Contemporary Challenges and Practices in Logistics and Supply Chain Management

Okumus, Abdullah (Ed.); Demirci, Ebru (Ed.); Gul, Muhammet (Ed.) Book Contemporary Challenges and Practices in Logistics and Supply Chain Management Provided in Cooperation with: Istanbul University Press Suggested Citation: Okumus, Abdullah (Ed.); Demirci, Ebru (Ed.); Gul, Muhammet (Ed.) (2024) : Contemporary Challenges and Practices in Logistics and Supply Chain Management, ISBN 978-605-07-1615-3, Istanbul University Press, Istanbul, Turkiye, https://doi.org/10.26650/B/SS05ET50.2024.016 This Version is available at: https://hdl.handle.net/10419/312689 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. 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If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. https://creativecommons.org/licenses/by-nc/4.0/ i ii CONTEMPORARY CHALLENGES AND PRACTICES IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT EDITORS Abdullah Okumuş İstanbul University, School of Business, İstanbul, Türkiye Ebru Demirci İstanbul University, School of Transportation and Logistics, İstanbul, Türkiye Muhammet Gül İstanbul University, School of Transportation and Logistics, İstanbul, Türkiye iv Published by Istanbul University Press Istanbul University Central Campus, 34452 Beyazıt/Fatih, Istanbul - Turkiye https://iupress.istanbul.edu.tr Contemporary Challenges and Practices in Logistics and Supply Chain Management Editors: Abdullah Okumuş, Ebru Demirci, Muhammet Gül E-ISBN: 978-605-07-1615-3 DOI: 10.26650/B/SS05ET50.2024.016 Istanbul University Publication No: 5351 Published Online in May, 2024 It is recommended that a reference to the DOI is included when citing this work. This work is published online under the terms of Creative Commons Attribution- NonCommercial 4.0 International License (CC BY-NC 4.0) https://creativecommons.org/licenses/by-nc/4.0/ This work is copyrighted. Except for the Creative Commons version published online, the legal exceptions and the terms of the applicable license agreements shall be taken into account. This book was published as part of the Istanbul University Press’ 100th Anniversary of the Republic book project. v PREFACE In recent years, extraordinary developments such as global epidemics, war and other humanitarian crises that the world has experienced have caused some recessions and difficulties in logistics and supply chains as well as in all sectors. While the world is making calculations of returning to its old order, new concepts and issues in logistics and supply chain management are on the agenda of both researchers and practical industry environments. For this reason, the idea of this book has emerged in order to bring these new concepts, models, and good practice examples that are new and candidate to application in these two subjects, such as logistics and supply chain management, which require an interdisciplinary view. With this book, contemporary challenges and applications in logistics and supply chain have been discussed from the perspective of different disciplines such as marketing, management science, social sciences, engineering and law. Many issues such as supply chain analytics, new developments in logistics and human resources in the supply chain, new concepts in sustainable and reverse logistics (such as sustainable supplier selection, risk management, resilience, service quality), integration of the internet of things into logistics and supply chain, evaluation of sustainable practices and company profitability of transportation and logistics businesses, and the situation of freight forwarders in logistics and transportation law have been discussed through this book, and a guide has emerged that will benefit both the academia and industry. We are very thankful to the Istanbul University Press team for making this book publication smooth and successful. We thank all the authors, who are the true architects of the success of our book project, and the reviewers for their valuable comments, contributions, patience and cooperation. Finally, we, as the three editors of this book, are grateful to our families for their constant love, patience and support. Without their unique support, we would not have been able to complete this book. With the best wishes that the book will be useful to all concerned. Abdullah OKUMUŞ, Ebru DEMİRCİ, Muhammet GÜL vii PREFACE ........................................................................................................................................iii CHAPTER 1 SUPPLY CHAIN MANAGEMENT: CHALLENGES AND SOLUTIONS Burcu ADIGÜZEL MERCANGÖZ, Farheen NAZ, Arvind UPADHYAY ...................................... 1 CHAPTER 2 SUPPLY CHAIN ANALYTICS IN THE CURRENT NEW WORLD Ashwin A. KADKOL, Burcu ADIGÜZEL MERCANGÖZ, Jayanth SEKAR, Sadhana GOPAL, Ankur KUMAR ................................................................................................. 15 CHAPTER 3 COMMON HUMAN RESOURCES ISSUES AND NEW CHALLENGES IN LOGISTICS Burcu Özge ÖZASLAN ÇALIŞKAN ............................................................................................ 27 CHAPTER 4 SUSTAINABLE SUPPLIER SELECTION PROBLEM Erkan ÇELİK .................................................................................................................................. 55 CHAPTER 5 SUSTAINABLE AND REVERSE LOGISTICS RISK MANAGEMENT Muhammet GÜL, Samuel YOUSEFI, Babak Mohamadpour TOSARKANI ................................ 67 CHAPTER 6 TURKISH NATIONAL TRANSPORTATION, LOGISTICS POLICIES AND ECONOMIC GROWTH Mehmet ADAK ............................................................................................................................... 79 CHAPTER 7 INTERNET OF THINGS (IOT) APPLICATIONS IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT Mehmet Ali ERTÜRK .................................................................................................................. 101 CHAPTER 8 FREIGHT FORWARDERS IN CONTEMPORARY LOGISTICS AND TRANSPORTATION LAW: CURRENT PRACTICE AND CHALLENGES Turkay ÖZDEMİR ........................................................................................................................ 117 CHAPTER 9 EVALUATION OF SUSTAINABLE PRACTICES AND COMPANY PROFITABILITY OF TRANSPORTATION AND LOGISTICS BUSINESS Ebru DEMİRCİ, Cengiz Görkem AKIN, Jan BENUS ................................................................. 143 CONTENTS CHAPTER 10 LOGISTICS SERVICE QUALITY AS A DETERMINANT OF CUSTOMER LOYALTY IN ONLINE RETAILING Erdem ÖZKAN ............................................................................................................................. 179 CONTENTS viii 7Burcu ADIGÜZEL MERCANGÖZ, Farheen NAZ, Arvind UPADHYAY With the spread of digitalization in the world, digitalization has also become very common in supply chain management. Companies and organizations need to follow current developments in digital supply chain management. It is needed to keep up with innovative technologies such as big data analytics, blockchain, augmented reality, cloud computing, IoT, etc. Digital supply chains integrate innovative technologies, improve customer service, and increase the organization’s performance. Thereby, effective digital supply chain management also solves other supply chain problems (14). In fact, digitalization appears as both a challenge and a solution. Because companies that have successfully adapted to digitalization can solve many supply chain problems. However, companies that fail to achieve this will not be able to stand with the traditional methods they used in the past. Blockchain is a cryptographically saved distributed ledger that cannot be altered. This technology ensures the recordkeeping, and settlements. Thus, blockchain can allow traceability and confirm the origin of manufacture. Blockchain technologies in the supply chain is a technology that creates trust between parties. By using this technology, supply chain managers can realize a secure communication paradigm where data integrity and stability can be guaranteed. As mentioned before, supply chains are a structure with many physical flows involving multiple actors and stakeholders, and information sharing that supports this flow. Within this structure, many activities take place, starting from the receipt of the order to the delivery of the right product, in the right quantity, under the right conditions, at the right location, and at the right time. The application logic of blockchain and supply chains bears great similarities in this respect. As mentioned before, supply chains are a system with many flows involving multiple actors and stakeholders, and information sharing. Within the system, many activities take place, starting from the getting of the orders to the delivery of the “right product”, in the “right quantity”, under “the right conditions”, at “the right place”, and “at the right time”. Internet of Things (IoT) states that it is set into with software and other technologies to collect and exchange data with devices connected to each other over the internet. Thus, IoT has many practices in supply chain management, such as tracing flow, and smart and precision production. Cloud Computing ensures to reserve the data on many different hosts without direct active management and provides Software as a Service on Demand of customers. It is an internet-based computer system. It supports to the management for dealing with the big data analytics. SUPPLY CHANGE MANAGEMENT: CHALLENGES AND SOLUTIONS8 Big data analytics is identified as next-generation technologies that are designed to financially get value from large amounts of a broad variety of data by allowing high-speed capture, detection, and analysis. Big data analytics supports other technologies like cloud computing, and IoT. Information and Communication Technologies also provide information and data to supply chain management. Information and Communication Technologies help to decision making by acting as an information system for many supply chain stakeholders. Ballou et al. (2000) suggest that supply chain management has to balance and coordinate three dimensions of the system; in a function, between different functions, and between different organizations. However, since cooperations are generally among members with different reward systems or may be legally separate, members need to realize gains from their cooperation. There becomes a challenging situation when the gains pool with some members at the harm of others. Balancing these gains essential challenge for all members to be efficient in their cooperation, which is an essential challenge for the supply chain management. The solution to the challenge is to find a way to calculate and report incomes and expenditures, and other data, such as demand level, and customer service quality; give information related to the gain level, and reallocate the gains that put some members in a worse position as a result of their cooperation, thereby balance the gains (15). Information Technologies in Supply Chain Management ensure effective coordination between the processes of the chain, reduces the required costs and time, provide the requested information to be analyzed instantly, create long-term business relationships by providing value-added IT (information technologies) based services to the customers. For this reason, many businesses in the sector are investing in information technologies for managerial problems. With supply chain management software, accurate information is collected, analyzed and shared with business partners in the chain. Although this type of software brings together all business functions and enables businesses to be managed more effectively, within the scope of optimization; it cannot fully answer questions such as what should be done when, where and by whom. At this point, managers need Decision Support Systems (DSS) tools to optimize critical elements such as production characteristics, transportation costs, and inventory costs. For example, if transportation costs are the highest cost of a business, the first DSS application will be fleet routing systems or network design. Vaaland and Heide (2007) show that small and medium-sized enterprises give less importance to planning and control methods than large-sized enterprises. Ineffective management components in small and medium-sized enterprises cause severe problems in the supply chain system. If they do not improve efficient planning and control methods, they will face a decre - 9Burcu ADIGÜZEL MERCANGÖZ, Farheen NAZ, Arvind UPADHYAY ase in competitive power. To solve this problem, Small and Medium Enterprises must adopt the technology and system considered vital to keep supply chain management applications. Especially in the plans of large companies, more technology-oriented supply chain management is included. In addition, “horizontal collaboration” or “vertical integration” might decrease the information technology gap by sharing planning and control systems. Support systems suppliers should think of offering whole “turnkey” solutions to encourage supply chain functions explicitly targeting small and medium-sized enterprises (16). Some industries have their own supply chain challenges. For instance, according to Hussain et al. (2006), the petroleum industry has crucial supply chain management problems, especially in the logistics components, which do not exist in many other industries. The logistical challenges significantly affect the cost of oil and its derivatives. One of the solutions to these kinds of challenges is to use financial hedging instruments. For instance, a “swap contract” may be undertaken, saving a huge amount of logistics costs. Although the petroleum industry has been considered in Hussain’s (2006) study, the outputs of this study can also be applied to other industries. Financial derivatives are an instrument that can be used in other industries with high logistics costs to avoid the risk of costs (17). Yadav et al. (2022) state that the agriculture food supply chain faces many challenges regarding the growing demand for foodstuffs and consumer choice for food safety. Increasing concerns about sustainability, information asymmetry, food safety, food waste, and traceability issues are some of the most important challenges in the industry (18). Thus, supply chain managers should adopt industry 4.0 technology new tools, techniques, and methodologies to model and solve the present food supply chain challenges and design the food logistics network accordingly. Digitization and effective design of the agriculture food supply chain are inevitable solutions to address the problems. There are many effective design approaches to the agriculture food supply chain, such as blockchain, digital twin, IoT, big data analytics, information and communication technologies, cloud computing, and cyber-physical system. For instance, Blockchain can be traceable and confirm the origin of products. By using Blockchain the loss and waste of food can be suppressed. Further, IoT can have several implementations ranging from sensitive agriculture to smart agriculture. Smart agriculture technologies also has a vital role in the trackability of the agriculture food supply chain. According to Juma et al (2019) blockchain technology is a suitable technology for optimizing the processing model adopted the fields of healthcare, commercial supply chain, and food safety depending on the features of the Blockchain (19). Wu and Huang (2018) suggest that food supply chains may threaten the environment in SUPPLY CHANGE MANAGEMENT: CHALLENGES AND SOLUTIONS10 some ways. Stakeholders aiming to be environmentally friendly in their food chains have two main problems with limited resources and facing too many eco-options (20). The study emphasizes that these problems can be solved with business analytics tools. It can be successfully narrowed down to many options by evaluating of past accomplished selections. By using business analytics to sense the environmental sustainability of food supply chains from massive data sources and turns the complicated information into meaningful managerial knowledge of sustainable food supply chains, and managers can formulate effective strategies with this meaningful knowledge. It states that the two most important elements of successful sustainability applications are eco-innovation and food loss/waste. Kumar et al (2022) identify a pharmaceutical company’s most important supply chain challenges. They find that the top three key challenges are political factors, delays in the import process, and weak internet connection. In addition, during the COVID-19 era, the top three managerial opportunities are inventory management, transport method choice, and operational cost. Thus, companies can be added value to its product through a supply chain system, efficient management members, and skillful decision-making toward satisfying the demand on time and observing supplier performance (21). Advanced and Planning Systems (APS) provide real-time information from the chain across the entire supply chain, providing customers with a fast and reliable, feasible schedule. With the APS implementation, better throughput times, shorter delivery times, effectively managed inventory levels, and high customer satisfaction are achieved. The most important reason for the adoption of advanced planning systems by many businesses is that they ensure that processes in complex supply chain networks can be planned easily and in a short time. In addition, vehicle routing systems are used in supply chain management. Aiming to ensure that the products are delivered to the right locations with the available resources as soon as possible, vehicle routes are determined statically and dynamically by using technologies such as GPS, and database management systems. Vehicle Routing Systems (VRS) that integrate these technologies are used to effectively manage and dynamically route vehicles. Paul et al (2021) state that Covid crisis does not have many results as there are many results for financial, environmental, and political crises. The uniqueness of the Covid crisis makes it difficult to guess outcomes and potential challenges for recovery. Thus, the study tries to identify the challenges rather than finding solutions. When firms anticipate the challenges, they can develop suitable solutions to ensure the sustainability of their supply chains during the recovery. According to the study, raw material shortage, manufacturing and transportation breakdowns, and social distancing cause the fragility of global supply chains. Supply chain management must evolve strategies (22). 11Burcu ADIGÜZEL MERCANGÖZ, Farheen NAZ, Arvind UPADHYAY Yadav et al. (2020) emphasize the importance of sustainability in supply chain management. According to the study, the primarily culpability for failures in adopting sustainable supply chain management is seemed to be the managerial and organizational challenges. The secondary challenges are related to the lack of financial, technical, and human resources constraining the adoption of sustainability. Adopting the 6 River System (6 R’s) within the organization and environmental product design and lifecycle analysis is the most effective solution for sustainable supply chain management challenges (23). Jain et al. (2009) focus on supplier-related issues. They examined issues such as supplier selection, supplier-supplier relations, and supplier-buyer flexibility in relations in a dynamic supply chain. The study tries to present a dynamic model of the supply chain, taking into account some current and ongoing developments and research activities. This study analyses how various modelling techniques such as agent technology, Petri nets, fuzzy logic, and data mining can be applied to support dynamic supply chain models by taking into account of supplier-related challenges (24) The requirements for making logistics activities more flexible and perfect require the creation of new approaches and practices for logistics and supply chain processes. Optimization and intensive technology are at the forefront of these approaches. The approaches both increase the ability of supply chains to make more accurate and faster decisions regarding the solution of emerging or potential problems and significantly reduce the level of complexity in the system. Figure 3. Supply Chain Solutions Created by the authors One of the most effective ways for businesses to survive is to integrate technology and optimization applications into their supply chain systems in a way that will obtain the highest possible benefit. With supply chain management software, accurate information is collected, analyzed and shared with business partners in the chain. In addition to technological software, Decision Support Systems are also used, which optimize critical elements such as production features, transportation costs, inventory costs to answer questions such as what should be done when, where and by whom. The supply chain solutions are illustrated in Figure 3. SUPPLY CHANGE MANAGEMENT: CHALLENGES AND SOLUTIONS12 In the past, businesses thought of information operating systems and related software as costliness in order to carry out their logistics activities and demanded a mid-range system, today many companies invest in these technologies. One of these technologies is Blockchain technology. It also finds its place in supply chain applications. According to Irak and Topcu (2020), although the initial investment and energy consumption of blockchain technology are high, the gains it provides in the supply chain are well above these costs in the medium and long term (25). Especially with globalization, supply chains have become quite long and complex, ma - king it difficult to control and trace, creating opportunities for malicious people, intensifying competition, etc. cause. With the traceability feature, blockchain technology is beneficial for the applications in the supply chain for the tracking of products such as food, medicine, dangerous goods, and sensitive electronic devices that carry the risk of deterioration, theft or counterfeiting in the supply process. 4. Conclusion In 2019 people all around the world faced to a pandemic named COVID-19. This pandemic thrived instantaneously and affected all kind of business and the way of many things are done. However, companies had not a chance to prepare for such a pandemic, which thrived instantaneously. In addition, rapid digitalization causes conditions to change very quickly in the world. In brief, wars, pandemics, and rapid digitalization have created a world system that is much more difficult to predict. These demonstrate to companies that they must be ready for bad scenarios. Although we demonstrate the supply chain problems specific to different sectors and supply chain components in this chapter, it is understood that the solutions always focused on digitalization, technology-oriented approaches, and optimization. In the new world, digitalization has become inevitable. Digitization is both a solution and a challenge for companies that can lead to their extinction. Companies that can keep up with the fourth industrial revolution and digitalization will be able to survive. In the new world, where everything is changing very rapidly globally, supply chains are becoming more costly, risky, and complex. Thus, traditional supply chain strategies and methods can be insufficient. According to our literature survey, the condition of successful supply chain management is to be positioned around digitalization, technology, and integration. The business environment needs to be even more intertwined with the concept of a sustainable supply chain to be ready for the new digitalized world and the worst situation and remain resilient in the competitive environment. This requires agility and digitization. 13Burcu ADIGÜZEL MERCANGÖZ, Farheen NAZ, Arvind UPADHYAY In order to develop a potential solution in economic terms, blockchain can be used effectively. Many studies suggest blockchain technologies for solving supply chain problems. With blockchain technology, all the activities can be kept in the digital system from the suppliers to the end customers. By retaining the whole information about the process in the digital environment, the information of the process becomes visible, accurate and reliable and also can be accessed more efficiently. The flexibility of the process provides to cope with the of crisis. Lean supply chain practices can include sustainable and flexibility parameters. In addition, with the covid19 pandemic and the Industry 4.0 revolution, the number of factories that do their work with machines rather than human labor has increased. It is expected that as the machine usage rates increase in the factories, the error rate will decrease and therefore the quality and the productivity will increase. Blockchain technologies, digitalized factories, IoT technology is among the tools that can be used to solve supply chain management. Today, supply chain management is about using technology to make the supply chain and business smarter. Businesses now store very long supply chain data, not with the human factor, but with blockchain technology, and process it with big data analytics. Businesses no longer wait for machine breakdowns; with smart technologies They can now predict a failure before breakdowns happen and take steps to prevent it so that the supply chain can continue uninterrupted. It is also certain that companies that be unsuccessful to achieve these will fail. The literature review and the solutions proposed showed that the supply chain managers can no longer escape from digitalization and technology. The solution at the focal point of all kinds of problems is digitalization and technology. As digitalization has become prerequisite for the supply chain, companies are expected to make their investments in the line with digitalization and technological developments in order to provide sustainability and competitive advantage. References 1. Gartner Report, https://www.gartner.com/en/supply-chain/trends/supply-chain-analytics-mitigate-busi- ness-disruptions 2. Chopra S, Meindl P. Supply chain management: strategy, planning, and operation, 5th ed. USA: Prentice Hall; 2012. 3. Ottino JM. Chemical engineering in a complex world: grand challenges, vast opportunities. AIChE J 2011;57(7):1654-68. 4. Garcia DJ, You F. Supply chain design and optimization: challenges and opportunities. Computers & Chemical Engineering 2015;81:153-70. 5. Zsidisin GA, Melnyk SA, Ragatz GL. An institutional theory perspective of business continuity planning SUPPLY CHANGE MANAGEMENT: CHALLENGES AND SOLUTIONS14 for purchasing and supply management. Int J Produc Res 2005;43(16):3401-20. 6. Narasimhan R, Narayanan S, Srinivasan R. Explicating the mediating role of integrative supply management practices in strategic outsourcing: a case study analysis. Int J Produc Res 2010;48(2):379-404. 7. Schoenherr T, Modi SB, Benton WC, Carter CR, Choi TY, Larson PD, et al. Research opportunities in purchasing and supply management. Int J Produc Res 2012; 50(16): 4556-79. 8. Trent RJ. What everyone needs to know about SCM. Supply Chain Management Review 2004;8(2):52-9. 9. Miles RE, Snow CC. Organization theory and supply chain management: An evolving research perspecti- ve. Journal of Operations Management 2007;25(2):459-63. 10. Christopher M. Logistics & Supply Chain Management, 3rd ed. London: FT Prentice‐Hall; 2005. 11. Van Hoek R, Johnson M, Godsell J, Birtwistle A. Changing chains: three case studies of the change management needed to reconfigure European supply chains. Int J Log Manag 2010;21(2):230-50. 12. Bartner T. Overcoming global supply chain challenges. [Online] https://www.mckinsey.com/industries/travel-logistics-and-infrastructure/our-insights/overcoming-global-supply-chain-challenges. October 2023. 13. Brown A. Future of supply chain: challenges, trends & tips for 2022. [Online] https://www.skubana.com/ blog/supply-chain-management/challenges. October 2023. 14. Ageron B, Bentahar O, Gunasekaran A. Digital supply chain: challenges and future directions. In Supply Chain Forum: An International Journal, Taylor & Francis 2020;21(3):133-8. 15. Ballou RH, Gilbert SM, Mukherjee A. New managerial challenges from supply chain opportunities. Industrial Marketing Management 2000;29(1):7-18. 16. Vaaland TI, Heide M. Can the SME survive the supply chain challenges? Supply chain management: An International Journal 2007;12(1):20-31. 17. Hussain R, Assavapokee T, Khumawala B. Supply chain management in the petroleum industry: challenges and opportunities. International Journal of Global Logistics & Supply Chain Management 2006;1(2):90-7. 18. Yadav VS, Singh AR, Gunasekaran A, Raut RD, Narkhede B. Systematic literature review of the agro-food supply chain: Challenges, network design, and performance measurement perspectives. Sustainable Production and Consumption 2022;29:685-704. 19. Juma H, Shaalan K, Kamel I. A survey on using blockchain in trade supply chain solutions. IEEE Access 2019;(7):184115-32. 20. Wu PJ, Huang PC. Business analytics for systematically investigating sustainable food supply chains. Journal of Cleaner Production 2018;(203):968-76. 21. Kumar V, Ya KZ, Lai KK. Mapping the key challenges and managing the opportunities in supply chain distribution during COVID-19: a case of Myanmar pharmaceutical company. Journal of Global Operations and Strategic Sourcing, (ahead-of-print). 2022. 22. Paul SK, Chowdhury P, Moktadir MA, Lau KH. Supply chain recovery challenges in the wake of COVID-19 pandemic. J Bus Res 2021;(136):316-29. 23. Yadav G, Luthra S, Jakhar SK, Mangla SK, Rai DP. A framework to overcome sustainable supply chain challenges through solution measures of industry 4.0 and circular economy: an automotive case. Journal of Cleaner Production 2020;(254):120-2. 24. Jain V, Wadhwa S, Deshmukh SG. Select supplier-related issues in modelling a dynamic supply chain: potential, challenges and direction for future research. International Journal of Production Research 2009;47(11):3013-39. 25. Irak G, Topcu YE, Tedarik zincirinde blok zinciri teknolojisinin uygulanmasının maliyetler üzerindeki etkisi, Uluslararası Yönetim İktisat ve İşletme Dergisi 2020;16(1):171-85. CHAPTER 2 SUPPLY CHAIN ANALYTICS IN THE CURRENT NEW WORLD Ashwin A. KADKOL*, Burcu ADIGÜZEL MERCANGÖZ**, Jayanth SEKAR***, Sadhana GOPAL****, Ankur KUMAR***** *Pr. Technical Program Manager, GE Aerospace, Karnataka, India E-mail: [email protected] **İstanbul University, School of Transportation & Logistics, İstanbul, Türkiye E-mail: [email protected] ***Sr. Director Data & Analytics, GE Aerospace, Karnataka, India E-mail: [email protected] ****Sr. Data Scientist, GE Aerospace, Karnataka, India E-mail: [email protected] *****Sr. Staff Data Scientist, GE Aerospace, Karnataka, India E-mail: kumar[email protected] DOI: 10.26650/B/SS05ET50.2024.016.02 ABSTRACT Disruption and volatility are very common in the new world. In light of this, the supply chain community needs mechanisms to increase resilience, agility, better risk management, design methods, decision-making capabilities, by leveraging technologies like IoT, Blockchain, and Analytics. Prerequisites are not limited to the availability of good quality data, sharing of such data, factoring in the human element, and the need for increased collaboration across supplier levels and Original Equipment Manufacturers. Supply chain analytics consists of processes that companies use to gain insight and get value from the huge data associated with the procurement, processing, and distribution of goods. In today’s new world supply chain analytics is an indispensable component of supply chain management. With the above context, this work surveys analytics efforts spanning sourcing, manufacturing, inventory, demand, warehousing, transportation, and customer relationship management with the aim of detection, response, simulation, and prediction of events. In the new era, the supply chain challenges and thus solutions are too many and very complex. In this chapter, the focus has been mostly on Transportation Analytics. Authors in this chapter have dealt with the challenges of carrier selection, shipment modality selection, shipment consolidation, shipment type, route analysis, and the formation of new routes. The intent has been to present to the reader some introductory examples from the industry where such analytics could be useful. The theoretical bases for the examples stated are not treated in this chapter, but the focus has been to mainly draw out the problem, the typical inputs & outcomes with some hints on future work. Keywords: Supply chain analytics, transportation analytics, logistics management, transportation management CONTEMPORARY CHALLENGES AND PRACTICES IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT SUPPLY CHAIN ANALYTICS IN THE CURRENT NEW WORLD16 1. Introduction 1.1.SupplyChainAnalytics Supply chain analytics means using technology and data to eliminate barriers in complicated, multi-pronged processes and logistics. Systematizing these aspects of an entity simplifies processes, improves accuracy, and saves time. It can also help entities decrease their costs and balance their budget. Supply chain management deals with four main and interrelated areas: i. Goods and Products, ii. Manufacturing/production, storage, and distribution, iii. Transportation and iv. Shipping, logistics, routes (See Figure 1.). Supply chain analytics tries to make solutions in these areas. Therefore, Supply chain simulations model these components and sub-components and movements. While being modeled it gathers data on these components and uses the data to improve some areas. Supplier, Transportation, Inventory, warehouse management systems, customer relationship management systems, data process automation and robotic process automation are some of the important supply chain analytics solutions. IoT and Blockchain technologies are also used for solutions. In this way, supply chain risks decrease while productivity increases, it helps to enhance supply chain planning, increase the ability to meet demand, and decrease inventory costs. The focus of this chapter is on transportation management with some treatment on the inter-related areas of shipping, logistics, and routes. Figure1. Areas of Supply Chain Analytics 23Ashwin A. KADKOL, Burcu ADIGÜZEL MERCANGÖZ, Jayanth SEKAR, Sadhana GOPAL, Ankur KUMAR goods are shipped from one site to another on a large scale on a day-to-day basis. Estimating the number of shipments with the help of historic trends between sites, by considering various factors such as type of goods, cost per unit of weight, mode of transportation, and forwarder, can help in planning the shipments that are anticipated and there by meeting the delivery requirements. b. On-Time-Delivery Forecast – Transportation data can be used to meet the requirements of customers by predicting the on-time delivery of goods. It can help in effective planning of resource allocation and inventory management. On-Time delivery is critical to each business as the process line gets impacted as a chain reaction to the end outcomes. With the help of analytics and machine learning algorithms, bottlenecks, anomalies, and delays can be anticipated and planned to save time. This also throws light on the available stock, and the estimated inventory to be planned. c. Route Optimization – It is essential for businesses to scale and save on cost. Optimized route can help businesses in increasing the number of successful deliveries. Optimization algorithms uses the historic patterns between sites and compare several routes to pick the most optimal route between two sites, with optimal stops. 3. Conclusion The supply chain activities, systematized to deliver a particular product or service to the final buyer, have been one of the areas most affected by the pandemic conditions and the Russia-Ukraine war. The rapid digitalization in the world has been both an opportunity and a threat depending on the attitudes of companies and countries in this process. Increasing costs, disruption of transportation processes and decreasing efficiency of production are the most prominent challenges. In order to overcome these challenges, a new supply chain planning and keeping up with digitalization is required. Supply chain management aims to create a fast production cycle, balance costs, evaluate workforce requirements and establish a bond between suppliers and customers. While the challenges in front of the transportation companies in the new world system made transportation difficult, the inability of the factories to fully fulfil their functions also hindered production. Therefore, it is necessary to optimize, improve and digitalize the supply chain management process in the new world. In today’s new world, technological infrastructure, and system integration are required to increase operational efficiency, keep up with the digital transformation, ensure data security SUPPLY CHAIN ANALYTICS IN THE CURRENT NEW WORLD24 and take the digital interaction between parts of the supply chain to higher levels. The technological infrastructure also enables the analysis of stocks, raw materials, sales rates, and transportation processes against sudden events that may change in the market. In this way, access to instant reports becomes easier and new strategies can be developed faster. Although the supply chain challenges are too many and supply chain analytics is a vast and emerging area, we have focused on the challenges that we think are the most important in order to focus on a specific area without distracting the subject. In this chapter, the focus has been mostly on Transportation Analytics. More specifically, in this chapter, we have dealt with the challenges of carrier selection, shipment modality selection, shipment consolidation, shipment type, route analysis, and the formation of new routes. The intent has been to present to the reader some introductory examples from the industry where such analytics could be useful. The theoretical bases for the examples stated are not treated in this chapter, but the focus has been to mainly draw out the problem, the typical inputs & outcomes with some hints on future work. Acknowledgment This body of work received no specific grant from any funding agency in the public, commercial, or not-for-profit sectors. The authors would like to acknowledge GE Aerospace & Istanbul University for enabling this work. References 1. Hillier FS, Liberman GJ. Introduction to Operations Research, McGraw Hill, 2010. 2. Macdonald A. global logistics solutions: a guide to the problems shippers face, World Trade Mag, 2007:36- 40. 3. Monczka R, Trent R, Handfield R. Purchasing and supply chain management, Mason, OH: Thomson South-Western; 2005. 4. Russell SR, Taylor BW. Operations management: creating value along the supply chain. USA: Wiley Publication, 7th ed.; 2011. 5. Meixell MJ, Norbis M. Integrating carrier selection with supplier selection decisions to improve supply chain security. Intl. Trans. in Op. Res 2012;(19):711-32. 6. Meixell MJ, Norbis M. A review of the transportation mode choice and carrier selection literature. The Intl Jour of Logistics Management 2008;19(2):183-211. 7. Lin YK, Yeh C T. Determine the optimal carrier selection for a logistics network based on multi-commodity reliability criterion. Int J Systems Science 2013;44(5):949-65. 8. Liao Z, Rittscher J. Integration of supplier selection, procurement lot sizing and carrier selection under dynamic demand conditions. Int J Produc Econ 2007;107(2):502-10. 9. Cooke JA. 15th Annual Masters of Logistics Survey. Strategy Shift 2006; 25-30. 10. Ülkü MA. Analysis of shipment consolidation in the logistics supply chain. [Phd Thesis] Ontario, Canada: University of Waterloo; 2009. 25Ashwin A. KADKOL, Burcu ADIGÜZEL MERCANGÖZ, Jayanth SEKAR, Sadhana GOPAL, Ankur KUMAR 11. Çetinkaya S. Coordination of inventory and shipment consolidation decisions: a review of premises, models, and justification. In: Geunes J, Akçali E, Pardalos PM, Romeijn HE, Shen ZJM. (eds) Applications of Supply Chain Management and E-Commerce Research. Boston: Springer; 2005. 12. Çetinkaya S. Coordination of inventory and shipment consolidation decisions: A review of premises, models, and justification. In Guenes J, Akçalı E, Pardalos PM, Romeijn HE, Shen ZJM. (eds) Applications of Supply Chain Management and E-Commerce Research in Industry. Kluwer Series: Applied Optimization 2004;(92):3-51. 13. Combes F. The choice of shipment size in freight transport. Architecture, space management. France: Université Paris-Est; 2009. 14. Holguín Veras J. Revealed preference analysis of commercial vehicle choice process, Journal of Transportation Engineering 2002;128(4):336-46. 15. Johnson D, DeJong G. Shippers’ response to transport cost and time and model specification in freight mode and shipment size choice. Proceedings of the 2nd International Choice Modeling Conference ICMC 2011, UK: University of Leeds; 4-6 July. 2011. 16. Abate M, De Jong. The optimal shipment size and truck size choicethe allocation of trucks across hauls; 2014;(59):262-77. 17. Ben-Akiva M. A micro-simulation model of shipment size and transport chain choice. Transportation Research B 2007;41(9):950-96. 18. Kosicek M, Tesař R, Dařena F, Malo R, Motycka A. Route planning module as a part of supply chain management system. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis 2012;60(2):135-42. Images Sources ‘image: https://www.flaticon.com/free-icon/book_6192115’. ‘image: https://www.freepik.com/free-vector/delivery-icons_766498.htm#query=cargo%20ship%20icon&position=14&from_view=keyword&track=ais’. ‘image: https://www.vecteezy.com/vector-art/10575080-parcel-tracking-icon-logo-vector-illustration-track-or- der-symbol-template-for-graphic-and-web-design-collection’ ‘image: https://uxwing.com/truck-delivered-icon/’. ‘image: https://www.flaticon.com/free-icon/maps_2953567?term=maps&page=1&position=89&origin=search&related_id=2953567’. ‘image: https://www.flaticon.com/free-icon/diagram_1935521?term=logic&page=1&position=9&origin=search&related_id=1935521’. ‘image: https://www.flaticon.com/free-icon/identify_6159077?term=identify&page=1&position=9&origin=search&related_id=6159077’. ‘image: https://www.flaticon.com/free-icon/consolidation_7479757?term=consolidate&page=1&position=45&origin=search&related_id=7479757’. ‘image: https://www.flaticon.com/free-icon/board_4635577?term=team+meeting&page=1&position=30&origin=search&related_id=4635577 CHAPTER 3 COMMON HUMAN RESOURCES ISSUES AND NEW CHALLENGES IN LOGISTICS Burcu Özge ÖZASLAN ÇALIŞKAN* *İstanbul University, School of Transportation and Logistics, İstanbul, Türkiye E-mail: [email protected] DOI: 10.26650/B/SS05ET50.2024.016.03 ABSTRACT In this chapter, the HR challenges in the logistics sector and the way of overcoming these difficulties are discussed. Logistics is what keeps the economy alive worldwide. The economy couldn’t survive if trucking, transport and storage companies cannot get materials from suppliers to manufacturers and finished products from manufacturers to consumers. The success of such an important industry depends on people. In addition to hiring and retaining well-equipped and competent employees, logistics managers should evaluate the performance and determine key performance indicators correctly, manage employee relations, occupational health and safety for the sector, ensure team management in a way that emphasizes the importance of teamwork in terms of logistics processes. Many HR related issues such as training, motivating, time tracking and empowering employees should also be managed successfully in logistics companies. From this perspective, in this study, first of all, the new trends in HR processes in the logistics sector will be evaluated, and the challenges faced in this sector will be evaluated in the context of the mentioned human resources management functions. Keywords: HR challenges in logistics, logistics and supply chain competencies, performance, balanced supply chain management scorecard, training, hiring and retaining competent employees in logistics, Logistics management CONTEMPORARY CHALLENGES AND PRACTICES IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT COMMON HR ISSUES AND NEW CHALLENGES IN LOGISTICS28 Introduction The concept of logistics was used as a military concept in the 1990s. Nowadays it is perceived as a strategic activity that has a competitive advantage in terms of businesses (1). In the early 1900s with the transportation of agricultural products, it began to be considered as a science. Bowersox and Closs (1996) defined logistics as the correct management of the supply, transportation and storage activities of the right material within an organization with the right cost and profitability (2). The original and most fundamental concept of logistics is a set of three operational activities that add value to goods: movement, warehousing and rearrangement. There are certain aspects on which the added value inherent in these activities is based. These are place, period & pace and pattern that can be called as “Three P-s (PPP)”. Place can be defined as adding place value by moving items from locations of lower value to the customer to locations of higher value to the customer. Additionally, period & pace means that adding time value to products by storing them so that products are moved from the periods in which they are available (either extraction, harvest or post-production) to the periods customers need, making all processes more efficient. The inventory is optimal for each individual’s economy and it ensures separation of processes along the value chain so that it can work at speed. Finally pattern can be described as adding order value to items by arranging them in desired quantities and patterns. Examples include consolidation, break-bulk, sequencing, picking/packing, etc. (3). That is the operational part of the logistics. Today, countries determine strategies targeting “customer satisfaction” and “low costs” in order to achieve long-term competitive advantage. In addition, various developments such as the globalization of world trade and the increase in trade volume, the continuously develo - ping expectations of customers within the framework of product quality as well as the level of logistics service, the shortening of product life cycles and the development of systems working with zero stock have an important place in the creation of “logistics strategies”. In addition, the rapid developments in information technology, the long-term cooperation of the units within the distribution channels within the framework of logistics activities, creating “supply chains” and the increase in the use of outsourcing are among the main factors that play a role in the formation of these strategies. At the same time, all these have brought with it the necessity of using limited and valuable resources more effectively and efficiently. In such a competitive environment with limited resources, the priority of all systems has been to increase production. One of the most important factors affecting performance, life cycle, 29Burcu Özge ÖZASLAN ÇALIŞKAN design and research, which is effective in increasing production, is logistics. The concept of logistics is also related to human resources management. Human resource management includes specific activities such as the recruitment, training, development, health and safety protection, compensation and dismissal of employees employed in an organization. On the other hand, considering that logistics is a labor-intensive business with high service quality, technologies such as automation and information systems are used, it works 7/24 and it requires online control, it becomes clear how important the investment to be made in people is in terms of logistics. At this point, each of the human resources management functions is also important for logistics enterprises. The aim here is to create a work environment where the employee will be satisfied, to carry out activities that will protect their health and safety, and to get the highest efficiency from the employee. Every step taken in this direction will help to create the most suitable working environment for both the employee and the employer. The logistics industry is undergoing a significant transformation, characterized by new technological solutions in daily practice. It is a sector that is exposed to numerous legal, economic, social, technological and environmental changes. This kind of changes have a subsidiary impact on the values and expectations of the employees and, accordingly, the choices they make and their job satisfaction. The present circumstance is expressed by the lack of well qualified human resources and the requirement to discover appropriate answers to figure it out. Retaining well qualified human resources, particularly for employees with proven skills and vocational preparation, can be counted as the challenges faced by organizations. Identifying what inspires these types of employees in line with their choices and neccesities is the solving. In this direction, logistics firms are starting to give more importance to practices aimed at establishing the concept of employee brand. This makes reference to a condition that an owner makes the company engaging to present and potential workers. To achieve this, the head of the company proactively distinguishes itself from its rivals and incorporates developing HR functions. Thus, it becomes more effortless to attract and retain well qualified workers (4). In light of these developments, today the supply chain has ceased to be a half-and-half mix of infrastructure and information systems technology, and has become more of a mix of human behavior, system technology and asset infrastructure (5). 1. Management and Leading Even if the best and most efficient equipment is used in logistics operations, the operation will fail without effective management. Unmotivated people can cause failures despite strong technical infrastructure and systems. All these reasons are the best proof that management is about people. The most critical function of a business is to make the most of its existing COMMON HR ISSUES AND NEW CHALLENGES IN LOGISTICS30 workforce. The low motivation of the employees also increases the workforce turnover and absenteeism in the business. Organizations with high absenteeism and staff turnover also have relatively low productivity rates and higher operating costs, according to analyzes of distribution centers in large corporate networks. Getting the best for people isn’t always an easy process. People work at different levels within the organizational structure, and while they contribute to the organizational culture by working as a team, they also get the results of their individual efforts (6). In other words, they need a work environment where they can realize their individual goals while realizing their organizational goals. The presence of an effective leader contributes to the formation of a supply chain that has the power to drive the necessary change in terms of sustainability and continuous improvement. If the organization and at the head of the supply chain does not have an effective supply chain leader supported by talented and enthusiastic personnel, steps taken to strengthen the supply chain will not be successful (7). It will not be effective to act without the support of senior managers who deal with the formulation and prioritization of corporate strategies in the development of relations with suppliers and customers in enterprises. In the absence of these features, both the company and the manager lose their competitive advantage, as senior managers are responsible for deciding the cap on resources to invest in the business. When evaluated from a management perspective, it can be said that leadership behaviors include the right amount of demand information from customers, creating positive perceptions for relational trust and long-term support. In addition, an important factor that differentiates businesses from their competitors and increases the overall visibility of the organization is the charismatic behavior of senior managers. As a result, external stakeholders, such as suppliers, increase their identification with businesses through such leaders and decide to cooperate with these organizations. For all these reasons, researchers emphasize that the formulation and implementation of supply chain strategies require effective leadership behaviors and senior management support (8). 2. Selection Today, an active, highlydeveloped and innovational logistics and supply chain industry is of great importance in terms of achieving and sustaining global financial and economical growth and envolvement. In addition to the need for significant logistics infrastructure investments, the availability of qualified, talented and experienced employees will help the logistics and supply chain industry meet global economic demands. The multi-disciplinary nature of logistics makes it necessary for people who want to make a career in this field to work with people from many different disciplines with many different characteristics. For this reason, companies often look for people who have expertise in certain aspects of the supply chain, 31Burcu Özge ÖZASLAN ÇALIŞKAN but who can see the big picture and who can prioritize company goals rather than functional goals when making decisions. The logistics industry is human-centered by its nature. For this reason, the selection of human resources that work in this sector is important for businesses. Human resource selection is defined as the process of hiring the right candidate for any position in the business. Failure to manage this process correctly will emerge as an important cost item for the business. It is possible to meet business expectations with objectivity and strategic perspective in the selection process. Recruitment of the right personnel will provide many benefits for the business, and the wrong selection will reduce productivity and have many negative effects on the business. An organization has to execute a number of human resources functions that are not an easy task, such as selecting, retaining and training an adequate and cabaple supply chain manager. A prosperous supply chain manager has to achieve success by implementing a comprehensive SCM strategy, overcoming daily functional challenges and interacting with other divisions and outer organization sharers on a worldwide proporiton. In order to achieve this, he must have the necessary skills. Although the supply chain is accepted as a crucial management activity for a business in terms of global competition, the literature about the talent management in terms of supply chain management has not developed sufficiently. The lack of literature on talent management and talent evolvement of supply chain managers has increased the difficulties in measuring the capability of supply chain professionals. There are several competencies required in this area, including technical competencies and social competencies. Technical competencies which called as hard skills and social competencies which called as soft skills are the two main areas of competence add to a supply chain professionals’ knowledge and these skills will support managers in making their business determinations. A supply chain manager must possess technical knowledge and business competencies, as well as the talent to communicate and harmonize efficaciously through group work. Within the scope of the supply chain, high level of communication competence and effective communication skills are very important as there are more than one company across the countries (9). 3. Logistics and Supply Chain Management competencies The conception of competency was handled in the field of management for the fist time by Selznick in 1957 to mean “distinctive competency” (10). White used the concept of competency for the first time in 1959 by associating it with people (11). However, its real popularity in the field of human resources became popular with McClelland’s article “Testing for Competence Rather than Intelligence” published in the American Psychologist magazine in 1973. COMMON HR ISSUES AND NEW CHALLENGES IN LOGISTICS32 The concept of competency has been specified in numerous ways by various researchers. As mentioned earlier, Boyatzis (1982) defined competency as an “underlying characteristic of the person that leads to or causes effective or superior performance” (12). It was stated that competencies are the DNA of organizations. The concept was defined as the structural creation of how the work will be carried out. Developing new competencies may need hiring new employee, moving authrity from insiders to outsiders, and germinate a new culture (13). Klein (1996) defined competency as “behavioral indicators or the sum of observable behaviors” (14). In general, competency is described as the group of behaviors, personality, abilities, interestingnesses, motivation, and observable behaviors and actions exhibited in the past to achieve desired results. Lindberg and Rantatalo (2015) define professional competence as “the inferred potential for desirable activity within a professional practice” (15). The competencies used by the individual to achieve the goals of the organization are defined as employee performance. The performance of the employee can be described as the degree to which certain standards and targets are achieved by pre-planning the work in business life or the degree of approaching the desired targets. Employee performance is an indicator that shows the level of work done in different sectors. It is stated that every action taken by an individual to perform a planned task is an indicator of employee performance. Organizational effectiveness is defined as the degree to which an enterprise achieves its objectives with the resources and tools available without placing an unnecessary burden on its employees. It is mostly related to how effectively and efficiently the resources are used while the organization continues its activities. Effectiveness refers to the values and activities of the human dimension of the business, but also includes the individual’s cabability to accomplish a particular aim inside the time frame allotted for the duty (16). The performance of the enterprises mostly depends on the competencies of the company managers and the quality of the management, which is directly related to their managerial potential. For this reason, companies have been trying hard to improve their management quality lately. Senior management is multidimensional and complex, also requires many competencies. With the increasing need for technological tools in business processes, digital transformation in the logistics industry has accelerated. In the logistics sector, technological applications are used to raise the effectiveness of operations and decrease costs, model the delivery flow, and monitor the order flow. Logistics managers benefit from technological programs while performing their duties. These technological programs include distribution requirements planning (DRP), material requirements planning (MRP), radio frequency identification (RFID), transportation management systems (TMS) and digital applications such 39Burcu Özge ÖZASLAN ÇALIŞKAN contribute enough to the logistics sector, the incompetence of sector employees and insufficient education levels. All these and similar problems are also reflected in international data. The low logistics performance index of Turkey also shows that it is not at a good level in the ranking (40). One of the main reasons for this can be expressed as the lack of competent professionals in the field of logistics. In order for Turkey to become a base in the logistics sector, in addition to carrying out many infrastructure works, the human resources employed in the sector must also be experts in their field and have sufficient knowledge and equipment. In other words, employees of logistics sector need to have significant logistics competencies. 4. Work performance, key performance indicators and Balanced scorecard approach to SCM Organizations today compete in saturated markets. They often try to gain competitive advantage by disseminating their models, products and ideas among their partners. This is usually managed in a Supply Chain, which includes coordinating the flow of materials, information and payments between companies. Supply Chain has become a central focus for strategy and a critical factor in gaining competitive advantage. Leading companies such as McDonald’s, Amazon, and Unilever recognize the importance of Supply Chain, making it a top priority due to its variability and process complexity. Thus, effective Supply Chain Management (SCM) has become a potentially valuable way to secure competitive advantage and improve corporate performance, because struggle is no longer between companies but between Supply Chain (41). For all sectors, the supply chain is an crucial component for the improvement of logistics. It can increase the efficiency and effectiveness of existing information sharing not only in the transfer of goods, but also in the complex hierarchy in the process from the point where the product is produced to the end point reaching the final consumer. Although there are different qualitative and quantitative performance evaluation methods, systematic grouping of different performance measures has not been included in the relevant literature. The expression of both quantitative and qualitative performance measures for easy reproduction and arrangement is represented by Chan. Isolated from general criteria such as quality and cost, other performance measures were described in Chan’s research. These are resource usage; flexibility; visibility; trust; and innovation (42). It is noteworthy that different definitions in the literature have been developed for visibility, trust and innovation. In this research, with the expectation of a clear development of supply chain performance measures, the proposed solutions are presented by listing the details of the options for these performance measures. Although there is a growing number of researches on supply chain management theories and practices in the literature, the performance measurement methods that can be used to COMMON HR ISSUES AND NEW CHALLENGES IN LOGISTICS40 develop the supply chain are not sufficient, successful and effective. Traditional methods which is a variation of the many different methods and techniques used for supply chain management assessment takes into account familiar economical metrics such as net present value, return on investment, internal rate of return and payback period. Although these assessment technics based on economical criteria they are most suitable for measuring the value of simple supply chain management operations. On the other hand they are not very suitable for next generation supply chain management applications. These composite supply chains try to produce a number of advantages, comprising intangible ones. Therefore, measurement objectives need to represent a balanced approach and be cathegorized at strategic, tactical and operational levels, as well as financial and non-financial measures for effective management of the supply chain (43). Different models such as Supply Chain Operations Reference (SCOR-model) and Balanced Scorecard (BSC) are used to evaluate organizational performance in businesses. The SCOR-model is a hierarchical and interactive business model that expresses business processes, performance metrics, good business practices and personal competencies in a unified structure. It is created by a plan, source, make, deliver, and return (41). The SCOR model is adapted to different conditions and scenarios because it is an industry independent management tool for supply chain management. It can be also adapted to different industries such as manufacturing, construction, service, logistics operations and collaborative Supply Chain networks. As mentioned in the following section Balanced Scorecard was developed by Kaplan and Norton in the early 90s. It focuses on business strategy from four perspectives: finance, customers, internal processes, and learning and growth (44). Many studies combine both models; however, meaningful results emerge only when the type of company, sector, organizational culture and size of the organization are taken into account. The focus of these models is to support a part of an organization to achieve the planned goals. In addition, models such as SCOR and BSC have key performance indicators (KPIs) that enable companies to achieve their goals (41). KPIs act as a set of measures focusing on those sides of organizational performance that are critical for the success of the organization. KPIs are seldom new to the organization. They may have not been recognized or they were gathering dust somewhere unknown to the current management team (45). In the literature, some researchers trying to define supply chain (logistics) performance with the Balanced scorecard approach have presented some criteria to measure logistics performance (46). Much of the literature on logistics performance seems to focus on models and frameworks and is about managing different aspects of logistics (47,48,49). There are 41Burcu Özge ÖZASLAN ÇALIŞKAN other studies that try to look specifically at certain units of the supply chain and measure performance on that basis. In this context, Choy et al. (2007) developed a performance management system for supplier relationship management for maintenance logistics providers using a benchmarking framework (50). Similarly, in measuring logistics performance systems using an activity-based costing approach, Koota and Takala (1998) applied this methodology to a case study in the basic metals industry (51). The balanced scorecard is designed to help firms that historically place too much emphasis on short-term financial performance. As the name suggests, the purpose of the scorecard is to provide a structured mechanism to influence managers to achieve a balance between non-financial and financial results over short-term and long-term time horizons. Much like SCM, it is important to note that there is currently a strong interest in balanced scorecard performance management systems among senior managers. Many managers are seeking to learn more about SCM and the balanced scorecard as separate management tools, but it is now more important that understanding the interrelationship between these two concepts in order to have a greater likelihood of leveraging supply chains into a source of competitive advantage (52). The balanced scorecard is the way of evaluating corporate performance from the perspectives of financial, internal business process, customer, and learning and growth dimensions. According to Kaplan and Norton (1992), their measurement tool which is called balanced scorecard is designed to complement “financial measures of past performance with their measures of the drivers of future performance”. They developed this concept with the aim of keeping score on a set of elements that provide a balance between short-term and long-term goals, between financial and non-financial measures, between lagging and leading indicators, and between internal and external performance perspectives (44). Traditional logistics performance measures, although useful, neither adequately assess supply chain orientation. The shift in philosophy that takes place when a supply chain point of view is embedded within the balanced scorecard framework is that the internal perspective of the scorecard is expanded to include both the “interfunctional” and “partnership” perspectives. Most of the performance measures used to measure supply chain performance consist of performance measures used for logistics performance evaluation, which provides internal focus. Logistics-oriented performance measures aim to optimize the performance of an enterprise in the supply chain, but do not consider the performance of other enterprises in the chain. Therefore, it falls short of measuring supply chain performance (52). At the same time, traditional performance measures such as profitability are not suitable for SCM. Because it provides a focus for a single business and does not have a holistic COMMON HR ISSUES AND NEW CHALLENGES IN LOGISTICS42 understanding that covers the entire chain for performance improvement. Many businesses are aware of the importance of financial and non-financial metrics. However, businesses are unsuccessful in using these criteria in a balanced structure. Some managers and researchers have focused on financial measures, while others have focused on operational measures. Such a difference in approach prevents the disclosure of performance criteria that will explain the performance of the enterprise. For a balanced approach, businesses need to realize that financial performance measures will be better analyzed together with non-financial measures of strategic decisions, reporting, daily production control and distribution operations. Another issue that differs between businesses is the number of performance measures to be used. Most of the time, businesses apply a large number of performance measures with the advice of their employees and consultants. In this case, they do not realize the fact that better results can be achieved with the use of a few good performance measures. Businesses can apply the balanced scorecard by setting goals for time, quality, performance, and service and translating these goals into specific metrics. Firms should direct their day-to-day business operations in line with a combination of these measures and operational measures, rather than purely financial measures. There are some certain steps to follow when creating a balanced supply chain management scorecard for businesses (43). One of them is increasing the awareness about balanced SCM scorecard in the company. Another one is gathering and analyse data on corporate, business strategy and SCM strategy. Particular aims and targets connected to corporate strategy, business strategy and SCM strategy. Also traditional metrics already in use for SCM appraisal. It is also known that potential metrics associated with four point of view of balanced scorecard. It is important to define the organization-specific aims for each of the four perspectives and the targets of the SCM operation. When developing a pre-balanced SCM scorecard, care should be taken that it is based on the defined goals and objectives of the business and the approach outlined. Getting comments and feedback from management on the balanced SCM scorecard and editing it consequently is another important step. Afterwards it should be accomplished a consensus on the balanced SCM scorecard that will be utilized by the corporation and the final step is to communicate both the balanced SCM scorecard and the underlying logic to all stakeholders. Measuring performance is very important in terms of determining the place of countries in the competition, just like the competition between businesses. In order to increase the logistics service quality of countries, the importance of measuring and determining their global performance has emerged. The Logistics Performance Index (LPI), which shows the situation 43Burcu Özge ÖZASLAN ÇALIŞKAN of countries in this competitive environment and enables them to compare their logistics performance, is published by the World Bank. The general logistics performance index of the countries is calculated in the range of 1-5 points by taking the weighted averages of these six indicators, and as the score rises to 5, it is interpreted as an increase in the quality of logistics performance. While the three indicators consist of input features such as public regulations, public policies and transportation infrastructure, the other three indicators are the outputs affected by the improvements and regulations made in these indicators. While indicators consist of customs, infrastructure, logistics quality and competence, which are the policy regulation tools that show the main inputs in supply chain service delivery, performance outputs in service delivery consist of two categories including international shipments, tracking and monitoring and timing indicators (53). By measuring on-site trade logistics performance, LPI helps countries and their companies and partners understand the challenges they face in reducing logistics barriers to international trade. Logistics performance is evaluated as a tool to measure the level of economic development, as well as ranking countries, regions and cities according to the development of logistics infrastructure. Having a quality and sufficient logistics network can be effective on economic and social development and can be said to be effective in transitioning to a country position preferred by investors. Turkey has the potential to be a logistics base in a strategic area, with its experience coming from being surrounded by seas on three sides and having its coasts suitable for making ports, being a bridge between Asia, Europe and the Middle East, and having similar trade routes in the past. 5. Occupational Health and Safety management Today, the issue of occupational health and safety in businesses is considered as one of the human resources management functions. It is seen that businesses are increasingly giving importance to the subject in order to provide both legal regulations and administrative development. When the issue is viewed from the perspective of all sectors, it is noteworthy that the point of view that while determining the occupational health and safety policy in the enterprises should be adopted with the aim of providing a safe and healthy environment for the employees, it is necessary to act with the aim of preventing all kinds of losses that will prevent the normal working order, and accidents that result in people or machines. In this direction, businesses should aim to create a safe and healthy work environment for their employees. In order to achieve this goal, it should be adopted that the necessary responsibility COMMON HR ISSUES AND NEW CHALLENGES IN LOGISTICS44 belongs to all individuals in the organization, together with managers and employees. This shared responsibility requires everyone’s participation. The most important factor that causes accidents and will prevent them is people directly. An accident-free working environment will only be provided to the extent that occupational health and safety rules are known and can be used by employees in daily activities. Occupational health and safety issue, which has started to be handled more comprehensively in recent years by considering its legal and economic dimensions in terms of all sectors, is important especially in terms of providing competitive advantage in the logistics sector, which can be considered as a new sector, and being in a better position compared to other enterprises in the sector. Today, while performing logistics activities, besides information and technology, an intense human power is also needed. Reducing work accidents plays an important role in terms of reducing labor costs in logistics activities, increasing employee motivation, increasing productivity, increasing and protecting business reputation. In order to reduce occupational accidents, it is necessary to adopt occupational health and safety practices and create an occupational health and safety culture within the enterprise. In addition, situations such as raising awareness and training of employees on occupational health and safety, running a feedback system by valuing the opinions of employees, taking protective and preventive measures by determining the risks and dangers in the work area, and operating a continuous control mechanism will reduce the occurrence of occupational accidents. In this way, workforce losses will be minimized, employee loyalty and motivation will increase, and expected increases in performance and productivity will be possible. From the point of view of logistics activities, it emerges that this situation will ensure that the products are delivered to the customer in the right amount and at the right time with minimum costs in competitive conditions. From the perspective of the logistics sector, the logistics management process, which includes activities such as demand forecasting, stock management, logistics communication, material handling, transportation/transportation, supply process, order processing, packaging, customer service, and after-sales support, has certain risks in terms of occupational health and safety. It is known that one of the most important activities that requires raising awareness of employees about occupational health and safety through various trainings is storage. Therefore, it will be possible to say that the issues that need to be emphasized in terms of occupational health and safety in terms of the activities included in logistics management are transportation and storage. The management of the flow of goods and services and the process of transforming raw materials into finished products is defined as supply chain (SCM) management. It enables a 45Burcu Özge ÖZASLAN ÇALIŞKAN company to gain competitive advantage in the market by increasing customer value through active regulation of supply-side activities. Supply chain management is a set of links covering the entire process from the procurement stage of goods and services to their production and reaching the final consumer. It consists of a network of raw material extraction, production, distribution and vendor. In terms of business processes, the supply chain sales process includes many areas such as production, inventory management, material supply, distribution, procurement and customer service. It is also one of the key strategies to increase organizational effectiveness. Standards are strategic tools to achieve efficiency gains by reducing waste in logistics. The logistics sector, which has a significant share of the national income measured by gross domestic product (GDP), is also one of the most important employers. Having a successful supply chain management requires making important decisions regarding the flow of information, products and money. Every decision must be taken to improve the resource of the supply chain. The supply chain is the management of demand by strategic cooperation between all the different structures of the enterprises, which are located horizontally and vertically in the system in order to meet customer needs, in order to increase the performance of the whole system in the long term. The aim in the supply chain is to increase the overall performance of the system. For this, each business in the system must increase its performance within itself. Because the core of the supply chain is the idea of “better performance for a better future”. Businesses in the logistics industry can also include safety and health concerns as a part of their SCM operations. The policy stating the general purpose of the company provides a safe and healthy working environment. OHS risk assessment should assess risks and quantify them by using risk matrices. Occupational health and safety management programs are designed to provide tools to achieve goals through continuous improvement of OHS performance. OHS hazards should be controlled according to the risk control hierarchy and the OHS tool should also consider planning in non-routine operations. Occupational Health and Safety Management Systems (OHSMS) is a proactive and sustainable approach aimed at effectively protecting the safety of employees’ work conditions, increasing health and safety performance, and continuously improving processes, with policies, strategies, procedures and activities implemented to prevent risks with the commitment of senior management. OSHMS ensures that all personnel who may pose a hazard to OHS receive appropriate training. Establishes safety and health committees in enterprises to support employee participation in decision-making processes. These elements are explored to prevent recurrence of work-related COMMON HR ISSUES AND NEW CHALLENGES IN LOGISTICS46 injuries, health problems, illnesses, and incidents. A safety inspection or audit is performed to measure safety performance. Emergency Response Plan (ERP) should be tested regularly for emergencies such as fire, oil or hazardous chemical spill (54). Workplace safety includes significant risks. The unintended consequences of workplace safety incidents include serious injury, death, serious insurance costs, legal consequences, and other losses. Although there are significant studies on workplace safety in the literature, there is limited research examining risks and safety in terms of supply chain security. From the supply chain perspective, two key features stand out. First, it takes into account the systems approach so that the entire supply chain is viewed as a single entity, and second, it requires a strategic orientation towards a collaborative effort to harmonize and unify operational and strategic capabilities within and between companies. This approach can be applied to manage workplace safety risk. The impact of supply chain risks due to supply chain variability requires collaboration with other supply chain partners. Therefore, the supply chain should be considered as a whole. A collaborative supply chain can be created by addressing the risks faced by a business through interactions with other supply chain partners. This provides an efficient environment for supply chain risk management (55). On the other hand, there is no interaction with only tangible risk sources that change their effects in the event of an interruption. It can also create a separate source of risk and increase supply chain vulnerability. Focusing on the core business is essential for both research and decision making. A supply chain will have an impact on job performance, as work can have adverse effects, particularly on the physical and mental health of employees (56). 6. Training, Motivating and Empowering Employees In terms of gaining competitive advantage, technology or infrastructure is easily imitated. The human resource that can use technology and equipment effectively and efficiently is inimitable. Supply chains with this power have a sustainable competitive advantage. In order to increase the productivity potential of the employees in the enterprises and provide competitive advantage to the enterprise, there is a need for a workforce equipped with the necessary knowledge and skills. For this reason, businesses attach importance to training activities in order to train qualified personnel who know their own processes well. Professionals who will work in today’s large supply chains need to have the knowledge and skills to see the big picture and ensure seamless integration between system elements. This requires knowledge and skills in many subjects in business, logistics and management. However, the degree of importance of these knowledge and skills may vary according to the 47Burcu Özge ÖZASLAN ÇALIŞKAN characteristics of the position, characteristics of the business and the region where the business is located. Undoubtedly, it is necessary to take a logistics and supply chain training in line with the program created in the light of needs in order to have knowledge in this wide area. Industry 4.0 brings radical changes in logistics processes due to new technologies. This includes the role, duties and required skills of logistics workers and requires them to be extensively qualified. Current research for deriving competency requirements in operational and cost-effective logistics lacks methodological support that adequately considers process, technology, training and competence. The future logistics specialist will need to be knowledgeable not only in the management of place, period & pace and pattern services, but also in the management of extended supply chains, which includes building relationships and managing flows over far and wide networks. The challenges facing this specialist will increasingly involve the establishment of strategic partnerships and the dynamic control of the flow of items and information across the networks that connect these partnerships. As we move toward a more competitive global economy, there will be an increasing demand for highly qualified people to create and manage more efficient logistics systems and supply chains. As businesses are beginning to recognize the importance of having knowledge in this area (57). Various research studies have established suitably skilled logisticians and supply chain practitioners as a major challenge for global organisations. However, skills requirements may not be the same across the globe as they depend on the complexity and maturity of a particular country’s logistics and supply chain environment. Furthermore, logistics education and training do not necessarily meet industry requirements. In the ever-changing supply chain environment, it is important to understand the broad range of industry requirements. It requires an educational and further developmental process that focuses on a holistic perspective to create and deliver customer value. Some studies indicate that too much educational emphasis has been placed on the technical aspects of the role of logistics (24). What is really needed in that industry is to be at a level of competence that will include an appropriate mix between soft and hard skills. Considering that there has been a significant increase in the number of young managers in the logistics sector in recent years, it can be thought that this is due to the recruitment trend focusing on a better educated workforce with modern qualifications. However, in practice, it is very difficult to decide when it comes to choosing between a well-trained logistics professional with a recent university degree and a logistics specialization and a high school diploma, but with a long history with leading logistics companies. Where the need is urgent, priority will likely be given to the second candidate to fill the position. Kisperska-Moroń, COMMON HR ISSUES AND NEW CHALLENGES IN LOGISTICS48 (2010) reached the conclusion that logistics and supply chain attributes are constantly changing. The increasing “logistics awareness” of operational and administrative personnel in supply chains and logistics drew attention. In their study, the most important issues in real human resources management in logistics, such as coexistence and cooperation of different generations, diversification and individualization of career types, a single person can be a serious power, temporary cooperation and long-term cooperation, virtual management world were emphasized (5). In Supply Chain Management (SCM), inter-firm collaboration is considered as the key to effective management for the delivery of the value that a customer desires. When the definitions of logistics and SCM are interpreted, it can be seen that logistics activities take place both in the supply process, in the production process and in the distribution process of the enterprise. This situation causes the same logistics activities to be carried out with different understandings in different business processes. For example, the transportation and storage operations in the procurement process are different from the transportation and storage operations in the post-production distribution phase. The reason for this is that the product features moving in the chain and the expectations of the next customer after the businesses in the channel change. Increasing educated workforce and advanced information systems facilitate business activities by reducing the need for continuous monitoring and close supervision. Businesses are constantly faced with the challenge of managing the “human” variable in the management equation, which includes different variables. Empowerment involves sharing power, information, and rewards with employees to take initiative, make decisions and solve problems in their work. It is known that there are very few studies about empowerment in the field of SCM to date. Lakshminarasimha focused on hard variables in his research. Therefore, integrating empowerment as a latent variable structure into a SCM framework and assessing its role in SCM results is of interest from a sectoral as well as academic point of view. Lakshminarasimha’s research was to demonstrate the role of empowerment in collaboration between organizations and their downstream partners (58). Some companies in the USA not only train their own employees on SCM, but also include their suppliers and even their suppliers’ suppliers in the training. The fact that the customer, the supplier and the supplier’s supplier receive training on supply chain in the same room, ask questions and give examples from themselves, improves the cooperation significantly. While the partners are learning, they also get to know each other and start to speak the same language. Due to the need for qualified workforce in Turkey, an increasing demand for higher education has emerged in the logistics sector. Especially in the fields of logistics and transporta- CHAPTER 4 SUSTAINABLE SUPPLIER SELECTION PROBLEM Erkan ÇELİK* *İstanbul University, School of Transportation and Logistics, İstanbul, Türkiye E-mail: [email protected] DOI: 10.26650/B/SS05ET50.2024.016.04 ABSTRACT Supplier selection is one of the research areas of supply chain and logistics management which has extensively studied by practitioners and researchers. The sustainability is getting more important in supply chain and logistics management. Therefore, the sustainable supplier selection is one of the main components for both researchers and practitioners in the of a sustainable supply chain and logistics management because of the increase in environmental protection and social obligations awareness. This paper presents a bibliometric analysis to understand the current research on sustainable supplier selection problem. This literature review provides an insight for researchers and practitioners on sustainable supplier selection problem in terms of presenting current state and potential areas. Keywords: Sustainable, supplier selection, multi criteria decision making, logistics CONTEMPORARY CHALLENGES AND PRACTICES IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT SUSTAINABLE SUPPLIER SELECTION PROBLEM56 1. Introduction Sustainability has increasingly attracted as an important issue by both researchers and practitioners in supply chain management in recent years. Both practitioners and researchers has focused on for more sustainable deliver in supply chain management (1). Supplier selection problem is one of the vital research areas in sustainable supply chain management (2). The supplier selection problem is considered as a multi-criteria decision-making problem that takes into account multiple criteria. On the other hand, sustainable supplier selection problem considers the sustainable criteria in addition to the economical, quality and social criteria. Different solution approaches are proposed by researchers and practitioners in literature review. While some approaches are applied in single version, the integrated approaches that is consisted of at least two different approaches. Igarashi et al. (3) reviewed green supplier selection problem considering the analytical model. They also identified the key dimension of the green supplier selection problem as decision-making tools, strategic alignment, supply chain context, and supplier selection process. Govindan et al. [4] review approaches and criteria for green supplier selection problem. They classified the approaches as single and integrated approaches and classified the criteria into two separate classes as green and traditional criteria. Zimmer et al. (5) presented a review on sustainable supplier selection, monitoring and development focusing models on decision-making process. They stated that analytic hierarchy process, analytic network process and fuzzy-based approaches are dominance in literature. Konys (6) analyzed the green supplier selection criteria. Rashidi et al. (7) presented a meta-literature review in sustainable supplier selection problem. Fuzzy TOPSIS and fuzzy AHP are most applied hybrid methods according to the review. Schram et al. (8) presented a review on multi criteria decision making based approaches for sustainable supplier selection. According to their review, TOPSIS and AHP are the most implemented approaches. In this paper, we presented a bibliometric analysis for the sustainable supplier selection problem. A total of 565 documents are analyzed. The journal, distribution year, and country of the author are analyzed. In addition, authors’ keywords, co-authorship-countries, co-author network and bibliographic coupling are presented in detail. The rest of the paper is elaborated as follows. While section 2 presents the research methodology, Section 3 presents the details of the bibliometric analysis. The last section describes the conclusion. 2. Research methodology In this paper, the review of the sustainable supplier selection is searched using Scopus as 57Erkan ÇELİK the resource for published papers collection. We researched in review analysis “sustainable supplier selection” and “green supplier selection” keywords. The only paper in English is included. The research articles, review articles, book and book chapter are considered in analysis. At the final step of the articles analysis, the set of databases consist of 565 documents. The remaining papers are review and analyzed manually. According to the review analysis, the most top journals are presented in Table 1. Almost 35% of the papers is published in top 11 journals. The topmost two top journals are Journal of Cleaner Production and Sustainability with 7.3%. It is also illustrated in Figure 1. Table 1. The most top journal published for sustainable supplier selection problem Journal Name #Paper Percentage Journal of Cleaner Production 41 7.3% Sustainability 41 7.3% Computers and Industrial Engineering 18 3.2% Journal of Intelligent and Fuzzy Systems 17 3.0% Mathematics 14 2.5% Soft Computing 13 2.3% International Journal of Production Economics 12 2.1% Expert Systems with Applications 11 1.9% Information Sciences 11 1.9% Mathematical Problems in Engineering 11 1.9% Environmental Science and Pollution Research 10 1.8% Figure1. The illustration of most top journal published for sustainable supplier selection problem SUSTAINABLE SUPPLIER SELECTION PROBLEM58 The 535 papers are considered to model the progress of paper to sustainable supplier selection problem in time, by adapting the distribution of the number of documents between the 2009–2022 via a regression analysis. 95% confidence level is considered in regression analysis. The year of 2023 is not included in analysis that 22 papers are published. It is inferred that after 2016, there is an significant increase in the production of papers (Figure 2). The trend becomes even more marked with a higher R2 value (88.9%), demonstrating sustainable supplier selection problem papers have increasingly better reception within the literature. Figure2. The distribution of papers by years The review analysis is also classified by country for each document, resulting in 10 portions and presented in Table 2. While China is the most papers published with 212 (35.9%) of all papers for sustainable supplier selection problem, the second country is Iran with papers published with 97 (16.4%) of all papers. On the other hand, Turkey is the most forth country with 53 (9%) of all papers. Table 2. The distribution of papers by country Country #Paper Percentage China 212 35.9% Iran 97 16.4% India 68 11.5% Turkey 53 9.0% Taiwan 36 6.1% United States 36 6.1% 59Erkan ÇELİK United Kingdom 26 4.4% Malaysia 23 3.9% Spain 20 3.4% Germany 19 3.2% 3. Bibliometric analysis Bibliometric analysis is an application of quantitative tools to analyze the scientific papers [9]. In this section, a bibliometric analysis of published works is presented in the green supplier selection problem. The set of databases consist of 565 documents. In this section, the applied analysis is presented in detail. Author-keyword analysis is implemented to determine the most used author keywords using VOSviewer software. While Figure 3 presents the treemap of the top authors’ keywords, the results of the Author-keyword analysis is illustrated in Figure 4. The most top keywords are green supplier selection, supplier selection, and sustainable supplier selection. Figure3. The treemap of the most used authors’ keywords SUSTAINABLE SUPPLIER SELECTION PROBLEM60 Figure4. The most used authors’ keywords According to the analysis 3 clusters are obtained as red, green, and blue. Sustainable supplier selection, supplier selection and sustainable supply chain are most used keywords in red cluster. In Red cluster, green supplier selection is most used author keywords. On the other hand, blue cluster focused on the approaches. Fuzzy theory, AHP, and TOPSIS are most used keywords. 61Erkan ÇELİK Figure5. Co-authorship-countries The top countries that have published the most articles on green supplier selection problem are presented in Figure 5 and Figure 6. China has the most published paper with 212 articles. While Iran is in the second place with 97 published papers, India is the third country with the highest number of publications with 68 articles. In addition to the first third three country, Turkey is in the fourth place with 51 published papers. When the number of citations is analyzed, China and Iran are positioned the first two places as the number of published papers, like the number of published articles. However, when the number of citations is examined, it is seen that Denmark is in the third place. SUSTAINABLE SUPPLIER SELECTION PROBLEM62 Figure6. Co-authorship countries network Figure7. The published papers in journals 63Erkan ÇELİK In Figure 7, the most cited journals are illustrated. According to the number of citations, the top three journals are Journal of Cleaner Production, Expert Systems with Applications, and International Journal of Production Economics. On the other hand, Journal of Cleaner Production, Sustainability, and Computers and Industrial Engineering are top three journals with respect to number of published papers. Figure8. Co-author network It is stated that in common citation analysis, it is generally focused on references that come in pairs (10). The link strength of the co-authors on sustainable supplier selection problem is illustrated in Figure 8. For the co-author network map, the value “20” was selected for the minimum number of citations. The most commonly cited authors are; Wei (11) (1178 citations, 82 link strength), Wei (12) (673 citations, 68 link strength), Wu (551 citations, 53 link strength), Wang (13) (489 citations, 31 link strength), Wei (396 citations, 30 link strength), and Yazdani (14) (637 citations, 11 link strength). SUSTAINABLE SUPPLIER SELECTION PROBLEM64 Figure9. Bibliographic coupling In bibliographic coupling, the link strengths depend on the number of common references (10). The bibliographic coupling appears when two publications refer to the same third publication (15). The link strength of the authors is presented in Figure 9. In this paper, “2” was selected for the minimum number of citations of a document for the bibliographic coupling network map. The documents of the authors with the highest number of bibliographic matches on sustainable supplier selection; Zimmer (5) (266 citations, 4131 link strength), Zhou (2018) (48 citations, 3862 link strength), Kilic (2020) (61 citations, 3383 link strength), Gören (2018) (125 citations, 3364 link strength), Kannan (2018) (190 citations, 3148 link strength), Menon (2022) (4 citations, 3017 link strength), Şişman (2022) (0 citations, 2925 link strength), Aslani (2021) (9 citations, 2835 link strength), Jain (2020a) (93 citations, 2775 link strength), Sen (2017) (16 citations, 2774 link strength), Celik (2) (15 citations, 2633 link strength). Conclusion In this paper, a total of 565 documents are analyzed in bibliometric analysis for sustainable supplier selection problem. Different analyses are implemented as the journal, distribution year, and country of the author. The results of the authors’ keywords, co-authorship-countries, co-author network and bibliographic coupling are analyzed in detail. Sustainable supplier selection problem is considered as multi criteria decision making considering sustainable criteria in addition to traditional criteria as economic, social, and qu- 71Muhammet GÜL, Samuel YOUSEFI, Babak Mohamadpour TOSARKANI Risk assessment is another main pillar of SRLRM to evaluate risks based on their probabilities (6). In fact, risk assessment deals with the probability of an event occurring and its consequences (8). This stage includes risk impact assessment, risk modeling, and risk prioritization to identify critical risks. Several risk assessment methods have been introduced in the literature to analyze the various risks, especially supply chain risks. However, risk assessment methods can be divided into quantitative or qualitative methods. Quantitative methods enable decision-makers to quantify the probability of occurrence and impact of a risk (i.e., severity) based on the recorded data in an organization. On the other hand, qualitative or conceptual risk assessment frameworks focus on the characteristics of risk rather than its probability values. The qualitative risk assessment often employs experts’ opinions in the form of linguistic scales to determine the probability of occurrence and impact of a risk. Using linguistic variables for investigating the factors associated with the identified risks can also be beneficial for managers to identify the weaknesses of the systems (9). After identifying and assessing risks associated with logistics systems, decision-makers should define and implement risk mitigation measures to reduce the adverse impacts of the existing risks (6). Risk mitigation refers to the development of effective mitigation measures to reduce risks and consequently facilitate achieving the determined management goals (e.g., increasing customer satisfaction and profitability). The main aim of the risk mitigation measures can be different and include avoidance, reduction, and transference strategies. However, today’s organizations may face various limitations (e.g., budget), and they cannot struggle with all identified risks. Organizations, in this case, should target the most critical risks identified in the risk assessment stage to ensure the success of SRL systems or facilitate the adoption of such systems. More precisely, the mitigation of negative impacts of critical risks may affect other risks, inherently interconnected with these risks. After implementing the risk mitigation measures, managers should also monitor the behaviour of critical or target risks to guarantee performance improvement in the logistics systems. 3. Risk identification in SRLs It has been stated in the previous sections that the activities of identifying, assessing and mitigating risks are at the center of SRL management. In this section, we will focus on the identification of risk, and the next sections cover assessment and mitigation. Risk identification provides a list of risks that are likely to affect the sustainable and reverse supply chain and, thus, the wider organization (10). When considering risks from a sustainability perspective, it can be seen that in many ways they differ from typical supply chain risks in many ways. Giannakis and Papadopoulos (11) address sustainability-related risks as environmental, SUSTAINABLE AND REVERSE LOGISTICS RISK MANAGEMENT72 social and financial/economic hazards. For each of these hazard groups, a classification of endogenous (i.e., internal risks arising from the activities of companies along their supply chain) and exogenous (i.e., external risks posed by the interactions of companies with the external environment in which they operate) has been proposed. Regarding the environmental dimension, the risk steering principle is to meet the requirements for the quality of a shared ecosystem. Environmental accidents, natural disasters, pollution, emission of harmful gases, non-conformance to sustainability rules (e.g., unnecessary packaging, unsuitable use of energy, and waste), and water scarcity are the most important risk factors that come to mind initially under the environmental dimension (11). The social dimension refers to the assignment of responsibilities to employees, customers, business partners, governments and communities. Working life-based inequalities (e.g., unfair wages, child labour/forced labour, discrimination, and bad working conditions), unethical treatment of animals, pandemics, and social instability are considered under the social dimension (11). The economic dimension includes the monetary risks brought by the financial environment, the deceptive behaviour of companies and individuals, and the effort for sustainable economic growth. Risk factors such as price fixing accusations, antitrust claims, boycotts, energy price instability and financial crises are also the main risks evaluated under the economic dimension (11). On the other hand, a comprehensive study on reverse logistics risks (12) revealed 41 different factors. These risk factors are placed in clusters in three main groups: strategic, tactical and operational. The strategic cluster mostly includes the information-oriented aspects of the business and the risks that directly affect the decision-making of top management. This cluster includes 21 risks, such as poor communication, lack of shared goal, poor strategic development, technological change, competitive uncertainty, and corporate social responsibility, that affect an organization’s long-term strategic operations. The tactical set consists of 14 risks, such as demand fluctuation, labour instability, and political instability, that affect an organization’s medium-term tactical operations. Mostly, inventory and supply management issues are included in this cluster. The operational cluster includes six risks (i.e., financial instability, macroeconomic uncertainty, transportation, security, customer and outsourcing risk) that directly affect daily operations. Any disruption as a result of exposure to such risks has an immediate and direct impact on the performance of reverse logistics systems. Senthil et al. (13) combined a list of nine SRL risk types as follows: environmental, inventory, data managing, time management, managerial, cultural, quantity, outsourcing and distribution risks. In another research by (14), the main risks associated with the operation of SRL are defined under eight items. These include inadequate storage and collection process, lack of a suitable 73Muhammet GÜL, Samuel YOUSEFI, Babak Mohamadpour TOSARKANI vehicle for transportation, equipment and communication between the supply chain actors, vehicle routing issues, overstock inventory, and low quality of the residue. In this context, the methods used to identify risks include risk checklists, taxonomies, risk mapping, subjective evaluation of experts through surveys, interviews, group meetings and the Delphi method, and extensive literature reviews (i.e., content analysis of academic articles, industry reports, and white papers) (10-12). Undoubtedly, the SRLRM process, which struggles with many types and numbers of risks, is very difficult to manage. Different categories can be introduced to focus on the most important types of risk. The standardized triple classification of internal operational risks, risks within the chain, and risks arising from the external environment make it easy for managers to identify risks. Some formal procedures are needed for this identification. The usual way is to divide the chain process into a series of activities, systematically examining each activity in turn and identifying the risks in each. To do this, managers can analyze past events, gather insights or directly analyze operations (10). The risk identification ensures that significant risks of SRL systems are recorded. But problems can always occur. Besides the inherent difficulty of identifying risk, managers may be reluctant to acknowledge that risks exist and must take appropriate action to deal with them. After compiling the most critical risks associated with SRL, managers ensure that they are assessed using logical and scientific methods. 4. SRL risk assessment In this section, the published papers on SRL risk assessment focusing on their used approaches are analyzed. To evaluate the risks of SRL, there are methods called qualitative, quantitative or semi-quantitative, which are among the risk assessment methods followed by the traditional health and safety perspective. In order to evaluate the risks of SRL, there are methods called qualitative, quantitative or semi-quantitative, which are among the risk assessment methods. It is seen that there are limited studies in academic databases such as Scopus with appropriate key terms (e.g. “sustainable reverse logistics” AND “risk assessment”). However, due to the diversity of the study spectrum, we have determined that the studies in which the risks that occur directly in an SRL system, evaluated in the context of the framework in Figure 2, are limited. In Table 1, we have included some selected focus studies. When these are evaluated, it can be stated that multi-criteria decision making (MCDM), traditional risk analysis techniques such as failure mode and effect analysis (FMEA) and Bayesian network, and fuzzy logic are used. MCDM is a field that operates on the basis of determining the most appropriate among the options and is frequently used by researchers in risk assessment. It is generally applied SUSTAINABLE AND REVERSE LOGISTICS RISK MANAGEMENT74 as a combination of two basic stages. The first is the determination of the importance level of the parameters that include the description of the risk. In this part, MCDM methods based on pairwise comparisons such as analytic hierarchy process (AHP), analytic network process (ANP), and best-worst method (BWM) are generally used. The second stage is the stage, where the risk types determined in the SRL process are handled in the light of these parameters, scored with expert opinions, and the risk scores and ranks are determined. At this stage, mostly compromise and outranking-based MCDM methods (e.g., TOPSIS, VIKOR, PROMETHEE, ELECTRE) are used (13, 16-17, 22-23). Fuzzy logic is also frequently used in risk assessment, both to better present the uncertain environment in decision-making and improve the limited flexibility provided by linguistic evaluations expressed in precise numbers (15, 18-21). It can be said that MCDM methods combined with fuzzy logic produce useful solutions compared with traditional risk assessment approaches. Apart from MCDM, fuzzy logic theory, and traditional approaches, there are different concepts used, especially in the assessment of SRL risks. Among these, it is possible to count optimization-oriented operations research techniques such as linear programming, goal programming, game theory, nonlinear programming and stochastic programming (24). In these models, instead of evaluating the risks, the optimization objectives, mostly economic and environmental objectives, are satisfied with a mathematical model in which the risks will be minimized. Table 1. Studies and used methods in SRL risk assessment Study Focus Method Method details Giannakis and Papadopoulos (11) Explore sustainability-related supply chain risks FMEA A mixed method risk assessment approach including statistical analysis and FMEA Senthil et al. (13) Analysis and prioritisation of risks in a reverse logistics network MCDM Hybrid AHP-Fuzzy TOPSIS method; Hybrid AHPPROMETHEE method; Hybrid AHP-Diagraph and Matrix method Omosa et al. (15) Reverse logistics supply chain for end-of-life vehicle recycling risk management Fuzzy set Fuzzy knowledge representation theory embedded in the risk assessment process that helps to quantify risk ratings Huizhe and Donglin (16) Risk assessment of reverse logistics of retailing MCDM The unascertained measurement and attribute hierarchy model (AHM) employed to risk assessment of reverse logistics of retail enterprise 75Muhammet GÜL, Samuel YOUSEFI, Babak Mohamadpour TOSARKANI Huizhe and Lihua (17) Effective index of retailing reverse logistics risk factors MCDM AHM and index weigh merged Yan et al. (18) Retailing reverse logistics risk factors assessment Fuzzy set A triangular fuzzy numberbased risk assessment approach Meng (19) Risk analysis of reverse logistics outsourcing Fuzzy set Fuzzy comprehensive analysis method Zhou et al. (20) SME reverse logistics outsourcing risk analysis Fuzzy set Fuzzy comprehensive evaluation method Insuasty-Reina et al. (21) Prioritization of operational risks in a reverse logistics network for the recovery of waste cooking oil Fuzzy set Fuzzy quality function deployment Duran and Zafeirakopoulos (22) Environmental risk assessment of e-waste MCDM ANP, COPRAS Rostamzadeh et al. (23) Evaluation of sustainable supply chain risk management MCDM TOPSIS, CRITIC Jayasinghe et al. (25) Cause and effect relationship risks in reverse logistics supply chains for demolition waste Bayesian network, Interviews A mixed method approach (Semistructured interviews, structured interviews, thematic analysis, and Bayesian belief network) Another important element in the fuzzy logic integrated MCDM SRL risk assessment studies is the decision-making experts. The fact that their evaluations are stated with fuzzy linguistic expressions, and the formation of a group decision also strengthens the accuracy of the results of the study. Apart from MCDM and fuzzy logic theory, traditional risk assessment approaches such as FMEA and Bayesian networks are also used for assessing SRL risks. Giannakis and Papadopoulos (11) determined the relative importance of a defined set of sustainability-related supply chain risks using FMEA. As a result of their studies, it has been stated that endogenous environmental risks are the main risks. In another study (25), semi-structured and structured interviews were conducted to identify and assess the interdependencies of risks in SRL systems. Data were analyzed using thematic analysis, and a Bayesian network was used to develop a risk model. 5. Risk mitigation for SRL management Risk mitigation is the final stage of the SRLRM methodology. In this context, managers need to discuss the decisions and actions they will take to deal with the high-scoring risks that emerged in the previous stage. It is necessary to make measures and recommendations for the risks that are less controllable. In the study of Giannakis and Papadopoulos (11), six basic SUSTAINABLE AND REVERSE LOGISTICS RISK MANAGEMENT76 strategies, including avoid, mitigate, prevent, cooperate, insure, and retain, are mentioned. These measures need to be structured so that at least the SRL system can operate normally or with little disruption, be effective in dealing with risks, allow efficient use of resources, and comply with legal constraints (10). There are several techniques to put such strategies into action. Among them, it is necessary to mention the what-if analysis and cost analysis or cost-benefit analysis (26). In the literature, although not directly for the SRL risk mitigation stage, there are models recommended for the prioritization of control measures in reducing the risks arising from occupational health and safety, especially in the process industries (27). It is important to prioritize these preventive measures and develop models by considering performance, applicability, functionality and integrability, which are the factors that affect the decision process. 6. Conclusion Logistics systems play a major role in improving customer satisfaction and supply chain network efficiency and, consequently, increasing the profitability of a company. Due to the increasing importance of the sustainability concept in various fields, SRL systems have been created to improve resource utilization, protect the ecological environment, improve social responsibility, and increase the supply chain’s profitability simultaneously. However, the success of the implementation of SRL systems in various industries can be challenging because of existing infrastructure requirements and organizational limitations. Therefore, managers should manage risks and barriers associated with SRL systems to improve the performance of such systems. Hence, a comprehensive SRLRM framework can enable managers to deal with potential risks to prevent their negative impacts on the performance of logistics operations. More precisely, SRLRM aims to identify these potential risks, asses risks based on various factors, and propose effective measures to mitigate the adverse impacts of critical risks. Based on the literature, such risks are identified through checklists, interviews with experts and extensive literature reviews. Furthermore, most existing approaches for SRL risk assessment in the literature are developed based on MCDM techniques and fuzzy sets. To address some shortcomings associated with these frameworks, such as biased comparisons and not considering the interactions among risks, the development of decision support systems based on the advanced versions of MCDM and data analytics techniques can be considered for future research. The SRL mitigation stage can be considered as an intact part, while the definition and prioritization of mitigation measures are of cardinal importance to improve the performance of logistics operations. 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CHAPTER 6 TURKISH NATIONAL TRANSPORTATION, LOGISTICS POLICIES AND ECONOMIC GROWTH Mehmet ADAK* *İstanbul University, School of Transportation and Logistics, İstanbul, Türkiye E-Mail: [email protected] DOI: 10.26650/B/SS05ET50.2024.016.06 ABSTRACT In this study, the developments in the basic transportation channels of the Republic of Turkey from the foundation to the present and the contributions of these developments to economic growth have been investigated. First of all, the transportation development of the country is summarized from a historical perspective. In the following stage, the contribution of each transportation channel to economic growth has been tried to be analyzed. Finally, the effect of the developments in all transportation channels on aggregate production was tried to be analyzed in time dimension. Keywords: Airway, Economic Growth, Highway, Maritime way, Railway CONTEMPORARY CHALLENGES AND PRACTICES IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT TURKISH NATIONAL TRANSPORT, LOGISTICS POLICIES AND ECONOMIC GROWTH80 1. Introduction In this study, the transportation adventure of Turkey, which has been experienced in its 100-year history since its establishment, has been examined in a historical perspective and the effect of this development on economic growth has been investigated. Transportation and Logistics is an important production factor that the country’s economies use to supply their products to the markets and to supply the necessary inputs for their production. The Republic of Turkey has given great importance to transportation and logistics channels for economic development since the day it was founded. While railway investments were adopted as a state policy until the Second World War, road transportation was given importance after the Second World War. With the development of the aviation sector around the world, Turkey has shown the necessary importance to this sector and Turkish civil aviation has covered significant distances. While there has been progress in all transportation sectors, unfortunately, the necessary development has not been observed in the Maritime sector. Developments in all sectors except the maritime sector developed in the same direction as the economic growth. In this study, the half-century adventures of the highway, railway, airline and seaway sectors were summarized and their relations with economic growth were tried to be explained. 2. Road Transportation When the Republic of Turkey was founded, the unit responsible for highways was the Ministry of Public Works. In the following process, attention was paid to the construction of roads and bridges under a presidency within the Ministry of Public Works. It is accepted that the modern regulation of Highways in Turkey started in 1950. General Directorate of Highways was established in 1950. Thus, the country’s highway policy was prepared and plans and programs were initiated in line with this policy. The institution, which primarily focuses on the rehabilitation of old roads, has also turned to the construction of new roads that are needed. At the same time, modern methods and mechanized production processes have begun to be followed in highway construction. As a general policy, reaching the smallest housing unit has been accepted as a national goal. In this process, reaching the highway network extending to villages and districts has been adopted as a general goal and studies have been continued in line with this aim (1). In the following years, importance was given to the construction of highways in European standards. In particular, road constructions continued by determining highway standards and adhering to these standards. These years were also the years when import substitution foreign trade policies were followed. It has been observed that foreign automobile manufacturers 87Mehmet ADAK Figure5.Railway (km) The number of passengers transported by railway in Turkey is given in Figure 6. The total number of passengers carried by railways in 1977 was 112607000. This figure reached 146359000 in 1989. In the following years, decreases were observed in this number. In 2002, the number of passengers transported by rail decreased to 73088000. While the number of passengers carried on the railways reached 121190000 in 2011, 246013000 people were transported on the railways in 2019, reaching the highest number of passengers in the countr- y’s history. In 2021, this figure decreased to 1916 million. The reason for this decline is the covid19 epidemic (2). TURKISH NATIONAL TRANSPORT, LOGISTICS POLICIES AND ECONOMIC GROWTH88 Figure6.Number of Passengers (thousand) Freight values carried by railway in Turkey are given in Figure 7. The amount of freight transported by rail was 13,938,000 tons in 1977. Until 2004, the amount of freight transported on railways did not exceed 15,000,000 tons, except for 1999. The amount of cargo carried in 2004 reached 17,989,000 tons, 20,185,000 tons in 2006, 25,421,000 tons in 2011, 31,673.00 tons in 2018 and 38,157,000 tons in 2021 (3). Figure7.Freight (thousand tons) 89Mehmet ADAK 4. Air Transportation It is generally accepted that the first Turkish aviation activities started in 1912. The adventure of Turkish air transportation, which started with a runway and two hangars in Yeşilköy, continues to grow with the world’s leading fleet and infrastructure facilities. In 1933, the Turkish Air Mail institution was established with 5 aircraft in its inventory. In the following years, the Airline State Enterprise Administration was established under the Ministry of Defense. The main duty of this institution has been determined as carrying passengers and cargo as a civil air transport. After the Second World War, based on the new world order, changes were made in the field of transportation in Turkey. The General Directorate of Civil Aviation was established under the current name of the Ministry of Transport. All civil aviation passenger and freight transport operates under the legal supervision of this institution. The number of passengers transported by air in Turkey is given in Figure 8. The total number of passengers carried in 1960 was recorded as 713,217. The total number of passengers carried by air reached 977,913 in 1965. The total number of passengers carried in 1969 was 2,037,467. This figure reached 3,301,143 in 1971, 4,179,900 in 1972, and 5,979,087 in 1976. In 1988, the total number of passengers carried by air increased to 10,840,179. This figure was 20,674,531 in 1993, 30,780,662 in 1996, 55,545,473 in 2005, 70,352,876 in 2007, 102,800,392 in 2010, 165,720,234 in 2014 and 208,373,696 in 2019. realized as. The years 2020 and 2021 have been recorded as periods of decline in terms of the number of passengers carried on airlines due to the covid19 epidemic (4). Figure8.Total Passenger TURKISH NATIONAL TRANSPORT, LOGISTICS POLICIES AND ECONOMIC GROWTH90 The distribution of the number of passengers carried by air in Turkey between domestic and international flights is given in Figure 9. When the number of domestic and international passengers carried on airlines is compared, it is seen that both figures were close to each other, around 3 million passengers until 1987. Since 1987, Turkish civil aviation has started to export services abroad with its integration into the globalizing world. While the number of passengers carried on domestic lines was 5,347,723 in 1990, the number of passengers carried on international lines was 8,282,242. In 1995, these numbers increased to 10,347,528 in domestic lines and 17,419,851 in international lines. As of 2021, the number of passengers carried abroad has been approximately twice the number of passengers carried domestically. Today, Turkish Civil Aviation provides transportation services between foreign cities to foreign citizens, especially via Istanbul (5). Figure 9. Passenger Distribution The amount of cargo transported by air in Turkey is given in Figure 10. The total freight transported by airlines in 1960 was 13,002 tons. The total amount of cargo carried in 1976 increased to 103.447 tons. This figure was recorded as 226,813 tons in 1988, 301.403 tons in 1990, 576.920 tons in 1995 and 931,191 tons in 2003. While the total amount of cargo transported by air was 2.021.076 tons in 2010, this figure was 3.072.831 tons in 2015 and 4.090168 tons in 2019. 91Mehmet ADAK Figure 10. Total Freight (ton) The distribution of the total amount of cargo transported by air in Turkey on domestic and international lines is given in Figure 11. Between 1960 and 1980, the amount of freight transported domestically and internationally by air was approximately equal. Since 1980, the tonnage in international freight transportation by air has exceeded the domestic freight amount and the difference has increased with each passing year. In 2000, domestic air freight transportation was 226,356 tons, while international freight transportation was 570,271 tons. In 2010, these figures were 554,710 tons for domestic and 1,466,366 tons for abroad. In 2019, the amount of domestic cargo transportation by air was 833,769 tons, while the amount of international cargo transportation was recorded as 2,969,206 tons (5). TURKISH NATIONAL TRANSPORT, LOGISTICS POLICIES AND ECONOMIC GROWTH92 Figure 11. Freight Distribution (ton) The total number of aircraft is given in Figure 12. The number of aircraft registered in air transport was 138 in 2002. This figure increased to 202 in 2005, 332 in 2010, 422 in 2014, and 564 in 2019. Figure12.Number of Aircraft 93Mehmet ADAK Total airline seat capacity is given in Figure 13. Over the years, there has been a significant increase in seat capacity in air transport. The seat capacity in Turkish civil air transportation realized in 2002 is 25,114. This figure increased to 57,899 in 2010 and to 100,365 in 2016. As of 2020, air transport seat capacity was recorded as 104,464 (4). Figure13. Seat Capacity 5. Maritime Transport The fact that our country is surrounded by seas on three sides provides a great advantage in terms of maritime trade. However, leaving the cabotage right in our seas to foreign states has caused the decline of Turkish maritime. Western countries that have experienced the industrial revolution have monopolized the maritime trade in our country with the technical advantages they have provided and the privileges they have provided in our seas. With the abolition of the privileges given to foreigners with the Republic and the cabotage law accepted, Turkish maritime started to develop. With the development of maritime came specialization. It was aimed to manage all maritime activities from a single point by establishing the General Directorate of State Port Operations and the General Directorate of State Maritime Lines. In the following years, these two different institutions were transformed into a single institution as the General Directorate of State Maritime and Port Operations. Later, Maritime Bank was established. In the process following the Second World War, globalization affected all world economies. Turkey has been affected by this development. As in the rest of the world, privatization has also shown itself in Turkish Maritime. Ports have entered the privatization process. Today, TURKISH NATIONAL TRANSPORT, LOGISTICS POLICIES AND ECONOMIC GROWTH94 most of our commercial ports are managed by private entrepreneurs (6). Total airline seat capacity is given in Figure 14. The number of Turkish merchant ships of 150 gross tonnage and above has doubled in the last 20 years. The Turkish fleet, which was 1,242 in 1999, reached 2,102 by the end of 2022 (7). Turkish-owned ships either prefer to fly the Turkish flag or they carry a foreign flag. While the number of foreign flagged and Turkish owned ships was 0 in 1999, this figure was recorded as 1,001 in 2022. In the last twenty years, the number of Turkish flagged ships has shown a horizontal course and has not been subject to a significant increase. In 2022, the number of Turkish flagged commercial ships was observed as 1,001 (7). Figure14.Turkish Merchant Fleet (Vessels of 150 GT and over) The structural situation of the total Turkish merchant marine fleet is given in Figure 15 and Figure 16. The total deadweight (DWT) capacity of the Turkish merchant marine fleet has decreased over the last two decades. Dedveyt is accepted as the empty weight of the ship. From the chart below, it is observed that despite the decrease in the deadweight capacity of Turkish flagged vessels over the years, there has been an increase in the deadweight capacity of Turkish-owned but foreign-flagged vessels (7). 95Mehmet ADAK Figure15.DWT Development of the Turkish Merchant Fleet (Vessels of 150 GT and over) Total gross ton (GT), the Turkish merchant marine fleet has shown a horizontal course in the last two decades. Gross is an indicator of capacity in which a ship is included in the total volume that it can carry along with its own weight. Gross capacity also showed an increase in Turkish owned but foreign flagged ships, just as in the deadweight indicator. Figure16.GT Development of the Turkish Merchant Fleet (Vessels of 150 GT and over) TURKISH NATIONAL TRANSPORT, LOGISTICS POLICIES AND ECONOMIC GROWTH96 The average age of the Turkish merchant marine fleet is calculated as 22, as shown in Figure 17. Figure17.Average Age of Turkish Fleet 6. Economic Growth Türkiye preferred the import substitution growth system in the 1970s. In this period, imports were made almost impossible by high tariffs, and it was adopted that similar products to be imported should be produced domestically. This period is generally accepted as the time period when the first private entrepreneurship developed. This development showed itself in the form of increases in production. In 1973, per capita income was 674 dollars, and in 1979 this figure increased to 2,068 dollars. Per capita income figures over the years are given in Figure 18. By the 1980s, the foreign exchange problem experienced in the economy increased excessively. On January 24, 1980, new economic decisions were taken. One of these decisions was the abandonment of import substitution industrial policies and the adoption of export-based industrial policies instead. With this new preference, Turkey has adopted to produce not as much as it needs, but also to sell abroad. During this period, production increased very rapidly. Income rose rapidly. While the per capita income was 1,561 dollars in 1980, this figure increased to 2773 dollars in 1990. 103Mehmet Ali ERTÜRK inadequacy of classical techniques in data processing has led to the rapid development of artificial intelligence and data analytics. Industries that enable quick adaptation to artificial intelligence applications, such as customer segmentation, profitability planning, investment planning, and future forecasting, monetized the sector. In the Internet of Things ecosystem, data is essential. There are different approaches to managing data, from centralized to decentralized management. Decentralized management involves multiple authorities reaching a consensus and is vital advancement in academia and industry. The blockchain is the most promising approach for decentralized approaches with the help of cryptographic tools to manage data securely and transparently. The technology has become popular with cryptocurrencies. However, its applications are not limited and can be used to track goods and services in logistics and supply chain use cases. The rapid and real-time data transmission and developments in artificial intelligence have begun to change simulation approaches. These changes have started to be replaced by digital twins realized with real-time digital copy instead of simulations performed with abstraction methods. It is possible to perform real-time analysis and investigate what-if simulation scenarios through digital twins in logistics and supply chain applications. The primary objective of this chapter is to introduce how next-generation information technologies contribute to logistics and supply chain management from a technology perspective. These technologies are the IoT and the relationships of the IoT with artificial intelligence, data analytics, blockchain, and digital twins from the logistics supply chain management standpoint. In this chapter, the Second Section discusses the Internet of Things, data transmission, and application protocols. The Third Section demonstrates the IoT-based artificial intelligence, big data analytics, blockchain, and digital twin in logistics and supply chain management introduced. The final Section concludes the chapter. 2. Internet of Things (IoT) Many building blocks comprise the Internet of Things, and it is impossible to discuss a single generally accepted architecture. Considering the applications, devices, and the Internet that make up the Internet of things, it is understood that it should have a multi-layered architecture. While three- and five-tier approaches stand out, architectures are not limited to this. The layers of the three and five approaches in Figure 1 are visible. If we inspect the three-layer structure: INTERNET OF THINGS (IOT) APPLICATIONS IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT104 i. The perception layer: where data from different sensors are collected, and the physical environment is interacted with in this layer. ii. Network layer: the transmission of sensor data is also the data transmission layer, which includes one- or two-way designs. iii. The application layer is the product-oriented layer, and services are carried out through this layer. The difference between the five-layer structure is that the transport layer refers to the layer that transmits the data, and the processing layer refers to the layer where the analysis is carried out, and the data is processed. The business layer is the layer of the business where the entire IoT ecosystem is run (2). We can discuss the building blocks of the IOT. 2.1. Data Communications in IoT One of the Internet of Things’ essential components is physical sensors’ data communication. The highlight here is the mobility of devices thanks to wireless communication and the ability to communicate independently of the location. For this, first of all, the necessary infrastructure and the sensors must be capable of transmitting data from this layer. Many technologies serve this infrastructure today. At the beginning of these, LoRaWAN, LoRa, RFID, LTE, Z-Wave, NFC, UWB, M2M, 6LoWPAN, 5G, Nb-IoT, SigFox, IEEE 802.11, Bluetooth protocols are coming. Figure1. IoT Architecture Approaches (2) 105Mehmet Ali ERTÜRK Table 1: IoT Data Communications Technology Comparison Sigfox NB-IoT LoRaWAN WiFi ZigBee Bluetooth Standards Sigfox 3GPP LoRa Alliance IEEE 802.11 IEEE 802.15.4 Bluetooth SIG Modulation BPSK QPSK CSS DSSS, OFDM DSSS, QPSK GFSK Frequencies ISM: 433 MHz, 868 MHz, 915 MHz Licensed under LTE ISM: 433 MHz, 868 MHz, 915 MHz ISM: 2.4 GHz, 5 GHz ISM: 868 MHz, 2.4 GHz 2.4 GHz Coverage 10–40 km 2–20 km 1–10 km 10–100 m 10–100 m 10–100 m Bandwidth 100 Hz 200 kHz 125 kHz, 250 kHz 20 MHz, 40 MHz, 80 MHz, 160 MHz 2 MHz 1 MHz TX Limit 140 Packets per Day Unlimited Duty Cycle Lim. Unlimited Unlimited Unlimited Max Data Rate 100 bps 200 kbps 50 kbps Gbps 250 kbs at 2.4 GHz 2 Mbps Private Deployments No No Yes Yes Yes Yes Energy Consumption Low Low Low High Low Low Security Low High High Low-High High Low-High Each technology has its communication structure, and there are differences according to the usage area. The prominent comparison of LoRaWAN, Sigofx, NB-IoT, WiFi, Zigbee, and Bluetooth is given in Table 1 (4). When compared, LoRaWAN works on an unlicensed spectrum; it can be deployed as public or private and enables long-distance data transmission with a builtin security model. Although we do not have the opportunity to examine all communication technologies, we will evaluate the open protocol LoRaWAN, which is on its way to becoming a de facto standard today. In addition, we will mention that LoRaWAN comes to the fore in supply chain applications, among other communication networks. LoRa stands for Long Range, a Radio Frequency (RF) modulation corresponding to the OSI reference model’s physical layer. Whereas LoRaWAN is a MAC layer standard that coordinates the medium. In this section, we will discuss the technical aspects of both LoRa and LoRaWAN in detail. LoRaWAN is a MAC layer protocol that aims to solve medium and network congestion management issues. Any node using the LoRaWAN protocol can benefit from the following features provided by the standard; management of the medium, power consumption, adaptive data rates, and security(4). INTERNET OF THINGS (IOT) APPLICATIONS IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT106 Figure2. LoRaWAN Architecture (4) A general architecture of LoRaWAN is given in Figure 2. The sensors can provide data communication up to 2 km in the dense urban and up to 15 km in rural areas with LoRa modulation. The data sent from the sensors is captured by the LoRaWAN base stations and routed to the network server. The network server manages the LoRaWAN network and forwards incoming messages to the corresponding application server. LoRaWAN is Low Power Wide Area Network (LPWAN) providing long-distance data transmission with low power consumption. This feature makes LoRaWAN an effective candidate for logistics and supply chain applications. 2.2. Application Protocols in IoT Layer 7 of the OSI reference model is the application layer. For example, protocols that enable data exchange between computers on the Internet or in a local network are application layer protocols in the seventh layer. Today, we use these applications, which have developed many application layers, daily. In the Internet of Things paradigm, the primary element is to provide an internet connection for devices with limited capacity and to provide applications and services with the data obtained from these devices. Therefore, many protocols have been developed in the application layer specialized for IoT. One of these application protocols is the Constrained Application Protocol (CoAP). Designed with energy efficiency in mind, CoAP works over the UDP protocol. UDP offers a faster connection, so no session management is found in TCP. In addition, CoAP provides security using Datagram Transport Layer Security (DTLS) (5). 107Mehmet Ali ERTÜRK Another important IoT application protocol is Message Queue Telemetry Transporter (MQTT). The protocol works on the subscription principle. Parties subscribed to a particular topic are notified when a message is received on that topic. It is an effective method to transmit data, especially to devices with limited hardware resources. Since data transmission is in the form of broadcasts, bandwidth is used effectively (5). An Extensible Markup Language (XML) complete protocol used in instant messaging applications is Extensible Messaging and Presence Protocol (XMPP). Advanced Message Queuing Protocol (AMPQ) is a messaging protocol that works with subscription logic similar to XMPP. The working principles of AMPQ are similar to MQTT (5). 3. Applications in Logistics and Supplychain The age of smart production started after the fourth industrial revolution, and the essential tool of this age has been the Internet of things. It is the Industrial Internet of Things (IIoT), which is specialized for industry and on which Edustri 4.0 is emphasized. The fact that information technologies and production robots have become smart has become a part of the fact that the data obtained with IIoT, thanks to artificial intelligence, is carried out with lower production costs and personalized intelligent elements. With the expansion of IIoT, smart applications have started to take place in many sectors. Smart cities, smart transportation, smart health, smart living spaces, smart vehicles (Internet of Vehicles - IoV), autonomous vehicles, and big data applications are some of the prominent ones (6). The Supply Chain encompasses all of the assets and processes that encompass orders, supplier to customer. SC process includes the right item to be delivered at the right price and the right volumes on time. This process can be very complex. However, we can overcome addressed issues using information technology and smart techniques. In this case, IIoT is the critical technology. Each product or service order can be tracked from supplier to customer with smart devices in real-time. In traditional supply chain processes, we need help delivering products on time or keeping excess stock. Using IIoT makes it possible to run supply chain processes more intelligent, connected, autonomously, integrated, and innovatively (7). Making supply chain processes smart is possible with infrastructures to be designed in different areas. The first step is to make things smart. In this step, it will be ensured that all kinds of objects moving from one point to another in the procurement processes can be tracked. Different technologies can be used to make objects smarter. The first step is to make things smart to enable sensing, which corresponds to the perception layer. In this step, it will be ensured that all kinds of objects moving from one point to another in the procurement INTERNET OF THINGS (IOT) APPLICATIONS IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT108 processes can be tracked. Different technologies can be used to make objects smarter. The first of these is to associate the object with being tracked with sensors that provide long-range communication, such as RFID, Bluetooth, QR Codes, or LoRaWAN. It will be shaped in itself in other processes according to the connection structure of the communication integrated attached to the objects. For example, in a warehouse where RFID is used, it is possible to read every object entering and leaving the warehouse with RFID readers and to follow the necessary movements. This approach will not only be the tracking of objects, but it will also be a part of the infrastructure that can trigger processes such as automatic stock counting and the ordering of new products under a certain stock or the supply of materials needed on the production line. Equipping objects with smart sensors will improve tracking processes and learn and monitor the status of products with special needs, such as cold chains or healthcare applications. For example, these sensors can monitor the factors such as temperature, pressure, and leakage of the object they are in, generate a warning against possible danger, or inform the changes in the physical nature of the product. We can give a few examples of life-threatening gas leaks, monitoring the validity period of drugs, and physical changes such as cracks or fractures. This ability transforms physical entities into perceptible objects. Intelligent sensors are generally limited in battery life, processor capacity, and memory resources. Therefore, the operations that can be performed on devices with limited resources are limited, and it is aimed to obtain maximum efficiency with the least possible operation. These sensors are not general purposes; they are just specialized tools for a specific target. So, algorithms running on the sensors are expected to be efficient regarding time and space complexity. Today, energy-efficient operations can be performed on sensors with limited resources. Therefore, tools and methods that prioritize energy efficiency have been developed while designing algorithms and embedded software on sensors. The LoRaWAN protocol we mentioned in the previous section is one of them. It has methods and structures developed for wireless data transmission to provide energy efficiency in A, B, and C classes. The LoRaWAN protocol we mentioned in the previous section is one of them. It has methods and structures developed for wireless data transmission to provide energy efficiency in A, B, and C classes. In addition, machine learning, a sub-branch of artificial intelligence, can be customized and work on the sensor. Tensorflow Light, which is a machine learning platform Tensorflow’s customized version, is applied in embedded systems is one of them (8). 109Mehmet Ali ERTÜRK 3.1. Artificial Intelligence Artificial intelligence is widely used in supply chain and logistics management as well as in every area of our lives. When we look at the historical development process of artificial intelligence, we see that it goes back to the 1950s. There has always been an open question of whether machines can think like humans. From this point of view, we can define AI as systems or machines that mimic human thinking and behavior (9). Figure3. Artifical Intelligence, Machine Learning and Deep Learning Artificial Intelligence is a significant discipline; some sub-concepts and topics make it up. Machine Learning and Deep Learning are at the forefront of topics widely used in today’s applications. Figure 3 shows the relationship between Artificial Intelligence, Machine Learning, and Deep Learning. Deep Learning is a sub-field of Machine Learning, while Machine Learning is a sub-field of Artificial Intelligence. Machine Learning algorithms are basically grouped under two main headings supervised and unsupervised learning. While supervised learning consists of labeled datasets, unsupervised learning does not have labels. Artificial intelligence is used in most IoT-based supply chain and logistics management aspects, from sensors to enterprise resource planning (ERP) applications on the cloud. Using TensorFlow Lite on microcontrollers with limited resources makes it possible to develop smart applications with the information obtained from the sensors. For example, an IoT module with an acceleration sensor can infer whether the object is moving or not, and if it is in INTERNET OF THINGS (IOT) APPLICATIONS IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT110 motion, it can detect which axis it is moving. While performing these operations, the available resources will be sufficient without using any cloud or server connection. Another application example, it is possible to detect at what speed objects are moving. Navigation systems can be designed for indoor warehouses. Thanks to sensors customized for Supply Chain and Logistics, objects that need to be kept under specific temperatures and pressure can be monitored by data reading and machine learning analysis of these sensors. Thanks to the machine learning technique used in devices with limited capacity, it is possible to design energy-efficient devices without continuous data transfer to cloud servers. This approach will minimize costs by extending the life of battery-powered mobile sensors. Expanding Machine Learning and Artificial Intelligence applications with satellite-as- sisted systems is possible. For this, the satellite-oriented internet of things is technologically emerging. It offers the opportunity to monitor objects worldwide with its satellite-based communication tools. Furthermore, with Artificial Intelligence, it is possible to make high-cost satellite communication more efficient by optimizing data transmission periods (10). The variety and level of data production have increased with the Internet of Things sensors. Administrative tools can be developed by analyzing this data with Machine Learning. This way, predictions about the future can be made based on ML algorithms. For example, a business can operate without stock, and the rate of change of stocks and the products that will be needed in the future can be ordered by estimating. In this way, stock holding costs will be minimized. These analyzes are usually gathered under data analytics or big data analytics. 3.2. Big Data Analyics In the past, the source of the data was humans. Today, not only humans but also machines produce data. The produced data can be structured or unstructured from database tables, the working sound of a machine, a picture of an object, or a video stream of a security camera. The change in the size, shape, and speed of data has caused data analysis with classical methods to be insufficient and has led to the development of big data analytics. Big Data Analytics are methods in which data are analyzed with machine learning methods apart from classical methods. In order to consider data analysis to be big data, the data must have volume, velocity, value, veracity, and a variety of properties known as 5V (11). With big data analytics, how data is held and processed has also changed direction. Now, there is software such as Apache Hadoop and Apache Spark, where distributed structures replace central data centers. Today, in supply chain applications, data is produced from many sources, such as sensors, 111Mehmet Ali ERTÜRK people, trade sites, and logistics. Issues such as analysis and future forecasting in supply chain management, which are quite complex in nature, can be resolved with big data analytics. In Supply Chain management, in addition to known parameters such as capacity, demand, and cost, there are also uncertain and risky variables. Many computational methods and statistical tools have been developed to make future predictions in uncertain environments. When the data parameters included in the supply chain management are examined, It contains information such as stores, customers, products, sales, orders, shipping, and delivery. Reducing costs can be reduced by analyzing these data in detail and making estimations. In addition, it is possible to forecast the future in the fields of risk and quality management, product planning and control, logistics planning, and demand management by using big data analytics. Therefore, supply chain demand estimation is an important issue, and Artificial Neural Networks, Regression, Time Series estimation, Support Vector Machines, and Decision trees are among the most frequently used methods (12). Another technology where data is tracked more effectively in logistics and supply chain management applications is blockchain. 3.3. Blockchain The first idea about digital ledger and the blockchain dates back to 1990s. However, the technology has become popular with its financial application, the cryptocurrency Bitcoin (13). So when a decentralized trust-based cryptocurrency network was introduced, it caught awareness and started appearing in different applications from education to health, finance to logistics, and supply chain. The idea of a distributed system is it does not require central management. In blockchain networks, tasks on the network, such as transactions, work peer to peer. Both systems have their advantages and disadvantages. The main disadvantage of a distributed system is performance. The centralized architectures have faster operation times since everything is coordinated and validated through a central system. On the other hand, operations on distributed systems can take a lot of work and time. Figure 4 represents centralized and decentralized network architectures. INTERNET OF THINGS (IOT) APPLICATIONS IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT112 a. Centralized b. Decentralized Figure 4: Centralized and decentralized architectures Blockchain depends on secure encryption and consensus methods that allow data to be persistent, correct, and unmodifiable in the network. A record represents the single traction, which is called a block (Figure 5). Blocks knit together to construct the blockchain. Blockchain is a distributed database system that does not require central control. Whenever a transaction is triggered, the operation is distributed to all nodes over the blockchain network. Therefore, it is necessary to validate if the operation is valid. If the action is valid, it is agreed to be persistent in the database, which is the ledger. Therefore, an agreement mechanism is essential to check if the current action is correct; it is called Proof of Work. Figure 5. Blocks and blockchain Once a transaction is verified and added to the blockchain network, any party can no longer modify it. In this way, it is possible to develop transparent applications. As a result, a more transparent process can be carried out with the blockchain infrastructure in all processes and transactions of the supply chain management process, from order placing to delivery. Blockchain applications can be used in private or public network infrastructures. A logistics process or firm may privately set up its infrastructure or maintain its services from a public 119Turkay ÖZDEMİR Business within the 4th Book. Turkish Commercial Code is a main body of commercial law and comprises with 6 main book that one of them is Carriage Business, which mainly depends on the Convention on the Contract for the International Carriage of Goods by Road (CMR). On the other hand, in international carriage conventions that differ according to each type of transportation, it is important which provisions should be applied in which ways for freight forwarders. Because, within those conventions, there is no such forwarder concepts, there is contractual carrier concept and the persons or entities whom the carrier is responsible. So that the position of forwarder must be determine accordingly. In this book chapter, firstly the general functioning of the logistics sector and it’s connection with international procurement will be determined; then the conventions applied in the sector and the main business operations and finally the relationship with Freight Forwarders will be evaluated. The aim of this chapter is to present the complex types of businesses in the logistics sector and their functioning, their status, and relations between them from a legal perspective. Therefore, the evaluation of the contractual position of freight forwarders in terms of their obligations and responsibilities must be done to know risks and benefits within each operation. 2- The Concept of Freight Forwarder / Logistics Organizer Or Organizer of Transportation Works A freight forwarder is generally considered as a concept related to mixed (multimodal) transports. It was born out of the need to provide services such as connecting the transports taking place in different environments in these transports, transferring their loads to vehicles moving in different environments and providing services such as handling, transfer or temporary storage. In fact, this need is not new when we look at the history of transportation. However, because of the extraordinary increase in container transportation as a transportation technique in recent history; it has enabled the establishment of transportation contracts for the delivery of commodities subject to international trade at the workplace of the seller/exporter (non-exporter seller manufacturer) and delivery at the workplace of the buyer/importer. Developments in cargo transportation have also been effective in the same direction, so that all logistics activities from one point to another point have become carried out as whole. Container transportation also requires special ports and piers equipped with container ships and appropriate handling equipment. In these ports, the main infrastructure is provided by the port administration or management and the container service equipment and organization is provided by container terminal companies. In this case, in order to provide regular line-liner voyages, mutual chartering agreements between shipowners based on an operating (supply) FREIGHT FORWARDERS IN CONTEMPORARY LOGISTICS AND TRANSPORTATION LAW:...120 agreement are required. They enter into voyage charter agreements for a specific section or area of the container ship to accommodate their customers’ commodity-filled containers. The contracts concluded in this process contain complex indemnity clauses, which the shipowners pass on to their customers through bills of lading, bills of lading and contracts of carriage. In some joint service contracts, each logistics operator may market a service; in this process, the clauses in the contracts and bills of lading specify who is the carrier, agent, broker, freight forwarder and what kind of responsibilities they undertake, and that the contract is between the shipowner named in the bill of lading and the customer (4). As a result of the stage reached in container transportation, it has profoundly affected the terminology of modes of delivery and transport law in international trade, for example, it has led to the development of concepts such as door-to-door transportation as well as port-to-port transportation. Thus, due to the need for mixed transportation operations, the importance of the freight forwarder, who organizes the entire transportation through sub-contracts and performs the entire transportation through or with other carriers, has increased respectively. When freight forwarder enterprises become powerful within sector, they come into scope of law and governmental authorities. So that, to decide upon their rights and duties, they become together within such associations as an economical actors. Almost all of the major freight forwarders in the UK are members of BIFA (The British International Freight Association) (5). The Freight Forwarders’ Institute, which is affiliated to BIFA, works as a professional support institute for those involved in international freight forwarding. BIFA registered members agree to apply the Standard Terms of Trade, employ a minimum number of professional members, maintain continuous liability insurance and abide by the association’s code of conduct. Trial membership is available for companies new to the industry. Ordinary commercial membership is available for companies that cannot comply with all the conditions and specifically want to use their own terms of trade (4). In Turkey, UTIKAD - International Transportation and Logistics Service Producers Association, which has the same purpose and provides similar support to its members, is in charge. As a historical process, it was established in 1986 as UNMAD-International Transportation Contractors and Agents Association, 1995-UTIKAD- International Freight Forwarders and Agents Association, 1999- UTIKAD- International Transportation and Logistics Service Producers Association (see more information, online, at https://www.utikad.org.tr/UTIKAD-Ta- rihce). Here, as can be understood from the title alone, terms such as transport contractor, freight forwarder and logistics service providers have been and are being used, rather than the expression of freight forwarder. However, what is in question is an organizer activity that 121Turkay ÖZDEMİR organizes the contractual transportation process and is subject to the provisions of the carrier as determined by the Regulation. FIATA (International Ferderation of Freight Forwarders Associations) was established as an international federation of freight forwarders associations established in other countries, including UTIKAD and BIFA. These associations and such international bodies provide model rules for the Freight Forwarding service and some associations explicitly recognize that their rules provide a minimum degree of customer protection (4). This means that these bodies are such guarantees for the member enterprises’ customers. Forwarders may issue various documents, contract standards and proposals relating to customers, goods, process, carriers for their customers and other interested parties. Forwarders are usually intermediaries, using documents relating to the carriage, such as bills of lading and consignment notes, issued by carriers they designate, without actually performing the carriage themselves. Sometimes they may act as agents as the carrier’s representative and have the authority to issue the transport documents themselves. Sometimes they may issue documents in the form of intermediate transport documents to indicate that the goods have been instructed to be picked up from the customer’s place of business or to indicate that the goods have been shipped to the consignee. It is common practice for forwarders to issue a Forwarder Certificate of Receipt (FCR or House BL) for commodities in their possession or control. The FCR is mainly used in intercontinental trade and functions similar to a bill of lading. It is the FCR that actually starts the transportation process, but it does not necessarily mean that the long-distance transportation process has started in a mixed transportation process or in overseas transportation. However, the forwarder issuing the H/BL is not obliged to contract for the carriage of the commodity, it is possible to contract only as an agent without being considered as a carrier (4). If the name of the forwarder appears on the House BL and it is signed as a carrier or multimodal transport operator-MTO (7), they will be considered as a carrier in terms of both public obligations and the transportation process. The forwarder providing multimodal transportation services may use its own bill of lading form with the will to accept responsibility as a carrier or may use a FIATA bill of lading (FBL), which clearly indicates that it assumes responsibility for the carriage of the goods. In terms of Turkish law, if the carrier carries the goods in its own name and on its own account, it shall be deemed to be a carrier in accordance with the Forwarder Regulation and the provisi - ons of Art. 921, Art. 926 and Art. 927 of the Turkish Commercial Code (TCC). Here, it is more FREIGHT FORWARDERS IN CONTEMPORARY LOGISTICS AND TRANSPORTATION LAW:...122 important that the carrier undertakes the work, brings the goods together and transports them, and collects the transportation fees on its own account, rather than the transportation documents it issues. Especially when it comes to the follow-up of the process, instead of stepping out of the way after concluding the contract like a broker and leaving the cargo interest and the actual carrier in the execution of the process together, the forwarder will now have to show the care and responsibility of the carrier. It is an acting carrier for process responsibility that any loss or damages or delay resulted in damage to be compensated, liabilities will be on, with for the actual carriers (8). 3- Contract Terms For Freight Forwarders Generally, forwarders are companies that serve their customers with continuous commercial relationships such as monthly, quarterly, or annually. The customer’s main objective in the contract is to be attracted to the provisions limiting or eliminating the company’s liability and the provisions requiring the customer to indemnify in certain circumstances and is expected to be a party to the contract accordingly. It draws attention to the terms that are most likely to affect the client’s situation and, when combined with the reference to the terms on the face of the forms issued for each individual work with a service, aims to ensure that such terms are included in the contract by encouraging adequate notice to the client. In a contract based on standard terms, whether general terms of business or negotiated by the parties, the party relying on them must prove that the terms incorporated into the contract are consistent with the will. This will be possible either by the customer’s acceptance of the inclusion of such terms in the contract or by the party relying on them proving that the other party was notified of their inclusion at the time of the conclusion of the contract. Due to the nature of forwarder operations, it may be difficult to notify the forwarder at the time of conclusion of the contract, such as in cases where the forwarder is the consignee acting on behalf of the consignee with respect to the instructions given by the consignor-carrier. However, in cases where there are two forwarders providing mutual correspondent services and operating in different countries, it is sufficient for the defendants who wish to rely on the terms of a member association such as BIFA or UTIKAD to send an e-mail or fax containing the phrase “the terms of this business are shown on the back” (4). It should be noted here that the general terms of business and framework contract terms developed by IATA-International Air Transport Association may be equally binding in air cargo transportation operations. In particular, the inclusion of the framework contract terms developed by member associations in the scope of the individually concluded contract may also depend on whether the forwarder has entered a direct legal relationship with the customer as a contractual intermediary agent or as the performer of the service. 123Turkay ÖZDEMİR The incorporation of such corporate framework clauses into the content of the logistics service contract during the transportation process may also be written directly in the form of contractual terms and not by reference. Sometimes, the forwarder may act as an agent in a continuous representation relationship. This should also be interpreted according to the provision of the framework contract. The scope of the framework contract is completely formed by the free will of the parties. However, it can be stated that the general terms will apply to all kinds of logistics services and some free services other than transportation. Since transportation in logistics processes is also specified in all international contracts as a commercial business, it cannot be done free of charge. For international perspective, transportation must be agreed to be carried out for a price. Otherwise, international conventions such as1999-Montreal Convention, CMR or COTIF-CIM will not be applicable. Again, in terms of the Hague and the Hague Visby Rules, the issuance of a bill of lading and the commercial nature of the business require carriage for consideration. 3-1. Freight Forwarder Services and Contractual Parties Freight Forwarder services means services related to the transportation, consolidation, storage, handling or packaging and distribution of goods, as well as any activity related to making declarations for official purposes, insuring, and refrigerating goods or providing payments and documents related to goods (4). The forwarder, who undertakes these services, but does not have to perform them personally, is considered as a carrier in all international conventions and practices and is equipped with the rights and obligations of the carrier. Freight Forwarder services means the planning, execution, and control of all necessary logistics activities, including but not limited to the transportation of goods from the point of origin to the destination. In this process, services are received from multiple people and institutions, notifications are made, and different contractual relationships are entered. In all of them, the forwarder acts either as a responsible party or as a representative and is either alone or jointly and severally liable for any breaches. In this respect, under the appearance of assuming full responsibility, there is also a subcontractor auxiliary enterprise to which it can transfer full responsibility according to the contract. Freight Forwarder services include, but are not limited to, all payments, including customs charges, administrative, auxiliary and consultancy services related to the movement of the goods subject to transportation. The remuneration received here is covered by the expression “final remuneration” in Article 921 of the TCC and is defined as “...agreeing on a single price FREIGHT FORWARDERS IN CONTEMPORARY LOGISTICS AND TRANSPORTATION LAW:...124 including transportation costs...”. Here, the broker working with a fee including all costs will now have to be interpreted as an organizer, acting carries, in other words, freight forwarder. Article 4 of the Regulation on Freight Forwarder “i) Transportation business organizer (freight forwarder): Real and legal persons and legal entities who are accepted as carriers within the framework of the obligations and responsibilities imposed by this Regulation and other relevant legislation on those who operate in the capacity of transportation, real and legal persons who have obtained authorization certificates in the field of goods and cargo transportation in accordance with the relevant legislation, and real and legal persons who issue transportation invoices by having goods and cargo transportation on their own behalf and account, including combined transportation, by using or using the facilities, capabilities and capacities of vehicles with foreign license plates operating in the field of goods transportation and other types of transportation when necessary, provided that they comply with international agreements”. There is a similar definition in the Road Transport Regulation Art.4, ğğğ, that in Turkish law this definition is generally accepted so on. Logistics activity means all services undertaken by service providers within the scope of the movement of goods, including collection, loading, unloading, acceptance, inventory control, storage, control, handling, order processing, consolidation, palletization, preparation for loading, loading, assembly, labelling, invoicing, preparation of loading documents, customs clearance, delivery, and shipment tracking. Likewise, in the Road Transport Regulation, besides freight forwarder, the definition of logistics enterprises also determined as “Logistics enterprise: In addition to transportation activities, real and legal persons who have the right to use an independent workplace and undertake all or part of the loading, unloading, storage, stacking, packaging, sorting, labelling, order planning, distribution, delivery and similar services under their own supervision and control after receiving all kinds of goods belonging to their customers” within Art. 4-ğğ. Essentially, all of these activities are logistics activities and the businesses that have the competence to organize them are freight forwarder businesses. For Turkish Law, logistics enterprise has a capacity to operate as his business; freight forwarder has a capacity to organise but not actually do it. The main thing in forwarder activities is the movement of goods and it is not necessary for sender or any logistics sector enterprise to own goods in the transportation process. The sender who gives the goods to the transportation process, has the cargo interest, including the goods and its packages, pallets, containers and other transportation equipment, which are the subject of any contract concluded as the cargo interest or related to the contract. This is essentially the sender and is in the position of contractual party as the sender at the destina- 125Turkay ÖZDEMİR tion. In logistics services, the customer for the forwarder is the person who makes a request or on whose behalf a business is undertaken, or services, information or advice are provided. He can be a buyer, seller, tenant or borrower as such. The customer is often involved in the dispute process as the sender or the consignee in terms of liability. 3-2. Forwarder Activity and Logistics Apart from providing gratuitous and reward activities, the activities, and tasks to be undertaken by the Forwarder are those with the objective of generating income. In any case, the movement of goods belonging to the customer is important. Moving its own goods will not be considered as a logistics activity. There are some drawbacks in trying to define the scope of forwarder or logistics activities that can be undertaken, and in imposing limitations. Such a limitation carries the risk that there may be several unforeseen works during the movement process from the point where the goods are located to the point where they should arrive, and in such cases, the operation may fail. For this reason, restrictions, or limitations in the definition of work to be done may lead to the need for re-evaluation later. In other words, it may be necessary to agree separately for the framework agreements of institutions and associations that are not explicitly foreseen to be applied to the contract between the parties, or for a new set of works foreseen in the individual contract. Logistics activities require the actual realization of all the work required in the entire process, while the forwarder requires the establishment of the contractual relationship necessary for its planning and implementation. The customer vis-à-vis the forwarder can often be an owner, buyer, seller, lessee with financial leasing. In the forwarder contract, the capacity of the customer for the purpose of transportation must be included. Thus, disputes regarding ownership and other rights on the transported goods can be minimized. In determining the party to the forwarder agreement, it is important to determine whether it is an agent, exporter, importer, customs broker or other intermediary and to define its duties. In cases where the goods are sent by a consignor to a consignee by road, if there is no basis for an agreement, it is accepted that the consignee-shipper is a party to the contract of carriage in accordance with Article 89/2 and 3 of the Turkish Code of Obligations (TCO). Thus, although the consignor and consignee are essentially the same person in terms of the contract, the cargo means the goods that must be picked up from the seller-supplier address or the place where the goods are located. In terms of INCOTERMS 2020 the legal place of delivery seems to be determined as EX-Works delivery However, the forwarder contract must specify the mode of delivery FREIGHT FORWARDERS IN CONTEMPORARY LOGISTICS AND TRANSPORTATION LAW:...126 in terms of the customer’s entitlement to the goods and for whom the transportation process is organized. When the contractually undertaking carrier is accepted as the organizer of the carriage, it should consider both the person requesting the service and the person on whose behalf the service is requested as the customer in terms of its own receivables. Instead of both of them being simultaneously regulated as customers, they are alternatives to each other in the exercise of rights and powers. In both the Roman Germanic and Common Law systems, the party to the contract is normally one of them. However, it may be possible in cases where the capacity of representation is not disclosed or where the representative personally concludes the contract instead of the represented party. In other words, in the case of brokers who act on their own behalf but on behalf of the cargo interest, and in the case of agents who do not clearly state the representative relationship, these persons will also be in the position of customers for the forwarder. 3-3. Application of Imperative Law in International Logistics Process International conventions and state law and regulations about transportation and logistics process mostly impose mandatory rules to be applied. However the concept is within trade and international commerce that, always there are so many issues to be determined by the parties. Art.2 of the BIFA framework contract “In the event that the application of any legislation is mandatory for the undertaking of any work, such conditions in relation to such work shall be understood to be subject to such legislation, and nothing in such conditions shall be deemed to waive any of the company’s rights or immunities, to increase any of its responsibilities or obligations under the legislation, and if any part of such conditions is contrary to such legislation to any extent, such part shall be invalidated to that extent and no more in relation to such work” (4), both national legislation and international conventions emphasize the need for mandatory application. As important as contracts are in the implementation of commercial provisions, it is also clear that these contracts should be drafted in accordance with the absolute and relative mandatory legislation and convention provisions. Contract terms that violate the mandatory provisions will be invalid but cannot be interpreted to mean that the entire commercial contract between the parties is invalid. This provision explicitly recognizes that there is the possibility that there may be legislation governing a particular operation and restricting the freedom of the parties to contract on the debt relationship. In some countries, the restrictions imposed on freedom of contract may be different from those imposed in other countries, according to their own public order and 127Turkay ÖZDEMİR understanding of the law. If a transportation subject to a special liability regime for international transportation is supplied by the Forwarder or performed by subcontractors, differences may arise depending on the country where the relevant service is carried out. Such regimes contain provisions that prevent the carrier from reducing or eliminating its responsibilities or that treat limitations differently. In the event of a breach of the mandatory provisions governing the service undertaken by the Forwarder, partial invalidity will result in. Contractual provisions that violate the mandatory provisions are invalid, but those that do not violate them remain valid. The inclusion of such provisions in a long-term framework contract does not require their validity in the face of changing mandatory legislation and convention provisions. 3-4. Unfair Contract Terms The Articles 21-25 of the Turkish Code of Obligations (TCO) for Turkey and the Unfa- ir Contract Terms Act 1977 (The Unfair Contract Terms Act 1977/UCTA) for the UK and the necessity of analysing unfair terms within contracts and the necessity of invalidation or non-application accordingly are also clear for legality. Although there is no such distinction for Turkey, according to Article 26 of the UCTA, the Law will not apply to international supply contracts concluded by parties with places of business in different states where the possession of the goods passes. A British Forwarder contracting with a foreign customer may avoid the application of the Law if it takes possession of the goods. On the other hand, in the unlikely event that a foreign Forwarder enters a contract under the terms of BIFA, this provision may only apply if it is the law chosen by the parties in accordance with Article 29 of the terms of BIFA. In other words, like the mandatory and public order rules of each country, the unfair terms included in the general terms and conditions of the contracts will also be subject to the control of the law applicable to the substance of the contract. Be that as it may, the provisions in the contracts do not eliminate the obligations and defences provided by an international liability regime such as the CMR Convention (4). For example, the 2 SDR limit of liability in the FIATA terms does not apply as a limited liability ceiling outside the maritime transportation process. Where the forwarder contract falls within the scope of the UCTA - as further defined in Chapter 13 - any contractual term intended to exclude or limit liability for negligence (slight negligence) will be subject to section 2 and will be void if it covers death or personal injury and subject to a reasonableness test in other cases of loss or damage. 3 and other terms intended to exclude or limit liability as defined in section 13 will be subject to the reasonableness test in section 3. This happens either where the forwarder’s customer is a consumer or where FREIGHT FORWARDERS IN CONTEMPORARY LOGISTICS AND TRANSPORTATION LAW:...128 the forwarder writes standard business terms (general terms of business). There will be little doubt that BIFA terms and other similar terms of trade are “written standard terms of business” and that they constitute the forwarder’s standard written terms “invariably or at least usually if they contract on them”. However, where a forwarder or logistics service provider operates based on negotiated terms, these are unlikely to be regarded as standard terms of business unless the negotiations had little effect on the added terms. The forwarder must prove that the term to be deemed to be included in the scope of the contract is fair and reasonable and was known or contemplated in detail by the parties at the time the contract was concluded. Courts are free to exercise their judgment in determining whether a term meets this test. At this point, it should be noted that the condition to be relied upon must be communicated to the customer. In practice, unless there is a great economic imbalance between the parties (in a bargaining position), the view is expressed that custom and commercial practice is also an important factor in commercial relations (4). Apart from UCTA, the “EU Council Directive on Unfair Terms in Consumer Contracts” entered into force in July 1995 (5th April 1993, 93/13/EEC). These will apply where the Forwarder, as a service provider, is dealing with a consumer. As the provisions of the Directive will apply at the same time (side by side) with the UCTA terms, it will be necessary to consider the circumstances in which each applies. While there is a similarity between UCTA’s reasonableness test and the Directive’s concept of unfairness, there are contractual provisions that are not currently controlled by UCTA but should be subject to control by the Directive, such as, for example, a price variation clause. As required by Article 3 (3), the Regulatory Annex contains a list of terms that may be considered unfair terms. In these respects, where UCTA provides greater consumer protection, Article 8 of the Directive appears to allow such protection to be maintained. 3-5. Choice of Law It is important to choose a state law in international contracts between the parties and to indicate such a law in cases where the parties do not expressly agree or for the interpretation and completion of their declarations of will. In determining the law applicable to contracts in Private International Law, reference is generally made to the law chosen by the parties (9). Article 24 and 29 of the Law numbered 5718 stipulates that if the parties have made a choice of law, that law shall be applied. However, here, the provisions of the international conventions to which Turkey is a party in Article 1/2 of the Law shall be applied first. Which means that, if a convention exists to be applicable, firstly it will be practised, and for the gaps and unregulated issues, chosen law will be applied to the case. 135Turkay ÖZDEMİR matters of limited liability or abolition of liability, regulations should be made by considering the mandatory character of the provisions of the TCC. If the logistics operator carries out the supervision and control during the transportation of the goods, the logistics operator may also assume the responsibility of the carrier arising from the loading and stacking and other acts pursuant to the intermediary transportation contract. If the logistics operator has undertaken the transportation itself, if a single fee has been agreed for the fee-commission-logistics activity, if it mediates the transportation by collecting cargo together, it will now be subject to the provisions of the carrier. Here, even if there are contractual provisions stating that he will not be considered as a carrier, his carrier title will not be prejudiced. 6-1.1. Carriage Process In the Framework Logistics Services contract, the places of origin and destination must be given with specific definitions, and the place of loading and the place of unloading of the goods must be specified in each transportation. Therefore, it is necessary to concretize the place of origin and destination in each individual transportation process. Likewise, the mode of transport, the route and the nature of the vehicles to be used in the transportation must also be specified. The logistics operator will not be liable for incorrect instructions; however, failure to provide instructions may result in the operator’s liability. Especially in cases such as deviation from the route, failure to make the requested vehicle available, liability as a carrier will be in question. If there are no instructions to the contrary, the logistics operator can act freely in terms of route-vehicle and other issues. The logistics operator may withdraw the goods in the transportation organized by itself, and may instruct to transport the goods to a different location. However, this instruction must be compatible with the customer’s instruction and contractual rights. 6-1.2. Collection Cargo In the logistics services contract, it may be agreed that the cargoes of other persons shall not be mixed with the cargoes of the customer, and that the cargoes of more than one customer shall not be carried in the same transportation. If there is no such agreement, the operator acting as a carrier is free. In this case, the customer must clearly state his/her own interest and demand from the logistics operator, and the prohibition of transhipment must be stated in the partial load, especially if the damage caused by transhipment is desired to be within the scope of liability. FREIGHT FORWARDERS IN CONTEMPORARY LOGISTICS AND TRANSPORTATION LAW:...136 6-1.3. Duration of Transportation A transportation period may be agreed in the contract. This period must be reasonable. Unless necessity, administrative intervention or force majeure is demonstrated, exceeding the time limit is itself a reason for liability. The logistics operator, as the carrier, is obliged to reveal and explain the reasons for extraordinary time overruns. 6-1.4. Proof of Delivery of Goods It is the duty of the logistics operator to prove the delivery of the goods to the consignee - the buyer with a document such as a delivery note - transportation note - transportation bill - delivery receipt to prove that the seller has fulfilled his performance arising from the sales - supply contract. The logistics operator who fails to prove that the goods have reached their destination will be liable. Specifying the type, number and weight of the goods in the delivery document is important in terms of liability law. 6-1.5. Receipt from Unauthorized Person and Delivery to Unauthorized Person It is important that the goods are delivered at the place of destination to the person named as consignee on the transport and shipping documents or to his authorized representative. Although full commercial representation or commercial agency is not required there, it must be confirmed whether the consignee is an employee of the consignee. The negotiable character of the bill of lading and the delivery of the goods to the rightful bearer are important in terms of authorization. The delivery of the sea carrier will be the delivery of the logistics operator. Delivering to the wrong person, who will be the right person, who will be authorized to deliver and receive the goods must be written separately in the logistics services contract. If a commitment has been made to the customer for the collection of the price of the goods or any other payment, the logistics operator must refrain from delivering the goods if this money is not collected. In this case, an instruction must be obtained from the customer on the grounds that there is a delivery obstacle. Otherwise, it is inevitable that the goods will be sold (converted into money) according to the law of the place where the goods are located and the goods will be evaluated for the customer. 6-2. Road Transportation When the carriage is carried out by road, the mandatory character of the international CMR provisions and the mandatory character of the provisions of Book 4 of the TCC should be observed domestically. 137Turkay ÖZDEMİR 6-3. Other Modes of Transportation If the logistics business contract clearly states in which cases other modes of transportation will be used, it should also be considered that the liability scheme will operate according to this mode of transportation. 6-4. Other Transportation Works in Addition to the Contract of Carriage As stated above, certain works are included among the transportation works in the provisions of the TCC. The logistics operator may have undertaken these as performance. 6-4.1. Packaging Pursuant to Article 862 of the TCC, if packaging is required considering the transportation process, it is essential that this is done by the sender (the sender of the contract of carriage). However, within the scope of the logistics services contract, it may be undertaken by the logistics operator as a performance in addition to the transportation. If it is contractually undertaken by a separate company and packaging is performed, it will be considered as an independent work contract. The logistics operator may also impose the packaging performance undertaken by the logistics operator on the carrier as an ancillary performance. The adequacy of the package, the type of foil-metal-wooden-shrink packaging to be used is a problem directly related to the nature of the goods. The mode of transport, whether it is partial or full carriage, the nature of the goods are decisive for the form and type of packaging. In fact, the orders and instructions of the manufacturer-seller of the goods on packaging suitable for the nature of the goods are important. Sometimes, the type of packaging alone may even be the cause of total loss. The logistics operator, who undertakes the packaging separately, should specify in the contract the additional charges and costs for the packaging. There will be a significant difference even between the fact that it will only take the cost and that it defines this work as a job. 6-4.2. Pallet and Container Supply How long and by whom the pallets and containers to be used in the transportation process will be supplied is a very important issue. In logistics service contracts, it is important who will supply pallets or containers and under what conditions, and how they will be returned and how they will be returned. FREIGHT FORWARDERS IN CONTEMPORARY LOGISTICS AND TRANSPORTATION LAW:...138 Will the logistics operator be able to charge rent for the pallets and containers it supplies? This issue should be written in the contract, will it be able to request the costs incurred on the assumption that it will not receive a rental fee; again, in cases of overdue demurrage-delayed containers and pallets, the responsible party for the payment should be determined in the contract. Here, the costs of pallets and containers, ownership, whether the ownership belongs to the logistics operator, the unloading time and delivery time of pallets and containers must be included in the contract. The delivery points to which empty pallets and containers will be returned must also be specified. The robustness of the pallets, their dimensions, their suitability for flood or rough handling, their suitability for use with forklifts, cranes or other means must be inspected, and who is responsible for damages caused by the vehicles used in loading and unloading must be included in the contract. 6-4.3. Weighing and Drawing List Especially in land transportation, unless weighing is performed, the record written on the bill of lading does not constitute a presumption as to the quantity of the goods. In other transportation methods, if the weighing information is written on the bill of lading, it is accepted as valid as a presumption. If weighing is the obligation of the logistics operator, the weighing method, costs, weighing and recording system must be agreed upon in the contract and the fact that the cargo has been weighed must be recorded in the bill of lading. In this regard, it is important that the goods are weighed and characterized in terms of quantity. 6-4.4. Marking According to Article 862/2 of the TCC, the duty of marking also belongs to the shipper. However, when the logistics operator undertakes these works, he shall be liable for the damages caused by this. In particular, signs regarding the loading, stacking and fixing of the goods, warning points and signs regarding how the goods will be handled during transportation and transfer processes, weight-number-shipped information are also considered as signs. When the logistics operator undertakes the marking obligation, in order for this obligation to be valid; it may be undertaken for goods in a certain period of time, in a certain warehouse, 139Turkay ÖZDEMİR in a certain place, for the defined goods of a certain customer, for the goods of certain buyers. In other words, when the marking obligation is mentioned, the goods must be specific. The marking obligation will not be mentioned in an indefinite and comprehensive manner. Goods damaged due to inadequate marking may be broken, explode when stacked on top of each other, may be mixed due to lack of support, the logistics operator, who is under obligation to mark the goods in accordance with the chemical or other dangerous nature of the goods, must know and perform accordingly and receive this service from third parties as required. There are generally valid markings for logistics operators and the meaning of these markings should be considered by the performance assistants and men who take part in each stage. Whether the goods are subject to customs clearance or not, and how the transportation stacks and packages are unpacked, may also need to be specifically indicated in the marking. There may be differences depending on the goods and the mode of transportation. 6-4.5. Loading and Unloading Pursuant to Article 863 of the TCC, loading and unloading must be carried out by the consignor, unless it is otherwise understood from the contract, the necessity of the situation or commercial practice. In the event that the consignee on behalf and account of the shipper is different, the unloading of the goods shall belong to the consignee. However, it is possible for the logistics operator to undertake these obligations under both the contract of carriage and the logistics service contract. For the cargo to be transported without any damage during transportation, loading should be done in accordance with the vehicle and the road. Loading that considers the vehicle and road conditions can be said to be in compliance with “transportation safety”. For the vehicle to travel safely in traffic, the traffic order must be ensured as “operational safety”. If the logistics operator undertakes loading and unloading, both operational safety and loading safety are within the scope of the operator’s obligations. Even when the carrier and driver are outsourced, the operator will be responsible for the entire process. In addition to the driver, it is the joint responsibility of the parking lot manager, the business manager of the shipper, the port or area exit officer, the authorized officer for the transportation of dangerous goods, the relevant authorized managers, and officers to ensure operational safety. However, if the logistics operator has undertaken this work with a contract, all these persons should be evaluated within the scope of the responsibility of the logistics operator. FREIGHT FORWARDERS IN CONTEMPORARY LOGISTICS AND TRANSPORTATION LAW:...140 Responsibility for loading exceeding the loading capacity, gauge, overloaded cargo or the limit of loading can also be evaluated within the same scope. Responsibility for administrative sanctions due to these reasons and their final responsible parties will also be determined according to the provisions of the contract. The liability of the driver for carelessness and imprudence in exceeding the transportation capacity and the liability of the logistics operator must be included in the contract. The TCC considers loading as the sum of the acts of placing on the vehicle, stacking and securing. Even in the case of special stacking and lashing companies, it is a legal requirement that the work should be considered as a whole and stacking, fixing and placing on the vehicle should be considered as a single act in terms of logistics services. However, it is possible to separate these activities in the logistics services contract. In cases where the cargo overturns in the normal course of the vehicle, the stacks deteriorate, and damage is caused by pressure and friction, it cannot be ignored that the main cause of damage is caused by loading. However, sometimes there are cases where different risks related to loading and goods are the cause of damage together, and there is a common fault and responsibility. Here, it is inevitable to discuss the effect of tipping, friction or the nature of the goods on the damage and to apportion fault accordingly. The loading and unloading periods must be specified separately in the contract as free time and time periods for which compensation may be calculated. Paragraphs 862/2 and 3 of TCC Art. 862/2 and 3 should be taken into consideration here and should be observed in the contract between the parties. 6-5. Brokerage Activities as a Broker and Other Activities 6-5.1. Storage The cargo may be securely stored in places such as ports, airports, terminals or warehouses, as well as in warehouses or warehouses and warehouses with storage agreements. In this case, the forwarder, who is in charge of concluding the contract, may separately claim and sue for the payments arising from these works. The costs and expenses incurred in works exceeding the ordinary transportation works shall be claimed from the cargo interest. 6-5.2. Order planning Necessary contracts can be made to plan how much and when the raw materials and/or intermediate materials required in production will be available. For this purpose, it is inevitable 141Turkay ÖZDEMİR to store at the nearest point and to make shipments with partial transfer accordingly. In this case, there must be a special agreement in the contract. Otherwise, the costs and costs incurred for such works that arise with orders and instructions may be reflected on the cargo concerned. 6-5.3. Preparation Preparation of cargo for transportation is a general term. In particular, activities such as assembly, disassembly, packaging for commercial use and marketing activities, preparation of user manuals, translation and printing of documents, warranty and compliance documents are within this scope. Such works should be defined and undertaken separately. This is because the costs of these activities, which are included in the production process and which are also among the logistics operations, but which are not usual in transportation operations, will be based on special instructions. 6-5.4. Customs procedures In addition to direct representation before the customs authorities, in addition to the indirect representation authority granted to customs brokers, other customs regimes with economic effect and other customs procedures may be carried out in addition to summary declaration, export declaration or import declaration works and transactions based on the powers granted to the organizers of transportation works. Here, tax payment or other legal obligations may be reflected on the cargo to the extent that they are incurred. However, the representation of the transactions may be considered among the works carried out with a definite fee included in the logistics process. Therefore, it should be specifically considered in the contract process. 7- Conclusion Among the enterprises that carry out logistics activities that require important systems and applications in the procurement process, freight forwarders, which are established and operated as a separate commercial enterprise that also takes the titles of agency, broker and carrier, are the main and most broadly responsible actors. While they perform the operations required by this position through contracts; it is not important whether they actually perform them or not. In other words, while establishing contractual relations and taking part in the responsibility network, they take part in the process together with those who actually do the work. The contracts concluded by these enterprises are atypical contracts that can be evaluated within the general boundaries of the work contract, which covers many important and separate contractual activities, although the logistics services are concluded as a framework contract with continuous performances and fixed-term contracts. It should be applied as a combined FREIGHT FORWARDERS IN CONTEMPORARY LOGISTICS AND TRANSPORTATION LAW:...142 contract. It should not be ignored that the main operation consists of transportation works that must be actually carried out in terms of all logistics processes. References 1. Jones,Peter; FIATA Legal Handbook on Forwarding, Toronto, 2012 2. Road Transport Regulation [Internet]. [Publisher: Ministry of Transport and Infrastructure] 2004 Feb 25, [updated 2023 Jan 14] Available: https://www.mevzuat.gov.tr/File/GeneratePdf?mevzuatNo=24299&mevzuatTur=KurumVeKurulusYonetmeligi&mevzuatTertip=5 3. Regulation on the Organizer of Transportation Works [Internet], [Publisher: Ministry of Transport and Infrastructure] 2018 July 06, [updated 2023 April 08] Available:https://mevzuat.gov.tr/mevzuat?Mevzuat- No=39686&MevzuatTur=7&MevzuatTertip=5 4. Glass D. Freight forwarding and multi modal transport contracts [Internet]. London, England: Informa Law; 2013. Available from: http://dx.doi.org/10.4324/9781315878140 5. BIFA (The British International Freight Association) [Internet].[Publisher: The British International Freight Association], Available: https://bifa.org/ 6. International Transportation and Logistics Service Producers Association (UNMAD) [Internet]. [Publisher: International Transportation and Logistics Service Producers Association], Available: https://www.utikad. org.tr/UTIKAD-Tarihce 7. Adıgüzel B. Liability of Carrier (MTO) in Multimodal Transport (Turkish). Ankara, 2015 8. Özdemir T. International Law of Carriage of Goods, Loss and Damage Liability (Turkish), İstanbul, 2006 9. Private International and Procedural Law. [Internet] 2007 Dec 12, [Publisher : Republic of Turkiye, Ministry of Justice] Available: www.mevzuat.gov.tr/mevzuatmetin/1.5.5718.pdf 10. Baluch I. Transport Logistics, Past, Present and Predictions. Dubai, 2005 11. Baluch I, Edwards CH. Transport Logistics: The Wheel of Commerce. Ivy House Publishing Group; 2010. CHAPTER 9 EVALUATION OF SUSTAINABLE PRACTICES AND COMPANY PROFITABILITY OF TRANSPORTATION AND LOGISTICS BUSINESS Ebru DEMİRCİ*, Cengiz Görkem AKIN**, Jan BENUS*** *İstanbul University, School of Transportation and Logistics, İstanbul, Türkiye E-mail: [email protected] **İstanbul University, School of Transportation and Logistics, İstanbul, Türkiye E-mail: [email protected] ***Zilina University, Department of Road and Urban Transport, Zilina, Slovakia E-mail: [email protected] DOI: 10.26650/B/SS05ET50.2024.016.09 ABSTRACT Sustainability assessments are made by considering financial and non-financial indicators. Various profitability measures (such as EVA, CFROI, ROA, ROE) are used to analyze the financial status of companies and measure their profitability. The aim of the article is to apply the profitability criteria to the corporate data of 6 logistics and transportation companies in Europe and Turkey and to measure the level of significance between the sustainability performance criteria of the companies. This study is based on the information obtained through a comprehensive literature review on sustainability and profitability criteria, and the financial statements and balance sheets of companies. Obtained data were analyzed by correlation and ANOVA. As a result of the research, EVA, which is among the profitability criteria, gave the most similar result to the total sustainability performance score ranking. However, the closest result to the social sustainability performance score ranking was the ROA and ROE profitability criteria ranking, while the closest result to the economic sustainability performance score ranking was the EVA profitability criterion. Keywords: Sustainability, Logistics management, Financial profitability CONTEMPORARY CHALLENGES AND PRACTICES IN LOGISTICS AND SUPPLY CHAIN MANAGEMENT EVALUATION OF SUSTAINABLE PRACTICES AND COMPANY PROFITABILITY OF...144 1. Introduction Businesses, which form an important part of economic, social and environmental life, are expected to act responsibly and to report not only the economic impact and results of their activities, but also the social and environmental impacts and results, due to their position and roles. The reporting of an enterprise’s activities, including its economic results as well as its social and environmental consequences, is perceived by its stakeholders as an indicator of the value given to their expectations. Reports containing the economic, social and environmental impacts and results of an enterprise’s activities are also called by various expressions such as sustainability reporting, non-financial reporting, triple responsibility reporting, corporate social responsibility reporting. In this section, the relationship between the level of knowledge disclosed in sustainability reports on economic, environmental and social performance and company profitability will be examined. Sustainability reports of a total of 6 companies operating in the fields of “storage, transportation, logistics and courier services” and “travel and transportation services” in Europe and Turkey were examined. For this purpose, the company profitability and sustainability performances of the enterprises were analyzed and ranked. The reports of businesses published in 2021 according to the Global Reporting Initiative (GRI) reporting principles were considered. The aim of this study is to determine the relationship between the knowledge levels of the companies that publish sustainability reports according to the GRI reporting framework in Europe and Turkey, regarding the sustainability performance indicators, and the profitability of the company. For this purpose, firstly, the level of knowledge disclosed by the companies that publish sustainability reports in accordance with the GRI reporting framework regarding the performance indicators in the aforementioned reports will be determined. Then, the relationship between the determined sustainability performance levels and company profitability will be revealed. The studies examined within the scope of this study were categorized similar to the classification system used by Baah et al., who examined the sustainable practices and financial performance in detail in the logistics sector (1). Although it examines sustainable / green logistics practices and financial performance, studies that are not included in the classification system used in the aforementioned study are listed under the title of “Other”. In this context, in the literature review, it is seen that studies that reveal the relationship between sustainable logistics practices and financial performance have gained popularity in the last 10 years. On