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Integrated Planning in Hybrid Courier Operations

Ninikas, G., Athanasopoulos, T., Zeimpekis, V., Minis, I.

International Journal of Logistics Management (IJLM), 2013


Purpose - We 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: a) Mass deliveries to be served over a horizon of multiple days, and b) real-time dynamic requests to be served within the same service period.
Design/methodology/approach – To address the aforementioned challenges, we developed an architecture that enhances a typical fleet management system by integrating purpose designed methods. Specifically, we plan mass deliveries taking into account typical routes of everyday operations. For planning dynamic requests in real time, we propose an efficient insertion heuristic.
Findings – The results from testing the proposed optimization algorithms for planning mass deliveries and real-time dynamic requests 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. Our tests showed that the allocation of flexible orders within a three-day time horizon improved the cost per flexible order by 7,4%, while computerized routing improved the cost of initial (static) routing by 14%. Furthermore, the proposed method for managing dynamic requests reduced the excess cost per served request by over 40%. Overall, the proposed integrated system improved the total routing costs by 16,5% 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: Express logistics, fleet management systems, re-planning in vehicle routing, multi-period vehicle routing
Paper type Research paper