Impact of 3PL Outsourcing on Supply Chain Management in Manufacturing Companies in Norway: Case Study Norsk Hydro

Authors

  • Harberg Terje Mengistu University of Bergen
  • Kapur Svein Dimitrov University of Bergen
  • Mudassar Halleland Qureshi University of Bergen

DOI:

https://doi.org/10.53819/81018102t5174

Abstract

3PL outsourcing is a practice in which a company outsources its logistics and supply chain management functions to a third-party logistics provider. By outsourcing logistics activities to a 3PL provider with advanced technology solutions, organizations can improve their supply chain management and achieve greater efficiency and effectiveness. Supply chain management is the coordination and management of all activities involved in the production and delivery of goods and services from raw materials to end customers. It includes activities like procurement, production, transportation, warehousing, and distribution. The research used the descriptive research design. The target population was 30 Manufacturing Companies in Norway.  The research did sampling of 40 participants that were chosen from the target population of 30 Manufacturing Companies in Norway. Questionnaires were utilized to gather the data. The study concluded that the partnership between manufacturers and 3PL providers has become increasingly critical in Norway's competitive manufacturing industry. This collaboration helps to streamline processes, enhance visibility, and optimize inventory management, leading to greater supply chain performance.  To ensure successful outsourcing, it is essential to conduct a thorough analysis of the supply chain, identify the right 3PL provider, establish clear communication and collaboration, develop a performance monitoring system, and regularly review and assess the outsourcing arrangement. It was recommended that before deciding on whether to outsource logistics functions to a 3PL provider, it is crucial to conduct an in-depth analysis of the current supply chain to identify areas that need improvement. The manufacturing company should establish a clear communication plan with the 3PL provider, outlining expectations, key performance indicators (KPIs), and regular reporting requirements. Effective communication and collaboration are crucial to the success of 3PL outsourcing.

Keywords: 3PL Outsourcing, Supply Chain Management, Manufacturing Companies, Norway

Author Biographies

Harberg Terje Mengistu, University of Bergen

Postgraduate Student, University of Bergen

Kapur Svein Dimitrov , University of Bergen

Lecturer, University of Bergen

Mudassar Halleland Qureshi, University of Bergen

Lecturer, University of Bergen

References

Barker, J. M., Gibson, A. R., Hofer, A. R., Hofer, C., Moussaoui, I., & Scott, M. A. (2021). A competitive dynamics perspective on the diversification of third-party logistics providers’ service portfolios. Transportation Research Part E: Logistics and Transportation Review, 146, 102219. https://doi.org/10.1016/j.tre.2020.102219

Dimitrov, I., & Dimitrova, A. (2021, October). Impact of Using Third-Party Logistics Provider on Organizational Performance in the Bulgarian Context. In 2021 IV International Conference on High Technology for Sustainable Development (HiTech) (pp. 01-04). IEEE. https://doi.org/10.1109/HiTech53072.2021.9614228

Heitz, A., Launay, P., & Beziat, A. (2019). Heterogeneity of logistics facilities: an issue for a better understanding and planning of the location of logistics facilities. European Transport Research Review, 11(1), 5. https://doi.org/10.1186/s12544-018-0341-5

Huo, B., Haq, M. Z. U., & Gu, M. (2021). The impact of information sharing on supply chain learning and flexibility performance. International Journal of Production Research, 59(5), 1411-1434. https://doi.org/10.1080/00207543.2020.1824082

Khan, S. A., Alkhatib, S., Ammar, Z., Moktadir, M. A., & Kumar, A. (2022). Benchmarking the outsourcing factors of third-party logistics services selection: analysing influential strength and building a sustainable decision model. Benchmarking: An International Journal, 29(6), 1797-1825. https://doi.org/10.1108/BIJ-03-2020-0121

Lisitsa, S., Levina, A., & Lepekhin, A. (2019). Supply-chain management in the oil industry. In E3S Web of Conferences (Vol. 110, p. 02061). EDP Sciences. https://doi.org/10.1051/e3sconf/201911002061

Meidutė-Kavaliauskienė, I., & Činčikaitė, R. (2023, February). Optimization of Customs Processes for Improving Cooperation between Third-Party Logistics Companies. In TRANSBALTICA XIII: Transportation Science and Technology: Proceedings of the 13th International Conference TRANSBALTICA, September 15-16, 2022, Vilnius, Lithuania (pp. 528-538). Cham: Springer International Publishing. https://doi.org/10.1007/978-3-031-25863-3_50

Mengistu, H. S., Derseh, M. T., Zewdu, A. A., Haile, K. T., Bahiru, B., & Ambaye, A. S. (2022). Outsourcing a Means for Strengthening the Health Care Supply Chain Management: A Narrative Review. J Alcohol Drug Depend, 10, 366.

Nguyen, T. M. H., & Ménoury, M. (2022). Selection of 3PL providers for overseas market expansion: insights from a Vietnamese company. Journal of Supply Chain Management Science, 3(3-4), 96-112.

Prataviera, L. B., Creazza, A., Dallari, F., & Melacini, M. (2023). How can logistics service providers foster supply chain collaboration in logistics triads? Insights from the Italian grocery industry. Supply Chain Management: An International Journal, 28(2), 242-261. https://doi.org/10.1108/SCM-03-2021-0120

Qureshi, M. R. N. M. (2022). A bibliometric analysis of third-party logistics services providers (3PLSP) selection for supply chain strategic advantage. Sustainability, 14(19), 11836. https://doi.org/10.3390/su141911836

Sergeevna, B. V. (2022). Knowledge Management Practices and Barriers to their Implementation in Third-Party Logistics Service Providers: Case of Russian Companies.

Shaiq, M., & Hassan, M. (2019). Factors affecting growth of logistics outsourcing: a perspective of third-party logistics providers in Pakistan. Journal of Business Strategies, 13(1), 143. https://doi.org/10.29270/JBS.13.1 (2019).080

Tiwari, S., Sharma, P., Choi, T. M., & Lim, A. (2023). Blockchain and third-party logistics for global supply chain operations: Stakeholders’ perspectives and decision roadmap. Transportation Research Part E: Logistics and Transportation Review, 170, 103012. https://doi.org/10.1016/j.tre.2022.103012

Wang, C. N., Nguyen, N. A. T., Dang, T. T., & Lu, C. M. (2021). A compromised decision-making approach to third-party logistics selection in sustainable supply chain using fuzzy AHP and fuzzy VIKOR methods. Mathematics, 9(8), 886. https://doi.org/10.3390/math9080886

Yadav, S., Garg, D., & Luthra, S. (2020). Selection of third-party logistics services for internet of things-based agriculture supply chain management. International Journal of Logistics Systems and Management, 35(2), 204-230. https://doi.org/10.1504/IJLSM.2020.104780

Zhang, D., Su, Y., Zhao, M., & Chen, X. (2022). CPT-TODIM method for interval neutrosophic MAGDM and its application to third-party logistics service providers’ selection. Technological and Economic Development of Economy, 28(1), 201-219. https://doi.org/10.3846/tede.2021.15758

Downloads

Published

2023-06-02

How to Cite

Mengistu, H. T. ., Dimitrov , K. S. ., & Qureshi, M. H. . (2023). Impact of 3PL Outsourcing on Supply Chain Management in Manufacturing Companies in Norway: Case Study Norsk Hydro. Journal of Procurement & Supply Chain, 7(1), 1–11. https://doi.org/10.53819/81018102t5174

Issue

Section

Articles