Logistics control: an approach to quality

There has been a rapid acceptance by firms in the United States that product quality is necessary to compete in today's global markets. Product quality, in this sense, can be defined as an agreed upon set of standards and tolerance limits between the firm and its customers. The attitudes of product quality are a result of the successful creation of possession utility (marketing), form utility (manufacturing), and time, place, and quantity utilities (logistics).

In order to assure that these utilities are created to meet the quality requirements of the customer, control must be exercised over the logistics activities. The purpose of exercising control is to assure that the desired results are attained. The purpose of this research was to investigate the nature of control in logistics in industry by using the order cycle as a framework and by determining if control is exercised, when it is exercised, and how it is exercised.

Data was gathered for this research using a survey mailed to 300 logistics executives who are members of the Council of Logistics Management. Because this research was descriptive in nature, frequency distributions, chi-square analyses, and multiple regressions were used to analyze the data.

The major finding of this research was that although logistics executives indicated that they performed control activities on the order cycle, they only have little effective control over its output. This is because there is not enough emphasis by logistics executives on the critical control activities: development of tolerances, variance analysis, and capability analysis.

Another finding of this research was that the level of control exerted by a firm over its order cycle is not a function of the firm's demographic characteristics. These characteristics included revenue level, industry, and geographic area served.

To conclude, logistics executives in the sample exhibited low levels of control over the order cycle and its components. Although some possible explanations for this situation are offered, it appears that the level of control is not affected by, nor is a function of, the firm's demographic characteristics.