The effect of adopting collaborative transportation management by Taiwanese computer manufacturers - Model building and empirical studies

Dun Ji Chen*, Hen Chin Chen, Su Hauan Lai

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


Collaborative transportation management (CTM) enhances the value of the supply chain mainly through the cooperation between the shipper and the carrier. For the computer industry, the mechanism of CTM may reduce the transportation cost and the inventory cost. This paper developed the cost function of domestic computer industry based on the cost data from the thirteen listed companies during the period from 1999 to 2005 in Taiwan. The results of the empirical study showed that there is a substitution relationship between the transportation element and the inventory element in the whole computer industry. Additionally, the cross elasticity of the OBMs is higher than the one of the OEMs/ODMs. This means that the OBMs can significantly reduce the inventory cost by the efficient transportation. In the analysis of economic characteristics, the whole computer industry exhibits increasing returns to scale. Three OBMs, Asus, Acer, and Lemel, and three OEMs/ODMs, Wistron, Iventec, and Quanta, approximately possess constant returns to scale. That is to say, they almost achieve the optimal scale. Since internal costs will increase or reduce after introducing CTM, this research estimated the cost differences between computer companies with and without CTM base on the data in 2006.Then, we analyzed the changes in the cost differences under three different scenarios which are set by the accuracy of CTM and the degree of information sharing in the supply chain. The results indicated that computer industry saves the total cost ranging from 1.5% to 6.1% after implementing effectively.

Original languageEnglish
Pages (from-to)481-499
Number of pages19
JournalInternational Journal of Information and Management Sciences
Issue number4
Publication statusPublished - 2010 Dec
Externally publishedYes


  • Collaborative transportation management
  • Computer industry
  • Cost difference
  • Cost function

ASJC Scopus subject areas

  • Control and Systems Engineering
  • Management Information Systems
  • Strategy and Management
  • Industrial and Manufacturing Engineering
  • Information Systems and Management


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