Diagnosing lDiagnosing lDiagnosing lDiagnosing logistic performanceogistic performanceogistic performanceogistic performance problems problems problems problems

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Diagnosing l

Diagnosing logistic performance

ogistic performance

ogistic performance problems

ogistic performance

problems

A research of reliability problems

using hard and soft systems perspectives

MASTER THESIS University of Groningen

Faculty of Economics and Business MSc Business Administration

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Acknowledgements

The research for this work is made possible because of the commitment of my colleague Ron Broekhof at the Flower Auction in Aalsmeer. I thank Ron for his engagement with our project, his hospitality by giving me a room in his office and for sharing with me his ideas and views on organisational matters. I thank the other people for joining the project teams and making such valuable contributions.

I thank Martin Land of the Groningen University for wanting to read and assess my thesis. I expect it is not in the area of your academic interest, which makes it even more interesting to hear your comment on my work. Furthermore, now that I have the chance, I also want to thank you for making me study that ‘terrible’ book of Schönsleben. I have not felt so proud since the day I passed my exam for your course. Knowing that I have tackled Schönsleben makes me feel self-confident about understanding some difficult things about operations management.

In 2002, I have started to study business administration at TSM and since then I attended classes of several lecturers of Groningen University. One of them of was Jan de Vries, who was also the first person I suggested to switch from TSM to Groningen. As he gave me his support, I made up my mind and decided to go for it. I subscribed for the master study, left my house, husband and children (a couple of days a week), attended classes, wrote papers, passed exams and, two year too late, I now finish my final thesis. It was all worth it! To Jan I am deeply grateful for expressing his faith in my competences. Thank you for your support, our conversations, e-mail correspondence, and our nice dinners in Amsterdam and Groningen. You have been also very clear about the consequences of not accomplishing my thesis … so I am glad I can continue to visit your city without the risk of getting ‘my legs broken’. I hope that our friendship continues for many years and we will keep meeting, while I make a late attempt to find my way in Academia, almost as successful as you have.

Lisa Suurland Nieuw-Vennep

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Summary

This thesis is based on the question how to investigate and explain the reliability problems of the Flower Auction in Aalsmeer. The aim was to take a comprehensive view at the problem situation that goes beyond the description of symptoms. A project team has looked at the problems and its findings and recommendations all together represent a multi-perspective view addressing different managerial issues. However, a coherent and systematic review of facts, causes and consequences, was not

accomplished. This thesis is meant to close this gap and uses the empirical data that were gathered at the time of the project and beyond.

The objective of this research is to develop a diagnostic framework incorporating both hard and soft systems perspectives in order to explain logistic problems. From a systems-structural perspective, the logistic system is regarded as a designed tool to enhance goal attainment, and knowledge is gained about the structural characteristics of the logistic organisation from which the logistic performance (partly) can be explained. From the behavioural perspective, insights are gained about the antecedents of the emergent behaviour of the logistic task owners and the effects on the logistic performance. The diagnostic framework of this research is based on the conceptual model of logistic organisation that comprises three structure dimensions. First, the logistic control structure reflects the coordination of all operating decisions on a strategic, adaptive and operational control level. Second, the organic logistic structure concerns the division and allocation of logistic control tasks to individual positions and organisational units. Third, the personnel logistic structure reflects the relations between the people taking care of logistic control activities. The congruence-hypothesis, for which empirical evidence is found before, states that the three dimensions can reinforce each other positively or negatively. However, the dynamics are not yet clear to us. Therefore, in order to develop a more detailed framework on the phenomenon of congruence, the central research question of this research focuses on three types of congruence, i.e. technical, political and cultural congruence. The technical fit of parts of the logistic organisation is assessed with a systems-structural perspectives, whereas the political and cultural fits require to take a soft systems perspective.

The diagnostic framework is built on the issue of logistic coordination. Because of the decomposition of logistic decisions (for example strategic versus operational decisions, long-term and short-term decisions) and the division of logistic task areas among units and people, a need for coordination emerges. This relates to task-related interdependences, but not exclusively. Within labour

organisations also cognitive and cultural interdependences between people occur that interfere with functional interdependences. The different interdependences ask for different coordination

mechanisms, which to a certain extent can be formally ‘designed’. In particular, task-related interdependences can be managed by coordination mechanisms that are designed beforehand to establish the required coordination ability. Logistic coordination that cannot be designed relates to informal control behaviour that stems from power relationships and social networks. This means that both formal and informal control behaviour shape the actual logistic coordination. The essence of the diagnostic framework is that logistic performance is presumed to result from the congruence between the effectuated coordination ability and the need for coordination.

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empirical data.

Empirical results with respect to the ‘technical fit’ show that the information-processing ability runs short to align strategic decisions on different functional areas (marketing, operations, and human resources) as well as to align aggregated and detailed logistic decisions. As a result, the logistic operation is controlled by mostly low-level decision-making on a detailed level and on a short-term notice, with focus on goal attainment that is limited to each (sub-) unit’s responsibility. In particular, the logistic performance on the reliability dimension is restrained by this practice as the operation’s reliability relies heavily on the coordination of the functional interdependences. As for the ‘political fit’, times are changing because of globalization and new marketing systems. The low cost strategy may gradually move towards an integrative strategy (balancing cost and service goals), although implicit trade-off decisions still seem to favour the goal attainment on the dimension of costs and speed, thereby neglecting somewhat the operation’s reliability. The ability to political bargaining could not be established well in this research. The (qualitative) datasets that originate from the participative observations generate only limited insight on the political practices. At the time, staff turnover occurred at the high managerial level (board of directors and divisional manager) after which a turnover of middle managers was noticed. Decision-making processes seemed to be hold up, delayed or latent and it was difficult to put a finger on the political forces. Cultural differences, however, appeared to exist strongly between the two main divisions (Auctioning and Internal Transport & Distribution) because of differences in stakeholders, type of processes, commercial environments and performance goals. This cultural heterogeneity keeps the parties separated and inhibits formal and informal communication and cultural adjustments. This largely explains the continued existence of the problem situation in which the logistic coordination ability does not fit the need for coordination. After the empirical study, the diagnostic framework is assessed. A conclusion is that the framework offers the possibility to explain a logistic problem situation like at the Flower Auction, by assessing different factors in coherence. The congruence-hypothesis is further developed by specifically focussing on two important types of congruence. On a strategic level, the first type of congruence considers the effectiveness of feed forward and feedback (logistic) control loops. On an operational level, the logistic system’s internal congruence is analysed by use of the construct of coordination. This type of congruence shows whether the logistic control behaviour generates the coordination ability that fits the coordination need resulting from the structural organisational arrangements. Insight is gained about whether the existing interdependences (i.e. functional, cultural and social) are taken care of by the right coordination mechanisms and behaviours.

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11 1 Introduction

Introduction

This research is about diagnosing a logistic problem situation by taking a multi-perspective view. Logistic performance in real life is partly accomplished by applying the expert knowledge on operations management that has been explained to us by many authors, among which Slack (2001) and Schönsleben (2004). They show how to tackle the operations management issues from a clear problem statement and to solve this in an efficient way. However, this is not all that matters. Instead, we also have to deal with several other influences, like external pressures and uncertainties,

organisational culture and political processes, because of which a clear problem is often hard to define. That is why this research is based on the claim that both a hard systems perspective and a soft systems perspective are necessary for explaining and solving a logistic performance problem. The ‘soft’

approach is concerned with finding out what the problem situation is and, therefore, it addresses in particular the views of relevant stakeholders within (and possibly outside) the company walls. The ‘hard’ approach is applicable ones the problem situation is thoroughly understood and defined and solutions can be designed and implemented.

In this chapter, we introduce the problem situation at a very large flower-auctioneering firm. The first paragraph describes the commercial market, the market systems in use, the logistic performance problem and the initiative taken to find solutions for this problem. In the second paragraph, the research design will be developed systematically and an outline of the thesis is presented.

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1.1 1.1 The Flower Auction

The Flower Auction

1.1.1 The marketThe marketThe marketThe market

The Flower Auction (hereafter referred to as 'FA') is located in Aalsmeer and one of the largest flower-auctioneering firms in the world. In 2005, FA is a cooperative with about 2,900 members, breeders and growers established in the Netherlands and for a small part abroad. In that same year another 1,500 growers sold their products at the FA. The flowers and plants have been purchased by 1,050 buyers. Between 2004 and 2005 the sales turnover increased with 3.2%, from 1,630 to 1,690

million Euros, although the quantities sold dropped by 0.4%.

In October 2006, the boards of FA and Flora Holland have signed a declaration of intent for a merger of the two cooperatives. On the Dutch market, these two auctions have a joint market share of more than 90%. However, the flower and plant industry is not limited to the Netherlands. Both on the production and on the sales side, the flower and plant business is an international market: 30% of the current volume of cut flowers bought and sold at Dutch auctions comes from abroad, and more than 80% of flowers and plants is exported from the Netherlands to other countries.

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increase in energy costs, the increasing costs of logistics and due to more stringent laws and regulations. These cost increases are not compensated by a structural price improvement of the product and therefore cost savings are necessary. In summary, a great deal of the pressure being felt by the Dutch auctions comes from internationalisation, new digital sales systems and expansion in foreign production areas, while specialisation and changes in sales patterns both at home and abroad mean that increasingly large quantities of products are traded outside of the Dutch auctions. Instead of competing with on another, the two Dutch auctions want to try to maintain their position in this changing market by joining their efforts1_.

There are two market systems. Firstly, auctions (by ‘Dutch auction’: a method in which the price clock is started by the auctioneer and moves rapidly downwards) take place every weekday in five separate halls, all dedicated to a category of flowers or plants. Recent developments include image auctioning and remote buying. In image auctioning, flowers and plants no longer appear in front of the clock but are sold based on photographs and other information. In this way flowers and plants can be taken straight from the cooled storage areas to the customer once sold. Remote buying enables traders from everywhere to purchase products online using their PC. Traders are no longer required to be physically present in the auction room. Secondly, beside the clock-auctioning a second market system has been implemented: intermediary services. Under this system, transactions are not

established using the auction clock, but via FA employees who work as sellers on behalf of growers. In 2005, intermediary services accounted for 13% of the total sales volume of cut flowers, 56% of indoor plants sales and 42% of garden plants sales. Sales by intermediary services have been growing at the cost of the auctioning system in the last three consecutive years.

1.1.2 The operation The operation The operation The operation

Each flower auction hall has tiered desks for hundreds of buyers, each linked to the auction computer. Each buyer has an uninterrupted view at the four auction price clocks behind the auctioneers, and at the flowers that are conveyed through the auction halls on their trolleys. The auction halls are equipped with in total 13 auction projected clocks: large, highly visible screens displaying more information than traditional clocks. For example, growers have the option of showing their logo or photographs accompanying the products being auctioned.

The flower auction operation comprises two main physical parts. The first is the sellers’ area known as the auction section where flowers are received, held in cooled storage areas and auctioned. The second is the ‘buyers section’ where buyers, exporters and wholesalers rent or buy a workshop to prepare flowers for shipment. Trucks leave FA every working day with destinations throughout Europe. On a typical day there are about 10,000 people working at the centre (1,800 of them working directly for the FA), together handling nearly 20 million cut flowers and over two million plants. Flowers are very delicate and wilt quickly, so dealing with them in such large quantities makes the speed, accuracy and dependability of the operation critical. During the evening and overnight, flowers are brought into the operation in standard containers and boxes, which are subsequently handled in standard stacking trolleys. There are 135,000 of these trolleys in circulation. Each lot of flowers is assigned a reference number, and descriptions are entered on the delivery forms attached to each trolley. The trolleys are then held in cooled storage until they are collected for the auctioning on the following morning at 6 am.

Two important features of the operation system can be noticed. On the one hand, there is a high level

1_{From: ‘Merger special’, publication of Aalsmeer Flower Auction and Flora Holland, 26 October 2006, and the ‘Merger}

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of computerisation. Growers have to send an electronic consignment note, to inform FA which products will be supplied for auctioning. There are electronic consignment notes for both the price clock and for intermediary services. With the electronic consignment note, the auctioneer as well as customers can see what is on sale before the clock starts. In addition, a tracking & tracing system is implemented to be able to monitor the logistic phase of the products delivered at the FA centre. Moreover, the auction clocks themselves are computerized systems at the hart of the information architecture. The products are sold by Dutch auction. The first (and consecutive) bidder who presses the desk button stops the clock and becomes buyer of that lot. All details of that one bid are recorded by computer and printed out on a distribution voucher. The complete lot can eventually be sold to more than ten traders. After every bid, the clock is started again. The computer generates all

distribution vouchers, which have to be attached manually to the appropriate trolley. This reveals the second characteristic of the FA operation, it largely consist of manual work.

Besides the high level of computerisation, a high degree of manual work is involved in the physical handling of the products, and the accompanying paperwork and computer-supported activities (like scanning). Taken into account the vulnerability of the products and the need for speed, the accuracy of the operation not only depends on the reliability of the computer systems but also on the design of the physical handling process and the care of people involved, starting with the grower and the transporter, and ending with the distribution employee of the FA. Therefore, a high level of computerisation may contribute to the performance of the operation and is therefore necessary as such, but it is not sufficient. The operations’ performance on the dimensions speed, accuracy and dependability depends on both computer systems as well as on handling processes, and on people working in the entire supply chain.

1.1.3 Logistic Logistic Logistic Logistic performance problemsperformance problemsperformance problemsperformance problems

During the logistic operation, parts of the products can be lost or damaged. When an employee notices and reports this, the problem is registered and treated as an internal fault. Buyers may also complain about not having received the goods they bought at the auction, or they complain about damaged goods. In this case, the problem is registered and handled as a customer complaint. In both cases, the Logistic Division is responsible for solving the problems by means of the so-called retrieval process. In December 2004, the two large auctions conducted a benchmark, comparing their internal logistic operations of the sites in Aalsmeer, Naaldwijk and Rijnsburg. One of the findings shows that the number of customer complaints at Aalsmeer is higher than at the other sites. This site also appears to consume more labour-hours to handle these complaints and to correct process faults by retrieving lost products. Thirdly, more reimbursements (relative to turnover) are paid for damaged or lost products. The authors of the benchmark tried to explain the relatively high number of customer complaints by pointing at the workforce at that site, which comprised a larger percentage of temporary employees and employees with a poor command of the Dutch language. The absence of a quantitative audit of incoming goods before auctioning was seen as a second explanation. Because of this, products can be auctioned based on an electronic consignment note, and eventually be reported missing, while actually they may not have been supplied by the grower. Finally, the authors expected less internal process errors at the Rijnsberg site because of the clear physical arrangements in the distribution area. According to the operational plan, the Internal Transport & Distribution (hereafter referred to as 'ITD') division aimed at lowering the amount of reimbursements paid to growers and buyers for lost or damaged goods for 2006. However, the target that was set for that year was not realised. In

addition, the performance of the logistic operation did not come up to other efficiency standards. The results in terms of cost per trolley, cost per transaction, trolleys per hour (productivity), and

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targets and measures concerning these topics were set. The number of customer complaints per transaction (in the auction chain) is set on 0.65 %, meaning 65 complaints on every 1,000 transactions, which would be an improvement compared to 2006.

1.1.4 Initiative to Initiative to Initiative to Initiative to find solutionsfind solutionsfind solutionsfind solutions

In November 2006, the head of department of ITD Operations initiated a project and assigned the author of this thesis as project leader. This project was aimed at the improvement of customer complaint handling and the retrieval of internal process faults. The head of department stated that largely, the retrieval of faults should be done instantly by the unit responsible for the fault, instead of by a separate unit later on in the logistic chain. On a more abstract level, the goal was to underline the necessity of prevention of faults. A project was started and employees, who all worked at the retrieval work unit except for two people, were assigned to join project teams. These teams were supposed to describe, analyse and redesign the relevant processes. At the start of the project, the head of

department left the company and the lower level managers were to take responsibility for the daily logistic operation. However, none of them replaced the former head of department as being an active supporter of the project. One middle manager took the view that customer complaints could only be reduced by repositioning retrieval employees in the organisation structure, while others pointed at the logistic operation itself. In meetings of the project teams, it was often argued that other workers upstream of the goods flow just made it easy for themselves, while downstream "we have to deal with the consequences".

At the end of the project, the type of faults that accounted for the highest number of faults and/or reimbursements were prioritized, and discussions took place about what recommendations should be made. A report was written that contained the findings and views of the project teams, and it was sent to the middle managers. A central issue was that faults made upstream in the goods flow can cause new faults that all together are more difficult to recover later on in the operation. Project team members argued that changing working procedures in the logistic operation could (and should) lower the number of process faults and customer complaints. Based on their (retrieval) working experiences they came up with ideas to prevent process faults from happening or causing any more problems.

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1.2 1.2 Research

Research

Research design

design

This thesis focuses on the question how to investigate and explain the logistic performance problem in a given situation like at FA. The aim is to take a comprehensive view at a certain problem situation that goes beyond the description of symptoms and reveals the relevant determinants of the problems. During the project meetings with the people who work in the daily logistic operation many ideas were put forward that relate to all sorts of management issues, like capacity management, quality management and human resource management. One could say that the findings and

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1.2.1 A preliminary rA preliminary rA preliminary rA preliminary research objectiveesearch objectiveesearch objective esearch objective

In this research, we want to be able to diagnose systematically and comprehensively the logistic problem situation at FA. The problem situation concerns the logistic operation, as well as the internal faults and customers complaints that necessitate the retrieval process. It also appeared that different managers at different organisational levels have different interests as well as diverging views of the causes of the internal faults and the customer complaints, and what should be done about it. This is the reason that this research takes a multi-perspective view on the problem situation at FA. We need to gain insight in the actual logistic operation and the actual faults and customer complaints. On the other hand, we must understand the antecedents of the diverging interests and views, and the ways in which the problems are dealt with.

The diverging views can be illustrated by the next events. In a meeting with the middle managers, the project leader and the manager of the retrieval unit suggested that a relationship exists between the process faults and control of the logistic operation. Some middle managers did not appreciate this, and argued that the project was only about improving the retrieval process. Although the head of

department specifically aimed at prevention of faults, one middle manager was particularly interested in getting control over the retrieval activities. Furthermore, the recommendations of the project teams in which many people had participated, did not get much support.

During the project, data is collected and analysed about the logistic operation, the accompanying internal faults and resulting customer complaints. These insights, gained in the course of the conference meetings, all concern the logistic goods flows as area of special attention. Furthermore, ideas were put forward with respects to control issues such as the strategy and the capacity planning and organisational issues like the allocation of responsibilities and the personnel reward system. The manager of the retrieval unit also initiated two meetings with managers from other operational work units to discuss the opportunities for improving the ‘plant processes’ and the ‘flower processes’. This initiative did even bring people from Auctioning and ITD divisions together, which appeared to lead to a constructive dialogue.

Before we can determine our research objective that elaborates the ‘multi-perspective view’, first a preliminary objective is formulated. This objective shows the direction to explore theoretical insights, which can found the final research objective and the central research question. For this moment, our preliminary research objective is to develop a multi-perspective diagnostic framework, with which logistic performance problems in a given situation can be explained.In the next sub-section of this chapter, a review of applicable theoretical insights is presented.

1.2.2 Theoretical perspectiveTheoretical perspectiveTheoretical perspectiveTheoretical perspective and research objective and research objective and research objective and research objective

The ability of an organisation to perform both dependably and accurately - in other words to be reliable – can be regarded as a dimension of service quality. Fitzsimmons and Fitzsimmons (2006) argue that reliable service performance is a customer expectation and means that the service is accomplished on time, in the same manner, and without errors every time. Customer satisfaction is the result of comparison of perceptions of the service received with expectations of the service desired. When expectations are not met, service quality is deemed unacceptable and customers will complain and/or will not return. The authors argue that controlling service quality can only be achieved by focusing on the delivery process itself. They have developed a quality development ladder which states that quality development encompasses several progressive phases, ranging from

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In general, the concept of quality has been considered, defined and described by many authors. Beckford (2002) reviews the work of eight worldwide known ‘quality gurus’2_{. He argues that the work} of these gurus relies principally on the mechanistic view of organisation and that the value of holistic or systemic thinking about organisational issues is largely ignored. "Holistic thinking moves away from treating quality as a technical exercise in improving production performance and product quality to embrace less mechanistic, softer issues of culture, stakeholder relations and organisational politics, as well as offering assistance on the technical aspects” (Beckford, 2002, p. 143-144).

In general, a basic premise of systems theory is that organisational effectiveness depends on adaptation to environmental conditions. Organisations can more readily adapt to their environments when internal organisational characteristics are compatible with environmental conditions. For example, contingency theory anticipates that organisational structure must be sufficiently complex to mirror environmental complexity and that organisations will use techniques for coping with environmental uncertainty. Good internal and external congruence is expected to yield higher quality and greater efficiency of operations than poor congruence will. Because system parts are necessarily interrelated, incompatibility among system parts or levels leads to ineffectiveness of the entire system (Harrison and Shirom, 1999, p52).

Systems thinking implies that an organisation and its interactions are studied as a whole, not as an assembly of individual parts. The performance of individual parts of the organisation becomes less important; emphasis shifts to their total interacting performance – that is how they interact to produce products or services and the impact of change in one part on each of the others. For example, recruitment policies and inbound logistics affect service production capability and the ability to meet quality targets. Commitments given to customers interact with production elements of the

organisation, creating demands that need to be met. Harrison and Shirom also state that overlying these aspects are the internal politics of the organisation: that is, the way in which people interact, the coherence of their behaviour, the degree of mutuality in their objectives. Furthermore, the appraisal and reward policy that is related to performance complicates the situation even more.

The dominant way of systems thinking is ’hard’ systems thinking, which assumes that the problem to be tackled is to select an efficient means of achieving a known end, which is defined at the start and thereafter taken as given. The ‘hard’ thinking is dominant in open systems thinking and in

contingency theory, which are primarily descriptive models (Beckford, p. 165). However, as Checkland (2001, in: Rosenhead and Mingers, p. 62) points out, in many, perhaps most, managerial problems at any level the questions – What are the objectives? What are we trying to achieve? - are themselves problematic. This is because of the multiplicity of views, with alternative interpretations that are based on logic, power, politics, and personality. With just ‘hard’ thinking, it is not possible to capture this richness of a problem situation. Mingers (2001, in: Rosenhead and Mingers) argues that modelling and analysis of the kind which is provided by the systems approach is being enhanced through the development of a range of ‘soft’ problem structuring methods that address the qualitative, people-centred issues that are present in real-world intervention. Soft systems methodology

(Checkland, 2001) for example, advocates constructing several system models that reflect the

cognitive maps of participants in organisational problem solving. Comparisons among these maps can contribute to organisational learning and to consensus building among different stakeholders

(Harrisom and Shirom, 1999, p. 41).

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RESEARCH OBJECTIVE

Following the above-described theoretical notions, the research objective can be formulated more accurately. What we were referring to as a multi-perspective view is in fact a combination of the hard systems and soft systems perspectives. The objective of this research is therefore:

To develop a diagnostic framework incorporating both hard and soft systems perspectives that enables to diagnose logistic performance problems in a given situation.

The derived objective is to use this framework and to explain the problem situation at FA.

Considering the multiplicity of views that generally exist in an organisation, it is appropriate to combine hard systems and soft systems thinking. In this way, it is possible to go below the surface of the logistic performance problems, and to examine more thoroughly the underlying system features and their dynamic interactions.

1.2.3 Conceptual modelConceptual modelConceptual modelConceptual model

A potentially useful approach is by looking at the degree of congruence between several logistic system dimensions. De Vries (1999) has created a framework from which descriptive as well as analysing and prescriptive statements can be made regarding the organisational embedment of goods flow control. From empirical evidence, the author argues that the performance of a logistic system can largely be explained by the interaction between the logistic control structure, the organic logistic structure and the personnel logistic structure. The logistic system of an organisation is composed of employees and production resources with which a given input of materials or goods is transformed into products or services. The logistic control structure reflects the coordination of all operating decisions on strategic, adaptive and operational control level. The design of the logistic control structure depends on the characteristic features of the logistic system and its environment. Customer expectations, the product structure, the process structures and managerial beliefs about the design of the physical infrastructure all have implications for the design of the control structure. The organic logistic structure concerns the division and allocation of logistic control tasks to individual positions, and the way these individual positions are clustered to organisational units. The personnel logistic structure reflects the formal and actual relationships between persons and groups who take care of logistic control activities. Together the three structure dimensions represent the logistic organisation (see Figure 1).

Figure Figure Figure

Figure 1111. Conceptual model of the logistic . Conceptual model of the logistic . Conceptual model of the logistic . Conceptual model of the logistic organisationorganisationorganisation (De Vries, 1999)organisation (De Vries, 1999) (De Vries, 1999) (De Vries, 1999)

An important benefit of this integral approach is that it creates the possibility for asking questions systematically and that it gives potential explanations for an underperforming logistic control. De Vries has also found that the three structure dimensions can influence each other positively or negatively. In case of positive congruence, the effects of one structure dimension on logistic

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the logistic performance is influenced negatively because of the reinforcement of the shortcomings on the different dimensions. However, although empirical evidence supports the congruence-hypothesis, a detailed theoretical framework on the phenomenon of interaction has not yet been developed. The author suggests that this frame should synthesize insights gained by the control-oriented perspective and insights from the behavioural perspective, which deals with social processes and organisational politics and their influence on the decision-making.

An interesting approach that studies social and political processes is the social network approach. THE SOCIAL NETWORK APPROACH

The social network approach is based on a few important assumptions: (a) individuals and their actions are viewed as interdependent, (b) relational ties between people are channels for transfer of resources, (c) network models focusing on individuals view the network’s structural environment as providing opportunities for or constraints on individual action, and (d) network models conceptualize structure as lasting patterns of relations among actors (Rispens, 2006). Tichy (1980) has developed a specific network model, which is often addressed. In this model, organisations consist of multiple networks, i.e. clusters of people joined by a variety of links that transmit goods and services,

information, influence, and affect. These clusters of people are both formal, such as departments and work groups, and informal (emergent), such as coalitions and cliques. This means that within an organisation there exists a multiplicity of social structures, which arise out of many possible types of social relationships. Only a portion of the organisation structure is formal (prescribed), and unplanned structures and behaviour patterns will always emerge.

The network approach is concerned with the patterns of all formal (prescribed) and emergent

relationships, and it seeks to identify their causes and consequences. Tichy (1980) argues that network approach facilitates the integration of three orientations to organisations by highlighting the explicit analysis of what flows through the networks – (a) information, (b) influence and/or (c) affect: a) Technical orientation; This orientation is found in contingency, information-processing

approaches to organisation design, which claim that the information-processing capacity should match the level of task and environmental uncertainty facing the organisation.

b) Political orientation: In this orientation, organisations are viewed as political entities that exist to allocate resources among various interest groups. They consist of coalitions whose members are continually calculating whether they might fare better if they altered their participation. Chains of influence should be analysed by identifying coalitions, and assessing how they operate. c) Cultural orientation: This orientation views organisations as cultural systems of values with

shared symbols, shared cognitive schemes that tie people together and form a common organisational culture. These values and beliefs are built into a social structure via interaction among people.

Thus, the network approach facilitates the analysis of the multiple and dynamic interdependencies between organisational parts and the dynamic interplay of the organisation and its environment. Tichy (1980) argues that one-dimensional thinking in organisational development often leads to unanticipated negative consequences. For example, over-reliance on the technical engineering perspective can lead to an ideal technical solution that, however, is not congruent with the normative culture of the workers. On the other hand, a purely political orientation or cultural orientation to organisational life is also dysfunctional. Tichy advocates that the interrelationships should be analysed from the three perspectives simultaneously, that is to see whether the organisational parts fit from a technical, political and cultural perspective.

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SYNTHESIS OF THE TWO MODELS (of logistic organisation and social network)

The relevance of the network approach is that it shows that the logistic organisation can be identified and analysed from a technical, political and cultural perspective. Tichy distinguishes three aspect models of fit, namely the model of technical fit, the model of political fit and the model of cultural fit (Tichy, 1980, p. 128-137):

• The ‘technical fit’ concerns the fit between the uncertainty facing the organisation (because of a

changing and complex environment, a complex technology and large interdependence among tasks) and the ability to meet this uncertainty by the necessary information processing.

• The ‘political fit’ refers to the fit between political uncertainty (resulting from unclear external

demands and unclear internal agreement over goals and means) on the one hand and the ability to political bargaining and exchange processing on the other hand.

• The ‘cultural fit’ is established – on the one hand - from the cultural uncertainty, which results

from (other) values in the external environment and the (lack of) internal cultural homogeneity and – on the other hand - the ability to necessary cultural/value adjustments.

For our research, it is presumed that these models of fit can assist in building a more detailed

framework on the phenomenon of interaction. We are looking for a better understanding of how the configuration of the logistic organisation – in terms of logistic control structure, organic logistic structure and personnel structure –affects the performance of the logistic system. From the network approach, we have learned that a technical fit, a political fit and a cultural fit are important. Thus, the problem definitionof this research is as follows:

Develop a diagnostic framework by which the logistic performance can be explained from the technical, political and cultural fit of parts of the logistic organisation.

1.2.4 ResearchResearchResearchResearch questions questions questions questions

The research questions that need to be answered for developing this diagnostic framework are: 1. What are the indicators to describe the logistic organisation with respect to the logistic control

structure, the organic logistic structure and the personnel logistic structure?

2. Which conceptual elements and relations among these elements enable the analysis of the technical fit, the political fit and the cultural fit parts of the logistic organisation?

3. Which explanation can be found for the reliability problems at FA by using the diagnostic framework?

4. What is the explanatory value of the diagnostic framework and what improvements does it need for future research?

1.2.5 MethodologyMethodologyMethodologyMethodology

This main character of this study is exploratory as it aims to give a good description of the relationship between logistic organisation and logistic performance. Based on the theoretical insights, which already have been explored briefly in this paragraph, this study tries to deepen the existing knowledge by interpreting and explaining the processes that occur in a real life situation. The aim to increase existing knowledge implies that the so-called ‘empirical cycle’ is applicable. Braster (2000) argues that a scientific research can start at any point of this cycle. A deductive approach means that the starting point is a theory from which hypothesis are deduced that are empirically tested. An inductive approach is taken when the research starts with observations that are the basis for empirical generalisations, which are then elaborated into a theory.

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deepen the existing knowledge, it is not possible to formulate a clear-cut problem statement and a strictly deductive design. This means that a clearly programmed and systematic data collection and data processing is out of the question. Instead, a flexible and iterative approach is used. At the same time, different research steps can be distinguished that all together represent the research cycle followed. The steps are: 1) empirical exploration, 2) theoretical study, 3) empirical study and 4) evaluation.

Figure Figure Figure

Figure 2222. The research cycle. The research cycle. The research cycle. The research cycle followed followed followed followed 1. EMPIRICAL EXPLORATION

In this step, the aim of the case study was to become familiar with the functioning of the logistic system and the problem situation. This knowledge proved to be necessary to proceed with a more profound investigation. This step lasted from June 2006 until April 2007, a period in which the researcher was also employed by the company. The following activities have taken place:

• Desk study of company documents like the strategic plans, operational plans, benchmark report as well as quantitative data on faults, customer complaints, budgets and reimbursement costs. • Informal meetings with operational people and managers of different departments and work

units, who talked confidentially about their views of and opinions about the operational (technical), political and cultural setting.

• Participative observation in the role of project leader and leader of conference meetings:

o_{Unstructured interviews with logistic task owners about the problems of capacity planning to} collect empirical data about the logistic control structure.

o_{Unstructured interviews with workers at the Customer Service Centre to collect data about} the front office and back office tasks and the way these tasks were coordinated.

o_{Leadership of conference meetings. Four project teams were formed that consisted mostly of} members of the Retrieval unit. At the end of the project (in March 2007), two new meetings were kept with logistic task owners from other units to collect their opinions and ideas about necessary improvements. About 15 conference meetings took place in which the participants shared their knowledge, opinions and views about the physical infrastructure of the goods flows, the sources of internal process faults and customers complaints.

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problem situation. 2. THEORETICAL STUDY

The activity of theorising started largely after the exploration of the problem situation had ended. When the datasets were constructed in the company, this was done partly with this current research in mind and partly because of the specific task assignments. After this, a literature review is conducted to find theoretical insights that were applicable for describing and explaining the logistic problems from a hard and soft systems perspective. It seemed hard to find academic articles about determining factors related to control behaviour of logistic task owners. However, some articles were found to be applicable and eventually insights from different sources are combined to develop the (first concept of the) diagnostic framework. Chapter 2 of this thesis is dedicated to the results of the theoretical study. 3. EMPIRICAL STUDY

The diagnostic framework is applied using the three above-mentioned datasets, resulting in the empirical study. This step has run parallel with the theoretical study, which implies an iterative process of taking notices of possible theoretical notions and discovering empirical findings. (That is why in Figure 2 a two-way arrow is drawn between steps two and three). Theoretical insights have directed the empirical study but also empirical findings leaded to a search for (more) applicable theories. The aim was to use organisational theories and principals that provide norms or rules about the design and functioning of the logistic organisation. In this thesis, two chapters describe the results of the empirical study. In chapter 3, the problem situation is described in terms of the parameters indicating the logistic control structure and the organic and personnel logistic structures. Chapter 4 presents the empirical findings from application of the diagnostic framework.

4. EVALUATION

At a given moment during the empirical study, it was decided to end the search for new theoretical insights and the diagnostic framework was established. Again, this shows the iterative process of theorising and empirical study that was based on a continuous assessment (represented by a two-way arrow between steps three and four). The final step of this research is concerned with the question whether the diagnostic framework is of explanatory value, i.e. does it enable to give a valid

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2

22 2 Theoretical insights on logistic

Theoretical insights on logistic

Theoretical insights on logistic organisation

organisation

This chapter is dedicated to the results of the theoretical study. The theoretical study has run parallel with the empirical study, which implies an iterative process of looking for and applying theoretical notions to the empirical data. At a given moment, it was decided to end the search for new theoretical insights and the diagnostic framework was established. These findings are presented in the following paragraphs. In the first paragraph, a systems-structural perspective addresses to the logistic

organisation. This perspective treats the logistic organisation as a ‘tool’ to enhance goal attainment, and studies the structural characteristics of the logistic organisation in relation to this goal attainment. In the second paragraph, a behavioural perspective is taken that focuses specifically on the behaviour of the logistic task owners and the causes of this behaviour. In the third and last paragraph, the theoretical notions of the two perspectives are synthesized into a diagnostic framework. This diagnostic framework comprises of a conceptual model and indicators to describe the structural and behavioural characteristics of the logistic organisation, and to analyse its relationship with the logistic performance.

2.1

2.1 2.1 A systems

A systems

A systems----structural perspective

structural perspective

The systems-structural view of logistic organisation implies a systems perspective that particularly addresses the structural characteristics of the logistic organisation. From a systems perspective organisations are viewed as consisting of interdependent subsystems whose functions can be

delineated in abstract terms like system maintenance and adaptation, or more concretely in terms of customer relationship management, operations management and human resources management. As argued by Harrison and Shirom (1999, p. 47), an organisation’s effectiveness depends on its ability to adapt to or even shape its environment as well as its ability to meet internal system needs. The latter includes conducting the transformation processes, managing the operations, and tying people into their roles in the organisation. The systems-structural perspective in this thesis focuses on the structural characteristics of the aspect systems that are distinguished in our conceptual framework of the logistic organisation, i.e. the logistic control system, the organic logistic system and the personnel logistic system. Our aim is to be able to diagnose the logistic organisation in order to enhance the logistic goal attainment of an organisation. In this paragraph, an explanation is given of the way to describe and diagnose the logistic organisation and its ability to logistic goal attainment.

At the hart of the conceptual model is the ‘behaviour of the logistic system’. We will first describe the meaning of this construct of logistic system as part of the analytical framework.

THE LOGISTIC SYSTEM

De Vries (1999) proposes a strong relationship between the logistic control system (represents the way in which the goods flow is controlled) and the organisational embedment of this control. This

relationship becomes manifest in the logistic system, which is comprised of employees and production resources by which materials or goods are transformed into products and/or services. The logistic system consists of different subsystems, i.e. the primary work units, stock-keeping points and transportation systems. In a work unit, production activities can take place as well as information-processing activities, packing and unpacking activities and inspection activities. Stock-keeping points, where goods are stored and wait for further processing, often divide primary work units. The

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logistic control and the organisational embedment of this control. Of particular importance is to understand thoroughly the complexity of the situation to control. For example, an operation with a highly uncertain environment and a large variety of products implies a much larger control

complexity than an operation that produces a small product range in a highly predictable

environment. The logistic control system should be structured in such a way that control complexity is reduced and the operation is controlled effectively. This is explained in the following section.

2.1.1 The logistic control structureThe logistic control structureThe logistic control structureThe logistic control structure

The internal structure of the logistic system is the configuration of relations between primary work units, stock-keeping points and transportation systems.These relations may refer to different concepts, for example the flow of information between the subsystems, the exchangeability of personnel, the shared use of resources, etc. Based on this relation concept, the complexity of the logistic system can be determined by the amount and variety of relations and subsystems.The more and diverse these relations are, the more complex is the logistic system. The main idea behind the design of the goods flow control is that control complexity should be reduced. This can be done by a differentiation of control levels (Bertrand, Wortmann and Wijngaard, 1998; De Leeuw, 2000; De Vries, 1999). At each of these control levels it must be decided which elementary coordination issues play a role. This is not just important from the perspective of complexity reduction, but also with regard to the issue of organisational embedment of the goods flow control.

Three control levelscan be distinguished: the strategic logistic control, the adaptive logistic control and the operational logistic control.

• At the strategic control level, decisions are made about objectives, means and strategies. These decisions act as constraints for the lower control levels. Firstly, a framework of objectives is formulated which, generally speaking, concerns the achievement of a certain level of performance or customer service at a minimum of total cost. At this control level, the focus is at the entire goods flow, i.e. from input of materials up to the delivery of products and services to the customer. Secondly, decisions are made about the design of the logistic system. This decision-making involves formulating the relevant product-market-combinations with a matching control structure. Furthermore, logistic decision-making must be consistent with other strategic decisions on issues like purchasing, marketing, sales, and human resources.

• The central point of the adaptive logistic control is the design of the logistic system, both in terms of the physical infrastructure as well as in terms of control and organisation. The strategic logistic objectives are elaborated into operational performance objectives such as shortening of

throughput times, lowering of stocks, greater flexibility or improvement of reliability. In addition, decisions are taken with respect to how the operational logistic control is realised.

• The operational control level is concerned with control decisions about the entire flow of materials and goods that enter pass through and leave the company. These decisions vary from aggregated decisions related to capacity and material management, to detailed decision-making at a single work unit that results in work order release.

The logistic control structure exclusively addresses the logistic decisions that have to be taken. The organic and personnel logistic structures determine where in the organisation the authority for decision-making is allocated and which persons are held responsible for the executing of these decisions.

2.1.2 The organic logistic structureThe organic logistic structureThe organic logistic structureThe organic logistic structure

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reflects the way in which the different logistic control activities are divided among individual positions and the way in which these positions are clustered into organisational units and

departments. De organic logistic structure can be characterised by means of three parameters (De Vries, 1999, p. 151-154):

• The first parameter is the degree of concentration, which tells in how far the logistic control activities are spread throughout the organisation, or whether they are concentrated in a single or a few organisation units. When all logistic control activities are located in a single logistic department, this means a strong concentration. On the other hand, functional de-concentration means that logistic control activities are split up and allocated to functional areas like production, marketing, sales and purchasing.

• The second parameter is the position of the logistic control activities in the organisation relative to other kinds of decision taking structures. Given a certain degree of concentration, the relative position addresses the question where in the organic structure the logistic control activities are allocated. The relative position has a vertical and a horizontal dimension. In case of centralisation, the logistic control activities are allocated nearby the top management level. The horizontal dimension concerns the positioning of the different logistic control activities in relation to other functional decision areas.

• The third parameter is the principle of clustering the logistic control activities to organisational units. There are two clustering principle available. Firstly, the clustering can be done based on the homogeneity of the logistic control activities. This homogeneity can refer to features or

characteristics of the control activities like the time window, the focal area or the knowledge necessary for the execution of the control activities. The second clustering principle relates to the final objectives or output of the different logistic control activities. From a rational perspective, the allocation of logistic control activities must aim at minimizing the total costs of coordination. Considering the two different clustering principles, an organisation has to make a trade-off decision between internal versus external logistic efficiency. Internal logistic efficiency is achieved mostly by the allocation of similar logistic control activities within one department or unit. External logistic efficiency however results from allocating logistic control activities among (functionally) different departments.

In order to reduce the control complexity, the logistic control task is subdivided into relatively independent clusters of activities that are allocated to individual positions. In case of functional de-concentration, one of the consequences of this division is an additional need for coordination between these clusters of control activities, which is referred to as ‘structural coordination’. The higher the degree of de-concentration of the organic structure and the fewer clusters of logistic control activities can be distinguished, the higher the need for structural coordination is. The recognition of this need for structural coordination is important for the design and analysis of the personnel logistic structure.

2.1.3 The personnel logistic structureThe personnel logistic structureThe personnel logistic structureThe personnel logistic structure

From a systems perspective, the personnel logistic structure consists of the individuals and groups who take care of the logistic control activities. The personnel logistic system is defined as the total of formal and actual relationships between these individuals and groups. This means that besides the hierarchical relations, also power relationships, negotiation relationships and communicative relationships are part of the personnel structure. Furthermore, several characteristics of (groups of) logistic task owners are relevant, in particular the logistic responsibilities and authorities, and the different (logistic) power bases of people involved.

LOGISTIC RESPONSIBILITY AND AUTHORITY

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or functional relationship. The concepts of logistic authority and logistic responsibility have both a formal and a reality component. In many situations, a logistic task owner is held responsible for achieving logistic objectives, e.g. realisation of certain throughputs, while at the same time this person can be missing the formal authority to give compelling operational orders. It then depends on the (informal) status and power of the person whether he or she is able to achieve the desired goals. LOGISTIC POWER

Logistic power is the ability to influence the logistic control and the logistic performance. The power of an individual can be based on the hierarchical position in the organisation (formal power), on having relevant expertise in terms of logistic knowledge and experience (expert power), and on having the ‘power of disposal’ of scarce resources like information, financial means and the ability to deliver services (De Vries, 1999, p. 190). Both the variety and the dynamic character of power bases and the means of power make the issue of logistic power a complex one. The logistic organisation can be viewed as coalitions of stakeholders, which have common as well as opposing interests, while their compositions may change frequently. This political behaviour of stakeholders generally makes it difficult to see through the personnel logistic system. Harrison and Shirom (1999, p. 122-125) address this assessment problem and argue, “Investigators need to follow the treatment of specific issue in different parts of the organisation and examine political struggles directly” (p. 123). They suggest to direct attention to overt manifestations or indicators of power, which are presented in Table 1.

Table Table Table

Table 1111. Assessing stakeholder power (from Harrison and Shirom, 1999, p. 124). Assessing stakeholder power (from Harrison and Shirom, 1999, p. 124). Assessing stakeholder power (from Harrison and Shirom, 1999, p. 124). Assessing stakeholder power (from Harrison and Shirom, 1999, p. 124) Indicators

Indicators Indicators

Indicators Guiding questionsGuiding questions Guiding questionsGuiding questions

Resources What kinds of resources are most important to members? Who gets

disproportionate shares of these resources? In what units or job categories are pay and benefits particularly generous? Who controls resource acquisition and distribution?

Centrality Which processes are vital to everyday operations? Which are critical to success? Who influences and participates in them? Who are consulted for vital advice, information and help in influencing key decisions? Who handles contacts with powerful external parties? Who holds central positions in important networks? Irreplaceability Who is regarded as irreplaceable?

Structure Who holds top positions (titles) in the hierarchy? How many titles does each person have? How much is the person paid compared to others? What share of ownership does he or she have?

Participation and influence in decision-making

Who participates in key official and unofficial decision-making forums? Who gets access to top decision makers? Whose views dominate important decisions? Who has won in power struggles and conflicts? To whom do members turn for sponsorship projects, career developments?

Symbols What are the main symbols of status and power (e.g., titles, office decor)? Who displays these symbols?

Reputation Which groups, units, individuals are regarded as especially powerful? Which units do people join in order to get ahead fast? With whom do members try to develop contacts? Whom do they try to impress?

The assessment of each stakeholder’s capacity for logistic decision-making and action also needs to consider the possibility that people who cannot alone affect managerial decisions will form powerful coalitions. However, even a relatively powerful group may lack the capacity to act on a particular issue, for example because the capacity for mobilisation of stakeholders is restricted.

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interviews, document study (of organisational charts, job descriptions, salary scales, minutes of conference meetings, etcetera) and survey (to assess peoples’ reputations). Each of the measures and data-gathering techniques contain limitations, which can be overcome by using multiple measures.

2.1.4 CCCCoordinationoordinationoordination mechanismsoordinationmechanismsmechanismsmechanisms

The personnel logistic system is aiming at the establishment of logistic coordination. We have already distinguished two types of necessary coordination, namely logistic control coordination and structural logistic coordination. Logistic control coordination deals with the alignment of logistic decisions and logistic control levels, whereas structural logistic coordination refers to the alignment of logistic control activities that are divided among different logistic task owners. Regardless of the type of coordination, logistic coordination can be established by means of different coordination mechanisms. Over the last decades, several researchers have reported on coordination mechanisms. Two classic studies are those of the organisational design theorists Galbraith (1973) and Mintzberg (1979). Although they have used different terms, they both seem to agree on different levels of task interdependency requiring different coordination mechanisms. These mechanisms are regarded as instruments to align the interdependency that is caused by the division of labour. Mintzberg (1979) has built a theory on generic organisational structures. He distinguishes five coordination

mechanisms, i.e. (a) mutual adjustment, (b) direct supervision, (c) standardisation of work, (d) standardisation of output and (e) standardisation of skills. Coordination mechanisms are here related to organisational factors like specialisation, decentralisation, formalisation, size, and etcetera. As the complexity of the work rises because of these organisational factors, the coordination mechanism that is used most often moves from (a) mutual adjustment to (b) direct supervision and so on, until coming back to (a).

Galbraith (1973) adopted an information-processing viewpoint of the organisation pointing out that the greater the task uncertainty, the greater the amount of information that must be processed among decision makers. This determines the type of coordination mechanism that is necessary. For example, as the task interdependency rises and the need for information processing increases, a greater need arises for hierarchy in addition to impersonal coordination because rules, policies, and procedures have limited information-processing capacities. This approach is of particular interest for this thesis as it studies the logistic organisation of which the logistic control structure is a central issue. From Galbraith’s theory, the following coordination mechanisms can be deduced: logistic rules, programs and procedures, hierarchies of logistic authority, and logistic goal setting. Furthermore, Galbraith distinguishes two coordination strategies. One strategy that is also often applied in logistics aims at reducing the amount of necessary logistic coordination. The need for information processing is then reduced by allowing (larger) work-in-process stocks, increasing standard (throughput) times and setting longer delivery times. Otherwise, the reduction of information processing can be achieved by creating autonomous logistic tasks and by introducing autonomous teams. The second strategy aims at enhancing the information processing capacity. This can be done by investing in the logistic

information systems, with the aim to relieve the existing communication channels in the organisation. In addition, the creation of lateral relationships and collective decision-making processes are ways to counterbalance the centralisation of logistic coordination.

Most organisations show a complex configuration of coordination mechanisms. Many organisations feel the pressure to improve the logistic performance and this easily leads to a larger need for

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between different parties involved in the goods flow control. From a cultural perspective, the actual behaviour of individuals and groups is strongly determined by collective rules of conduct, values and opinions on logistic matters. The design and implementation of the coordination mechanisms should therefore also account for cultural differences between parties involved in logistic control. We will turn back to this issue in the following paragraph.

For now, we conclude that the clustering of logistic control activities, and the allocation of these control task clusters to organisational units, should give rise to a minimum of coordination problems. Furthermore, coordination mechanisms must be designed and applied such that the information-processing ability and the ability to coordination match the need for coordination. However, in reality these principles seems difficult to accomplish (De Vries, 1999). The reasons for this will be addressed in the next paragraph by insights from social and organisational psychological studies.

2.1.5 SummarySummarySummarySummary

The framework presented here makes it possible to describe a logistic organisation in a given situation. In summary, the characteristics to investigate are presented in Table 2.

Table Table Table

Table 2222. Summary of characteristics. Summary of characteristics. Summary of characteristics. Summary of characteristics Structure dimension

Structure dimension Structure dimension

Structure dimension CharacteristicsCharacteristicsCharacteristicsCharacteristics

Strategic Strategic decisions with respect to performance objectives, logistic resources, process technology and infrastructure, and logistic organisation

Adaptive Decisions concerning the design of the logistic system and the logistic control structure

Translation of strategic objectives into logistic performance criteria Logistic control

structure

Operational Coordination activities: trade-off decisions concerning the goods flow Deduced control activities: information processing activities and other activities deduced from coordination activities

Organic logistic structure Principle for clustering of logistic control activities Relative position of logistic control activities Degree of concentration

Personnel logistic structure Division of responsibility and authority Power and negotiation relations

Logistic coordination mechanisms and communication relations

In this paragraph, a systems-structural perspective is used to view the logistic organisation as a ‘tool’ to enhance goal attainment, and to gain knowledge about the structural characteristics of the logistic organisation. This line of inquire represents to a large degree the assessment of the ‘technical fit’ like we discussed on page 8 (the model of technical fit by Tichy, 1980). This fit concerns the ‘technical’ alignment of uncertainty facing the organisation and the information-processing ability. The

uncertainty can result from a changing and complex environment, a complex technology and/or large interdependence among tasks. Technical fit or congruence is found when this uncertainty is properly handled because of the ability to process all necessary information efficiently and effectively. From Table 2 we can deduce that all characteristics of the logistic control structure and the organic control structure relate entirely to this technical fit. The personnel logistic structure, however, relates largely to the political and cultural fit.

To explain the relationship between the cultural and political characteristics of the logistic

Diagnosing lDiagnosing lDiagnosing lDiagnosing logistic performanceogistic performanceogistic performanceogistic performance problems problems problems problems

Diagnosing l

Diagnosing l

Diagnosing l

Diagnosing logistic performance

ogistic performance

ogistic performance problems

ogistic performance

problems

problems

problems

A research of reliability problems

using hard and soft systems perspectives

Acknowledgements

Acknowledgements

Acknowledgements

Acknowledgements

Summary

Summary

Summary

Summary

Table of contents

Table of contents

Table of contents

Table of contents

1

11

1 Introduction

Introduction

Introduction

Introduction

1.1

1.1

1.1

1.1 The Flower Auction

The Flower Auction

The Flower Auction

The Flower Auction

1.2

1.2

1.2

1.2 Research

Research

Research

Research design

design

design

design

2

22

2 Theoretical insights on logistic

Theoretical insights on logistic

Theoretical insights on logistic

Theoretical insights on logistic organisation

organisation

organisation

organisation

2.1

2.1

2.1

2.1 A systems

A systems

A systems

A systems----structural perspective

structural perspective

structural perspective

structural perspective