The development of the service sector, including logistics services, is linked to changes occurring in the economic systems of countries. The income elasticity of demand for services is significantly higher than that for goods, which results, among other things, in a systematic increase in services provided. For years, the logistics services market has been developing towards increasing the degree of their implementation through outsourcing, defined as “the exclusion of certain functions (services) from the organizational structure of an enterprise and transferring them to specialized companies for execution”. Polish equivalents of the term outsourcing include the terms: ‘wydzielenie’ (separation), referring to internal outsourcing, or ‘wyodrębnienie’ (extraction), associated with external outsourcing. A key issue in this area is undoubtedly ensuring the required quality of service provision, which remains a guarantee of the proper functioning of an organization. As shown by the annual “Third Party Logistics” reports, which contain a broad analysis of the global outsourcing services sector, the most important problem in cooperation between outsourcing partners remains the issue of failing to meet the quality of delivered services (in 2006 this concerned 51% of enterprises, while in 2007 it was 46%). Companies point to this issue as the biggest problem affecting and disrupting relationships with external contractors, expecting the introduction of mechanisms ensuring appropriate, high quality of services provided to them.
The aim of the article is to indicate the role and importance of quality in the outsourcing of logistics services as a key factor in cooperation with an external partner, and an attempt to define basic metrics allowing for the assessment of the quality of logistics services delivered within the framework of outsourcing.
The essence of logistics services
The provision of all types of services, defined as “activity consisting of performing tasks commissioned by a client”, is inextricably linked to logistics activity. In the literature on the subject, there are a number of definitions describing the understanding of services in a logistics context, which essentially differ from each other in the degree of detail. One of them defines logistics services as “a product constituting a collection of customer wishes and expectations”, reflecting their essence, which manifests itself in the fullest possible satisfaction of the needs of the party interested in purchasing a given service, in accordance with expectations. Logistics management of services, aimed at meeting these expectations, is, in turn, the process of planning and executing a service, taking into account the analysis of needs, possibilities, and methods of providing these services throughout the supply chain, from the producer to the consumer.
Services, i.e., essentially intangible activities offered by one party to satisfy the needs of another party without transferring ownership rights, are characterized primarily by: intangibility, perishability, heterogeneity, simultaneity, and complementarity.
The basic feature of services – intangibility – results from the lack of their physical characteristics, resulting in an organizational and economic situation in which:
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services cannot be stored,
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services cannot be protected by patents,
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services cannot be directly displayed as part of sales promotion,
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it is difficult to find a basis for pricing other than the prices of competing services,
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it is difficult to test and pre-evaluate a service design,
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often the value of services is impossible for the consumer to assess before purchase.
The essence of a service differs diametrically from a material product, but based on the product life cycle, stages related to its implementation have been distinguished in the past. Characteristic stages of the service provision process are:
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market research and customer needs regarding services that can be offered,
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formulation of a general service offer,
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designing the process of executing a specific ordered service,
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execution of the service delivery process,
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control of service execution and compliance with requirements,
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evaluation of service execution by the provider and according to customer opinion,
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analysis of comments regarding service execution and introducing corrections to the offer and the service design process.
By grouping detailed undertakings related to the implementation of a logistics service, we can define 4 essential phases in this regard, namely: the preparatory-organizational phase, the implementation phase, the control phase, and the post-control phase. The phenomena and processes occurring within individual phases of service provision are characterized by a direct dependence on the type and condition of the economy in which they occur, affecting all its participants. Figure 1 shows the stages of logistics service provision along with the scope of activities carried out by service providers and service recipients.
Of significant importance in the considered area is the direct contact between the service provider and the service recipient, as well as the impossibility of measuring it before execution and the limited possibility of multiple measurements after implementation. This results, among other things, in the necessity of precisely defining detailed requirements regarding a specific service at the preparatory-organizational stage and selecting the appropriate entity that guarantees an adequate level of their implementation. These issues take on particular importance in relation to logistics services provided to an enterprise by an external entity within the framework of outsourcing.
The article comes from the “Logistyka” magazine 3/2010.