A Data-Driven Decision-Making Model for the Third-Party Logistics (3PL) Industry

Abstract

The evolution of the supply chain has resulted in a growth in the usage of technology and data generated and distributed within the industry. Third-party logistics (3PL) companies operating within the supply chain industry are not maximising the capabilities of data to make well- informed decisions. The purpose of this paper is to address this gap and to develop a prescriptive, theoretical model for data-driven decision-making (DDDM). To address the gap, a literature review of DDDM in 3PL industry and in other contexts was conducted. The proposed model is built based on the consideration of existing DDDM models and frameworks; data and data analytics principles to collect, store, manage and analyse data; and the Cynefin framework. Existing models and frameworks for DDDM do not provide explicit guidelines on how to apply DDDM in a 3PL and supply chain context. The proposed DDDM model constitutes of three phases, namely: (1) the setup phase, that considers data knowledge and decision-making knowledge; (2) execution phase; and (3) the learning phase. The application of the model in 3PL companies can support the decision- making process in these companies, with a consideration of the challenges and opportunities that exist in the supply chain. The decision-makers in 3PLs can thus make better-informed decisions that positively impact their enterprises and the supply chain.