Analysis of the skilled work force effect on the logistics performance index—case study from India

Amrita Jhawar,Shikha N Khera,S K Garg

doi:10.1007/s12159-014-0117-9

Amrita Jhawar, Shikha N Khera + Show 1 more

Open Access

https://doi.org/10.1007/s12159-014-0117-9

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Journal: Logistics Research	Publication Date: Jun 17, 2014
Citations: 15	License type: CC BY 4.0

Affiliation: Delhi Technological University

Abstract

The purpose of this paper is to study the impact of development of skilled work force through investment in training, welfare, working conditions, and wages on the logistics performance index. It also discusses the effect of skilled labour on logistics cost, logistics time, reliability, flexibility, and safety of a logistics system. The paper is based on a case study conducted on an Indian Logistics Service provider. A causal loop diagram and the stock and flow diagram have been developed according to system dynamics modelling principles. The simulation result shows significant improvement in the logistics performance index. The reduction in logistics cost and logistics time is 12 % and 80 min, respectively. With training provided to 36 % employees of the company, the retention rate improved by 58 % and score of recruitment reached to 4.4 out of five. The paper shows that investment done in human resources in the Indian logistics sector will help the logistics service providers and their customers in terms of improved logistics performance and higher profits and will also improve the image attractiveness of the Indian logistics industry.

Highlights

1.1 Importance of logisticsOver the past decades, globalization has caused an expansion in trade, leading to the growing strategic importance of the logistics function within the organization
The purpose of this paper is to study the impact of development of skilled work force through investment in training, welfare, working conditions, and wages on the logistics performance index
Only 13–14 % is spent on nonsalary expenses such as manpower development items such as welfare, training, which is very less compared with global logistics countries, which spend more than 20 %

Summary

Introduction

1.1 Importance of logisticsOver the past decades, globalization has caused an expansion in trade, leading to the growing strategic importance of the logistics function within the organization. Improvements in logistics have been the primary source of increased profits for companies, allowing them to maintain their competitive advantage [24]. Logistics have become important source of sustainable competitive advantage [8, 18, 39]. Logistics concern the efficient transfer of goods from the source of supply through the place of manufacture to the point of consumption in a cost-effective way while providing an acceptable service to the customer [21]. The Council of Supply Chain Management Professionals (2007) defines logistics management as that part of the supply chain management processes, which plans, implements, and controls the efficient, effective forward and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption in order to meet customers’ requirements [17]

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