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The impact of the complexity of logistics services on the degree of integration […] in the supply chain

The impact of the complexity of logistics services on the degree of integration between partners in the supply chain

The paper was presented at the Polish Logistics Congress “Logistics 2000 – Meeting the logistics challenges of the 21st century”. Poznań, June 1-2, 2000.

1. Introduction. Factors influencing the competitiveness of companies in Poland
Commonly recognized competitive tools such as price, quality, reliability, and product or service availability are no longer sufficient today. They have been known and used by all major “market players” for quite some time. Today, it is known that the foundation for building a company’s competitiveness is innovation, resulting from its orientation towards customer satisfaction and related to the broadly understood product (and thus also the service), technology, and organization. Especially in relation to the consumer goods market, this assumption is particularly important for many companies.

It stems from the conviction that sales create company value, and the product – value for the customer. This conviction leads practically to the choice of a strategy of participating in a great race played out in the market to become the best in terms of costs or unrivaled from the point of view of utility features and parameters. The marketing image of a product (service) is based on the motive of price and quality, which is then sold – which no longer surprises anyone – at constantly decreasing profitability.

Companies locating their offer in other enterprises in the supply and investment market long ago noticed the possibility, and perhaps also the necessity, of other solutions. It was recognized that one must look at the sold service (product) from a broader perspective, i.e., where it is situated in the economic process at the recipient’s end. A jointly conducted analysis generally allows for determining how to adapt the product to the needs identified during it, so that it contributes to increasing efficiency, and thus what additional values can be created. From that moment on, it is only a step to winning the customer – practically only to a certain extent – thanks to the initial service (product) offer.

The strategy of comprehensive solutions implies the adoption by partners of an orientation towards increasing company value and, of course, the use of concepts and sales tools other than traditional ones. Due to the complexity of the solutions, delicate customer education becomes necessary so that one can speak to them in “the same language”.
It seems that one of today’s paradigms of competitiveness is becoming such a described partnership, leading to integration with the participation – sometimes even of many – cooperating companies, taking the form of a system of complementary, mutually beneficial connections. A new pattern of competition is emerging, currently shaped mainly by the processes of economic globalization, market fragmentation, and the development of new information and telecommunication technologies.

In addition to the aforementioned partnership search and creation of additional values through enriching the offer with another service or product, there is room in the partnership for outsourcing, allowing for concentration on the best-performed activities, and the care for customers’ sense of security, which is gaining particular importance. They increasingly value the “friendliness” and “transparency” of a company, knowledge of its goals, actions, and corporate culture. All this fosters the creation of lasting relationships between companies, in which mutual trust and reliance on each other is a basic canon.

It is difficult to predict how the competitive game will change under the influence of the development of the e-economy, i.e., the environment of the global electronic market and its derivatives, but it can be stated without risk that it will be even more focused on individualized customer satisfaction, cost and price reduction, excellent quality, and information will be its most powerful tool.

The entire article in PDF format.

Ref-4.pdf