 Osman   …
IMPLEMENTING THE STRATEGY
   Aims of the chapter   Relating strategy to lower decisions   Areas for decisions in implementation   Managing chang...
AIMS OF THE CHAPTERAfter listening us you should be able to:■ SEE how a logistics strategy fits into an  organisation’s br...
STRATEGY IMPLEMENTATIONIs the process that turnsstrategies and plans intoaction in order to achievestrategic objectives an...
RELATING STRATEGY TO LOWERDECISIONS
Strategies only become effective whenthey are implemented. This means that thelong term aims are translated into lowerdeci...
   Strategic are concerned with more detailed    tactical and operational decisions. The    distinction between strategic...
When we talk aboutimplementing a logisticstrategy we mean making thelower decision, andtranslating the general aimsof the ...
Difficulties with implementation   It can be difficult to translate a logistic    strategy into lower decision. This is o...
There are two options at this point;   First; managers can say that the strategy has    been carefully designed, and ever...
Some common problem with implementinglogistic strategy   Strategies are badly designed,perhaps with    the wrong aims or ...
How we do solve these problem?   An organisational structure that is flexible    and allows innovation   Developing an o...
BEST SOLUTIONHaving the right skill in the rightplace at the right time.
AREAS FOR DECISIONS INIMPLEMENTATION- Types of decision- Structure of the supply chain- Location of facilities- Ownership ...
Types of DecisionImplementation is convenient to describe  two types of strategic decision:1- Sets out the principles we w...
- These decisions have “Long Term”  consequences.- The first decision type is concerned with  “aims and designs”- The seco...
Levels of decision in logistics
Traditional ViewsBallou says that;When moving to the implementation of a strategy,  we need to concentrate on four areas:-...
Helming and Zonnenberg suggest decisions in five areas:- Supply Chain Configuration- Enabling Practices- Strategic Relatio...
“ Companies hurl staggering sums of money and  human resource at their supply chain  infrastructure, only to fail at imple...
A BROADER VIEW  A broader view of implementation says that;we should consider decisions in every function oflogistics from...
Structure of The Supply ChainThe supply chain for a product consists of tiers of suppliers feeding materials from original...
Structure of a supply chain
Some supply chains have few tiers ofcustomers and suppliers,while others havemany; some chains have very simple flows ofma...
Building Sand & Dvd Player
-Product value-Bulk-Perishability-Availability so on….
-has low value-bulky-readily available
Some factors that affect the structureof supply chain:- Type of customer demand- Economic climate- Availability of logisti...
Supply chain length;   is the number of tiers or intermediaries, thatmaterials flow through between source anddestination....
Supply chain breadth;   is the number of parallel routes that materials can flow through.     Example: Thornton’s has a na...
Different shapes of supply chain
The best choice of length and breadthdepends on;-   The amount of control that an organization    wants over its logistics...
Broadening the chain gives high customer service, but it increases costs and reduces the manufacturer’s control.Making the...
We can illustrate some of the options fora supply chain with a basic product,such as shoes.
LOCATION OF FACILITIES
Best location for facilities;  For example Warehouse;-areas with development grants-factories-customers-transport
Location effect on logisticsperformance ;   Fast delivery →→use local warehouses   Low cost →→stocks in large,centralise...
Qestions of location?   It should be tackled very carefully,as they    have a considerable impact over the long    term....
Location is not an isolateddecision.WHY? It leads to a series of related decisions about  the work done in each location,...
Ownership and Outsourcing  One organisation does not have to own asupply chain to get the benefits of integration.Supplier...
Supplier–customer partnerships→→ easiest to imagine and they have mosteffect on the supply chain.   A similar arrangement ...
A common form of partnership for logisticshas a specialised company looking after allof an organisation’s transport.  This...
Why stop at transport   An organisation can form partnerships with    other companies to look after warehousing,    purch...
A fuller list of potential benefits includes:   Lower fixed costs, with customers only paying for services    they use  ...
Rowley summarises the benefits by saying   ‘The results of successful outsourcing are    service improvement, cost reduct...
There are disadvantages:   Reduced control   Inability to respond to unusual circumstances   More complicated communica...
European contract logistics   Huge business in Europe   Total cost of logistics was $ 150 billion in 1999    (26%→third ...
Enabling Practices       Enabling practices are the activities    associated with the supply chain that allow it    to wor...
Organisation has designed the structure of    its supply chain, and found the best locations    for facilities   For exam...
The idea of the enabling practices as  supporters of logistics can be important If we look at ; series of organisations i...
Capacity    The capacity of a supply chain is the largest amount of materials that can flow through it in a given time.(lo...
   Bottleneck → not all parts of a chain have the    same capacity, so the overall capacity is set by    the part with th...
   The only way of increasing the capacity of the    supply chain is to increase the capacity of the    bottleneck; addin...
The solution:   To get a smooth flow of materials through the supply chain, we have to make sure that each part has an app...
Ralston Energy Systems(RES) affiliate of Eveready Battery Company (EBC) manufacturing plants in America, Europe and Asia...
Summary of logistics at RalstonEnergy Systems s.r.o.
This structure had a number of weaknesses:   The sales warehouse was leased from a    competitor of RES.It was not approp...
Their solution was to outsource logisticsto a third party.   RES effectively closed its sales warehouse,    and moved the...
The new service brought the followingbenefits:   Flexible warehousing space   Variable warehousing costs   Variable dis...
MANAGING CHANGE               You’ll never              get me up on              one of those                butterfly   ...
   Without accepting the fact that evrything    changes,we can not find perfect    compusure.But unfortunately, altough i...
CHANGE ISINEVITABLE(kaçınılmaz)
CHANGE;   Everywhere, it is constantly changing.   To survive organizations need to decide,not    whether to change,but ...
   As the strategy    evolves, the operations    of the whole logistics    function must adjust    and move forward. New ...
 To manage change, manage yourself first, influence others later.
What We Know About Change   Change will not stop-        Complex change is    it will only go faster        typically ac...
People Respond to Change….   At different rates   At multiple levels:    personally,    professionally,    socially and ...
   Many organisations prefer to stick to their    old practices. Unfortunately, this allows    more flexible competitors ...
Some signs that an organisation is notchanging to meet new circumstancesinclude:   low sales and falling market share, as...
Change Can Be Perceived As Positive or Negative   Change is a normal part of    business and if we do not    respond we w...
Organisations typically move througha series of stages:   1. Denial – where employees deny that there is    a need for ch...
RATE OF CHANGE   Rate of change is important .because some    organizations change very quickly , such as    Intel which ...
Say It Once, Say It Twice, and Say It Again
THE ANSWER..
SUMMARYHasan Celal KÖK   The logistics strategy sets the overall direction    for logistics. Implementing the strategy tr...
    Some strategic decisions are concerned with    principles, the first of these are considered    more in the design of...
CASE STUDYPASSENGER INTERCHANGE    Congestion is increase on the roads,    especially in major cities. Some of this is du...
What is these?
Public transport•Theseservices must be attractive for peoplebecause, amount of crowding will decrease, itmore safely than ...
Buses are the most flexible from of publictransport so many people use the bus for go toanother city
But there are some difficulties itemswith the time for a journey these are:   Joining time   Waiting time   Journey tim...
In practise, most major cities such as London,Paris have sucessful interchanges, and they arespreading into smaller towns.
As a result there has been an increase in theuse of public transport a reduction in the numberof cars in the town centre a...
QUESTIONS OF CASE STUDY   What are the benefits of integrated    public transport systems?   Are the problems of moving ...
Implementig                the strategy
Implementig                the strategy
Upcoming SlideShare
Loading in …5
×

Implementig the strategy

626 views

Published on

Published in: Business, Technology
0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
626
On SlideShare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
25
Comments
0
Likes
1
Embeds 0
No embeds

No notes for slide

Implementig the strategy

  1. 1.  Osman …
  2. 2. IMPLEMENTING THE STRATEGY
  3. 3.  Aims of the chapter Relating strategy to lower decisions Areas for decisions in implementation Managing change Case study-Passenger interchange.
  4. 4. AIMS OF THE CHAPTERAfter listening us you should be able to:■ SEE how a logistics strategy fits into an organisation’s broader decisions■ OUTLINE the strategic importance of logistics■ DEFINE a logistics strategy and DISCUSS its focus■ DISCUSS alternative logistics strategies■ APPROACH the design of a logistics strategy
  5. 5. STRATEGY IMPLEMENTATIONIs the process that turnsstrategies and plans intoaction in order to achievestrategic objectives and goals
  6. 6. RELATING STRATEGY TO LOWERDECISIONS
  7. 7. Strategies only become effective whenthey are implemented. This means that thelong term aims are translated into lowerdecision ,and the work is carried out toachieve them.
  8. 8.  Strategic are concerned with more detailed tactical and operational decisions. The distinction between strategic ,tactical and operational decision are not really this clear.
  9. 9. When we talk aboutimplementing a logisticstrategy we mean making thelower decision, andtranslating the general aimsof the strategy positiveaction. We actually do whatis necessary to achieve theaims of the strategy.
  10. 10. Difficulties with implementation It can be difficult to translate a logistic strategy into lower decision. This is obviously true when the strategy is poorly designed, and lower managers have to translate vague concepts like ‘‘global leadership’’ into actual operations.
  11. 11. There are two options at this point; First; managers can say that the strategy has been carefully designed, and everyone must work harder or find new, innovative ways of achieving the target. Second; managers can say that the practical difficulties are too great, and that there was a mistake in setting unrealistic target.
  12. 12. Some common problem with implementinglogistic strategy Strategies are badly designed,perhaps with the wrong aims or focus They ignore key factors, or emphasise the wrong feature. People who design the strategies are not responsible for their implementation İt is imposible, or very difficult to implement them properly
  13. 13. How we do solve these problem? An organisational structure that is flexible and allows innovation Developing an organisational culture that supports the strategy Open communication which encourage the free exchange of ideas Effective systems to distribute information and support management decision.
  14. 14. BEST SOLUTIONHaving the right skill in the rightplace at the right time.
  15. 15. AREAS FOR DECISIONS INIMPLEMENTATION- Types of decision- Structure of the supply chain- Location of facilities- Ownership and outsourcing- Enabling practices- Capacity
  16. 16. Types of DecisionImplementation is convenient to describe two types of strategic decision:1- Sets out the principles we work with2- Shows how the organisation will achieve these principles
  17. 17. - These decisions have “Long Term” consequences.- The first decision type is concerned with “aims and designs”- The second decision type is concerned with “practicalities and implementation”
  18. 18. Levels of decision in logistics
  19. 19. Traditional ViewsBallou says that;When moving to the implementation of a strategy, we need to concentrate on four areas:- Customer Service- Facility Location- Inventory Policy- Trasnsport
  20. 20. Helming and Zonnenberg suggest decisions in five areas:- Supply Chain Configuration- Enabling Practices- Strategic Relationships- Application of Information Technology-Organisation
  21. 21. “ Companies hurl staggering sums of money and human resource at their supply chain infrastructure, only to fail at implementing their supply chain strategy.”
  22. 22. A BROADER VIEW A broader view of implementation says that;we should consider decisions in every function oflogistics from procurement through to finaldelivery.
  23. 23. Structure of The Supply ChainThe supply chain for a product consists of tiers of suppliers feeding materials from original sources into its operations, and then tiers of customers moving materials out to the final customers.
  24. 24. Structure of a supply chain
  25. 25. Some supply chains have few tiers ofcustomers and suppliers,while others havemany; some chains have very simple flows ofmaterials, while others have complex andconvoluted networks.
  26. 26. Building Sand & Dvd Player
  27. 27. -Product value-Bulk-Perishability-Availability so on….
  28. 28. -has low value-bulky-readily available
  29. 29. Some factors that affect the structureof supply chain:- Type of customer demand- Economic climate- Availability of logistics services- Culture- Rate of innovation- Competition- Market and financial arrangements
  30. 30. Supply chain length; is the number of tiers or intermediaries, thatmaterials flow through between source anddestination. Example: Exportes might use a series oflogistics centres, transport operators, agents,freight forwarders, brokers and agents to movematerials through different parts of theirjourney.
  31. 31. Supply chain breadth; is the number of parallel routes that materials can flow through. Example: Thornton’s has a narrower chain, and most of their chocolate sells through their own shops; Pigalle rt Fils has a very narrow chain and they only sell their chocolate in two shops in Belgium.
  32. 32. Different shapes of supply chain
  33. 33. The best choice of length and breadthdepends on;- The amount of control that an organization wants over its logistics- The quality of the service- The cost
  34. 34. Broadening the chain gives high customer service, but it increases costs and reduces the manufacturer’s control.Making the supply chain long and narrow can use intermediaries to reduce costs, but the manufacturer loses some control and the customer service does not improve.
  35. 35. We can illustrate some of the options fora supply chain with a basic product,such as shoes.
  36. 36. LOCATION OF FACILITIES
  37. 37. Best location for facilities; For example Warehouse;-areas with development grants-factories-customers-transport
  38. 38. Location effect on logisticsperformance ; Fast delivery →→use local warehouses Low cost →→stocks in large,centralised warehouses Import and export →→warehouses near to ports or rail terminals Manufactures goods →→stock of finished products near the factory
  39. 39. Qestions of location? It should be tackled very carefully,as they have a considerable impact over the long term. Once a facility is open it is difficult to close it down or move it.
  40. 40. Location is not an isolateddecision.WHY? It leads to a series of related decisions about the work done in each location, For example; - size of each facility - level of technology used - layout of resources - customers to serve from each location…
  41. 41. Ownership and Outsourcing One organisation does not have to own asupply chain to get the benefits of integration.Suppliers and customers can get mutual benefitsby working together, typically in a strategicalliance.
  42. 42. Supplier–customer partnerships→→ easiest to imagine and they have mosteffect on the supply chain. A similar arrangement can cover a wholerange of services,such as: -electricity supply,banking service and officecleaning
  43. 43. A common form of partnership for logisticshas a specialised company looking after allof an organisation’s transport. This arrangement has the advantages of anefficient and experienced specialist to lookafter the transport, while the organisation canconcentrate on its core operations.
  44. 44. Why stop at transport An organisation can form partnerships with other companies to look after warehousing, purchase of materials, materials handling, and many of the other functions of logistics. When one company uses other companies to run its logistics, it is called third party or contract logistics. The use of third party logistics is a special type of ‘make-or-buy’ decision
  45. 45. A fuller list of potential benefits includes: Lower fixed costs, with customers only paying for services they use Specialist suppliers who have expertise and use the best systems and practices Suppliers can combine work from several customers to get economies of scale Guaranteed high, and agreed, levels of customer service Flexible capacity, dealing effectively with peaks and troughs in demand Lower exposure to risk from, say, varying demand Increased geographical coverage and local knowledge A convenient way of entering new markets
  46. 46. Rowley summarises the benefits by saying ‘The results of successful outsourcing are service improvement, cost reduction and quality enhancement’
  47. 47. There are disadvantages: Reduced control Inability to respond to unusual circumstances More complicated communications Conflicting objectives, Less control over costs…
  48. 48. European contract logistics Huge business in Europe Total cost of logistics was $ 150 billion in 1999 (26%→third party suppliers) 4 years later it’s increase 30% higher Germany (28%)- France(20%)- UK(17%) Because each of the economies has developed differently, and different logistics requirements, the use of third parties varies quite widely. Germany, France and the UK each spend about $10 billion a year on third party logistics(grow at 8%) But growth will be faster in Italy and Spain but low levels of outsourcing.
  49. 49. Enabling Practices Enabling practices are the activities associated with the supply chain that allow it to work efficiently For example; reliable information processing is an enabling practice that allows logistics to function properly
  50. 50. Organisation has designed the structure of its supply chain, and found the best locations for facilities For example; use just-in-time methods to reduce stocks, EDI (Electronic Data Interchange) to link with partners, or procurement via websites
  51. 51. The idea of the enabling practices as supporters of logistics can be important If we look at ; series of organisations in the same business → envolved in similar ways (whisky distillers or detergent manufacturers)
  52. 52. Capacity The capacity of a supply chain is the largest amount of materials that can flow through it in a given time.(lorry→25 tonnes, airline→450 passengers etc.)
  53. 53.  Bottleneck → not all parts of a chain have the same capacity, so the overall capacity is set by the part with the smallest individual capacity If wholesaling forms the bottleneck with a capacity of 200 units of a product an hour, this sets the capacity of the whole supply chain – even if other parts have a much higher capacity
  54. 54.  The only way of increasing the capacity of the supply chain is to increase the capacity of the bottleneck; adding more resources elsewhere has no effect, it only increases the amount of spare facilities and reduces the utilisation.
  55. 55. The solution: To get a smooth flow of materials through the supply chain, we have to make sure that each part has an appropriate capacity. This means that the overall capacity matches total demand, and the capacity of each part is matched, so that there are no restrictive bottlenecks
  56. 56. Ralston Energy Systems(RES) affiliate of Eveready Battery Company (EBC) manufacturing plants in America, Europe and Asia leading brand range of batteries and torches Until 1998 RES ran two warehouses within the Czech Republic-The first was a bonded warehouse used to store imported materials-second warehouse was a ‘sales warehouse’ run by RES on its main site Two other trucking companies were involved in export and import operations.The sales warehouse was about three times the size of the bonded warehouse
  57. 57. Summary of logistics at RalstonEnergy Systems s.r.o.
  58. 58. This structure had a number of weaknesses: The sales warehouse was leased from a competitor of RES.It was not appropriate to store finished goods in a competitor’s facilities. The sales warehouse had become too small The sales warehouse had poor arrangements for loading and unloading trucks All goods imported into the Czech republic were sent to the bonded warehouse, moved by weekly Local distributors charged high rates for each truck load delivered.
  59. 59. Their solution was to outsource logisticsto a third party. RES effectively closed its sales warehouse, and moved these activities to the new operator.
  60. 60. The new service brought the followingbenefits: Flexible warehousing space Variable warehousing costs Variable distribution costs Increased service quality Associated services from the operator Saving overhead costs of management in the warehouse Extending opening times from 0700 to 1900 Removing the conflict of interest with a competitor- owned warehouse Managing remote stock in Slovenia from the same facilities
  61. 61. MANAGING CHANGE You’ll never get me up on one of those butterfly things!
  62. 62.  Without accepting the fact that evrything changes,we can not find perfect compusure.But unfortunately, altough it is true,it is diffucult for us to accept it.Because we cannot accept the truth of transience we suffer.(Shunryu Suzuki)
  63. 63. CHANGE ISINEVITABLE(kaçınılmaz)
  64. 64. CHANGE; Everywhere, it is constantly changing. To survive organizations need to decide,not whether to change,but when and how to make it occurs most succesfully. Change management tools are poorly understood and/or hard to implement To manage change, manage yourself first, influence others later
  65. 65.  As the strategy evolves, the operations of the whole logistics function must adjust and move forward. New practices affect everyone. Unfortunately, this presents a problem, as most of us do not really like changes.
  66. 66.  To manage change, manage yourself first, influence others later.
  67. 67. What We Know About Change Change will not stop-  Complex change is it will only go faster typically accepted if No matter how well enough time is planned, it will not be allowed trouble free  Rapid change can Each of us is occur if it’s a small accountable to adjustment making change  Most people initially acceptable resist rapid, complex change
  68. 68. People Respond to Change…. At different rates At multiple levels: personally, professionally, socially and organizationally By seeing it as opportunity or danger Successfully, by being resilient
  69. 69.  Many organisations prefer to stick to their old practices. Unfortunately, this allows more flexible competitors to gain an advantage, and their performance inevitably declines.
  70. 70. Some signs that an organisation is notchanging to meet new circumstancesinclude: low sales and falling market share, as old products are overtaken by competitors old-fashioned attitudes and operations poor communications within the organisation and with trading partners too much inflexible top management with no new appointments
  71. 71. Change Can Be Perceived As Positive or Negative Change is a normal part of business and if we do not respond we will fall behind competitors. To be more positive, we should welcome change as it creates opportunities, improves work conditions, gives better practices and performance, and more interesting, better-paid and more secure jobs. This new attitude does not happen by chance, but it needs careful management
  72. 72. Organisations typically move througha series of stages: 1. Denial – where employees deny that there is a need for change 2. Defence – defending the current way of doing things and criticising new proposals 3. Discarding – beginning to move away from the old ways and towards the new ones 4. Adoption – using the new ways and accepting that they are beneficial 5. Integration – assuming the new ways are normal and using them naturally.
  73. 73. RATE OF CHANGE Rate of change is important .because some organizations change very quickly , such as Intel which works at the frontiers of technology and is continually developing new products. Others change very slowly, and even make a virtue out of stability, such as Morgan sports cars whose basic design originated in the 1930s.
  74. 74. Say It Once, Say It Twice, and Say It Again
  75. 75. THE ANSWER..
  76. 76. SUMMARYHasan Celal KÖK The logistics strategy sets the overall direction for logistics. Implementing the strategy translates this into a series of lower decisions and actions. Unless the strategy is designed properly, implementation can be difficult or impossible.To avoid these problems, managers should consider implementation during the design of the strategy
  77. 77.  Some strategic decisions are concerned with principles, the first of these are considered more in the design of a strategy, second are considered more in the implementation. The supply chain must continually evolve to keep up with changing conditions. An important question concerns the rate of change.Business process re-engineering looks for more radical changes.
  78. 78. CASE STUDYPASSENGER INTERCHANGE Congestion is increase on the roads, especially in major cities. Some of this is due to commerical vehicles, but by far the majority is due to private cars.
  79. 79. What is these?
  80. 80. Public transport•Theseservices must be attractive for peoplebecause, amount of crowding will decrease, itmore safely than private cars.
  81. 81. Buses are the most flexible from of publictransport so many people use the bus for go toanother city
  82. 82. But there are some difficulties itemswith the time for a journey these are: Joining time Waiting time Journey time Leaving time
  83. 83. In practise, most major cities such as London,Paris have sucessful interchanges, and they arespreading into smaller towns.
  84. 84. As a result there has been an increase in theuse of public transport a reduction in the numberof cars in the town centre and improved airquality.
  85. 85. QUESTIONS OF CASE STUDY What are the benefits of integrated public transport systems? Are the problems of moving people significantly different from the problems of moving goods or services? What are the benefits of public transport over private transport? Should public transport be encouraged and, if so, how?

×