An engagement model for collaborative outsourcing relationships

Abstract: The modern world represents a turbulent and ever-changing environment. Business organisations strive to achieve efficient and effective logistics management processes within the value chain and increasingly appreciate the need for logistics specialists or expert partners to support their value chain or supply chain activities. Thus, the consideration of outsourcing non-core activities in the value chain has become paramount to organisations, with the ambition to optimise organisational structure towards sustainable competitive advantage. This is a business need which Logistics Service Providers (LSPs) have grasped over the years, and resultantly, have expanded their service offering in supply chain activities. Simultaneously, collaborative relationships between LSPs and their clients have become vital to achieve successful delivery of supply chain activities. The rationale of the study was to provide guidance on how collaborative relationships in an outsourced logistics function can be achieved both strategically and operationally. The aim of the study was to determine the foundation - associated key elements which enable optimal value from relationships between an LSP and its clients. The study was conducted on Imperial Logistics (IL), a division of Imperial Group (Proprietary) Limited. The key objectives of the study were to: i) provide guidance on an optimal strategic engagement model for a collaborative relationship in outsourcing, including suggesting a suitable performance measurement tool to measure such a relationship, and ii) to consider how well the current operational status quo in IL aligns to the engagement model. The study was conducted using a mixed-method approach; quantitative dataM.Com. (Business Management