Outsourcing of Logistics in SME Technology Company

Abstract

In recent years outsourcing has received a great deal of attention and companies have focused their activities on core competences. Basis for this study is to outsource warehousing, transportation and other logistics activities of the case company, Radionet Oy. Strategy of the company is to build a wide co-operation network in which it is specialized in. This network helps Radionet Oy to concentrate in core activities. Outsourcing offers a flexible logistics solution for the company at the state of expansion and entering global markets. Empiric data was collected for current situation analysis by using interview and discussion methods with experts of the company. Based on this analysis; criteria, requirements and service provider evaluation hierarchy tree are defined. Weigh of criteria were defined by two questionnaires directed to customers and company personnel. Evaluation of service providers has been resolved by using Analytic Hierarchy Process, AHP. This research provides a method developed for systematic evaluation of service providers. In addition outsourcing process model was developed. This process model can to be utilized when outsourcing other future functions. Systematic evaluation method is performed successfully at Radionet Oy and can also be utilized in other SME companies operating in the same area.