Decision model for logistics provider selection : Fläktwoods AB case

Abstract: The choice of proper logistics provider can be complex and might influence the success of manufacturing company. The complexity of decision can be caused by the numerous crite-ria for the selection of logistics provider. The great number of studies are discussing and presenting suggestions on logistics providers‟ selection models mostly in following streams: strategic decision making in organizations, industrial buying behavior, transportation pur-chasing, logistics suppliers‟ selection, and logistics relationships. The need for efficient pro-vider‟s selection and important criteria evaluation is causing the purpose of this paper.After the solid analysis of the theories discussed in the literature the author of this thesis is purposing the development of the hybrid model of logistics provider selection framework and finalizing with the model adapted for the case company. The issues regarding relation-ship with logistics provider and important selection criteria are questioned in this research as well.The inductive research approach is applied in this thesis. The selected qualitative study is the most suitable method regarding the problem and purpose of the study and provides for better understanding of the opinions and perceptions of the interviewed participants re-garding the frameworks of selecting logistics providers, also the process of relationship formation and coordination. Moreover, quantifying method processed through question-naires while evaluating the wide range of selection criteria related to this process is per-formed. Single case study as the research strategy is chosen, thus data is collected from six interviews conducted at six different logistics departments of the company.The main conclusions after the analysis of the covered literature and received data are re-sulting in the advice for practical implementation of the discussed model in the company‟s current procedures. The process basically includes need identification, documentation for RFQ process preparation and distribution to perspective logistics providers, results‟ analy-sis and meetings during the selection process, trial time in some cases, then final decision. The adapted model of the selection process which can be used in Fläktwoods can assist manufacturing companies having similar needs and requirements in transportation terms. The strategies in relationships‟ with logistics providers handling do not require much atten-tion in the company as its long-term relationship with main logistics services provider is re-sulting in a higher level of competitive attainment, also shorter one-year contracts benefit the company in terms of flexibility and price competition. Regardless the type of relation-ship, perceived trust, equity, and commitment are highly valuable in the company, therefore the success of the current relationship is further depending on strategic evaluation. The fu-ture study can be inspired for multiply case study, also for broader empirical investigation within the company.