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Freight Transport Time Savings and Organizational Performance: A Systemic Approach

Author

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  • Evangelos Sambracos

    () (University of Piraeus, Department of Economics, 80, Karaoli and Dimitriou Str, 18534 Piraeus, Greece)

  • Irene Ramfou

    () (University of Piraeus, Department of Economics, 80, Karaoli and Dimitriou Str, 18534 Piraeus, Greece)

Abstract

This paper investigates the effect of freight transport time savings (FTTS) on the performance of transport consuming companies. In the first part existing methods on FTTS valuation are critically discussed and their limitations are identified. Following, a conceptual model is built introducing an alternative approach for the valuation of FTTS that is based on the system perspective of firms, integrating the disciplines of systems thinking, performance measurement, transport and logistics decision making. Evidence from a Systems Dynamics' simulation experiment on a retailer suggests that the effect of FTTS on performance depends highly on the structure of the firm's transport related processes and decision making process. Through the development and simulation of several scenarios concerning the reaction of the firm to the FTTS, it is concluded that the value of FTTS is sensitive to the type of the reaction and its time profile.

Suggested Citation

  • Evangelos Sambracos & Irene Ramfou, 2013. "Freight Transport Time Savings and Organizational Performance: A Systemic Approach," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Eastern Macedonia and Thrace Institute of Technology (EMATTECH), Kavala, Greece, vol. 6(1), pages 19-40, April.
  • Handle: RePEc:tei:journl:v:6:y:2013:i:1:p:19-40
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    File URL: http://ijbesar.teiemt.gr/docs/volume6_issue1/freight_transport.pdf
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    References listed on IDEAS

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    1. massiani, jerome, 2008. "The welfare effects of freight travel time savings," MPRA Paper 8754, University Library of Munich, Germany.
    2. Hensher, David A., 2010. "Hypothetical bias, choice experiments and willingness to pay," Transportation Research Part B: Methodological, Elsevier, vol. 44(6), pages 735-752, July.
    3. Danielis, Romeo & Marcucci, Edoardo & Rotaris, Lucia, 2005. "Logistics managers' stated preferences for freight service attributes," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 41(3), pages 201-215, May.
    4. Guide, V. Daniel R. & Kraus, Mark E. & Srivastava, Rajesh, 1997. "Scheduling policies for remanufacturing," International Journal of Production Economics, Elsevier, vol. 48(2), pages 187-204, January.
    5. David Hensher & John Rose & William Greene, 2005. "The implications on willingness to pay of respondents ignoring specific attributes," Transportation, Springer, vol. 32(3), pages 203-222, May.
    6. Fleischmann, Moritz & Bloemhof-Ruwaard, Jacqueline M. & Dekker, Rommert & van der Laan, Erwin & van Nunen, Jo A. E. E. & Van Wassenhove, Luk N., 1997. "Quantitative models for reverse logistics: A review," European Journal of Operational Research, Elsevier, vol. 103(1), pages 1-17, November.
    7. Dreyer, Bent & Gronhaug, Kjell, 2004. "Uncertainty, flexibility, and sustained competitive advantage," Journal of Business Research, Elsevier, vol. 57(5), pages 484-494, May.
    8. Jérôme Massiani, 2003. "Benefits of travel time savings for freight transportation : beyond the costs," ERSA conference papers ersa03p388, European Regional Science Association.
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    Citations

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    Cited by:

    1. Evangelos Sambracos & Irene Ramfou, 2014. "The Effect of Freight Transport Time Changes on The Performance of Manufacturing Companies," European Research Studies Journal, European Research Studies Journal, vol. 0(1), pages 119-138.
    2. Sambracos, Evangelos & Ramfou, Irene, 2015. "Do freight transport time savings translate to benefit for transport consuming companies?," MPRA Paper 68558, University Library of Munich, Germany.

    More about this item

    Keywords

    Performance; Freight Transport Time; Cost-Benefit Analysis; State Preference Surveys; Systems Thinking;

    JEL classification:

    • L91 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Transportation: General
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

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