www.SupplyChainQuarterly.com [QUARTER 1/2017] CSCMP’s Supply Chain Quarterly 47
work logistics, there is only so much [benefit] you can
[achieve] when you have this localized focus.
Our main message is that future efforts should be
geared toward addressing cross-docking from a holistic
perspective where we consider local and network considerations together. But first we wanted to empirically verify this claim. Then we also set out to provide a detailed
example of what firms could actually do with this holistic
approach, what it generally implies for managers, and
how they can adopt it.
Your paper presents a case study of a large retailer in
the Netherlands. Why did you choose to focus on this
First of all, this retailer is one of the
largest international grocery retailers,
and it’s considered a leader in how
it’s organizing its distribution. Cross-docking forms a central part of the
company’s distribution strategy. And
at the time we started this research, the
retailer was planning a major change
in its distribution network. Although
that change did not actually relate to
cross-docking, it offered a very good
opportunity to propose and test some distribution network changes that we thought could improve cross-docking from a systemic or networkwide perspective.
On top of that, one of the warehouse managers at the
retailer was willing to cooperate with us in proposing
and testing a change for a local cross-dock improvement
effort. This provided a rather unique opportunity to
gather empirical data to support the call for a more holistic approach to cross-docking.
What makes the performance metrics you propose in
the paper different from the traditional metrics used
by cross-docking distribution centers?
Metrics was one of the key things that drove this
research. We believed that because cross-docking is all
about reducing inventory and improving flow, it has a
close analogy with lean manufacturing. It therefore also
makes sense to make this link with performance metrics.
What emerged during our research is that there was a
lack of performance metrics that would trigger manage-
ment to look at cross-docking more holistically. Cross-
docking operations are managed according to traditional
warehousing principles, where one manager would be
responsible for operations inside the distribution center
and another one for the transportation or other logistics
at the network level. On top of that, each of those man-
agers would have his or her own set of metrics geared
toward either localized performance or networkwide
With these existing metrics, it was very hard for us to
convey the need for the changes that we were proposing
to the retailer. So we added some performance metrics
inspired by “lean” and just-in-time manufacturing that
focused on the flow of the loads and
work-in-progress throughout the distribution network. An example would
be that we kept track of the number
of in-process loads that were on-site
at the cross-dock, which translates
into the work-in-progress metric from
lean manufacturing. We also tracked
the life span of loads throughout the
cross-docking systems [how long it
takes a load to go through the distribution network as a whole], which gives an indication
more or less of the flow.
We also used more traditional metrics because we felt
we could relate more easily to the managers using their
own metrics. An example of a traditional metric that
we incorporated was the travel distance covered by the
material handlers inside the cross-dock. The less time
material handlers have to travel, the more efficient the
cross-dock operations are considered to be by managers.
How can companies use this information to improve
their own cross-docking operations?
Our study shows that while local improvement efforts
for cross-docking can be very effective at making the
operations inside the distribution center more efficient,
the impact of these improvements from a systemwide
performance perspective can actually be quite limited.
On the other end, our paper shows that even minor
changes in the network design could result in consider-
The impact of
be quite limited.
[CONTINUED ON PAGE 54]