models and frameworks for DDDM do not provide explicit guidelines on how to apply DDDM in a 3PL and supply chain context. The proposed DDDM model constitutes of three phases, namely: (1) the setup phase, that considers data knowledge and decision-making knowledge; (2) execution phase; and (3) the learning phase. The application of the model in 3PL companies can support the decision- making process in these companies, with a consideration of the challenges and opportunities that exist in the supply chain. The decision-makers in 3PLs can thus make better-informed decisions that positively impact their enterprises and the supply chain.

Enhancing supply chain information sharing with third party logistics service providers

“…The findings indicate that the application of IT in South African SMEs enhanced information sharing by improving interaction between suppliers and customers. Moyo (2021) concurred that 3PLs should actively make significant technology investments to allow them to capture, gather and analyse information. Coyle et al (2017) proposed that organisations invest in supply chain information systems (SCISs) that will allow channel members to share information and harness their technological ability to plan, execute and control supply chain activities in real-time.…”

“…The findings indicate that the application of IT in South African SMEs enhanced information sharing by improving interaction between suppliers and customers. Moyo (2021) concurred that 3PLs should actively make significant technology investments to allow them to capture, gather and analyse information.…”

“…Niemann et al (2017) regarded 3PLs as external independent firms that provide integrated logistics services such as warehousing, transportation, distribution and financial services (Karrapan et al, 2017). Moyo (2021) added that 3PLs handle important logistics services such as packaging, warehousing, fulfilment and distribution of the product or service to the final customer. The activities provided by 3PLs are considered vital undertakings for achieving success in the supply chain and, as such, 3PLs have been regarded as an important success factor for supply chains globally and across sectors (Nel et al, 2018).…”

“…Giri and Sarker (2017) indicated that 3PLs play a vital role in SCM. Sharing information with 3PLs allows supply chains to analyse data in order to make informed decisions that will ultimately lead to an improved competitive advantage for the entire supply chain network (Moyo, 2021).…”

“…, 2017). Moyo (2021) added that 3PLs handle important logistics services such as packaging, warehousing, fulfilment and distribution of the product or service to the final customer. The activities provided by 3PLs are considered vital undertakings for achieving success in the supply chain and, as such, 3PLs have been regarded as an important success factor for supply chains globally and across sectors (Nel et al.…”