Proceedings of ICLT 2013

Implementation of governmental Logistics policies to enhance competitiveness in Thailand’s industrial sector

Korrakot Yaibuathet Tippayawong; Apichat Sopadang; Sakgasem Ramingwong

Department of Industrial Engineering, Faculty of Engineering, Chiang Mai University, Thailand; Department of Industrial Engineering, Faculty of Engineering, Chiang Mai University, Thailand; Department of Industrial Engineering, Faculty of Engineering, Chiang Mai University, Thailand

International Conference on Logistics & Transport 2013, Kyoto, Japan, pp. 153-162

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Abstract

Thailand industrial sector is now facing intense logistics cost disadvantages, amounted to about 14.3% GDP. Cost control from supply chain and logistics management is the main priority for every companies.The Bureau of Logistics, Department of Primary Industrial and Mines, one of the major governmental offices who are responsible for National logistics cost reduction has introduced a number of policies to cut down industrial logistics cost. With significant and regular funding to focused industries, tangible results and achievements have been realized and demonstrated. Purpose: This research paper aims to highlight the outcomes from the “Northern Thailand Logistics Improvement Project”, which was supported by the Bureau of Logistics in 2012. This paper provides insight into the improvement of the logistics performance obtained from applying various logistics techniques to the six highest exporter industries, consisting of (i) food, (ii) petroleum and plastic, (iii) electrical and electronics, (iv) auto parts, (v) garment and textiles, and (vi) natural rubber industries. Design/methodology/approach: Twenty-five selected companies from Northern Thailand have been evaluated using the industrial standard, Logistics Scorecard. Then, two improvement sub-projects are introduced to each company considering from the revealed weaknesses. Appropriate logistics and supply chain management tools are subsequently proposed to the company s‟ improvement team to resolve identified problems. Findings: It has been shown that the average score from the Logistics Scorecard was increased from 2.57 to 3.15, where the highest increasing score belonged to the electrical and electronics industry (42.5% improvement). This resulted in a decline of the logistics cost in selected companies (Northern Thailand area) by more than 15% or in total about 2 million USD. Potentially, these players can expect to reduce the logistically related costs by more than 14 million USD within five years. Research

Keywords

Logistics Policy Implementation; Productivity improvement; Logistics Scorecard Paper type: Logistics Development Policy

Citation

Korrakot Yaibuathet Tippayawong; Apichat Sopadang; Sakgasem Ramingwong (2013). Implementation of governmental Logistics policies to enhance competitiveness in Thailand’s industrial sector. Proceedings of the International Conference on Logistics & Transport (ICLT 2013), Kyoto, Japan, pp. 153-162.