Executives and senior management in chemical industry are continually confronted with the question which activities should be performed by own resources and which activities should be transferred to external service providers. Thereby the focus in not solely on reducing the TCO (Total cost of ownership) but also improvement of international competitiveness as an important success factor.
Camelot Management Consultants observe a recent shift in demand for the scope of outsourced services and partner selection projects. Besides operational topics like warehousing and transport the process know-how and innovative IT solutions are becoming more and more important. Both are associated with Lead Logistics Providers (LLP) or Fourth Party Logistics (4PL) Providers.
Acknowledging these current trends Camelot MC and Prof. Dr. Christian Kille (Institute for applied sciences at university Würzburg-Schweinfurt (FHWS)) jointly initiated a study to address this specific topic. The study is based on a scientific analysis of supplier models in logistics around LLP/ 4PL providers and outsourcing motives of companies. This is complemented by a survey among logistics experts mainly from chemical industry. Based on these inputs a 7-step guideline was developed answering the question which supplier models and which form of collaboration are fitting best to reduce complexity. With the help of this guideline companies can evaluate how the outsourcing strategy can be developed and which part of logistics activities should be included. The strategy is key to select and enter a successful partnership with a logistics service provider.
Additionally, the study addresses the different logistics activities around 3PL, LLP and 4PL nomenclature and connects them with the industry requirements and the maturity of organizational development.
The results of the study show the relevance of outsourcing of logistics processes for chemical industry. The study offers detailed insights into different decision-making levels and helps chemical companies identifying and making full use of the potential that outsourcing offers and to take initial steps in this direction.