Determination of an SCI's effect on revenues

Abstract

While introducing the conceptual framework of the quantification approach in Chapter 4, changes in revenues, costs and capital commitment are based on estimations. In the present chapter a fuzzy model for the determination of an SCI's reveneue contribution is presented. The starting point of the model is any form of inter-organisational collaboration in the context of SCM, an SCI. An illustration is provided by Figure 5-1. The implementation of such an SCI affects the financial performance of a company in many respects (e.g., Hofmann & Locker, 2009; Lambert & Pohlen, 2001; Pohlen & Coleman, 2005). It may reduce its operating costs, its need for current and fixed assets or it may generate additional revenues by increasing logistics customer service. The focus of the fuzzy model is the latter, and the question of the extent to which a change in logistics customer service affects revenues. It is assumed that the SCI itself is of inferior interest and has to be seen as an independent variable that causes an improvement in logistics customer service.