World Review of Intermodal Transportation Research (13 papers in press)
Drivers and Barriers of Reshoring in the Swedish Manufacturing Industry
by Gabriella Engstrom, Per Hilletofth, David Eriksson, Kristina Sollander
Abstract: The purpose of this study is to explore reshoring drivers and barriers in the Swedish manufacturing industry. The research is based on case research including five case companies from the Swedish manufacturing industry with experience of manufacturing reshoring. The empirical findings are compared to the existing literature to identify any potential gaps between the existing literature and the Swedish manufacturing context. The findings suggest that quality related issues, an increased degree of automation, and improved cost performance at the home base are the strongest reshoring drivers for Swedish manufacturing companies. The identified drivers and barriers are transferable and have the potential to be building blocks for researchers and practitioners to better understand the reshoring phenomena. The findings also show that further research should focus on reshoring drivers and barriers in relation to specific reshoring characteristics (e.g., ownership, scale of production being reshored, and position in the supply chain).
Keywords: Reshoring; Insourcing; Offshoring; Outsourcing; Supply Chain; Sweden.
Bilateral connectivity in the liner shipping network: An overview
by Iñigo L. Ansorena
Abstract: A general picture of the global shipping network is presented. The maritime network connects countries (nodes) with regular liner services (edges) all around the world. The weight factor of connections is the Liner Shipping Bilateral Connectivity Index (LSBCI). The LSBCI is a composite index developed by UNCTAD which reflects maritime connectivity between pairs of nations all around the globe. The first goal of the study is to determine the community structure of the network by means of modularity optimization. The structure clearly shows the main sea routes within the global network. The second goal is to extract more information from the strongest community by means of centrality metrics. The countries which achieved the best performance in the past decade are revealed.
Keywords: liner shipping; centrality metrics; modularity optimization; connectivity; communities; complex network.
Exploring causality between economic growth and air transport demand for Argentina and Uruguay
by Juan Gabriel Brida, Pablo Daniel Monterubbianesi, Sandra Zapata Aguirre
Abstract: This paper investigates the effects in the long term between air transportation and the economic growth in Uruguay and Argentina. Employing annual data from 1970 to 2011, the study uses cointegration analysis to consider the existence of a long run relation between real GDP and the number of air passengers in each country. Results show that for both considered countries, the series are cointegrated, and it is possible to estimate an Error Correction Model (ECM). The Granger Causality test shows that causality goes unidirectionally from GDP to air-transport for both countries. The elasticity and impulse- response function analysis shows that the effect of a GDP shock on the number of passengers is higher in Uruguay than in Argentina, which is consistent with the characteristics of the air market and the geographical conditions of each country. The results suggest different policy and planning implications.
Keywords: economic growth; air transport; cointegration; Granger causality; Argentina; Uruguay.
EVALUATION OF A NOVEL LOGISTICS SOLUTION FOR ROUNDWOOD IMPORT
by Ekku Heljanko, Olli-Pekka Hilmola, Andres Tolli
Abstract: Investment analysis on a logistics concept for timber transportation in South-Eastern Finland is presented. Concept utilizes longer freight train units, efficient terminal operations and multimodality based on High-Capacity Transport (HCT) trucks. This is compared to a current state of shorter direct train transportation to factories. Primary interest is on Russian birch wood import (used in pulp manufacturing). Analysis reveals that the modeled logistics concept is feasible. Taking the time-value of money into account, in the long-term this alternative method has lower overall costs compared to the current one. Possibility for intermodal container backhauling provides potential for synergy benefits. Synergies could also be accessed from the joint use of terminal by number of near-by factories. Although investment seems to be profitable, sensitivity analysis on the most crucial parameters should draw attention. Different factors should be analyzed further with advanced simulation tools such as illustrated using Vensim and Forio Simulate.
Keywords: wood transports; railways; road; terminal; investment appraisal; simulation.
Manufacturing relocation abroad and back: empirical evidence from the Nordic countries
by Jussi Heikkila, Sanna Nenonen, Jan Olhager, Jan Stentoft
Abstract: Businesses have increasingly engaged in various forms of cross-border transfers of activities. Much production, knowledge and work has been moved offshore from developed economies to achieve better competitiveness. However, recent research has begun to report about an opposite movement, i.e. backshoring of business activities. This research paper reports empirical survey results exploring and explaining manufacturing relocation from and to three Nordic countries. The purpose was to investigate manufacturing firms practices of pursuing different manufacturing globalisation strategies in terms of why, what types of companies, and where questions, and in the context of manufacturing relocation activities originating from Denmark, Finland, and Sweden. Both offshoring and backshoring of manufacturing are also analysed from the perspective of changes in ownership, i.e. the extent to which outsourcing or insourcing are related to manufacturing relocation.
Keywords: manufacturing; offshoring; outsourcing; backshoring; insourcing; reshoring; relocation; rightshoring; survey; Nordic countries.
Reshoring and Additive Manufacturing
by Hamid Moradlou, Wendy Tate
Abstract: Since the mid-20th century, offshoring of manufacturing facilities has gained significant popularity because of the opportunity for cost reduction. However, there is evidence that shows that offshoring strategies may not be beneficial for the organizations manufacturing activities and may increase the cost of ownership. There appears to be a tendency to reverse offshoring and begin reshoring manufacturing back to the country of origin. This paper focuses on the applicability of Additive Manufacturing (AM) as a supporting technology for increased reshoring to the United Kingdom (U.K.). This manuscript focuses on theory elaboration, bridging the new generation technologies to the reshoring movement in the U.K. This research identifies 6 potential areas where AM can have impacts on supply chain of reshoring companies to make them more responsive: shorter lead-time, responsiveness to the product and market changes, lower transportation costs, fewer miscommunications with the suppliers, more customization options, fewer products stored in inventory.
Keywords: Reshoring; Additive Manufacturing; Industry 4.0; Backshoring; Supply chain relocation.
Fair Comparison of Developing Software in Different Locations: Dynamic Decision Model
by Darja Smite, Emil Numminen
Abstract: While offshore software development is frequently looked at in simple economic terms, assumed benefits are not always achieved. This can be attributed to unexpectedly high transition costs and a number of extra costs for maintaining a sourcing strategy. When offshoring fails, companies need to revisit their decision. In this paper, an analytical model is proposed to support evaluation of offshoring strategies and decision options. The model focuses on value comparison, and treats outcomes of offshoring relationships more fairly and realistically than a na
Keywords: Offshoring decisions; Cost calculation; Transaction cost economics; Opportunity costs; Options; Cost/benefits; Software development.
A conceptual life cycle-based sustainability framework for assessing transportation vehicles
by Lambros K. Mitropoulos, Panos D. Prevedouros
Abstract: Life cycle assessment has been used extensively in the transportation sector to determine impacts of transportation infrastructure and other components; however, the majority of these studies focus on environmental life cycle impacts. This study presents applications of the life cycle assessment method in transportation and develops a sustainability framework that incorporates life cycle impacts for assessing urban transportation vehicles. The framework uses five sustainability dimensions, a set of 32 sustainability indicators, 14 midpoint impacts, seven endpoint impacts and three sustainability indices for the assessment of different technologies of urban transportation vehicles. The framework aims to enhance decision making by aggregating data, which are used to quantify multiple indicators, into different form of indices representing environment, technology performance, energy, economy and user-based impacts.
Keywords: framework; life cycle assessment; LCA; indicators; transportation; alternative fuels; vehicle technologies; sustainability indices.
Exploring opportunities for moral disengagement in codes of conduct from the textile industry
by David Eriksson, Per Hilletofth, Göran Svensson, Lars Bengtsson
Abstract: The purpose of this research is to assess how codes of conducts are outlined and formulated in relation to moral disengagement along the supply chain. The research is focused on the idea that supply chain structure may reduce the actors sense of moral responsibility for the actions and impacts of the supply chain on workers and environment. The research has been conducted as a case study including Swedish firms in the textile industry. The research has used secondary data from codes of conducts. The findings show that codes of conduct do not cover all supply chain practices linked with moral disengagement. This does not cause immoral behavior as such, but might cause moral disengagement. Supply chain research needs to focus on what should be included in codes of conduct and other ethical guidelines, so as to reduce the risk of immoral behavior. In order to reduce the likelihood for moral disengagement, there are several supply chain practices that should be included in codes of conduct, such as power asymmetry, managerial support, and incentives.
Keywords: Business ethics; corporate social responsibility; governance; manufacturing; multinational companies; qualitative research.
Rapid manufacturing as a reshoring enabler: A Why, Where and How approach
by Luciano Fratocchi
Abstract: The paper aims to investigate the hypothesis that additive manufacturing technologies may enable manufacturing reshoring, i.e. (partial vs. total) repatriation of (in-sourced vs. out-sourced) manufacturing activities earlier off-shored to foreign countries. Since the paper has an explorative nature, a desk research strategy was adopted based on the following perspectives: Why (motivations), Where (industries) and How (governance modes). Findings from the literature review were coupled with data from the Uni-CLUB MoRe reshoring dataset and from 11 cases of companies reshored their production activities after adopting rapid production systems. Collected evidence seems to confirm that rapid production technologies may enable manufacturing decisions, both in terms of motivations (Why perspective) and industries (Where perspective). Results belonging to the How perspective (governance modes) are not conclusive, even if case studies support the idea that companies internalize production activities after the reshoring decision.
Keywords: 3D printing; Additive manufacturing; Reshoring; Governance mode; Back-reshoring.
Innovation in container shipping organizations: Impact of intra- and inter-organizational connectedness
by Ceren Altuntaş Vural
Abstract: This article discusses the impacts of customer involvement, supplier involvement, employee involvement and multi-functional collaboration on the innovativeness of container shipping companies. It also considers the relationship between innovativeness and its impacts on business performance. The results of the structural equation modelling analysis used to explain these relationships indicate that container shipping companies rely on internal resources for business service innovation, while neither customer nor supplier involvement have any influence on their innovativeness. This suggests further analysis is needed concerning stakeholder inputs and innovation types with respect to different business-to-business services considering that it has positive impacts on both the financial and customer service performance of container shipping companies. With reference to these findings, managers might want to consider interdependencies between different stakeholders in collaborative innovation. Involving customers by using sales or marketing professionals as mediums might yield to better results in terms of effective customer involvement.
Keywords: Customer involvement; Supplier involvement; Employee involvement; New service development.
Assumptions for inventory modeling: Insights from practice
by Lauri Lattila, Samuli Kortelainen, Per Hilletofth
Abstract: Many different types of models have been developed to analyze multi-echelon supply chains. These models tend to rely on certain assumptions which might be too restrictive to be used in practical applications. In this paper we present a decision support system developed for a manufacturing company to aid decision making in both manufacturing and distribution strategy. The model is based on the assumptions of the decision-makers instead of relying on a pre-existing model architecture, which guarantees that the assumptions made are not too restrictive for practical use. The decision support system is based on agent-based modeling. The model was done in close co-operation with the personnel from the case company, and emphasis was based on how the company can use the model in decision making without requiring any special expertise in developing the supply chain alternatives. The case company expected the model to be able to utilize stochastic demand, which is not based on normal distribution. Warehouses also need the possibility to work in dual-roles and distribution needs to cover nonlinear transportation costs due to economics of scale. Due to rescheduling and dynamic capacity management, it is difficult to estimate actual production lead times for production orders. By using agent-based modeling we were able to take the central assumptions into account and create a decision support system, which the supply chain manager can use to evaluate various supply chain alternatives.
Keywords: Inventory management; Inventory modeling; Simulation; Decision support.
Special Issue on: Supply Chain Relocation Studies from a Brazilian Perspective
Minimum-cost flow algorithms: a performance evaluation using the Brazilian road network
by Carolina Luísa Dos Santos Vieira, Mônica Maria Mendes Luna, Jovane Medina Azevedo
Abstract: In this paper, we evaluate the practical performance of four algorithms for solving the minimum-cost flow problem on road networks. While most computational testing has been based on artificially generated networks, for this study we used 215 real-world test instances, solved over the Brazilian road network. We verified that, differently from the literature, Network Simplex was the best performing algorithm in practice for this context, both in terms of speed and robustness. Features such as the number of supply and demand nodes influenced runtime, besides network topology and spatial syntax. On the other hand, the supplied volume and the ratio of supply/demand nodes were not good performance predictors. Our evaluation also showed that efficiency may be tied to algorithmic structure. The results should be particularly useful to support a choice of a MCF algorithm for evaluation of transportation networks, allowing to reduce the cost of processing analyses of flow allocation. In view of limited economical resources available to developing economies, the definition of investment priorities in infrastructure should be supported by proper methods.
Keywords: minimum-cost flow; experimental study; Brazilian road network; algorithms performance; network simplex.