Operations management in Logistics

Background

Despite being mainly associated with IT-related industries, the logistics industry in Taiwan began in the 1980s with less specific industrial characteristics and mainly provided warehousing and material handling services, lagging far behind its Western counterparts. Not until the late 1990s did related industry policies begin to develop, due to increasing pressure from Western customers for global logistics capabilities, while service industries exhibited the trend of tailor-made logistics and large-variety-and-small-quantity home delivery. Logistics industry operations were moving toward the goals of process integration and value-added, innovative services.

Research objectives

The opinions of logistics educators in Taiwan on OR practices in the domestic logistics industry are explored in this research

Literature review

Most OR studies cover issues such as linear programming, transportation problems, assignment problems, network analysis, dynamic programming, game theory, integer programming, queuing models, and decision theory . However, according to members from both academia and industry of the Committee on the Next Decade in Operation Research , the focus of OR development in the future lies in optimization (including linear programming, non-linear programming, and multi-criteria analysis), stochastic processes, and artificial intelligence. It is also believed that the most significant OR impact on the logistics industry lies with delivery. For example, the latest information technology can allow real-time information transmission to the carrying devices and keep track of the transportation through satellite tracking. Meanwhile, the current trend is to incorporate OR techniques in professional subjects. For example, at the University of Iceland, integrated OR techniques into five courses in a new MBA program, including Analysis and Policy-Making, Operation Management I, Operation Management II, Marketing Engineering, and Performance Evaluation. Because he thought OR courses in the UK were softer, with a case study focus, while those in the US were more difficult, focusing on methodology and techniques, he recommended combining both British and American characteristics into OR courses.

The logistics system operation can be divided into network design, information, transportation, inventory, warehousing, material handling, and packaging . Slats provided a table listing further connections between logistics activities and OR techniques in the supply chain, such as forecasting demand—simulation model, customer orders—DLP model, location of warehouses—transportation model, location of production facilities—assignment/allocation, warehouse lay-out—dynamics model, stock policies—network model, and choice of equipment/facilities—multi-criteria analysis.

Dynamic relief-demand management is the key to the success of emergency logistics operations under the condition of large-scale natural disasters. In reality, the difficulty of relief-demand management is rooted in the uncertainties of relief-demand information due to the following phenomena. First, unlike business logistics (BL) where consumers themselves are the demand information provider, the relief demander (i.e., disaster-affected people) may not be the same as the relief-demand information provider in the emergency logistics context. Instead, those on-the-spot reporters, rescuers and charities usually act as the main information sources; thus, leading to the asymmetry of relief-demand information. Second, the relief-demand information sources are diverse, and usually provide the data under chaotic conditions without the aid of decision support tools and enough time for verification.

Furthermore, the relief-demand information needed for emergency logistics is a kind ...