Conceptual Analytic Network Model

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Running Head: SELECTING OF 3PL SERVICE PROVIDER
3PL service providers in Aerospace Company
Student
Date

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Running Head: SELECTING OF 3PL SERVICE PROVIDER
Table of contents
1. Introduction..................................................................................3
2. Literature review...........................................................................4
3. The analytical hierarchy process.........................................................5
4. The aerospace company....................................................................6
4.1The selection of the 3PL services providers in aerospace company...................7
4.2Implementation of AHP in the aerospace company....................................8
5. Recommendations .........................................................................10
6. Conclusion....................................................................................10
7. Bibliographies...................................................................................11

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Running Head: SELECTING OF 3PL SERVICE PROVIDER
1. Introduction
Globally, businesses are competitive, and therefore companies outsource their supply chain
processes to gain a competitive advantage over other proficient companies. Indeed, various
companies outsource logistics in their supply chain processes, and they manage the logistics
activities. Notably, outsourcing logistics has to lead to efficiencies in multiple businesses,
making it popular worldwide. The recent study shows that there has been an increase in
outsourced logistics and third-party logistics services (3PL). Therefore the 3PL refers to an
organization that manages different logistics modules under a contract of a customer from a
specified industry Sahu, Datta, and Mahapatr (2015 P.354-392). Globally, companies are turning
into the 3PL service providers since it has become an essential part of the company's supply
chain. Furthermore, 3PL providers offer many and different services worldwide, including;
distribution, customs, labeling, returns, freight forwarding, etc. consequently, the 3PL service
providers enable the organizations to improve in customer services and operational efficiency;
thus, cost reduction in logistics and expenditures. Due to the increment use of the 3PL services
by shippers, it has become a critical issue in selecting the appropriate 3PL services providers.
Therefore, the selection difficulties need to be addressed via the Multiple Criteria Decision
making (MCDM) approach Raut et al. (2018 p.76-97). Additionally, the analytical hierarchy
process (AHP) is among the applicable procedures in the (MCDM approach. Notably, (AHP)
plays an important role in qualitative and quantitative methodology whereby; it used by the
analytical decision-makers. Besides, it is inclusive of Expert choice and Decision lens, which are
professional software and are applicable during the practical. Recently, there has been a
deployment of 3PL service selection criteria, which is a combination of Technique for Oder

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Running Head: SELECTING OF 3PL SERVICE PROVIDER
Preference by similarity to Ideal Solution (TOPSIS) approach and AHP, thus; helpful in
reversing the logistics in an organization Ginting et al. (2017 p.58-64). Indeed, this report
analyses a criterion for selecting logistics services providers and decision making.
2. Literature review
3PL service providers are important in logistic thus, selecting the appropriate 3PL services has
been the primary challenge over the years. Therefore, companies ought to consider some factors
while selecting 3PL service providers Chocholáč, Sommerauerová, and Polák (2018). Various
studies have been conducted in identifying the appropriate 3PL selection criteria, though the
bottom line lies at defining and evaluating the probable logistics service provider Alkhatib,
Darlington, and Nguyen (2015 p.102-134). According to Tavana et al. (2016 p. 1705-1701),
some factors should be considered in the 3PL service providers selecting criteria including;
speed, top management, deliveries, the information system, financial stability, performance
metrics quality requirements, cost, and deliveries. Notably, there include some other factors
when selecting the potential 3PLproviders, including; flexibility, financial stability, size,
capability, reputation, quality of assets, long term relationship, and geographical range service.
Besides, quantitative methodologies are also applicable in choosing the 3PLservice providers
whereby, through qualitative and quantitative procedures, Fuzzy and AHP models were
developed. In the study, fuzzy is determined using different methodologies of selecting the 3PL
service providers, including; the triangular approach, the hybrid procedure, and analytical
network procedure ( ANP) Ergu et al. (2014 p.58p-74). The ANP performance in 3PL service
providers is determined from the supply chain perspective. In addition, a recent study shows the
suitable and preferred method of selecting the 3PL service providers whereby; TOPSIS and