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Logistic management
 

Logistic management

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    Logistic management Logistic management Presentation Transcript

    • L o g i s t i c M n a g e me n t aAn S u ppl y Ch a i n I mpe r a t i v e By Rajeev Sharma Asstt. Prof. Center of Business Management Bimtech rajeev.sharma@bimtech.ac.in
    • LOGISTICS DefinedPln in im e e t ga dcntol t phys a fo o mtr la f he go a n g plmnin n o rling he icl lwf aeia nd inis d ods fo po to oig t po o uet me cso e`sneda aprf rm in f r in o int f s o et utmr e t oit B y “ ipKolr Phil te” I tisesnial aplnningprcs a a infr aio at it se t ly a oes nd n omt n civ ySo A inert eprcs t to im e t fo o mtr la s ppl st o g t tgaiv oes ha pt izs he lwf aeia nd u ie hru h he ogn aio a it o rt nst t cso e ra izt n nd s peaio o he utmr
    • The wor d l ogist ic has or iginat ed f r om Gr eek wor d ‘ Logist ikos’ and t he Lat in wor d ‘ Logist icus’ which m eans science of com ing & cal cul at ing put I n ancient t im it was used m e in connect ion es or wit h m oving ar m ies, t he suppl ies of f ood & ar m ent s t o t he war f r ont . am Dur ing Wor l d War I I l ogist ics gained im t ance por in ar m oper at ions cover ing t he m y ovem ent of suppl ies , m & equipm en ent acr oss t he bor der TodayI t has acquir ed t he wider m eaning and is used in t he business f or t he m ovem ent of m er ial f r om at suppl ier s t o t he manuf act ur er and f inal l y t he f inished goods t o t he consum s er
    • Scope of LogisticI t is of cr it ical im t ance t o t he or ganizat ion how it del iver s por pr oduct s & ser vices t o t he cust om , whet her t he pr oduct is er t angibl e or int angibl e. Ef f ect ive & ef f icient Physical m ovem ent of t he t angibl e pr oduct wil l speak of int angibl e ser vices associat ed wit h t he pr oduct and t he or ganizat ion which is del iver ing it .I n Case of int angibl e pr oduct , t he del iver y of t angibl es at t he r ight pl ace & r ight t im wil l speak about it s qual it y. e On t he m o l evel inf r ast r uct ur e such as Var ious m acr odes of t r anspor t , t r anspor t at ion equip. , st or age f acil it ies, connect ivit y & inf or m ion pr ocessing ar e cont r ibut ing t o a at l ar g3 e ext ent in t he physical m ovem ent of goods pr oduced in manuf act ur ing , m ining & agr icul t ur e Sect or s.
    • Scope of logisticsThis speed & r el iabil it y in dist r ibut ion of pr oduct s & ser vices cont r ibut e t o a gr eat ext ent in t he gr owt h of a count r y` s dom ic & int er nat ional t r ade . est Logist ic cost as a per cent age of GDP acr oss t he wor l d is shown in t he f ol l owing t abl eCount r y Logist ic cost as a per cent age of GDPKor ea 16China 15J apan 14I ndia 13Fr ance 12UK 11USA 10
    • Scope of logistics I ndia spent near l y $ 5 0 bil l ion t o move m er ial at f r om one use t o anot her . So t he “ Publ ic dist r ibut ion syst em in t he count r y needsl ogist ical suppor t f or del iver ing goods at r ight pl ace on t im and t he l owest cost . e At Micr o Level l ogist ic pl ays a cr it ical r ol e in t he val ue del iver y syst em of business or ganizat ion t o pr ovide super ior cust om ser vice i. e. t o achieve a desir ed l evel er of del iver ed ser vices and qual it y at t he l owest possibl e cost . I n a nut shel l any pr oduct ivit y im ovem pr ent t hat coul d be achieved in any par t of l ogist ic syst em at t he m o , icror m o l evel woul d hel p in cost r educt ion and pr oper acr depl oym ent of scar e nat ional r esour ces t o t he
    • Fact In a m anuf act ur ing or g. t he business pr ocess st ar t s wit h t he f l ow of m er ial f r om t he suppl ier s, pr ogr ess t o t he at pl ant , t hen t o t he cust om t hr ough t he dist r ibut ion er channel t he depar t m ent m excel in t heir r espect ive ay f unct ion but or g. as a whol e t heir per f or m ance m be ay dism . al Reason Lack of Co or dinat ion in t heir act ivit iesThey have dif f er ent goal t o cher ishTher e is no singl e agency t hat coor dinat es t heir f unct ionsand hom ogenizes t hem . How t o over com ?e Use of Logist ic as a syst em
    • Logistic –A system approach Logist ic r ecognizes t hat al l t he act ivit ies of m er ial at movem ent acr oss t he business pr ocess ar eint er dependent and needs cl ose coor dinat ion and t hesear e t o be m aint ained as a syst em and not t he f unct ional Sil os. Syst em is shown as l ogist ic Mix incl uding f ol l owing f unct ional Ar eas Or der Pr ocessing I nf or m ion Fl ow at War ehousing I nvent or y cont r ol Packaging
    • Order Processing I nvol ve f ol l owing act ivit iesOr der checking f or any deviat ion in agr eed on negot iat edt er mTechnical det ail s;pr ice;del iver y per iod;paym ent t er m axes s;tet cChecking t he avail abil it y of m er ial in st ock ( m er ial at atr equisit ion)Pr oduct ion & m er ial schedul ing f or shor t age atAcknowl edging t he or der , indicat ing deviat ion if any I t is r out ine oper at ion but r equir e gr eat deal of pl anning t r aining of peopl e invol ved and invest m ent t o br ing about ef f iciency & accur acyI n a l ar ge or ganizat ion a syst em capabl e of handl ing t housands of vol um inous or der s wit h m inim hum invol vem um an ent orwit hout hum invol vem an ent is a m invol ving shor t ened or der ust
    • Information Flow I t is basical l y inf or m ion based act ivit y of invent or y at m ovem ent acr oss t he suppl y chain. Hence r ol e of inf or m ion syst em pl ays a vit al r ol e in del iver ing super ior at cust om ser vice er This f unct ion is r equir ed t o f acil it at e t he f ol l owing inf or m ion needs atOr der Regist r at ionOr der checking & edit ingOr der pr ocessingCoor dinat ion m eans t o int egr at e t he t ot al suppl y chain oft he com pany wit h inf or m ional needs as t o t im , quant it y, at eval ue e. g Lead t im r at e of consum ion , del iver y schedul e e, pt& pr ice of t he m er ial , Tr anspor t at ion t im & cost et c. at e
    • WarehousingA st or age pl ace wher ein f inished goods ar e st or ed t il l t hey ar e sol d. Ef f ect iveness of an or ganizat ion` s m ket ing ar st r at egy depends on m aking t he r ight decision r egar ding war ehouse. Nowadays War ehouse ar e t r eat ed as swit ching f acil it ies r at her t han st or age pl ace. I t is a m or cost cent er , m aj any cust om pr obl em ar e t he dir ect r esul t of im oper er pr war ehousing m anagem . ent Maj or decision of war e house ar e as f ol l ows: -Locat ion , Size & Number of war ehousing f acil it iesWar ehouse l ayoutDesign of buil ding
    • Inventory management Point or der pr obl em That isHow m uch t o or der When t oor der For t his we r equir eDependabl e I MS I ndependent I MSPur chase Cont r ol St or es cont r ol I ssuemanagement ABC Anal ysis VED Anal ysis Level Management
    • Packaging I t is al so a cr it ical el em ent in physical dist r ibut ion of t he pr oduct , which inf l uences t he ef f iciency of t he l ogist ic syst em t his is done wit h t he view of f ol l owing : - Foe handl ing and dam age pr event ionFor com unicat ions mFor int er m odal t r anspor t at ionSt or age space econom y Thus t o r educe packaging cost
    • Transportation Foe t he m ovem ent of goods f r om suppl ier t o buyer , t r anspor t at ion is t he m f undam al and im t ant ost ent por com ponent of l ogist ic. E. g. f or l ow unit val ue pr oduct s t he t r anspor t at ion cost com ponent is 2 0 % of t he pr oduct cost . I n l ogist ic cost it s shar e var ies up t o 6 5 - 70 % in case of m consum ver y l ow unit pr ice pr oduct s. ass edMode of t r anspor t at ion ( Cost & t im f act or ) eOwn f l eet or Out sour cingRout e Pl anningVehicl e schedul ingAr e t he f ew decision which ar e invol ved in
    • Three ForcesWhich have change t he per spect ive of l ogist ics Gl obal izat ionFocus on Suppl y chain Management Out sour cing of Non Cor e Com ency Funct ional Ar ea pet
    • GlobalizationThe ent ir e wor l d has becom a gl obal vil l age e f or m ket er s because of t he l iber al izat ion ar of econom of m count r ies and t he ics ostem gence of WTO which is f or cing business eror ganizat ions t o suppl y pr oduct s beyond t he nat ional boundar ies wher ever t her e is a m ket oppor t unit y. ar I n such condit ions t he r ol e of LOGI STI CS Wil l be t o pr ovide t im and pl ace t im and e epl ace ut il it y of t he pr oduct t o t he cust omer
    • Focus on Supply Chain Management Business t he wor l d over ar e st r iving f or com it iveness. I n t heir st r uggl e f or sur vival t heir pet f ocus has shif t ed t o t he suppl y chain I . e.I nt egr at ing t he pr ocess of Pr ocur em ent , pr ocessing & dist r ibut ing t o del iver val ue f or m oney t o t he cust om er Two key r ol es l ogist ics pl anning & suppor t ar eVal ue del iver y pr ocess success of suppl ychain m anagem ent
    • Outsourcing of Non Core Competency functional Area Out sour cing is a accept abl e t r end in business. Cor por at ion have r eal ized t hat doing ever yt hing byt hem ves does not r esul t in ef f ect ive & ef f icient use sel of scar e r esour ces avail abl e t o t hem . I t is bet t er t o out sour ce f unct ional ar ea t o exper t s who can do j ob at t he l owest cost and t hat t o ef f icient l y & Ef f ect ivel y. LOGI STI CS I s one such ar ea wher e m of business or g. do not ost have enough exper t ise t hus needs t o be out sour ced Thus Logist ics have shaped int o dif f er ent ser vice indust r y of f er ing com et e & cust om pl ized l ogist ics
    • Value Chain I t is under st ood now t hat an or ganizat ion` s com it ive Success coul d onl y com t hr ough pet eeit her cost l eader ship or of f er ing dif f er ent iat ed pr oduct and ser vices LOGI STI C MANAGEMENT Can pr ovide bot h t he benef it s sim t aneousl y ul Thr ough it s val ue chain act ivit ies Which can be cat egor ized int o dif f er ent t ypes I nbound l ogist ics oper at ions Out bound l ogist icsSuppor t act ivat es e. g HR, Account s & f inace, I T &
    • Infrastructure O A&F p e r operations a t S&M Services Customer Value i Out bondIn bound o Logisticslogistics n s Technology M&M HR
    • Supply Chain Stores Operations Stores Procurement Warehouse Vendor CustomerInbound Logis tics Out Bound Logis tics
    • Supply Chain Mater ial f l ow Material f l ow OPERATIONS Stor es P D Stores RM r is o FG tr c u i r bPur chas e e Inf ormation f l ow u Warehous ing m ti e o n Vendor t n Cus tomerInbound Logis tics Out bound l ogis tics
    • Logistics for Business Excellence For Business Excel l ence l ogist ics oper at ion need t o be int egr at ed on t he f ol l owing t wo f r ont s int egr at ion of l ogist ic int o businessI nt egr at ion of com ponent s of l ogist icsTo achieve t he obj ect ive of m aking avail abl e r ightpr oduct at t he r ight pl ace and at a r ight t im at l ow ecost , ever y business is r equir ed t o int egr at el ogist ics int o t he business pr ocess.For l ogist ic oper at ion t o r un sm hl y, pr oper ootint egr at ion am ongst t he com ponent of l ogist icpr ocess is a m . ust
    • Logistic HR A/Cs Finance Utilities Marketing PPC QC Mat. Mng. IT Others Organizational Functions In process Log. Suppliers Procurement Processing Distribution Customer In Bound Log. Out Bound Logistic Logistic System Component Transportation Material Handling & Storage Logistical Packaging Warehousing InformationInventory Mang. LOGISTIC FUNCTIONOrder Processing
    • Objectives of Logistic management   I nvent or y Reduct ion Rel iabl e and consist ent del iver y per f or mance Fr eight econom y Minim um pr oduct dam age  quick Response
    • NOTE: Am ongst m of t he I ndian com ost panies l ogist ics out sour cing Has now becom an accept ed t r end f or t he e f ol l owing r easons: Cost Saving Focus on cor e Business Paucit y of f unds Reduct ion in l iabil it ies Wider Geogr aphical cover ageCr oss pol l inat ion of bet t er avail abl e pr act ice
    • W arehousing N owadays warehousing is used as aswitching facility rather than as a long term storage house. A ttention is paid to 1 2 3 H igher lower shorter inventory turnover operating cost cycle time A nd in light of these warehouse`s performance is judged by its productivity 1 and cost performance while 2 trying to achieve 2 polemic goals.
    • We have t o decide on 2 f act or s Whet her t o haveCent r al izeddecent r al ized war ehouse war ehouseI t ensur es t ight cont r ol m t ipl e uldist r ibut ion On invent or ies and can cent er s Oper at e on EOS l ocat ion of sit es
    • Obj ect ive Main bet t er cust om ser vice er l ow oper at ingcost Ancil l ar y obj ect iveM x i mu m u t i l i z a t i o n o f s t o r a g e s pa c e a Hi g h e r l a b o u r pr o d u c t i v i t y M x i mu m As s e t u t i l i z a t i o n a Re d u c t i o n i n ma t e r i a l h a n d l i n g I nc r e as e i n i nv e nt or y t ur nov e r Re d u c e o r d e r f i l i n g t i me
    • War ehousing Funct ion 3 Funct ions Mat er ial St or age Funct ion Mat er ial Handl ing Funct ionI nf or m ion Handl ing Funct ion at
    • Mat er ial St or age f unct ionDue t o non synchr onizat ion of Manuf act ur ing cycl ewit h t hat of t he consum ion cycl e of t he m er ial , pt at st or age of t he m er ial r em at ains a big hur dl eSo m er ial st or age is r equir ed t o accom odat e t he at m f ol l owing f unct ions: Hol ding Consol idat ion Post ponem ent Br eak Bul k packing Cr oss Docking Mixing
    • Mat er ial Handl ing f unct ionThis invol ves t hr ee f unct ion 6. Loading & unl oading 8. Mat er ial Movement 10. Or der f il ing
    • I nf or m ion handl ing f unct ion at For t his f ol l owing inf or m ion is r equir ed at Goods inwar d I nspect ion & audit ing Goods out war d Excess St ock I nvoicing War ehouse expenses Tr ansit dam age & Br eakage Consignm ent t r ackingThis al l inf or m ion f acil it at e quick decision at