A process model of a logistics system as a basis for optimisation programme implementation

Abstract

The purpose of this paper is to investigate the role of the process approach in optimisation programme implementation. It is proposed that application of a process model of a company provides overcoming of functional boundaries and, consequently, overcoming of sub-optimisation of logistics system performance. The process model of an internal logistics system of a wholesale trading company, based on the Supply Chain Operations Reference (SCOR) model, has been developed. Relations between business functions, processes and performance indicators (metrics) have been analysed. The optimisation model has been developed, and comparative analysis of possible results of optimisation of processes and functions has been conducted. Results demonstrate that optimisation of functions results in a sub-optimal solution, caused by functional boundaries, whereas optimisation of processes results in an optimal one. Research provides the rationale for process approach implementation in order to make optimal decisions regarding the logistics activities and the technique of practical implementation of an optimisation programme.

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