Research Article: 2023 Vol: 22 Issue: 6
Fidrich Kamati, University Technology Malaysia
Citation Information: Kamati, F. (2023). The impact of the inbound logistics practices on the company performance: a focus on steel force company, windhoek, namibia. Academy of Strategic Management Journal, 22(6), 1-27.
The current study explores the effects of inbound logistics to the supply chain performance for the Steel Force Company based in Namibia. The enquiry examined the nexus between supply chain performance (SC) and inbound logistics practices utilising structured questionnaires as the major primary data collection tool. In conducting the enquiry the research population was constituted employees of the Steel Force Company which is based in Namibia. The study sample drawn from within the research population was constituted of 33 employees, and was reached through the use of the Slovene’s Formula. In the analysis, the research observed that inbound logistics practices which include among others, transportation, warehousing, Information Communication and Technology (ICT), procurement and inventory control, have the proclivity to hugely affect a company’s SC performance. One of the major conclusions of the research is that inbound practices are considered as invaluable in the operationalisation of the steel industry and possess the capacity to greatly influence the supply chain performance of companies. As such, these practices hugely affect supply chain performance especially so with regards to reliability, costs and client satisfaction. The enquiry recommends, from observing the analysed data that the research company must strive to make sure that enough resources are allocated to help improve operations. The organisation needs to also focus on talent and skills management by putting in place process for the retention and attraction of qualified manpower as well as making sure that management provides full support and has a visible involvement of all critical staff.
Inbound Logistics, Inbound Logistics Performance, Company Performance.
Contemporary organisations are tested with developing statures of worldwide rivalry; client's demands and needs for estimation of their cash as well as high partner's desires for venture returns. In light of this, notes that organisations presently seek after graceful supply chain management (SCM) as an upper hand strategy. Companies in a flexible supply chain (SC) execute, relate and accomplish on various planes; from item structure and improvement to item conveyance. Through supply chain management, an organisation seeks after the creation of worth especially from ideal item conveyance, cost management, client care and stock control (Beamon, 1999). The firms do so exclusively and sometimes through collaborations framed with different organisations to build client support and incomes. Through an understanding of supply chain capacities, organisations are able to manipulate operational proficiency as well as keep up an upper hand.
Furthermore, Beamon (1998) submits that ever-dynamic business elements have had an impact on the tasks and goals of SC frameworks through an expansion of focus around inbound exercises such as client care levels, expanded item quality and administrations, shorter process durations, low costs, facilitated development and adaptability of the item to address client issues. Firms seek after operational greatness through joint efforts and information offering to individual SC individuals.
Inbound co-ordinations shape a vital piece of an SCM. As opined by Mentzer (2001), it has emerged that in several associations, Supply Chain Management represents a critical competency, especially inbound coordination to help organisation activities. This is based on the grounds that its effect on administrations and items conveyance to end customer. As indicated by Brar & Saini (2001), in order to accomplish SC proficiency organisations should be enthused about inbound co-ordinations activities in the firm. Inbound co-ordinations are the starting purpose for all graceful exercises in an organisation, with the effect of ensuing Supply Chain exercises. An interruption affecting inbound co-ordinations stream have the proclivity to stop creation lines for need materials prompting lost business openings. Firms must, in this way, coordinate inbound co-ordinations in their SC efforts for the sourcing of materials and finished result conveyance.
Inbound Logistics Practices
In bound logistics is a method associated with the transfer of goods or finished inventory from the source to the buying organisation (Shyam, 2012). By supplying supplies, spares and goods required for daily operations, it supports business efficiency. Baker and Rushton (2008) state that the processing and transport of inbound shipments, inventory control, and warehousing are included in inbound logistics activities. The main concerns for Supply Chain cost reduction, inventory optimisation and client support are these practices.
Coyle (2011), states that inbound transportation is an enabling functions that that promotes and enhances the transfer or change of ownership for the goods. In the process of moving items from source to place of use, businesses appreciate the criticalness of location and time. Companies may select one or a combination multiple means of transportation that efficiently transfer materials for planned and efficient production (Branch, 2009). Well planned and timeous transporting of goods promotes Supply Chain performance by transporting goods to the final consumer/customer in a cost-effective manner, and safely. For planned lead times, inbound transportation should prepare to better handle delivery timelines. Baker (2010) notes that when handling inbound shipping, companies should have shipment visibility. There is a need to balance the nexus between costs of importation and the savings accrued at the final destination. As such entails a strong concentration on landing costs, customs clearance, keeping costs for inventory and lead times for shipments. Supply Chain performance in many instances is affected by shipping costs, along with the speed and quality of delivery of commodities. Companies must transfer materials in acceptable quality, the correct order, the correct quantity, and the apt time for great results (Bowersox, 2010).
The warehousing of goods provides two chief flows (Karaduman & Udeh, 2015) - inbound logistics where suppliers receive as well as store goods, and outbound logistics where items are collected and distributed to end clients/users. In order to use inventory in the warehouse to meet customer orders, SCM depends on inbound logistics. Inbound warehousing requires inspection, reception, and storage of goods. Accordingly, warehouses mainly promote the organized reception of inbound shipments into an enterprise in this respect. Through holding stocks for business activities, warehousing facilitates inventory management. Gibson (2013) states that through information system incorporation, vendors can handle inventory in the warehouse of their customers. Since the retailer is liable for restocking based on the availability of products in the warehouse, Vendor-managed inventory (VMI) ensures adequate supplies.
Inventory management is interested in determining the location and size of stock (goods and/or other resources for organisational use) (Wild, 2002). To ensure uninterrupted operations in a business, inventory is handled at different SC locations. Coyle (2009) states that material management exists not only in stores, but also during transit. In order to guarantee that commodities are always in supply in the correct quantities, quality as well as at the precise time, a company can participate in inventory management. This guarantees that they provide optimum service at managed costs (Reid & Sanders, 2007). Therefore, it is important that companies incorporate inbound logistics into their material procurement and end product distribution supply chain strategies.
In Namibia, there is sparse literature addressing inbound logistics as opposed to its counterpart countries. Lack of clear and authoritative studies on inbound logistics prompted the researcher to undertake analysis in the Namibian context, thereby bridging the gaps both in theoretical and practical understandings. To investigate the subject matter thoroughly, the researcher proposes to focus on Steel Force Company based in Windhoek, Namibia.
Supply Chain Performance
Housman (2004) believes that Supply Chain execution is a measure to Supply Chain tasks regarding the SC’s exercises in meeting extreme client’s needs, which include among them ideal conveyance of products as well as accessibility of vital stock in a responsive way. Uplifted rivalry among firms presented through globalisation, organisations can drive an incentive through powerful SCM. takes note of that organisations should take a gander at entire SC execution rather than improving specific capacities like coordination while dismissing downstream and upstream impacts. Kurien and Qureshi (2011), observe that the SCOR model methodology advances for various SC execution measures. SCOR investigates time, cost, adaptability and quality.
Huan (2004) takes note of the fact that these measurement action can be demonstrated by evaluating a company’s Supply Chain procedures, for example, item conveyance, lead time, SC responsiveness, creation adaptability, complete strategic administration cost, stock long stretches of flexibly and resource turns. Through assessing these measurements, SC execution measurement action can, consequently, be limited to cost, speed, unwavering quality and consumer loyalty points of view (Beamon, 1999). Eventually, these exhibition estimates will assist firms with surveying their serious position and work towards operational proficiency with the end goal of exploiting possible operational achievement (Stock & Lambert, 2000).
Supply Chain performance estimating assists businesses in a few different manners. Firstly, estimations straightforwardly control activities of tasks staff henceforth in a roundabout way impact execution; furthermore, established critical estimates assist to keep an organisation on target in accomplishing its Supply Chain upgrade goals; thirdly these estimates bolster actuality put together dynamically based with respect to yields of execution measures against goals; fourthly they impart SC necessities for checking, consistent enhancements and change the board in organisations; and ultimately they inspire enhanced supplier performativity (Monczka, 2011). Companies which have completed service management, including cost management, create effective Supply Chain in terms of versatility, client service as well as cost-effectiveness (Barrow, 2013).
Steel Manufacturing and Metal Fabrication in Namibia
Contemporarily, there are no local steel producing facilities in Namibia, which entirely depend on imports, most of which are imported from South Africa. The extent of metal items producing within the country additionally stays restricted, kept to not many organisations, a large portion of which are small, constraining the economies of scale that could be accomplished. Besides, the presentation of “fabricated metal products, machinery and equipment’ as a sub-part of the general assembling has been unobtrusive, constituting just a little portion of somewhere in the range of 3.2% and 4.2% and showing instability” (Ministry of Trade and Industry, 2016).
As indicated by Ministry of Trade and Industry, (2016) open doors have been recognised to build up a national steel fabricating industry in Namibia in a bid to service the issues of the local market, encourage the metal items producing segment, form linkages into different segments, for example, the construction industry, just as set up steel exports to neighbouring nations.
Be that as it may, in seeking after this advancement way, Namibia is probably going to confront solid rivalry from the built-up steel industry, specifically from South Africa, which is, for the most part, overwhelmed by hardly any enormous organisations, blocking the section of littler producers. The intensity posed by the youthful steel industry in Namibia can likewise be hindered by vitality as well as water costs, including an absence of the economies of scale in in nascent advancement phases. Also, the significance of making the fundamental aptitude base should never be undervalued at all.
Inbound Logistics Practices
Shyam (2012), postulate that the concept of inbound logistics references a process that concentrates on the movement of inputs and/or finished products dispatched from suppliers and delivered to a purchasing corporation. It promotes organisational efficiency through enhanced delivery of goods, products and spares required by companies in their daily operations. According to Baker and Rushton (2008) inbound logistics processes include collecting and transporting inbound consignments, the management of inventory as well as warehousing. As such activities like these are critical areas of focus for Supply Chain cost savings, customer service as well as inventory optimisation, and.
Coyle (2011), proposes that inbound transportation can be imagined as enabling for business and promotes the transference of the ownership of commodities/goods. As organisations transport materials and commodities from source to their places of utilization, the companies relish the utilities of time and place. Branch (2009) believes that organisations can select a single or a combination of several methods of moving materials effectively for pre-planned production processes. Proper movement of materials and goods promotes Supply Chain efficiency by ensuring that goods are delivered to the penultimate consumer securely and in a manner that is economic. Inbound transportation must be able to undertake proper planning to fulfill expected lead times and ensure timeous and acceptable management of timelines for the delivery of materials. According to Baker (2010) companies must ensure shipment visibility at the same time ensuring the management of inbound transportation. Companies must also be able to balance the concession savings accrued at the point of delivery and imports charges. What this translate to is a keen concentration on customs clearance, landed costs, inventory holding costs and shipments lead times. Supply Chain performativity is largely affected by costs of transportation, consistency and speed in the delivery of products. To attain optimum performance organisations should distribute and deliver goods in the proper order, correct quantity, the correct time as well as optimal quality (Bowersox, 2010).
Karaduman and Udeh (2015) suggest that warehousing performs two chief functions: inbound logistics through which goods coming from suppliers are receipted and ultimately stored as well as outbound logistics by which process materials are collected from the warehouse and send to the penultimate consumers. Supply Chain Management is highly reliant on inbound logistics in a bid to ensure the availability of inventory in the warehouse and in the process satisfy customer orders. The process of inbound warehousing involves among other this the inspection of goods, receiving goods as well as storage functions. As such, warehousing has the primary task of ensuring that reception of inbound shipments is coordinated within a company. Warehousing facilitates the management of an organisation’s inventory through holding stocks necessary for the operations of a business. With regards to this, Gibson (2013) believes that vendors can perform inventory management in the warehouses of an organisation’s clients utilising information system integration. Processes known as Vendor-managed inventory (VMI) ensure that there are always adequate supplies since the suppliers have the responsibility for the restocking basing on the availability of inventory in the organisation’s warehouse.
Wild (2002) considers inventory management as concerned with specifying the quantity as well as placement of stock (materials or goods for use in an organisation). The management of inventory is conducted at various locations of a Supply Chain, ensuring undisturbed functionings within an organisation. According to Coyle (2009) materials management does not only occur inside the stores but can also be conducted while materials and goods are in transit. An organisation will undertake the management of inventory with the goal of ensuring that commodities are available to the penultimate user at the right quantities, good quality as well as at the appropriate time. In doing this, organisations are able to ensure that delivers are made optimal services at regulated and acceptable costs (Reid and Sanders, 2007). It is, therefore, imperative that business integrates inbound logistics in their supply chain planning for the sourcing of materials as well as the deliveries of end products.
Supply Chain Performance
Housman (2004) imagines Supply Chain execution as being a measure to Supply Chain tasks regarding supply chain’s exercises to meet the extreme needs of the purchaser, which include the proper conveyance of commodities as well the availability of critical stock in responsive ways. Uplifted rivalry among organisations evinced through globalisation, organisations are able to drive an incentive through powerful Supply Chain Management. takes note of that organisations must take a gander at entire Supply Chain execution rather than improving specific capacities like coordination while dismissing upstream and downstream impacts. Kurien and Qureshi (2011) submit that the Supply Chain Operations Reference (SCOR) model methodology advances for the execution of various measures for supply chain. SCOR investigates quality, time, adaptability and cost.
According to Huan (2004) these measures are evinced by evaluating an organisation’s Supply Chain procedures, for example, item conveyance, lead time, SC responsiveness, creation adaptability, complete strategic administration cost, stock long stretches of flexibly and resource turns. Through an assessment of these measurements, Supply Chain execution measures can, consequently, should be able to be limited to cost, unwavering quality, speed and consumer loyalty points of view (Beamon, 1999). Eventually, these exhibition estimates will assist firms with surveying their serious position and work towards operational proficiency with the end goal of exploiting possible operational achievement (Stock and Lambert, 2000).
Supply Chain performance estimating helps organisations in a few different manners. Firstly, these estimations straightforwardly control activities of tasks staff henceforth in a roundabout way impact execution; furthermore, some critical estimates assist organisations to remain on target in accomplishing its Supply Chain upgrade objectives. A third way is that these estimates bolster actuality put together dynamically based with respect to yields of execution measures against goals; fourthly they impart SC necessities for checking, consistent enhancements and change the board in organisations; and ultimately they inspire enhanced supplier performativity (Monczka, 2011). Organisations that manage to accomplish service leadership, and cost leadership, are able to manage efficient Supply Chain processes with regards to client service and satisfaction, flexibility and are often than not cost effective (Barrow, 2013).
Theoretical Literature Review
According to Bell (2011) theories and theoretical groundings are propounded in order to explicate, predict, and comprehend data and, in several instances, to test and expand existing paradigms within the confines of establishable assumptions. Usually, theoretical foundations and underpinnings are imagined as the structure which a study is couched within. Theoretical frameworks thus explicate the principles that guide the research’s interpretation and analysis of data. It includes concepts and, together with their meanings and reference to relevant scholarly literature, the theory utilised within one’s specific study. Supply Chain Operations Comparison Theory, Queuing Theory, Constraints Theory and Agency Theory are some of the related theories that this study would look at. The section will describe current theories applicable to inbound logistics activities and SC management in a theoretical analysis. It seeks to establish connections between inbound logistics practices as well as inbound logistics as the basis for the current analysis.
Theory of Constraints
Propounded by Goldratt in 1984, the Theory of Constraints (TOC) is aimed at helping organisations to continuously accomplice their goals. The theory aims at increasing the throughput while also reducing inventory and the costs of operations. TOC seeks to establish and/ determine the most significant factor that impedes the attainment of the goal and subsequently methodically strengthen the constraint to a point where it ceases to limiting factor. With regards to throughput, it refers to the rate at which the firm generates money (Goldratt, 1984). This is linked to mechanisms that are put in place to generate more demand for goods and services. The firm should be at the same time reducing excessive inventory. TOC seeks to optimise benefits by making certain that the constraint is more effectively used. This theory makes it possible to concentrate efforts on establishable elements militating against performance as well as seek to manipulate the flow of maximum value-adding activities which found within the supply chain (Goldratt, 1984). Inbound logistics needs to be effectively handled as it can turn to be an impediment factor as firms can maintain operational efficiency in the supply chain. Through doing so, businesses will fix stock outs, decreased inventory holding costs long delivery lead times, and therefore optimum Supply Chain efficiency problems.
Resource-Based View
The Resource-Based Theory examines the differences in performances of organisations dependent on available resources (Miles, 2012). As such, this theoretical approach is based on two basic assumptions which include that corporations operating within a particular industry will possess similar resources. Such resources usually are not flawlessly mobile in different sections of the corporation. As such, differences in resources within organisations have the potential to subsist for very long periods of time (Miles, 2012). Theoretically, Resource-Based Theory believes that organisations are able to access diverse resources which are capable of giving them competitive advantages as well as that some of such resources are difficult to construct or imitate and cannot be traded in the variable markets. The theory stresses the resources of the organisation as its chief basis for its outstanding achievements and competitiveness. Companies may utilise their capital to enhance production by reducing operational costs as well as encouraging the will-to-pay of clients for commodities as well as other services the organisation provides (Miles, 2012). As organisations pass efficacy gains to their customers, it acquires a competitive edge against other corporates within the same line of business. By inbound logistics companies, physical, human, insights, data and collaborative resources can be acquired and combined in the creation of exclusive and company-specific capabilities in the manners in which they run goods to consumers/end users. Therefore, RBV allowed this study to have a sound theoretical basis.
Inbound Logistics Practices
Focusing on logistics and inbound logistics preparation, according to Harrington (2008), offers businesses an opportunity to substantially save and achieve Supply Chain efficiency. A least three relevant inbound logistics activities can be described despite there being no universal understanding/conceptualisation of inbound logistics. Transport, inventory management, and warehousing are these (Baker et al., 2008). The item can be located within previous researches (Droge et al., 2012; Liu & Luo, 2012; Lynch et al., 2000; Sar, 2017; Savitskie, 2003). The concept comprises of information communication and technology procurement, inventory management, service and process capabilities. “Logistics capabilities” are also the capability to implement logistics operations at the lowest possible cost to achieve the desired level of objectives.
Procurement
Procurement capability addresses the willingness to learn information and expertise regarding procurement functions that will lead the business to obtain a competitive advantage. Lai et al. (2006) established client satisfaction-based procurement practices. A significant relationship between procurement capacity and company efficiency was reported by Namusonge et al. (2017). In addition, improving relationships with an organisation’s suppliers is pertinent to the effective implementation of enhanced and modern systems and potential, particularly when new, goods and services become accessible online and increase the variety of commodities available within global markets.
Tips to Improve Inbound Logistics and Streamline Procurement
Knowing the variance that exist between procurement and inbound logistics may prove to be difficult to work out how inbound logistics can make significant improvements. Fortunately, as described by Rick LaGore via Global Trade Magazine, shippers who take measures will successfully improve the inbound logistics strategy as well as optimize procurement operations:
1. Understanding expenditures that are not regulated. Unique costs would often be beyond the reach of shippers, with certain expenditures also within the purview of the vendor. Recognising such irrepressible costs, however, is important in order to avoid superfluous increments in inbound transportation spending.
2. Analyse the cost of inbound freight. Using contemporary techniques and algorithms, all inbound freight costs can be evaluated to comprehend areas in which costs exist and ways to better prevent such in future.
3. Negotiating with vendors. Also the heavily micromanaged suppliers could also be able to discuss procedures for terms and inbound transportation/cargo management. Asking does not hurt.
4. Implement performance monitoring processes and technologies. Failure to control supplier and supplier output remains the key explanation for higher inbound freight expenditure, but it will help to incorporate processes and technologies that automate and track output measurement, which include the use of a TMS.
5. Prioritise ties with suppliers. Your company will often face suppliers who seem likely to leave you, but in these situations, you need to prioritise relationships with suppliers on the basis on the effect including its cost of inbound freight.
6. Investing in the best available talent. Efficiency and success of inbound freight management can also impact the knowledge and ability of the talent on your team. Ensure that the organization operates with educated, well-qualified staff.
7. Outsourcing in instance in which it is logical. Outsourcing logistics is an ideal manner to place the authority and challenges of handling procurement in a third-party’s possession and inbound logistics. In fact, this is a pertinent reason why more businesses are outsourcing third-party logistics experts (3PLs) to handle inbound logistics and ensure that freight data is used correctly and comprehensively.
8. Experimentation, utilising data and information, notes Shreyas Bhat of Inbound Logistics, to model contexts/situations and determine when and how procurement activities and also inbound logistics need to evolve for the company.
The procurement team of the company has a mountain of obligations and the management of the various inbound logistics operations compound its mounting pressure. Instead of attempting to let inbound logistics remain within the control of the procurement departments, take control as well as ensuring that those responsible for procurement have a safe, smart, technology based manners of making procurement decisions seamlessly and in the process reducing the costs linked to such decisions.
Transportation
A crucial task in the inbound logistics process is the capability to move commodities from the vendor to the end consumer. With regards to cost, speed and delivery quality, it provides both location and time utilities for a customer and enhances the efficiency of inbound logistics (Lambert, 2005). Creating a balance between these variables leads to Supply Chain output (Bowersox 2010). Transport activities include; Consolidations of Freight, monitoring (Track and trace), Customs clearance/compliance and forwarder management as explicated by the PF Collins International Trade Services (2003).
Shipments may be consolidated in order to produce greater amounts per shipment by adding more than one order. Inventory consolidation helps to achieve economies of scale at a lower cost of shipping per device. However, at the cost of scheduled transport, reliability as well as timeous transportation, consolidation should not happen (Ulku, 2009). Procedures at ports of entry into a country concerned with customs enforcement may increase transaction costs. The speed and predictability of inventory distribution is determined by Clearance Quality. Appropriate documents facilitate expedited customs clearance that reduces its impact on worldwide lead times for procurement (Zamora-Torres, 2013). It is important to note that electronic platforms allow the online reduction of clerical efforts to send information to government agencies (Hanouz, Geiger and Doherty, 2014).
Helo (2011) opines that through collecting and maintaining information on product positioning within the Supply Chain, businesses monitor and trace shipments, assisting in identifying and reducing transport exemptions to eradicate interruptions as well as delays. According to Dukare et al., (2015) real-time monitoring facilitates effective tracing of cargo as well as the visibility of delivery.
Transportation intermediaries boost operating efficiency in cargo transportation and raise service standards through spcialisation and abilities within the industry. Other associated services including warehousing, express package services, less-than-truckload transport, as well as multimodal transportation agreements are provided by most freight forwarders (Asian Development Bank, 2012).
Inventory Control
As Magad & Amos (1989) explicate, the purpose of inventory management is largely aimed at providing customer satisfaction. In the same vein, Eckert (2007) assessed inventory management as well as its relevance to customer growth and also determined the effectual relationship between client service and inventory management. On the other hand, Shin et al. (2015) assessed the managing of inventory within the field of inventory margin.
Jay and Barry (2006) submit that inventory management is largely geared towards ensuring that there is always enough inventory to service rising demand within a business that protects against disturbances in the flow of business resulting from stock depletions. Accordingly, Cheung and Lee (2002) opine that it eliminates excess inventory, maintains sufficient capacity and increases the availability of goods for customer service. As such, orders placed by customer are serviced responsively and flexibly (Kwon & Suh, 2004). This is through inventory management procedures such as lead time, expense, inventory amount and accuracy management (Axsater, 2006).
For companies that aim to balance supply and demand to prevent overstocking, inventory levels are a crucial factor. Automated manufacture of more supply orders monitors an organisation’s levels of inventory (Jacobs, 2010). It is also possible to monitor inventory by pegging interludes or levels of quantities to avoid the possibility of stocking out (Jacobs, 2013). Adeyemi (2010) believes that maintaining inventory is costly and that quantities should always be kept at acceptable levels in order for corporations to be competitive.
Inventory cost was described by Berman & Whang (2006) as chief component of the total cost of Supply Chain Management. The movement of inventory as well as costs of holding for Supply Chain productivity are regulated by firms. Inventory costs are incurred in many ways; in the form of rent or lease, they draw taxes, insurance premiums, as assets in balance sheets, obsolescence and storage costs. In order to disclose the inventory and money needed for daily operations, businesses must balance the money kept (Goldsby et al., 2005).
When monitoring inventory, reducing replenishment lead times is important. When there is market volatility and unreliable lead times, companies retain more security stock. This raises their stockholding costs and reduces customer service, so it is necessary for SC partners to minimize lead time collaboration and timely sharing of information (Chopra, 2004).
Firms achieve inventory accuracy by achieving a match between physical count and inventory records with regards to both quantity as well location as reflected within the inventory records within the system. Cycle counting ensures prompt detection, anomaly correction, and the maintenance of optimal stock levels. Constant and regular checks as well as item tracking also eliminate inventory errors (Jacobs, 2013).
Warehousing
The relation between suppliers and buyers' material inflows is the warehouse (Ramaa, 2016). This aspect of inbound logistics is very critical as this customer service is vibrantly improved closer to the customer. Ramaa (2016) thus went on to state that the deciding fact is warehousing activities for orders to be fulfilled promptly and for inventory management to be successful. Some of the important warehouse operations include, but are however not restricted to, choosing, moving, receiving and reviewing orders.
Organisations connect material flows from suppliers and buyers via warehousing, according to Ramaa (2012). In order to boost client support, they seek warehouse productivity. Warehousing operations decide order fulfillment and stock control now known as inventory management. Warehouse operations mainly include: collecting, examining, setting aside (transferring), as well as selecting orders.
Shortly after delivery to the warehouse, the receipt of goods begins. Unloading, proper quantity inspection and adequate revised inspection records and quality guided by the latest distribution are activities at this stage (Koster et al., 2006). For distribution to outbound transport vehicles, better known as cross-docking, incoming goods can be directly sorted. By removing the activities of putting products as stock in the warehouse, this method saves organizations money (Stephan and Boysen, 2011).
The process that occurs when products have been issued is regarded as “put away” and products are ready to be picked up or to be transferred (Frazelle, 2002) once they are transferred to their particular storage position within the warehouse. The picking of orders includes huddling and coordinating client orders, picking products from warehouses/storage facilities as well as the subsequent release of such for the fulfillment such given orders. It is powered by an object or stock-keeping unit's salience or characteristics (SKU) (Koster et al., 2006). In the same vein, it can be done in the form of complete cartons, pallets or subdivided into particular entities. The picking up may be conducted in variants of either single items or as an order. Numerous buyer orders are simultaneously selected when choosing a buyer's order at any point in time when choosing by article (Koster et al., 2006).
Information Communication Technology (ICT)
For management to boost efficiency, cost savings and return on assets, the flow of knowledge is essential. The value of information in logistics contributes to the development of improved relationships, providing enhanced coordination and responsiveness. Liu et al. (2013) analysed capabilities of IT and observed positive impacts on company results. Zhao et al. (2001) postulate that the ability of information technology had detrimental effects on company results. Shang & Marlow, (2005), however observe that IT capabilities have no relationship to the success of the company. With regards to Return on Asset (ROA), benefit and cycle time ratio, Liu et al. (2013) analysed information technology capacity. Lee et al. (2014) demonstrate that IT and its influence on the internet allow the convergence of supply and demand processes. Technology capacity helps to minimise costs, hold inventory level with lead time reductions at the minimum level (Shang & Marlow, 2005; Lee et al., 2014; & Zhao et al., 2001). Accordingly to Rashed et al. (2010) vaguely and broadly define the potential and techniques for knowledge sharing that had negative effects on company performance. The inbound logistics process will be strengthened by enhancing inbound logistics practices, leveraging inbound logistics technologies and gaining end-to-end visibility by the utilization of connected sensors and wireless devices.
Influence Of Logistics Information Technology On Lead Time
Herselman and Hay (2003) identify ICT as technologies that facilitate" human beings and their organisation's communication and cooperation, the development and sharing of information. In addition, Yu (2010) refers ICT as a set of technologies that allow information to be collected, shared, retrieved, processed, analysed and transmitted. ICT can be described in the order of words as any tool that promotes communication. On the other hand, Selwyn (2002) believes that Information and Communication Technology is "computer hardware and software umbrella term; digital broadcast and telecommunications technologies as well as repositories of electronic information such as the World Wide Web (www) or those found on CD-ROMs." ICT is further defined by Ssewanyana (2009) as a critical tool that enables clients (users) to be more productive plus successful.
Benefits of ICT for a business include input savings, cost reductions, greater flexibility as well as product quality enhancement (Majumdar et al., 2010; Mouelhi, 2009). Bloom et al .(2009) concluded that ICT have a critical role in building relationships or alliances (networking) and collaboration, as businesses use these systems to promote employee communication as well as reduce the cost of coordination. Arvanitis and Loukis (2009) have argued that businesses are specifically interested in the use of ICT techniques because they assist in areas such as inventory control in addition to quality, inbound logistics and SCM. Cohen et al (2002) observed ICT instruments play a supporting role in enhancing organisational effectiveness and productivity for human resource operations. Therefore, in order to achieve greater supply chain and logistics efficiencies (Jack et al, 2006), ICT instruments help to conduct activities more rapidly, facilitate independent decision-making processes as well as enable distributive practices (operations) (Huang and Nof, 1999).
Supplies are bought and goods are assembled at one or more factories in a typical supply chain, shipped to warehouses for transitional storing space and at the end forwarded to retailers or else end users (Fine, 1998). Different industries require supply chains to offer them knowledge required to go on and prosper. Leenders and Fearon (2006) observed that in the value chain, the use of ICT methods for supply chain management improves productivity and waste reduction. Technological developments including DRP, ERP, RFID enable companies to obtain a strategic inventory management advantage.
A barcode is defined by Helo et al (2008) as a code consisting of similar narrow lines and spaces that can then be stored as the Universal Product Code (UPC) in twenty to thirty characters per inch of coded data. By enabling faster data entry, bar-coding leads to supply chain efficiency (Gerald et al, 2000. Gerald et al (2000) mentioned that the saved and improved productivity often decreases labor costs. Barcodes also lead to the removal of expensive inventory over and understocking and the improved performance of JIT inventory systems. However, analysis works perfectly when tasks are planned. Better decision-making is often improved by utilising barcoding by defining that it would not be easy to gather using other approaches that can help SC managers make objective decisions.
According to Yazici (2002), it is necessary to integrate different activities of the company inside and outside, considering the fact that vendors (suppliers) are found across the globe. In order to accomplish this, Helo et al (2008) argued that Enterprise Resource Planning is a system of managing business consisting of applications/modules combining business functions such as marketing, finance, production as well as logistics. William (2009) accepts that, along with sales and marketing, procurement, accounting and finance, human resources development, materials movement and control, value-added, quality assurance, distribution and allocation or completed goods and materials through engineering processes as well as ICT, ERP effectively integrates all the information provided by the operations functions. According to Yazici (2002), ERP framework makes use of database technologies to monitor and integrate client, supplier, employee and financial information. In 2009, William found out that ERP systems can be instrumental in coordinating process-focused, functionally oriented organisations and enhancing the efficiency of different supply chains through communication, collaboration and coordination.
RFID refers to technologies that use radio waves to automatically classify individual objects (Lysons & Farrington (2006). Effy and Andy (2008) advised that by ensuring that inventory is kept at its minimum level, RFID technologies will increase the overall performance of different supply chain logistics organisations, thus increasing the efficiency and effectiveness of the process for accurate information. In addition, radio waves can enhance product traceability and visibility across the entire supply chain phase, allowing monitoring, distribution, checkout and counting processes efficient and accelerated, which can contribute to better inventory flows and more reliable information (Helo et al, 2008).
Lead Time Fundamentals and Information Management
Nordas et al. (2006) suggest that the period of time in between both placing an order as well as receiving of the ordered items is the lead time. Development of Just-In-Time (JIT) indicates that their efforts to monitor lead time are correlated with benefits. This helps to minimize lead time and is one of their JIT philosophy's sources of success (Foote et al, 2005). In an effort to minimize lead time, corporations and organizations have found that 90 percent of current operations are in fact non-essential and should be removed. They found waste associated with switching, quality failures, process management, factory layout, and system downtime as soon as producers concentrated on processes. And they sought to find ways to minimize waste or eradicate it. Harrington (1996) proposes that major optimisation outcomes can be obtained by eliminating non-value- adding activities from the systems as well as streamlining the knowledge flow.
Manufacturers competed on the basis of cost competitiveness in the 1960s and 70s. The consistency was the rage in the 1980s to date, and Zero Defects as well as Six Sigma came into vogue. Cost and efficiency remain relevant for first-class (world-class) activities, but in the modern day (today), the emphasis is firmly on speed.
A report was also produced by Bosireet (2011) on the effect of having to outsource on lead time as well as client satisfaction in Nairobi supermarkets. The study shows that 10 supermarkets outsource various services, including ads and promotions, repairs, fleet running, etc. The report also disclosed the effects on lead time of outsourcing. However, a new twist was introduced, according to Hetzel (1988), in which forecast errors result in expedition to satisfy unanticipated demand, and confusion compounds to queues and missing delivery targets. In this regards, Zong (2008) submits that there exist many variables in production processes that have led to long lead times for production. One of those important factors is machine failure. Although the researchers have addressed so many lead-time problems, special attention must be paid to areas that are ignored by the researchers, including the passage of logistical details.
Challenges in the Implementation of Inbound Logistics Practices
According to Behrends (2009) advances (innovations) are transforming the manner in which companies distribute products to organisations from sources. For instance, fuel cost volatility, the need for inter-modal logistics concepts as well as small packages pose new challenges for companies. This is dynamic and varies from increased transportation quantities to problems with the climate.
Blecker and Ringle (2014), the potential to use established synergies to solve emerging issues in inbound logistics is not maximised without cooperation among key players in logistics. Effective companies in the sector owe their accomplishments to their collaboration with other related organisations, including government agencies, private stakeholders, clients and developers of technology, etc. Massive financial investment has become an obstacle to logistics operations that are productive (Yu, 2011). Blecker et al., (2014) believes that for several businesses, budget constraints restrict spending on the intended strategy as well as thus often shift with economic adjustments, thus affecting their inbound logistics operations.
Inbound logistics activities depend on existing infrastructure that needs strategic investment from both public and private, such as warehouse construction, ports, highways, communication networks and energy supply facilities. They often require long lead times to be established and investment over time after repair that decide the efficiency of the whole logistics activities (Blecker et al. 2014).
Reducing Inbound Logistics Costs
Organisations appear to over-look the inbound supply chain when it comes to handling shipping costs. Controlling and handling inbound freight efficiently can be a challenging process without a good framework to keep suppliers accountable. Our top three tips to help reduce inbound logistics expenses are below.
Build Routing Guides and Introduce Programs For Vendor Compliance
The development of custom routing guides and the introduction of a supplier compliance framework is the first step to effectively handling inbound freight. Through the use of transport technologies, routing guides may be created manually, but more generally in the 21st century. Routing guides provide guidelines such as appropriate transport modes, carriers to be used for particular lanes, shipping or receiving hours, notification procedures for shipment and exception protocols for shipments that do not comply with the delivery window designated.
When routing guides are not followed, vendor enforcement systems detail the exact specifications between the recipient of the freight and the shipper. The vendor enforcement program specifies who is liable for what payments or acts if the shipper does not comply with standard operating procedures. In addition, standards are known from both sides, reducing procedural variability and preventing excessive costs.
To Improve Visibility and Control, Leverage Technology
It would seem like rational thinking to incorporate technology within supply chain management (SCM), and even in today's modern world, some organizations still handle shipments manually. Due to the lag time of manual updates, handling deliveries without technology will dramatically reduce visibility.
Shippers have 24/7 real-time access to shipment details with the power of a Transportation Management System (TMS) technology. Instead of handling shipments via excel or other systems, the carrier's shipment updates can be accessed almost instantaneously through EDI (electronic data exchange) and online portals.
In addition, companies have the opportunity to see whether suppliers have selected the wrong routing or an expensive shipping method for a particular shipment. This instantly improves the supplier enforcement program's transparency as well as effectiveness. Supplier control helps businesses to handle partnerships more proactively and to implement suppliers who regularly do not meet routing instructions with a charge back compliance scheme.
Companies often have the ability to quickly update routing guides based on market developments or with a particular carrier by using technology to host routing guides. Web-based routing guides enable businesses to make rapid changes to capitalise on potential savings in an ever-changing climate.
Supply Chain Workforce Management, Omni-channel delivery, RFID, Supply Chain Management systems, EDI, TPI-Retail Value Chain Federation), Customer Order Management, CRM /Cloud Solutions, YMS for transport management and monitoring freight in the yard outside 3PL's yard.
Seeking a Partner Who Needs The Business to Understand.
A good partner with such a knowledgeable team can help direct shippers to make constructive adjustments rather than just retroactively making changes because of a specific issue. Expert advice from business experts who genuinely understand the organization will save a large amount of time and money for consumers.
Inside its Domestic Freight Management products, Ascent Global Logistics offers customers robust Vendor Inbound Management systems. The Ascent Global Logistics team understands that teamwork is crucial, working with customers every inch of the process, from receiving inbound goods to dropping shipment directly from distributor to client.
Our team specialises in collaborating with consumers to understand their organization and overall priorities in order to then work together on processes and execution. Ascent Global Logistics will help customers build routing guides and automated systems to ensure the most cost-effective execution of shipments due to a detailed understanding of the fine details and nuisances in an inbound supply chain.
Focus on Total Fulfillment Costs
Make the decisions that, no matter where they occur in the SC, will meet consumer needs at the lowest possible overall cost. This means removing options at the cost of others that support only one portion of the stream. This can be done if, as waste is reduced, all supply chain participants share financial and organisational benefits.
The creation of an uninterrupted flow of goods downstream in a SC demands that all functions and sections within an organisation work together. The seven wastes in the supply chain are:
1. System complexity: extra, redundant steps and complicated procedures.
2. Lead time- unwarranted waiting times.
3. Transport - needless product movement.
4. Room, keeping locations for excessive inventory.
5. Inventory-inactive products that are raw, work-in-process (W.I.P), or completed.
6. Human effort-an operation that adds little meaning.
7. Packaging - packaging that carry air or cause damage.
8. Energy-(often referred to as the eighth waste): removing wasted energy in the SC: reducing power, gas, services, etc.
How to Optimise The Inbound Logistics Process
Specialists believe inbound logistics process to be “the final frontier" for businesses that aim at reducing costs of transportation. This method is not easy to streamline and needs tremendous effort from SC managers as well as warehouse operators.
Conceptual Framework
The research provided a conceptual framework of inbound logistics in relation to the performance of the company. Thus in this regard, the study will underline five (5) inbound logistics practices which are procurement, information communication and technology transportation, inventory management, and warehousing. An investigation is going to be centred on five (5) aspects and determine how they influence the overall performance Figure 1.
Research Design
The research was aimed at getting detailed information with regard to inbound logistics practices by Steel Force Company in relation to its overall business performance. The study considers the descriptive research as the most appropriate because it enables us to be able to describe a presenting situation as well as succinctly demonstrate possible relations between presenting variables. This design also permits “the examination of the phenomenon in depth using various kinds of evidence obtained from interviews with those involved, direct observation of events and analysis of documents and artefacts” (Yin, 2003). The focus of the enquiry in this regard is to report on the impact of inbound logistics in the company. Furthermore, the enquiry also seeks to highlight the critical components in the operationalisation of the process by the company.
Population
Bless and Higson-Smith (2006) opine that a research population is referent to a group of events, units or people from which a sample is selected with the ultimate goal of generalising findings of the research on the entire population. Thus, the research environment who formed the population for the current enquiry was constituted of all employees of the Steel Force Company – and the staff complement was 48.
Sample
A sample is any selected item or person that is drawn from the population to be included in an enquiry (Castillo, 2009). Blanche (2006) stated that the main reason for conducting a sampling process is to select representative units from the population (sample) that can be imagined to represent the qualities and characteristics of the total population and from which the enquiry is able to draw general conclusions regards the populations. The size of the sample for the current enquiry was 33. This size of the sample was determined using the Slovene’s Formula which is given as n = N / (1 + Ne^2) where n = number of samples, N = Total population and e = margin on error (Ryan, 2013).
n=48/ (1+48*0.01) = 32.43
The sample size was calculated at 99% confidence interval and found to be 33.
Source of Data
The study utilize both primary and secondary data to achieve the study objectives. The main instrument utilised in collecting primary data were structured questionnaires distributed to respondents. The secondary data was extracted from appropriate documents which included company annual reports, journals and other relevant publications. According to Remler and Ryzin (2011), primary data is unrefined and recent information. The source for primary data was utilised because of its capability to generate data can is more current, accurate, available, sufficient and above all relevant as compared to the reliability of secondary data. This explains why the structured questionnaire was utilised in collecting primary data from the company in this enquiry. The questionnaires were administered and respondents filled them in in their own times. Documents which include company annual reports, journals and other relevant publications were also used.
Data Analysis
The data was collected from a case study, and as such, in conducting the enquiry a case analysis was conducted. The analyses were done to gain understandings into the aspects informing inbound logistics practices at Steel Force as a company. Insights on each of the inbound logistics practices and their effects on SC performance were drawn from themes as well as patterns emerging from the case analysis. The higher the Likert scale rating is an indication that the factor is more important. Statistical Package for Social Science (SPSS Version 23) was utilised in the analyses of data and presented by the use of frequency tables and percentages. Methods of descriptive statistics including measures of central tendency were also utilised in the description of the levels of dispersion.
Discussion of Inbound Logistics Practices Results
The way an organisation performs is influenced by the practices and the operational policies such an organisation have in place. Just like any other organisation supply chain performance of a company is hinged on activities that are carried by various sections or departments. Of importance is the inbound logistics section which is deemed to play critical role in attaining a successful supply chain performance. Basing on this background knowledge this study was prompted with the motive of finding out the key inbound logistics practices in Steel Force company in Namibia. Inbound logistics practices include inventory control, transportation, Information Communication & Technology (ICT), procurement and warehousing. These basic factors inform the independent variables in this enquiry and of which the respondents from Steel Force were supposed to highlight the level criticality of the various activities related to inventory control, transportation, Information Communication & Technology (ICT), procurement and warehousing. Results are presented in Tables 1 to Table 5.
Table 1 Transportation Services | |||||
Frequency | Percent | Valid Percent | Cumulative Percent | ||
Freight Consolidation | very important extremely important |
4 21 |
16.0 84.0 |
16.0 84.0 |
16.0 100.0 |
Total | 25 | 100.0 | 100.0 | ||
Customs Clearance | very important extremely important |
5 20 |
20.0 80.0 |
20.0 80.0 |
20.0 100.0 |
Total | 25 | 100.0 | 100.0 | ||
Track Trace | very important extremely important |
5 20 |
20.0 80.0 |
20.0 80.0 |
20.0 100.0 |
Total | 25 | 100.0 | 100.0 | ||
Freight Forwarding | very important extremely important |
5 20 |
20.0 80.0 |
20.0 80.0 |
20.0 100.0 |
Total | 25 | 100.0 | 100.0 |
Table 2 Inventory Control Practices | |||||
Frequency | Percent | Valid Percent | Cumulative Percent | ||
Inventory Levels Optimisation | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Inventory Cost Reduction | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Inventory Lead Time Reduction | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Inventory Accuracies | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 |
Table 3 Warehousing Practices | |||||
Frequency | Percent | Valid Percent | Cumulative Percent | ||
Inspection Of Goods Before Receipting | very important | 4 | 16.0 | 16.0 | 16.0 |
extremely important | 21 | 84.0 | 84.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Inventory Put Away | very important | 4 | 16.0 | 16.0 | 16.0 |
extremely important | 21 | 84.0 | 84.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Automated Picking Systems | very important | 4 | 16.0 | 16.0 | 16.0 |
extremely important | 21 | 84.0 | 84.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 |
Table 4 Procurement | |||||
Frequency | Percent | Valid Percent | Cumulative Percent | ||
Understand Controlled And Non-Controlled Costs | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Negotiation With Suppliers | very important | 4 | 16.0 | 16.0 | 16.0 |
extremely important | 21 | 84.0 | 84.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Contract Management | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Prioritise Supplier Relationships | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Implement Processes And Technology To Track | very important | 6 | 24.0 | 24.0 | 24.0 |
extremely important | 19 | 76.0 | 76.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 |
Table 5 Information Communication & Technology (ICT) | |||||
Frequency | Percent | Valid Percent | Cumulative Percent | ||
Demand Process Integration | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Lead-time Reduction | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Control And Integrate Information | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Control And Integrate Information | very important | 5 | 20.0 | 20.0 | 20.0 |
extremely important | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 |
It can be gleaned from the above results that all activities to do with transportation in inbound logistics are imagined or regarded as very important and extremely important with 84% and 16% indicating that freight consolidation is extremely important and very important respectively, 80% and 20% indicating that customs clearance is extremely important as well as very important respectively whereas 80% and 20% also indicated that tracking and tracing and freight forwarding activities are extremely important and very important respectively.
The results in the table above indicate that all inventory control activities in inbound logistics are considered to be very important and extremely important with 80% indicating that inventory levels optimisation, inventory cost reduction, inventory lead-time reduction and monitoring of inventory accuracies are extremely important, with 20% indicating that these inventory control activities are very important.
The above data indicates that warehousing activities in inbound logistics are highly considered to be very important and extremely important with 84% indicating that inspecting goods before they are receipted, inventory put away, and automated picking systems are extremely important, with 16% indicating that these inventory control activities are very important.
The data in the above table indicates that all procurement activities within inbound logistics are considered to be either very important or extremely important with 80% and 20% indicating that understand controlled and non-controlled costs is extremely important and very important respectively, with 84% and 16% indicating that negotiation with suppliers is extremely important and very important respectively, 80% and 20% also indicated that contract management and prioritise supplier relationships activities are extremely important and very important respectively and lastly 76% and 24% implement processes and technology to track is also extremely important and very important respectively.
Data collected from respondents as reflected in the table reveals that all warehousing activities in inbound logistics are imagined and considered to be either very important or extremely important with 80% indicating that demand process integration, lead-time reduction, control and integrate information and control and integrate information are extremely important, with 20% indicating that these ICT activities are very important.
Analysis of Challenges In The Implementation Of Inbound Logistics Practices
This section presents the challenges that are experienced by Steel Force in implementing inbound logistics practices. In responding to this question the respondents were prompted to show an indication of their level of agreement to some major challenges that are normally faced by organisations when implementing inbound logistics practices. Results this are as demonstrated in Table 6 below.
Table 6 Challenges in Implementing Inbound Logistics Practices | |||||
Frequency | Percent | Valid Percent | Cumulative Percent | ||
Focusing More On Competition | strongly disagree | 19 | 76.0 | 76.0 | 76.0 |
Disagree | 6 | 24.0 | 24.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Inadequate Resources | strongly disagree | 19 | 76.0 | 76.0 | 76.0 |
Disagree | 3 | 12.0 | 12.0 | 88.0 | |
neither agree nor disagree | 1 | 4.0 | 4.0 | 92.0 | |
Agree | 2 | 8.0 | 8.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Many Layers In The Organisation | strongly disagree | 20 | 80.0 | 80.0 | 80.0 |
Disagree | 5 | 20.0 | 20.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Cultural Dynamism | strongly disagree | 21 | 84.0 | 84.0 | 84.0 |
Disagree | 4 | 16.0 | 16.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Insufficient Skills | strongly disagree | 21 | 84.0 | 84.0 | 84.0 |
Disagree | 4 | 16.0 | 16.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Inadequate Management Support | strongly disagree | 22 | 88.0 | 88.0 | 88.0 |
Disagree | 3 | 12.0 | 12.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 |
A high percentage (82%) of the research respondents evinced that they strongly disagreed to the challenges that impede the implementation of inbound logistics. About 8% of the respondents agreed that inadequate resources impede the implementation of inbound logistics practices. However, 4% neither agree nor disagree that inadequate resources hinders the implementation. The overall results shows that different organisations face different kinds of challenges that affects the implementation of inbound logistics practices. 76% of the respondents strongly disagree that management focuses much on competition whereas 24% disagree to the notion that there much focus on competition. On the other hand 76% strongly disagree that there are inadequate resources channelled towards the implementation of inbound logistics. 12 % disagree, 4% neither agree nor disagree and 8% agree that inadequate plays a function with regards to the impediment of inbound logistics implementation. On many layers in management about 80% of the respondents strongly disagree whereas 20% disagree. 84% of the respondents strongly disagree and 16% disagree that cultural dynamism is a challenge that affects the execution of inbound logistics. On the other hand 84% strongly agree and 16% disagree to the notion that insufficient skills impede inbound logistics implementation. The respondents shows that there is adequate management support as 88% and 12% strongly disagree and disagree respectively that there is an inadequate management support.
Indicators of Supply Chain Performance
The indicators of the SC performance according to this study include cost, reliability and customer satisfaction. The results as shown in Table 7.
Table 7 Indicators of Supply Chain Performance | |||||
Frequency | Percent | Valid Percent | Cumulative Percent | ||
Indicators Of Supply Chain Performance | Cost | 10 | 40.0 | 40.0 | 40.0 |
Reliability | 7 | 28.0 | 28.0 | 68.0 | |
Customer Satisfaction | 8 | 32.0 | 32.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 |
Cost represents the major pointer of the supply chain performance with 40% whereas reliability stands at 28% and customer satisfaction having 32% response rate Table 8.
Table 8 Impact of Inbound Logistics Practice on Supply Chain Performance | |||||
Frequency | Percent | Valid Percent | Cumulative Percent | ||
Transportation | High | 1 | 4.0 | 4.0 | 4.0 |
very high | 24 | 96.0 | 96.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Inventory Control | High | 1 | 4.0 | 4.0 | 4.0 |
very high | 24 | 96.0 | 96.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Warehousing | High | 3 | 12.0 | 12.0 | 12.0 |
very high | 22 | 88.0 | 88.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Procurement | High | 1 | 4.0 | 4.0 | 4.0 |
very high | 24 | 96.0 | 96.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
ICT | High | 5 | 20.0 | 20.0 | 20.0 |
very high | 20 | 80.0 | 80.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 |
With regards to the effects of inbound logistics practice on SC performativity: transportation has a high and a very high impact at 4% and 96% respectively. Inventory control has the same impact with transportation showing a high and a very high impact at 4% and 96% respectively. The other inbound activity is warehousing which has a high impact of 12% and very impact of 88%. Procurement is another inbound logistics activity which impact supply chain performance. Procurement had a 4% and 96% response rate on having a high impact and very high impact respectively. 20% and 80% high and very high impact respectively are attributable to ICT which the fifth inbound logistics activity which impact supply chain performance. Transportation, inventory control and procurement are the leading inbound logistics activities that possess very high impacts on supply chain performance. These activities are followed in terms of impact by warehousing (88%) and ICT (80%) in terms of having a very high impact on SC performance Table 9.
Table 9 Inbound Logistics and Supply Chain Performance | |||||
Frequency | Percent | Valid Percent | Cumulative Percent | ||
Inventory Accuracy | large extent | 2 | 8.0 | 8.0 | 8.0 |
very large extent | 23 | 92.0 | 92.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Tracking Of Shipments | large extent | 7 | 28.0 | 28.0 | 28.0 |
very large extent | 18 | 72.0 | 72.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Correct Order Picking | large extent | 7 | 28.0 | 28.0 | 28.0 |
very large extent | 18 | 72.0 | 72.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Inventory Cost Control Leads To Decreased SCM Costs | large extent | 8 | 32.0 | 32.0 | 32.0 |
very large extent | 17 | 68.0 | 68.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Freight Consolidation Reduced Trans Costs | large extent | 7 | 28.0 | 28.0 | 28.0 |
very large extent | 18 | 72.0 | 72.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Transferring Goods Reduces Operational Costs | large extent | 7 | 28.0 | 28.0 | 28.0 |
very large extent | 18 | 72.0 | 72.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Freight Consolidation Minimises Number Of Deliveries | large extent | 8 | 32.0 | 32.0 | 32.0 |
very large extent | 17 | 68.0 | 68.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Efficient Customs Clearance Enables Speedy Deliveries | large extent | 11 | 44.0 | 44.0 | 44.0 |
very large extent | 14 | 56.0 | 56.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Rate Of Order Picking Determines Product Delivery Speed | large extent | 8 | 32.0 | 32.0 | 32.0 |
very large extent | 17 | 68.0 | 68.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Shorter Shipment Lead-times Lead to Speedy Delivery | large extent | 9 | 36.0 | 36.0 | 36.0 |
very large extent | 16 | 64.0 | 64.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Correct Order Picking Enables Increased Customer Satisfaction | large extent | 9 | 36.0 | 36.0 | 36.0 |
very large extent | 16 | 64.0 | 64.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Tracking Shipments On Transit Improve Customer Satisfaction | large extent | 10 | 40.0 | 40.0 | 40.0 |
very large extent | 15 | 60.0 | 60.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 | ||
Low Inventory Costs Lead To Improved Customer Satisfaction | large extent | 8 | 32.0 | 32.0 | 32.0 |
very large extent | 17 | 68.0 | 68.0 | 100.0 | |
Total | 25 | 100.0 | 100.0 |
An organisation’s performance of is attributable to the practices as well the established policies for operation. The performance of an organisation’s supply chain is linked to activities that are done in its different functions (Mwangi and Waweru, 2013). The nexus between inbound logistics practices and supply chain performance of Steel Force. Inventory accuracy ensures supply chain reliability (8% and 92% large extent and very large respectively), Tracking of shipments increases supply chain reliability (28% and 72% large extent and very large respectively), Correct order picking enables supply chain reliability (28% and 72% large extent and very large respectively), Inventory cost control leads to a reduction in the costs of SCM (32% and 68% large extent and very large respectively), Freight consolidation has reduced transportation costs (28% and 72% large extent and very large respectively),Transporting products to their precise destinations within warehouses has the potential of reducing costs of operation (28% and 72% large extent and very large respectively), Freight consolidation minimizes the number product deliveries (32% and 68% large extent and very large respectively), Effectual clearance of goods with customs facilitates and enhances timeous and efficient delivery of goods (44% and 56% large extent and very large respectively), The rate of picking up of orders from the warehouse is determinant of the speed of delivering goods to the consumer markets (32% and 68% large extent and very large respectively), Shorter freight lead times facilitate the speedy transportation of commodities (36% and 64% large extent and very large respectively), Correct order picking enables increased customer satisfaction (36% and 64% large extent and very large respectively), Shipment tracking of goods in transit has enhanced customer service (40% and 60% large extent and very large respectively) and Low inventory costs facilitate improved client satisfaction (32% and 68% large extent and very large respectively).
Discussion of Findings
The results of this research dovetails with the literature reviewed. The need to implement the key inbound logistics practices was evident at Steel Force. Dynamism and competitiveness in the business world environment is caused firms to pursue SC efficiency as a tactic in leveraging competitive advantage. Steel force implemented inbound logistics practices which include inventory control, transportation, Information Communication & Technology (ICT), procurement and warehousing. These practices possess substantial effect on the SC performance causing the company to pay particular attention to inbound logistics. These results resonate with and are in sync with the resource based theory as it also considers companies as of resource bundles which according to Wernerfelt (1984) can be managed and controlled in a way the positions the firms competitively. Steel Force was found to put inbound logistics management as a critical component of its SC not only focusing on controlling costs but to achieve client satisfaction and ensuring SC reliability. Mwangi and Waweru, (2013) found out that cost of transportation has a bearing on the SC performance with a specific focus on reliability, customer satisfaction and devil very speed. Steel Force noted that all activities in inbound logistics are considered and imagined to be either very important or extremely important. These inbound logistics practices have an impact on customer satisfaction, SC reliability, SC costs as well as the delivery speed of goods and services. These practices pose big constraints which need to be utilised more effectively to maximise their benefits to Steel Force as explicated and propounded by theory of constrains. Regardless of these constraints encountered during the process of implementing inbound logistics practices by Steel Force, great success had been noted owing to commitment of adequate resources, sufficient skills, supportive organisational structures, able to embrace dynamism and culture found in Steel Force.
The inbound logistics practices implemented by Steel Force include transportation, inventory control, warehousing, procurement and Information Communication & Technology (ICT). These practices are deemed to be critical in Steel Force. Transportation activities in inbound logistics are considered to be either very important or extremely important. The transport activities include freight consolidation, customs clearance, tracking and tracing and freight forwarding. All inventory control activities in inbound logistics are also either very important or extremely important. Such activities are inventory levels optimisation, inventory cost reduction, inventory lead-time reduction and monitoring of inventory accuracies. All warehousing activities in inbound logistics are either very important or extremely important inspection of goods before receipting, inventory put away, and automated picking systems. Results also revealed that all procurement activities in inbound logistics are either very important or extremely important. These include to understand controlled and non-controlled costs, negotiation with suppliers, contract management, prioritise supplier relationships, and implement processes and technology to track. It is further revealed that all warehousing activities in inbound logistics are either very important or extremely important. The activities involve demand process integration, lead-time reduction, control and integrate information and control and integrate information.
From the above discussions and results of the study, the following conclusions were drawn. Steel Force Company adopted and implemented inbound logistics practices. The inbound logistics practices implemented by Steel Force include transportation, inventory control, warehousing, procurement and Information Communication & Technology (ICT).These practices are deemed to be critical in Steel Force and have a substantial effect on the SC performance. Such practices impact supply chain performance with reference to costs, customer satisfaction as well as reliability.
For a supply chain to be reliable and achieve customer satisfaction the overall cost will be high. To achieve SC efficiency activities conducted within the inbound logistics of Steel Force directly affect costs. The challenges that impede the implementation of inbound logistics at Steel Force was found to be inadequate resources. Success of inbound logistics practices implantation is attributed to adequate resource allocation, sufficient skills, management support and being able to manage cultural dynamism.
Recommendations
The recommendations discussed here are suggested in a bid to enhance the SC performance. In attempting to ensure effective implementation of the inbound logistics practices, Steel force management should ensure that there are adequate resources allocated, improve on talent management through retention and attraction of skilled personnel, and make sure that there is full management support and involvement of all key personnel. Management support is critical as this can set the tone and the direction in an organisation. It can be through effective or optimal resource management such as increased productivity, eliminating delays, increased quality, reduced costs, exploiting opportunities and improved morale. Also making sure that resources are directed to projects that are aligned to strategic corporate goals, matching skill sets with the organisation continually overcommit its people resources.
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Received: 02-Sep-2023, Manuscript No. ASMJ-23-13263; Editor assigned: 04-Sep-2023, PreQC No. ASMJ-23-13263(PQ); Reviewed: 18- Sep-2023, QC No. ASMJ-23-13263; Revised: 22-Sep-2023, Manuscript No. ASMJ-23-13263(R); Published: 29-Sep-2023