Case study in a mining company has been selected to be explored to answer the problem: what are the feasible solutions that the project team in the company can use, in order to ensure the materials will be available for the project when needed? This blog will discuss and select the preferred alternative for Logistics and Warehousing, based on field force analysis results from week 8-12 blog postings.
There are five feasible alternatives to consider for the procurement, logistics and warehousing of the project:
- Procurement, Logistic and Warehousing for the project are performed by the company’s Supply Chain Management (SCM) Department, as is (status quo).
- Procurement, Logistic and Warehousing for the project are performed by the project. SCM manager is reporting to the Project Manager.
- Procurement, Logistic and Warehousing for the project are performed by the company’s Supply Chain Management (SCM) Department, as is, but with simplified procedure and improvements
- Procurement, Logistic and Warehousing for the project are done by contractor (turn key project)
- Outsourcing ONLY the procurement function (NOT turnkey project, but JUST the procurement function), Logistic and Warehouse for the project are performed by the company’s Supply Chain Management (SCM) Department, as is, but with simplified procedure and improvements
Analysis and Criteria
Force Field Analysis technique has been used to analyze each alternatives. The following table shows the result for Logistic and Warehousing:
Table 20.1 Alternative comparison using Field Force Analysis – Logistic & Warehousing
Top three score alternatives (positive variance) have been chosen and will be compared using Compensatory Models, in order to select the most appropriate alternative for this company. As alternative 3 and alternative 5 are the same for logistics and warehousing, there will be only two alternatives to compare (alternative 3/5 and alternative 4).
Selection criteria are:
- Cost, all cost associated with change negative forces into positive forces
- Easy to implement, the easiest the implementation, less resistance, the better
- Time, time required to change the negative forces into positive forces
The two (2) alternatives comparison after assessing each negative forces is shown in the following table 20.2
Table 20.2 Alternatives comparison data
The attribute weight and ordinal ranking is shown on table 20.3
Table 20.3 Attribute Weight – Ordinary Ranking
The non dimensional scaling of the possible attribute values are presented in table 20.4
Table 20.4 Dimensionless Values
By combining the weights and performance for each alternative, the results are shown on table 20.5
Table 20.5 Weighted Score
According to the additive weighting technique analysis above, the alternative 3 has the highest score; therefore, it is chosen as preferred alternative. Alternative 4 can be also applied for selected project, i.e. major/big scale project.
Performance monitoring and post evaluation of result
The alternative 3 has to be periodically evaluated and aligned with up to date logistics and warehousing system practicing.
- Brassad, M., Ritter, D. (2010), The Memory Jogger 2, Second Edition, GOAL/QPC
- Richardson, G., T., W., Supply Chain Management. Retrieved from: http://www.witiger.com/internationalbusiness/SupplyChainManagement.htm
- Mindtools, Force Field Analysis. Retrieved from http://www.mindtools.com/pages/article/newTED_06.htm
- Sullivan, G., William, Wicks, M., Elin, Koelling, Patrick, C. (2009), Engineering Economic, Fifteenth Edition. Pearson International Edition.