Assessment of factors affecting the performance of outsourced logistics activities, in the case of Ethiopian airlines Prepared
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Date
2020-06
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Addis Ababa University
Abstract
The general objective of this study is to assess factors affecting the performance of outsourced
logistics activities, in the case of Ethiopian airlines. The study employed explanatory type of
research design. The target population for this study was all employees of Ethiopian Airlines
who work in the logistics department. Both primary and secondary data is used for this study.
Collected data is analyzed by using inferential and descriptive statistics technique with a
computer program called the statistical package for social science (SPSS), version 23. Finding
of this study indicates that Ethiopian airlines has outsource logistics service that is not
maximized as desired due to factors such as loss of control over the logistics service providers,
higher cost and longer time taken to select third party logistics provider, high level delay of
customer order delivery, and ineffective relationship between management and third party
logistics provider performance evaluation. The correlation result indicates that there are
relationships between the measures of impact on the performance of outsourced activities and
reasons for outsourcing logistics activities that have direct implication to all factors. The
researcher acknowledges that the existing outsourcing of logistics services is benefiting the
Ethiopian airlines. Recommendations of the researcher mainly focus on how the Ethiopian
airlines could maximize its outsourcing activity for more effective profitability. Particularly, it is
recommended that Ethiopian airlines should outsource only necessary aspects of business to
avoid reduction in profitability. Also; the department of logistics should avoid adoption of
inappropriate outsourcing strategies that negatively affects corporate profitability. These
concerns indicate that there is need for future research study which may bridge the gap in these
limitations.
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Keywords
outsourcing, logistics, performance, Core Competencies, Profitability, Flexibility