Running logistics cargo centres in the Oman and Zimbabwe: the key performance indicators and fault lines. P05: Recent Advances of Circular Economy and Sustainable Development in Supply Chain Management Dr. Faustino Taderera 1, Mahmood Sakhi Al Balushi 2, Dr. Reason Masengu 3 1 Programme Manager - MSc in
International Operations and Supply Chain Management Programme, Department of
Mechanical and Industrial Engineering, COE, National University of Science and
Technology, NU, PO Box 111, Muscat, Sultanate of Oman 2 PhD Candidate, Kazan Federal University, Russia and CEO, Al Madina Logistics Services, SAOC, Muscat, Sultanate of Oman 3 Senior Lecturer, Department of Management Studies, Middle East College, MEC, Muscat, Sultanate of Oman
1. INTRODUCTION Logistics and supply chains are increasingly gaining
greater importance as they play a vital role in the overall cost of the
products. Moreover, countries
have learned that developing the infrastructure for logistics services is
crucial for economic growth. Cargo logistics centers play a vital role in the country’s
competitive advantages. A critical resource that needs to be developed is human
capital and talents development Vietor (2007).
Governments also need to know the deep strategies, structures, and
policies that help make the country a more competitive, growth-oriented economy
Gattorna (2010). The
cargo logistics centres can be crucial contributors to the success and
prosperity of nations. They need to have
good economic environments that propel economic growth Porter (1998). Jain et al. (2007) state that most CRM failures are attributed to poor design, planning
and measurement of CRM projects and that capturing the wrong customer
information, unclear goals, inappropriate selection and use of technology,
inability to integrate people and processes and use of misleading metrics or
improper measurement approaches are the major barriers in implementing and
managing CRM projects. A
study by Mellat-Parast (2013), suggested that quality management facilitated cooperative learning and
improved inter-organizational learning processes. It said at the supply chain
level, it enhanced supply chain satisfaction and supply chain performance. Therefore,
TQM was central to SCM and distribution excellence. It was no secret that
logistics cargo centres faced many challenges as they operated. China has universities of supply chain
focusing on servicing and growing this huge sector. There are many big,
advanced countries which have adopted the same strategy. Oman
started very early to develop the logistics sector and make it a vital factor
in economic growth. Hence, the Oman
Logistics Strategy 2040 was developed in 2014 SOLS2040 (2015). The strategy aims at developing Oman as a
major logistics hub in the region. The government aims to make the logistics
sector one of the major non-oil sectors that would contribute to the GDP and
create jobs for the Omanis, jumping from 80,000 in 2020 to 300,000 in 2040 SOLS2040 (2015). Logistics sector
contribution to GDP was R.O. 1.5 billion, and very ambitious targets were set
to be achieved: R.O. 3 billion, R.O. 8 billion, and R.O. 14 billion in 2020,
2030, and 2040 respectively. For the Logistics Performance Index, the target
ranks are top 30, top 20, and top 10 in 2020, 2030, and 2040 respectively. The
Logistics Performance Index measures logistics efficiency in the following
areas: Customs Performance, International Shipments, Tracking and Tracing,
Infrastructure, Logistics Quality and Competence, and Timeliness. Performance metrics measurement was central to good supply chain management,
and these were: control (which allows managers to evaluate and control the
performance of resources they manage, communication (to communicate performance
to internal and external stakeholders) and finally improvement (which shined a light
on actual versus expected performance in order to take corrective action where
need be, Mckeller (2014). To achieve those objectives, the cargo logistics centers and hubs need to be developed and incentivized. Reduced supply chain vulnerability to risks arose through horizontal collaboration amongst producers, and vertical collaboration with the processor and retailers, Leat and Revoredo-Giha (2013). Oman has developed a number of world-class deep-sea ports and modern international airports. The main seaports include Sohar Port, Salalah Port, and Duqm Port. All these ports have major free zones and economic zones in the hinterland to develop cargo and logistics facilities that create captive volumes. The airports include Muscat International Airport, Salalah Airport, Sohar Airport, and Duqm Airport. All these airports have big cargo facilities except Sohar Airport. These cargo facilities are key drivers to enhance logistics cargo growth. The cargo logistics centers provide services for all international freight and shipping needs.The services include customs clearance, storage, and transportation. The cargo logistics facilities and services depend on the types of cargo and customers' requirements. There are containerized cargo, general cargo, and perishable cargo. Each one of these types requires different special handling services. Oman is well located for regional and international supply chain routes. Oman has excellent land connections with GCC countries. Oman is also well connected by the air and sea. The main logistics hubs in Oman include the Sohar Free Zone, Salalah Free Zone, Khazaen Economic City, Duqm Economic Zone, and Mazunah Fee Zone. All these cargo centers are well connected by land, sea, and air. These options for logistics help increase the competitiveness of the export and re-export trade. Oman has been improving in terms of logistics
performance. The World Bank's Logistics
Performance Index shows that Oman's rank has jumped from 59 in 2014 to 43 in
2018 (LPI, World Bank). The LPI
evaluates a number of attributes, mainly the Customs, Timing, Cost,
Infrastructure, etc. To set Oman as a major logistics hub, Oman has become a member of the IRU (Asyad). This membership helps to export smoothly to the final destination without any hurdles while crossing various borders and customs points. It also helps reduce the cost and time of shipments across countries to final destinations. 2. OMAN
LOGISTICS STRATEGY 2040 For Oman to be one of the key logistics hubs in the region, it has
developed a clear national strategy toward 2040; Sultanate of Oman Logistics
Strategy 2040 (SOLS2040). The overall
picture is that Oman is heading in the right direction in developing Oman as
one of the major regional logistics hubs.
The strategy focuses on four areas that will enable Oman to be among the
top ten logistics hubs in the region.
They are: ·
Market development for import, export, and
re-export. ·
Ease of doing business and smooth logistics
operations. ·
Development of the Omani workforce skills and
expertise. ·
Use of latest technologies as key enabler for
competitive logistics services. 3. OMAN ECONOMY Oman is heavily dependent on oil and gas in the fiscal
revenue and as a percentage of the total GDP. Despite the relentless efforts to
diversify the economy away from oil and gas, the country is still heavily dependent on these commodities. Oil
and gas revenue account for 52% of total revenue, and 70% of government revenue
in 2020 (NCSI). 4. LOGISTICS
MAJOR HUBS Many
logistics clusters have educational institutions specifically created to meet
the needs and schedules of logistics operations, including deep integration of
education with cluster operations. In addition, some cluster operations have
invested in specialized university facilities to support their logistics
mission and upgrade their capabilities through partnerships with international
centres of excellence Sheffi (2014). Developing Oman as a major logistics hub in the region, Oman has developed a number of free economic zones (where tax exemption and non-unionization of labour were the main attraction). Table 1
In 2020 Oman was the number 70 economy in the world in terms of GDP (current US$), the number 62 in total exports, the number 67 in total imports, the number 57 economy in terms of GDP per capita (current US$) and the number 73 most complex economy according to the Economic Complexity Index (ECI) 5. STATEMENT OF THE RESEARCH PROBLEM Two theories guide this research, and these are the theory of market orientation and the accelerator theory of investment as they apply to logistics cargo centres. Market orientation is a company philosophy focused on discovering and meeting the needs and desires of a company’s customers through its products mix, and in this instance cargo logistics centre businesses will be expected to meet foremost the needs of their diverse portfolio of customers directly, then the needs of society, the dictates of corporate social responsibility and sustainable business. In an international survey of 1,337 companies who have implemented CRM systems to support their sales force, CSO Insights has estimated that only 25 per cent reported significant improvements in performance, Pettey (2008). They said it was management commitment, implementation, and resourcing that normally affected CRM success or failure. This applied to LCC as well. The accelerator theory of investment, in its simplest form, is based upon the notion that a particular amount of capital stock is necessary to produce a given output. By definition, net investment equals gross investment minus capital consumption allowances or depreciation. Investment must be maximized for better productivity and profit maximization. Do Oman and Zimbabwe have environments where this is possible? Researchers must put themselves in the day in the life of an investor, a business person, business customer and government officer and politician (the political class) – what do they want and expect? Only then can incisive analysis be done. This research would question and critique the levels of efficiency, costs, and investment in the logistics cargo centres sector and why they are what they are, and what could be done to maximize performance, investment, and business in the sector. The purpose of this research was to contribute to the success of logistics cargo centres and diversification into logistics with focus on logistics cargo centres, and advance critical ideas to drive this plan forward. The conceptual framework is that fully integrated cargo logistics centres which embraced latest IT systems delivered good service to customers and society. The dynamics of theoretical perspectives and field research would rip this theory apart and educate the academic world on what was practical and the full spectrum of interest groups, institutions, and lobbyists. The two countries were running solid logistics cargo centres and a knowledge society partly insulated from reliance on agriculture and primary products income. Crow and Dabars (2015) quoting James Duderstadt said that the world was entering a new age, an age of knowledge, in which the key strategic resource necessary for prosperity has become knowledge itself – that is educated people and their ideas, but that universities, who produced those highly skilled people, were besieged by factors like public policies, reductions in public investments and market forces which could make universities fall by the wayside. The countries have achieved phenomenal and admirable progress in logistics cargo centres but more still needed to be done. All of them faced some operational problems which have to be solved for smooth operations. Some of the challenges were customs delays, driver shortages vagaries of weather and changing customs tariffs. Logistics was one of the most difficult industries on earth linking firms, government, society, and nations in a delicate matrix of trade, politics and economics. Moreover, all two countries will be competing for investment, markets, and talent with regional competitors like South Africa, Botswana, Namibia and Zambia (for Zimbabwe) the six GCC countries in the case of Oman as well as facing global competition. Research is required to inform government, industry and society about correct policies, alternatives, opportunities, risks, and pitfalls for logistics cargo centre excellence. Shah (2015), warned procurement practitioners
and industrialists saying the ten major challenges future leaders in
procurement would face were:- Focus on strategic relationships, continuously
looking for new markets, global supply chain risk, exchange rate volatility,
political instability, integrating risk management in sourcing, using free
trade agreements and tax havens, using of big data and analytics, technological
innovation and finally having the right skills and influencing skills which
means working collaboratively with other experts in and outside your
organization. How prepared were logistics cargo centres in these aspects? This research makes the crucial contribution to theory building by
shedding light on key operational and national policy imperatives which have
not been in the public domain in Oman and Zimbabwe, and for those already
known, to highlight their effectiveness and shortfalls, causes and remedial
measures based on world best practices, current findings, and literature
realities. Good well-functioning logistics cargo centres created millions of
jobs worldwide, have good admirable conditions of service, contributed to the
fiscus through taxes by profitable companies, provided a critical service
required by the economy, build confidence in the economy, attracted much needed
investment, lowered costs of operation substantially, improved competitiveness,
introduced advanced technologies to a country, improved overall industrial and
national efficiency, helped in import substitution, connected the country to
the world and attracted tourists to marvel at economic wonders there and were a
source of national pride. Poor service by any country and company reflected
lack of respect for contracts and other countries, dishonest and a complete
lack of ethics. It also destroyed trust, repeat business, loyalty,
profitability, goodwill, reputation, confidence, competitiveness and good
long-term relations amongst the vending community and their clients, the very
foundation and anchor of any successful business (refer to Appendix 1 and Appendix 2 and findings in this research). For these reasons this research was long overdue, necessary, and
transformative. It had to be done and was urgently required in both countries. 6. OBJECTIVES
AND RESEARCH QUESTIONS The objectives of this research are to: 2) Establish and evaluate KPIs in logistics cargo centre management. 3) Establish global best practices in logistics cargo centres. 4) Identify IT infrastructure and human capital required for good performance. 5) Establish the challenges faced by logistics cargo centres in the countries and best way forward. 7. RESEARCH QUESTIONS The research questions to be answered by this research were: - 1) What is the status of logistics cargo centre businesses and issues affecting them and their customers in Oman and Zimbabwe? 2) What are the KPIs in logistics cargo centre management? 3) What are the global best practices in logistics cargo centres. 4) Identify IT infrastructure and human capital required for good performance. 5) Establish the challenges faced by logistics cargo centres in the countries and best way forward. 8. LITERATURE REVIEW Hong Kong, Guangzhou, and Shenzhen have played
critical roles in regional growth in Asia but faced many challenges such as
port handling capacity, environmental problems, and the expansion of the
complex transportation system owing to large volume of goods. Authors said port
and terminal development and efficiency deserved more attention and can guide
in future port investment and regional development, Liu et al. (2022), (99-106).
This was a message to Oman LCCs and Oman Government, loud and clear. Networks
with densely interconnected first tier suppliers promoted network neutrality
and complexity. Gruchmann (2022), (170-192). These findings allow more comprehensive theoretical
grounding for mapping governance approaches in a network-sensitive context like
the LCCs under discussion. Logistics clusters depended on supportive government
in terms of public infrastructure, paying for and maintaining and regulating
the use of key infrastructure assets such as roads, railways, canals, ports and
airports and user-friendly regulations on land use, infrastructure use,
conveyance operations and trade to promote logistics clusters. The Singapore
government was renowned for both high efficiency and low corruption, an ill
affecting many governments in the world, Sheffi (2014). There were lessons for all two countries here as they work towards
establishment, maintenance and growing world class logistics cargo centres as
engines to drive the economy and as diversification measures. Any
infrastructure, regulatory or tariff shortfalls were clear fault lines not good
for logistics cargo centre development. Making the right decisions by companies
and governments produced good results which gave the feel-good factor that we
are contributing to our own country and the world in a positive way. Logistics scholars, as well as strategic management scholars, have in recent years shown that capabilities in logistics and supply chain management may be the foundation for a company's sustainable competitive advantage, Sandberg (2013), (176-188). He said it could be argued that beside product-, production-, or market-oriented companies, there were also flow-oriented companies, in which the business models are based on superior logistics performance. The importance of adopting an internal market orientation (IMO) for new service development performance is illustrated by Boukis (2013). The role of intra-team contingencies, such as trust, relationship conflict and political activity and some contextual antecedents, such as resource allocation effectiveness and efficiency and cross-functional integration were assessed The findings of explorative case studies suggest the implementation of various strategic SCM strategies in order to fit the requirements of the market (e.g. protect critical resources, implement a customized agile production strategy and enhance SC flexibility), Ponticelli et al. (2013). In this direction, specific SCM practices are already adopted by investigated firms. Identified techniques and tools aimed to achieve high customisation while reducing changes in specification. The issues here are security, strategic fit, speed to the market and flexibility. Taking a supply chain perspective, logistics performance refers to cost, time, and complexity in accomplishing import and export activities, Hausman et al. (2013). The paper studied the impact of logistics performance on global bilateral trade. Their research calibrated the impact of specific improvements in logistics performance (time, cost, and reliability) on increased trade. Their findings could spur public and private agencies that have direct or indirect influence over logistics performance to focus attention on altering the most relevant aspects of logistics performance to improve their country's ability to compete in today's global economy. Moreover, as their logistics metrics are directly related to operational performance, countries could use these metrics to target actions to improve logistics and monitor their progress. This is where governments are expected to facilitate logistics through infrastructure, SCM education and research institutions and having effective lobby and advocacy groups or industry associations to support firm level distribution and SCM. It is a shared partnership. There is a supply chain association in Oman but marketing professional body seems not there as yet. This is unfinished business in Oman. In contemporary business environments, the ability to manage operational knowledge is an important predictor of organizational competitiveness, Setia and Patel (2012). Organizations invest large sums in various types of information technologies (ITs) to manage operational knowledge. Because of their superior storage, processing and communication capabilities, ITs offer technical platforms to build knowledge management (KM) capabilities. A critique would say there were budgetary limitations and austerity after Covid-19 disruptions and slowdown of business. Where would adequate funding come from when austerity was still in place? A lot is being done but obviously not at optimum in terms of infrastructure development the world over. Currently the world is between a hard rock and a hard surface. 9. RESEARCH METHODOLOGY This study used a pragmatism research philosophy. The
pragmatism research philosophy is described in Burke Johnson and Onwuegbuzie
(2012), Göktürk
(n.d.) as the third force research philosophy. In Burke Johnson and Onwuegbuzie
(2012) citing Cresswell (2009) pragmatism originally derived
from a Greek work “pragma” which means action. For Saunders et al. (2012) pragmatism calls for
plurality in creation of knowledge and human actions cannot be separated from
reality, experience, and beliefs. Given this scenario or philosophical
underpinning researchers and scholars in logistics and supply chain have drawn
the epistemology of pragmatism to understand logistics aspects in areas such as
logistics cargo centres. Given the nature of the logistics industry in Zimbabwe
and Oman it is crystal clear that no single philosophy can unpack the
understanding of the contemporary problems. The research philosophy of a study
is usually determined by the nature of the research objectives Kaushik and Walsh (2019), Saunders et al. (2012). Taking an eagle’s view of
the study and the plurality of the logistics industry in Zimbabwe and Oman and
the composition of the research team this study adopted questionnaire method as
well as face to face interviews, expert panel interviews at Universities and
Industry. This is consistent with the pragmatism research philosophy and mixed
research approach Creswell (2011), Göktürk
(n.d.). Researchers used the survey questionnaire method as
well as face to face interviews, expert panel interviews at universities and
literature review in this research. Consent was obtained for both interviews
and survey. Validity and reliability issues were addressed full as were field
research protocols. Researchers explained the purpose of the research and
freewill for participation. 10. FINDINGS IN OMAN FIELD RESEARCH AND DISCUSSIONS So far these were the findings in Oman where field
research had been completed. Findings revealed that logistics cargo centres like
container terminals, warehouses, bonded warehouses, dry ports, airports, roads
and a modern Customs and Excise Department, which fully embraces e-government
and is strategically linked to all importers and exporters as well as critical
trade and related government departments have improved a lot, but still needed
further improvement in Oman to march regional and global competitors (Zimbabwe
field research is still work in progress). In a study to investigate success and failures of Customer Relationship
Management (CRM) systems and implementation Foss et al. (2008). found that the scope, size, complexity, and
duration of the CRM projects seem to vary quite significantly across firms and
that poor planning, lack of clear objectives and not recognising the need for
business change were the key reasons for CRM failures. The question that must
be answered is, ‘What systems, technology, culture and practices should be put
in place for CRM to be successful and do LCC firms in Oman have them?’ It was
found that critical skills, ports, Customs, and investment infrastructure in
Oman needed to be improved as well as processing and turnaround time to match
best practices in the region and globally. One Stop Shop for investment was
operational in Oman. Delayed deliveries and wrong documentation were
experienced sometimes due to port and Customs delays or transport and loading
delays. Oman had improved a lot. A number of external and internal factors
influenced the evolution of a university like – meeting the needs of industry,
an expanding USA population, internal migration and immigration, the needs of
war and how USA responded to it, the pressures for educational attainment and
mobility, the growing role of science in society, the growing importance of the
professions and professors and various pressures from government, and no single
person or persons controlled its destiny, but the result was the greatest
system of knowledge production and higher education, Cole (2009). A lot of work in progress is there to catch up with the rest of the
world. At the time of this submission our work was still work in progress and
we shared part of the findings only done in Oman excluding Zimbabwe field
research which would be in another paper. The research team for the Zimbabwe
field research may be adjusted as well for maximum outreach. So far these were the findings in Oman where field
research had been completed. 11. OMAN
CARGO LOGISTICS 11.1. SURVEY
AND INTERVIEW: RESULTS ANALYSIS 2022 The survey and interviews conducted to get primary data
for this research from various companies and industries that are closely
connected with logistics services providers and logistics centers. The survey
and interviews received from 14 companies (14 respondents answered the survey, one from each company).
Researchers would have wanted more respondents but unfortunately there seems to
be some reluctance to answer survey to a certain extend. The same applies to
interviews. Respondents were mainly based in Muscat and Sohar governorates.
Though the number is low, but the firms are considered the major manufacturers
and traders. Their valuable opinions
were shared that help answer questions related to this paper purpose and give a
fair understanding of the cargo market in Oman. Interviews were done with three
people only (top executives in their organisations), as some declined to do the
interviews for many reasons. Figure 1 Figure 1
The
majority respondents, about 50%, were trading firms, followed by manufacturing
36%. The respondents from Service and Logistics were about 7% each. Most
of these companies own trucks and use owned warehouses. The warehouse sizes
raged from 800 sqm to 20,000 sqm. In terms of ownership compared to leased,
about 43% own their warehouses and 7% own about 60% to 90% of their needs and
outsource the balance. On the other hand, about 50% lease their warehousing
needs. Figure 2 Figure 2
The
warehouse types usually include dry warehouse, AC warehouses, chilled
warehouses, and freezers. About 50% only have dry warehouses. The dry and AC/chilled warehouse are utilized
by 21%, while the balance. For
the outsourcing of the logistics services, a question on 3rd party
logistics services provider was included.
The question was to know how many use 3rd party logistics
services. The results showed that about 64% use 3rd party logistics
service provider for their logistics and supply chain needs. This is good indication that the logistics
market is developing and more and more businesses starting to outsource
logistics services. This definitely help
encourage more investments in logistics centers and operations. It is an
indication that business started to focus more on their core business and
outsource the logistics services to professional firms for better control of
cost and improve efficiency of supply chain. Regarding
the truck fleet ownership, the companies are increasingly starting to use
outsource trucks for trips. This usually
help in maximizing the efficiency of trips costs by enhancing the truck
capacity and route utilization. The
survey shows that about 79% use outsource trucks, while about 29% depend 100%
on the outsourced trucks. Figure 3 Figure 3
The
average monthly trips is 397 trips.
About 50% of these trips are done by owned trucks and 50% by the
outsourced trucks. This shows that
companies are trying to reduce the fixed cost and benefiting from outsourced
trucks as the need and requirement may change based on the supply and demand. The
ports are key element in the trade and business operations. Oman has world-class-deep-sea ports. The major ones are Salalah Port and Sohar
Port. Muscat International Airport along
Salalah Airport are some of the modern airports in the region with new cargo
building facilities. The quality of service at these seaports and airports
varies. Based on the survey, over 70% consider the quality of services at Sohar
and Salalah Ports are good while 29% and below consider them as average. The quality
of services at Muscat International Airport is considered good by 75% while
Salalah Airport received only 17%. This shows that Salalah Airport needs to
work on improving the quality of cargo services. Table 2
The
manufacturers and traders source their products from various local and global
sources. Over 36% of the firms imports 100% of their materials from global
suppliers. The imports mainly come from the following countries: UAE, Saudi,
India, USA, China, and Brazil. While
for the exports, over 50% of manufacturers and traders have some of their
products exported. Over 50% of the firms export about 29% of their products.
The exports market includes the following: UAE, Saudi, India, and Yemen. These
imports and exports are traded through the land borders, seaports, and
airports. About 14% of the firms use land borders as their main trading routes.
The sea ports are used by 93% of the firms. The
feedback from the survey on how to improve the cargo handling and
competitiveness of the Oman ports, airports and land borders highlighted the
following points: ·
Improve
handling efficiency and speed. ·
Be
more competitive in terms of cost and charges. ·
Improve
the inspection bays and service quality. On
the question of the main challenges in managing the human resources in logistics
services sector, the main point highlighted included the following: ·
Lack
of expertise and experience. ·
Less
capable of doing multiple tasks. ·
Less
interest on learning and developing. To
sum up the findings from survey and interviews it is quite clear Oman has done
very well in cargo logistics centre management where it employed thousands of
employees servicing the whole economy, was No. 4 in road infrastructure
development in the world and had climbed up the global logistics index by many
margins. Findings regarding successes recorded in Oman were mainly in good
service at most ports in Oman and the airports where satisfaction was quite
high (average 70%), except Salalah Port where the rate of dissatisfaction with
service was quite high above 80%; manpower development was rated as good,
infrastructure as good, customs as good as well and other government services. Regarding
the challenges faced key findings by respondents revealed that there was a need
to improve efficiency, speed of service, lower fees charged and charges, Oman
partly lacked local skilled and experienced logistics personnel, multi-skilled
local talent was in short supply, some employees especially fresh graduates
were not interested in training and learning and did not have a sense of responsibility
and company stewardship, marketing talent was in short supply locally,
punctuality was also an issue for some employees. Sheffi argued that the major
challenges facing supply chain operations were too much product complexity, too
much slow-moving and obsolete inventory, supply chain considerations not part
of the product design process, no supply chain strategy, ineffective matching
of supply with demand, physical network problems, global issues, outsourcing
problems, customer preferences, market growth, terrorism, and global warming,
Sheffi (2001). Higher education was humanity’s primary
enabler, its principal path on curing diseases Antony
et al. (2017), advancing technology, enhancing communication, creating
decent communities, making transportation safer, and even predicting the
weather, appreciating beauty, inspired by creativity, understand our past,
discern the consequences of our politics, comprehend, respect, and transcend
differences, made sense of our emotions, and assess our values. Dealing
with these depends on the country’s stage of economic development and policy
framework. It was mostly easier for well-resourced developing countries to
address most of these issues while 3rd world and developing
countries had resource constraints, less sophistication and less systems
integration. Respondents
emphasized the need for universities to have highly experienced lecturers with
industrial experience teaching in universities alongside pure academics so that
students have a rich experience which connects them with industrial realities.
On this part they said that guest lectures and workshops by industrialists
could help universities educate a solid future workforce with an industrial
culture. Suggestions were raised that more internships were required in
tertiary institutions as well as establishment of more supply chain training
institutions. What does theory say about these findings? Customers were at the heart of the LCC and the needs of industrial and post-industrial
societies and the emphasis on customer satisfaction, innovation and
competitiveness were central for LCC success. Oman was racing to do head on
competition with its GCC partners just as it cooperates with them in win-win
situation. Other academic commentators
had said the marketplace was a battleground where only the fittest survived and
prospered. Maxwell (2007) was frank and warned leaders that
leaders could not afford just to think outside the box, they needed to reinvent
the box or to blow it up, and that the first responsibility of a leader was to
define and address reality. That is what Oman must now do as a matter of
addressing the current and future economy. Others would argue that politicians
and national leaders were not company managers and had too many and complex
societal issues to deal with which required long term consultations and
consensus, and sometimes consensus was not the best technical decision. It
was argued that, “The primacy of human capital is leading to a global war for
talented people in much the same way that nations once fought over land because
it was considered a productive asset,” The Emirates Center for Strategic
Studies and Research (2003:4). This was the reality in the GCC and elsewhere
where companies and governments had to offer best benefit packages for
strategic employee retention. In the GCC countries with higher oil reserves
tended to give better conditions of service and could pamper strategic employees
with heaven on earth packages. LCCs were part the national economy and had to
fight competition for talent and investment and win. Despite continuous training
programmes LCCs were acting as training grounds and were losing employees to
oil companies and the government sector for reasons of better salaries and
condition of service as well as job security. Government was considered less
pressurized and conducive (refer to Appendix 1 and Appendix 2). Historically
Oman has always been a nation of global traders and masters of the sea and
global trade. It is a giant slowly taking its rightful place amongst the global
trading community starting in the GCC where it claws quite substantial trade
and investment (Table 1 is instructive regarding
this). The culture of logistics management and refinement has always been with
Oman throughout the ages. The titanic moves steadily in maneuvering the highly
competitive supply chain LCC business as it diversifies its economy away from
reliance on oil to a knowledge and service economy (Appendix 1 & Appendix 2 refer). Speeding up
establishment of majestic academic cities run by local and international
universities (like UAE) could accelerate this process supporting this direction
with top grade research, innovation, industrialisation, and production of world
class strategic human resources required by the LCCs, support industries and
government. 12. LIMITATIONS IN THIS RESEARCH This research faced a number of limitations. One of those limitations was
the refusal to answer certain questions considered too sensitive in this highly
conservative community or refusal to participate in the research altogether,
especially in interviews. Some survey questionnaires were not answered and was
of great concern to the researchers. The sample size became quite small due to
these refusals in both survey and interviews. Researchers struggled to get
willing respondents. However, researchers compensated most of those shortfalls
through triangulation of respondents by involving respondents from different
companies. This could have resulted in other issues being kept under the surface.
The compensating factor was the triangulation of findings by having
interviewees/respondents from a diversity of people. That helped to bring many
issues to the fore. Statistical tests too were not done as the sample was too
small. A bigger sample would have enabled researchers to do justice on this
parameter. This virgin
field research had quite some teething problems for researchers. The research was quite objective. Time would always be an issue for
working academics and industrialists. Having more time on the ground could have
possibly led to the unearthing of other issues. However, the researchers used
comprehensive questionnaires covering all issues that normally affected LCC in
any country as reflected by answers received and analysed in this research.
There was no doubt that coverage was comprehensive. The last limitation was
that this field research was done during the summer holidays here where many
people are on annual vacation, therefore some respondents may have been missed
as a result of that rather than refusal. 13. CONTRIBUTION OF THIS RESEARCH TO THE STOCK
OF NEW KNOWLEDGE This research has made many meanings sterling and breakthrough new
insights which were not known before in Oman LCCs, and about Oman LCC dynamics
and society. There were discoveries that there was a need to improve efficiency, speed of service,
lower fees charged and charges, Oman partly lacked local skilled and
experienced logistics personnel, multi-skilled local talent was in short
supply, some employees especially fresh graduates were not interested in
training and learning and did not have a sense of responsibility and company
stewardship, marketing talent was in short supply locally and what was
affecting LCCs which was previously unknown. This was our contribution to the
stock of knowledge about LCC and filling the gap in knowledge. This is one of
the most strategic and critical sections of the economy and contributing to
ongoing public discourse about LCC development does matter a lot in Oman and
beyond. Society was watching every development and wanted to see LCC succeed, prosper,
and grow. 14. RECOMMENDATIONS AND FUTURE
RESEARCH Findings from this research clearly indicated that
major successes had been achieved in LCC operations in Oman, but that more
needed to be done to catch up with the group of NICs and advanced economies
like China, Germany, USA, UAE, Saudi Arabia, Taiwan, and Singapore. There were
some supply chain pain points identified which needed to be addressed
naturally. Considering all the foregoing the researchers would summarise
shortfalls in performance as: the need to improve efficiency, speed of service,
lower fees charged and charges, Oman partly lacked local skilled and
experienced logistics personnel, multi-skilled local talent was in short
supply, some employees, especially fresh graduates, were not interested in
training and learning and did not have a sense of responsibility and company
stewardship, marketing talent was in short supply locally, and lastly punctuality
was also an issue for some employees. We make recommendations for a resurgent Oman in LCC
operations as follows: 1)
The Oman Government must make it compulsory to
employ supply chain graduate trainees in any supply chain office/operations as
a way to localize skills quickly and long term. One of the reasons why many
local supply chain graduates were not employed was that they did not have the
required experience. But experience was not bought from supermarket shelves but
was given by the very companies asking for it and requiring it, yet denying
these young people a chance to get and gain that very experience. It looks
quite contradictory. Many companies were already doing this and making a great
contribution to developing the sector and national economy, but many others
were not doing so. 2)
A regular multi-sectoral consultative process for
industrial associations, colleges/universities and government in crafting
policies and processes for LCC development targeted at cost reduction, efficiency,
and excellence in LCC operations. 3)
Deliberate policy interventions and industrial
investments were required to fully integrate LCC, and the rest of the economy
as was the case at ports like Rotterdam in Netherlands, Shanghai in China and
Jebel Ali Port in UAE. An IT big data driven model has proven to be a panacea
where this has been applied. A lot has been done in Oman but more needed to be
done. 4)
Comprehensive internships that address industry
supply chain operations must be done by all students and period of internship
could be bolstered to six months for students to get maximum industrial
exposure. Other countries do eight months. That way graduating students were
fully immersed in industrial supply chain operations and were productive from
day one of employment. 5)
Oman HEIs must employ a combination of highly
experienced industrial managers with supply chain backgrounds as lecturers
(even on a part time basis), and other career academics so that there is a
balance between theory and industrial realities. Universities in Europe are
known to do this with good results, e.g., Breda University of Applied Sciences
in Netherlands which has some senior managers and CEOs as supply chain
lecturers on a part time basis. This brings industry to the classroom and
students benefit from practicalities rather than just theories. It was very clear from literature review and field
research that outdated policies and slow change management by LCCs were the
major causes of challenges facing LCCs in Oman and some of these were in the government
domain where individual LCCs could do very little or none. These are areas
other researchers can look into maybe using longitudinal studies for a deeper
understanding and dealing with cross-cutting issues. Such research is necessary
to understand why known challenges persisted and what could be possible
solutions based on experiences elsewhere in the leading world. This research had sought to answer all research questions, which were clearly answered conclusively in this research as per above findings and analysis.
CONFLICT OF INTERESTS None. ACKNOWLEDGMENTS None. REFERENCES Asyad Group. (2021). Hh Sayyid Asa’Ad Bin Tariq Al Said To Inaugurate Iru World Congress Tomorrow. Boukis, A. (2013). Identifying Some Internal S/F Factors of
NSD Project Performance : International Journal of Retail and Distribution
Management, 41(7), 531-544.
https://doi.org/10.1108/IJRDM-05-2013-0099. Burke Johnson, R., and Onwuegbuzie, A. J. (2012). 2 Quantitative Purists, Ayer. In Educational Researcher. Popper. 33 (7). Cole, J.R. (2009). The Great American University: Its Rise to Preeminence, Its Indispensable National Role, Why It Must Be Protected: USA: Public Affairs. Creswell, J. (2011). John W. Creswell-Research Design_ Qualitative, Quantitative, and Mixed Methods Approaches-SAGE Publications, Inc (2013). Crow, M.M. and Dabars, W.B. (2015). Designing The New American University. Baltimore : Johns Hopkins University Press. Foss, B., Stone, M. and Ekinci, Y.
(2008). "What Makes for CRM System Success -
Or Failure ?", Journal of Database Marketing and Customer Strategy
Management 15, 68-78. https://doi.org/10.1057/dbm.2008.5. Gattorna, J. (2010). Dynamic Supply Chains, Delivering Value Through People. 2nd Edition. Pearson Education Limited, UK. Gruchmann, T. (2022). "Theorizing The Impact of
Network Characteristics on Multitier Sustainable Supply Chain Governance: A
Power Perspective", The International Journal of Logistics Management,
33(5), 170-192.
https://doi.org/10.1108/IJLM-08-2021-0429. Göktürk, E. (n.d.). What is "paradigm” ? Hausman, W.H., Lee, H. L. and Subramanian, U. (2013). The
Impact of Logistics Performance on Trade : Production and Operations
Management, 22 (2), 236-252. https://doi.org/10.1111/j.1937-5956.2011.01312.x. Jain, R., Jain, S. and Dhar, U. (2007). 'CUREL : A Scale for Measuring Customer Relationship Management Effectiveness In Service Sector', Journal of Services Research, 7(1) 37-58. Kaushik, V., and Walsh, C. A. (2019). Pragmatism As a Research Paradigm and Its Implications for Social Work Research. Social Sciences, 8(9). https://doi.org/10.3390/socsci8090255. Leat, P., and Revoredo-Giha, C. (2013). 'Risk and Resilience in
Agri-Food Supply Chains: The Case of the ASDA Porklink Supply Chain in
Scotland.'Supply Chain Management: An International Journal, 18(2), 219-231. https://doi.org/10.1108/13598541311318845. Liu, S., Park, S., Choi, Y., and Yeo, G. (2022). Efficiency Evaluation of Major Container Terminals in the Top Three Cities of The Pearl River Delta Using SBM-DEA And Undesirable DEA. The Asian Journal of Shipping and Logistics, 38(2), 99-106. https://doi.org/10.1016/j.ajsl.2022.03.001. Maxwell, J.C. (2007). The 21 Irrefutable Laws of Leadership. Nashville : Thomas Nelson. Mckeller, J.M. (2014). Supply Chain Management. New York : Mcgraw-Hill Education. Mellat-Parast, M. (2013). 'Supply Chain Quality Management : An Inter-Organizational Learning Perspective.' International Journal of Quality and Reliability Management, 30(5), 511-529. NCSI (2021). Oman National Center for Statistics and Information. Nooraie, S. V. and Parast, M. M. (2016). Mitigating Supply Chain Disruptions Through the Assessment of Trade-Offs Among Risks, Costs, and Investments In Capabilities, International Journal of Production Economics, 171, 8-21. https://doi.org/10.1016/j.ijpe.2015.10.018. Pettey, C. (2008). "Gartner Says More Than 50 Percent of CRM Implementations Considered Failures From Customer's Point of View". Ponticelli, S., Mininno, V., Dulmin, R. and Aloini, D. (2013). Supply Chain Implications for One-Off Luxury Products: Cases from the Yacht Industry: International Journal of Retail And Distribution Management, 41(11/12), 1008-1029. https://doi.org/10.1108/IJRDM-01-2013-0002. Porter, M. E. (1998). The Competitive Advantage of Nations. 2nd Edition. Palgrave Macmillan, UK. SOLS2040 (2015). Sultanate of Oman Logistics Strategy 2040. Ministry of Transport and Communication. Sandberg, E. (2013). Understanding Logistics-Based Competition in Retail ‐ A Business Model Approach: E. International Journal of Retail And Distribution Management, 41 (3), 176-188. https://doi.org/10.1108/09590551311306237. Saunders, M., Lewis, P., Thornhill, A., Lewis, S., and Thornhill, (2012). Research Methods for Business Students Fifth Edition. Setia, P. and Patel, P.C. (2012). How Information Systems
Help Create OM Capabilities: Consequents and Antecedents of Operational
Absorptive Capacity: Journal of Operations Management, 31 (7-8), 409-431. https://doi.org/10.1016/j.jom.2013.07.013. Shah, D. (2015). Ten Challenges for Future Leaders In Procurement. Sheffi, Y. (2001). "Supply Chain Management Under the
Threat of International Terrorism," International Journal of Logistics
Management, 12(2), 1-11.
https://doi.org/10.1108/09574090110806262. Sheffi, Y. (2014). Logistics Clusters, Delivering Value and Driving Growth. Massachusetts : The MIT Press. The Emirates Center for Strategic Studies and Research (2003). Human Resource Development in a Knowledge-Based Economy. Abu Dhabi : The Emirates Center for Strategic Studies and Research Series. Vietor, Richard H. K. (2007). How Countries Compete. Harvard Business School Press, Massachusetts, USA.
APPENDICES Appendix 1 Ullah, A., Eidin M.S., Ahmed, H.O.N. (2022). Logistics clusters development in Oman (2022 https://ijecm.co.uk/wp-content/uploads/2022/05/10518.pdf Appendix 2 ASYAD (2018). Oman proves that logistics integration is key to growth. Available at: https://www.iru.org/news-resources/newsroom/oman-proves-logistics-integration-key-growth
This work is licensed under a: Creative Commons Attribution 4.0 International License © IJETMR 2014-2023. All Rights Reserved. |