InternationalJournalofProductionResearchVol.49,No.6,15March2011,1685–1712Third-partylogisticsprovidersofferingformpostponementservices:valuepropositionsandorganisationalapproachesAlessioTrentin*DipartimentodiTecnicaeGestionedeisistemiindustriali,Universita`diPadova,StradellaS.Nicola3,36100Vicenza,Italy;ZaragozaLogisticsCenter,AvenidaGo´mezLaguna25,50009Zaragoza,Spain(Received14August2008;finalversionreceived4November2009)Intoday’sglobalsupplychains,third-partylogisticsproviders(3PLs)canplayanimportantroleinimplementingtheprincipleofformpostponement(FP).Thisproposesthatactivitiescreatingproductvarietyandtheassociatedproductionmixdecisionsaredeferredalongaproductfamilymanufacturinganddistributionprocessaslongaspossible.WhilebothFPandthird-partylogisticshaveincreasinglydrawntheattentionoftheacademiccommunityoverthelastfewyears,lessresearchhasbeencarriedoutonFPsupportedby3PLs.Thepresentpaperempiricallyinvestigateshow3PLscandelivervaluetocompaniesofferingproductvarietybyprovidingFPservices,definedasthecarryingoutofvariety-creatingactivitiesonbehalfofthesecompaniesclosetothetargetmarkets.Ourfindingsindicatethat,throughanFPservice,a3PLcangiveitscustomerstwodifferentkindsofbenefits:eitherimprovedperformanceinservingthecustomer’sexistingmarketsorentryintonewgeographicalmarkets.Further,ourresultsshowthatthroughthechoiceoftheorganisationalsolutionforFPserviceprovision,the3PLcanincreaseFPvaluebymitigatinganumberofdisadvantagesthatthecustomermightincurinthecaseofin-houseimplemen-tationofFP.Challengesthatthe3PLneedstoovercometoactuallyprovidethesepotentialbenefitsarealsoidentified.ThepaperconcludesbydiscussingtheimplicationsofourfindingsforbothpracticeandresearchonFP.Keywords:masscustomisation;postponement;supplychainmanagement1.IntroductionFormpostponement(FP)isanoperationsdesignprinciplethatmoreandmorecompaniesareturningto(MatthewsandSyed2004)undertheeffectofincreasingproductvarietyandcustomisation(Pine1993,BayusandPutsis1999,FunkeandRuhwedel2001).Theprincipleofformpostponement(FP)proposesthatcompaniesdefertheircommit-mentofresourcestoaspecificend-productinthemanufacturinganddistributionprocessaslongaspossible(Alderson1950,Heskett1977).ApplicationofFPrequiresdeferringatleastoneproductdifferentiationactivity(PDA),whichspecialisesthework-in-progressintoparticularend-products,andthedecisiondrivingsuchactivity(Lee1996,GargandTang1997).BydeferringaPDA,FPallowsforthecollectionofnewinformationaboutcustomerdemands(e.g.,actualcustomerorders,orupdatedsalesforecastsinthecase*Email:alessio.trentin@unipd.itISSN0020–7543print/ISSN1366–588Xonline2011Taylor&FrancisDOI:10.1080/00207541003623414)priortothemakingofthedecisiondrivingthePDA,therebyreducinguncertainty(Yangetal.2004a,Forzaetal.2008,Wongetal.2009).Third-partylogisticsproviders(3PLs)canplayanimportantroleinFPimplemen-tation(vanHoek2000a,Yangetal.2007),owingtotheincreasinggeographicaldispersionofsupplychains.Asproductionmovesfartherawayfromprimarymarkets,thereisagreaterincentivetoimplementingFPbyplacingPDAsinthedistributionchannel.Bydoingso,companiesservingglobalmarketsavoidmakingdecisionsonfinalproductconfigurationsfaraheadofthemomentofcustomerpurchaseandassurehighresponsiveness,whileretainingscaleeconomiesatcentralisedfactories(Cooper1993,VanHoek1998).WithmoreandmorecompaniestryingtoplacePDAsinthedistributionchannel,itcomesasnosurprisethat3PLs,especiallylarge3PLsoperatingonacontinentalorevenglobalscale,seethecarryingoutofPDAsonbehalfofmanufacturingcompaniesasaviableextensionoftheirserviceofferings(vanHoek2000a).Bydoingso,3PLscanraiseturnoverinahigher-marginareaofthesupplychainthantheincreasinglycommodifiedtraditionallogisticsservices(vanHoek2000b).Moreover,bysupplementingtransport-andwarehousing-basedserviceswiththecarryingoutofPDAsinthedistributionchannel,3PLscanreapthebenefitsofdeeperrelationswithexistingcustomersandincreasedcustomerloyalty(vanHoek2000a).WhileboththeliteratureonFP(vanHoek2001,Yangetal.2004b)andtheliteratureonthird-partylogistics(SelviaridisandSpring2007,Marasco2008)havegrownrapidlyoverthelastfewyears,lessattentionhasbeenpaidtoFPsupportedby3PLs.Thepresentpaperaimstoaugmentourunderstandingofhow3PLscandelivervaluetocompaniesofferingproductvarietybyprovidingFPservices,definedasthecarryingoutofPDAsonbehalfofthesecompaniesclosetothetargetmarkets.Accordingly,thepaperempiricallyinvestigatesthefollowingtworesearchquestions:whatFPservicescana3PLofferandhowdotheycreatevalueforthecustomerbuyingtheservice?Moreover,whatorganisationalsolutionscana3PLadopttoprovideanFPservice,howdotheyinfluencevaluetothe3PL’scustomer,andwhataretheassociatedchallengesforthe3PL?Theremainderofthispaperisorganisedasfollows.Section2providesmotivationsforourresearchinthecontextoftheexistingliteratureonFP.Section3describesandjustifiestheinductiveresearchdesignweusedtoaddressourresearchquestions.InSection4,threeobservationslinking3PL-providedFPservices,valuetothe3PL’scustomer,organisationalapproaches,andenablingorhindrancefactors,arepresentedalo