Essay on Sydney Port

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University of Nebraska - Lincoln

DigitalCommons@University of Nebraska - Lincoln
Management Department Faculty Publications Management Department

8-1-2008

A Strategy for Third-Party Logistics Systems: A Case Analysis Using the Blue Ocean Strategy
Changsu Kim
Yeongnam University, Korea, c.kim@yumail.ac.kr

Kyung Hoon Yang
University of Wisconsin-La Crosse, kyang@uwlax.edu

Jaekyung Kim
University of Nebraska - Lincoln, jkim6@unl.edu

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Kim, Changsu; Hoon Yang, Kyung; and Kim, Jaekyung, "A Strategy for Third-Party Logistics Systems: A Case Analysis Using the Blue Ocean
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H. Yang, tel 608 785-5462, fax 608 785-5460

Abstract One of today’s most frequently discussed topics in the business world is how to escape from the intense Red Ocean and how to create an uncontested Blue Ocean. However, because there are few practical guidelines available on this topic, we will introduce a case study of a third-party logistics (3PL) provider, CJ-Global Logistics Service (CJ-GLS), to show how it aspires to be a leader in the newly introduced 3PL industry in South Korea. CJ-GLS is a latecomer in the logistics industry, and its resources, such as the number of trucks and warehouses, are relatively small in comparison to those of established companies. But, it has achieved a distinct competitive advantage through innovative information technology (i.e., RFID— radio frequency identification), which has enabled it to create an uncontested market space, electronic logistics business. One remarkable fact about CJ-GLS is that its swift growth comes not from attracting competitors’ customers from the existing Red Ocean market but from creating a Blue Ocean market (3PL market), which previously existing incumbents ignored, and also from constructing a new business model founded on a RFID-based, ubiquitous-oriented 3PL system. Analyzed through a Four Actions Framework and characterized as Blue Ocean, this case study provides valuable information on how a company reinforces its

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