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Integrated planning in hybrid courier operations

George Ninikas (Department of Financial & Management Engineering, University of the Aegean, Chios, Greece)
Theodore Athanasopoulos (Department of Financial & Management Engineering, University of the Aegean, Chios, Greece)
Vasileios Zeimpekis (Department of Financial & Management Engineering, University of the Aegean, Chios, Greece)
Ioannis Minis (Department of Financial & Management Engineering, University of the Aegean, Chios, Greece)

The International Journal of Logistics Management

ISSN: 0957-4093

Article publication date: 4 November 2014

Abstract

Purpose

The purpose of this paper is to present the design and evaluation of an integrated system that supports planners and dispatchers to deliver enhanced courier operations. In addition to regular deliveries and pickups, these operations include: first, mass deliveries to be served over a horizon of multiple days; and second, real-time dynamic requests (DRs) to be served within the same service period.

Design/methodology/approach

To address the aforementioned challenges, the authors developed an architecture that enhances a typical fleet management system by integrating purpose designed methods. Specifically, the authors plan mass deliveries taking into account typical routes of everyday operations. For planning DRs in real time, the authors propose an efficient insertion heuristic.

Findings

The results from testing the proposed optimization algorithms for planning mass deliveries and real-time DRs are encouraging, since the proposed algorithms outperform current practices. Testing in a practical courier environment, indicated that the enhanced planning system may improve significantly operational performance.

Research limitations/implications

The proposed optimization algorithm for the dynamic aspect of this problem comprises a heuristic approach that reaches suboptimal solutions of high quality. The development of fast optimal algorithms for solving these very interesting and practical problems is a promising area for further research.

Practical implications

The proposed integrated system addresses significant problems of hybrid courier operations in an integrated, balanced manner. The tests showed that the allocation of flexible orders within a three-day time horizon improved the cost per flexible order by 7.4 percent, while computerized routing improved the cost of initial (static) routing by 14 percent. Furthermore, the proposed method for managing DRs reduced the excess cost per served request by over 40 percent. Overall, the proposed integrated system improved the total routing costs by 16.5 percent on average compared to current practices.

Originality/value

Both the planning problems and the related solution heuristics address original aspects of practical courier operations. Furthermore, the system integration and the proposed systematic planning contribute to the originality of the work.

Keywords

Acknowledgements

The authors would like to thank Dr Charis Marentakis and Georgios Drougkas of Hellenic Post, for their valuable support throughout this project. This work has been partially funded by the “Regional Operational Programme of Attica” (ROP of Attica) (project “Management of Dynamic Requests in Logistics (MaDReL)”) and the “Reinforcement Program of Human Research Manpower” (PENED) (co-financed by National and Community Funds (20 percent from the Greek Ministry of Development-General Secretariat of Research and Technology and 80 percent from EU-European Social Fund) – 03ED067 research project).

Citation

Ninikas, G., Athanasopoulos, T., Zeimpekis, V. and Minis, I. (2014), "Integrated planning in hybrid courier operations", The International Journal of Logistics Management, Vol. 25 No. 3, pp. 611-634. https://doi.org/10.1108/IJLM-09-2012-0097

Publisher

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Emerald Group Publishing Limited

Copyright © 2014, Emerald Group Publishing Limited