| Keynote Speech / Saloon A
Financial
and Physical Networks in the Global Logistics
The last two decades have seen immense changes in the forces and
institutions that govern economic activity. They encompass the
on-going changes associated with the European Union, and the changes
in liberalization and governance initiated by the World Trade Organization.
New markets and new forms of contracting are supporting outsourcing,
unbundling, contract manufacturing and a variety of other forms
of extended value constellations.
In tandem, revolutionary developments in transportation and logistics
(the rise of FedEx, UPS and DHL) are providing new global fulfillment
architectures for B2B and B2C. Expansion of physical capabilities
in international logistics began in the 1990s and has continued
unabated, with Hong Kong and Dubai the most evident examples, but
with increases in capacity in nearly every established port and
air hub. This was accompanied by increased sophistication and intermediation
activities of brokers and forwarders, followed by the development
of financial overlays and trading instruments for air cargo and
shipping capacity. In the process, the logistics industry has
become an interesting example on how physical markets have dovetailed
with financial and information markets in supporting and profiting
from globalization and outsourcing. It is also at the heart of
the enabling infrastructure that supports the explosion of international
trade that we have witnessed in the last decade.
This presentation will explore these issues by expanding on the
above theme. In particular, the outline of my presentation will
be the following:
1. A brief overview of the general trends in the global economy,
with the motivation to highlight these as drivers of changes in
logistics infrastructure;
2. Some general problems emerging from this for logistics, focusing
on the evolution of aircargo and maritime container traffic;
3. Extended analysis of options and risk management issues in
shipping following work by Hellermann, Kavussanos, Visvikis and
myself;
4. Conclusions and open research questions on network-enabled
strategies and the key role of financial and physical networks
in logistics in supporting these. Prof. Paul
R. Kleindorfer
Wharton School Management Sciences Retired Professor / Pennsylvania
University
Technology and Operations Management Honorary Research Professor
INSEAD |