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This article has been withdrawn as it was published elsewhere and accidentally duplicated. The original article can be seen here: 10.1108/EUM0000000000346. When citing the article, please cite: Ilene K. Kleinsorge, Philip B. Schary, Ray Tanner, (1989), “Evaluating Logistics Decisions”, International Journal of Physical Distribution & Materials Management, Vol. 19 Iss: 12, pp. 3 - 14.

A new approach to the problems of product line strategy and inventory investment decisions

Information technology is changing the nature of logistics organization. It is reducing the cost of transactions and redefining organizations and their interconnections. This paper examines the impact through the concept of transaction costs. This leads to discussion of current trends toward electronic integration and outsourcing of logistics services. The use of advanced information technology is redefining the role of the logistics manager.

This monograph progresses from a consideration of definitional issues to the development of a conceptual model for marketing‐logistics interaction and finally to a discussion of the issues of implementation of the model within the context of marketing strategy. Thus, following an introduction, Part II begins with definition of the field and examines the position of physical distribution in relation to marketing. Part III discusses the relationship of physical distribution and macro‐marketing, and is thus concerned about the social, aggregative goals of logistics systems, including the costs of distribution. Part IV continues this argument, examining specifically the influence of physical distribution on channel structure. Part V then focuses on the assumptions underlying the customer service function, asking how physical distribution can influence final demand in the market place. Part VI presents a conceptual model of marketing‐logistics demand stimulation. The operational issues concerned with its implementation are shown in Part VII; and a summary of the relevant points is presented in Part VIII. The concern has been not with presenting either new computational models nor empirical data but with presenting a new perspective on the marketing‐logistics interface. There is a need to reduce the barriers between these fields and to present more useful ways for co‐operation.

The lack of adequate information for logistics decisions and evaluating is a major problem for management. This article describes how linear programming is used to provide methodology to evaluate decisions and system performance without the availability of cost and other data. A simple application to logistics systems is discussed and its application to an actual problem is described.

Points to a new emphasis on distribution as a result of material shortages or failures of supply. Proposes that this new awareness requires understanding of the nature of distribution efforts through the logistic response function. Focuses on the managerial problems of utilizing distribution strategy, and asks how firms will capitalize on the challenge it presents.

Control over customer service can only be partial at best. If service is an adaptation of one system, the supplier's, to fit another, then the customer's part of the combined system is only subject to indirect influence. There is a further problem, however; the focus of a majority of the discussion of customer service has taken the limited perspective of the immediate interface between systems, usually defined in terms of a limited set of parameters such as product availability, delivery time and its variability. A broad view of customer service however, makes the service process much more difficult to control. In this article, we wish to consider four specific topics. The discussion begins with the problem of control within a strategic context. It then proceeds to the approaches to control which are presently being used, including findings from study of the practices of six manufacturing firms. This discussion will then focus on development of control over customer service as strategy. Finally we will focus on the organisational issues involved.

Satisfying target markets is a major strategic purpose of all organisations. Logistics management, however, often encounters difficulty in serving individual customer groups. The target market or market segment is the building block of corporate strategy, the focus of both marketing and logistics efforts. Marketing focuses narrowly on specific sets of customers who respond in a similar way to the marketing mix. Logistics strategy, on the other hand, stresses the integration of material and product flow through the organisation as a single unit. The common bond lies in meeting the needs of these groups.

Any chain (or network) connected through electronic links can be considered virtual. However, a virtual supply chain often encompasses much more than electronic links. It represents an organization structure that facilitates efficient and effective flows of both physical goods and information in a seamless fashion. What distinguishes the virtual chain from the traditional supply chain is its inherent flexibility to quickly adopt and adapt to changes in the business environment. As a result, new members can be continually added and old members deleted or have roles reassigned to them within the chain. Consequently, the ability to reconfigure organizational structures (sometimes on a real‐time basis) provides the chain the capability to customize solutions for different segments of customers or keep up with changes in customer requirements. This adaptability of the chain is likely to lead to competition between chains rather than between organizations. In this paper, we describe what “virtual” means in the context of a supply chain. We sketch out the evolution of the supply chain over the last few decades and elaborate on why organizations are being forced to confront the reality of “virtual organizations”. Then we present both technical and managerial issues associated with virtual chains and conclude with a projection of how the chain could look in the future.

Spotlights the principal emphasis of this study as descriptions of the present state and indicators of change in US channel structure. Follows this by speculating briefly about future trends in this structure and its relevance for UK business. Looks ahead to future developments and makes comparisons with the UK in regard to recent developments in US distribution patterns – particularly changing power relationships between institutions. States that though only UK sources have been available for use here, the trends in the US economy should be able to be described with sufficient detail. Concludes that there are lessons for the UK market in dealing with the USA and these should be used.