Both aforementioned strategies can be adopted separately or
jointly. One thing to be mentioned here is that, even
‘hedging’ strategies mitigate uncertainties and are favourable
for the execution department. However, it impacts the benefit
of another department. For example, production lead-time
hedging strategy is favourable for the buyer but add more
pressure to the prefab factory, for it has to overwork within a
shortened time period. In addition, space hedging is preferred
for the prefab factory who is regarded to shoulder shipping
service by itself but actually outsources to a 3PL, however, it
impacts the benefits of a 3PL. Even a traditional 3PL is
supposed to provide temporary storage service, holding more
in its warehouse leads to low efficiency of warehouse
management and congestion. Also, the empty space could be
leased out for others with a higher market price. In this way,
the conflicts always exist between two departments in the
hedging strategy.ogistics
uncertainty is not wisdom.