TYBMS LOGISTICS AND SUPPLY CHAIN MANAGEMENT

1. Module 1 – Chapter 1
Introduction to Logistics
Management

2. LOGISTICS MANAGEMENT
 Logistics management is the part of supply chain management that
plans, implements, and controls the efficient, effective flow and storage
of goods, services, and related information between the point of origin
and the point of consumption.
 An art and science of obtaining, producing, and distributing materials
and products in right place and in right quantity.
 Management stands for managing movement of materials as desired by
customer.
LOGISTICS
Process of planning, implementing and controlling the flow of goods and
services from place of production to the place of consumption for
confirming to customer satisfaction

3. IMPORTANCE OF
LOGISTICS
COMPETITIVE
EDGE
LOGISTICAL
COSTS
INTEGRATED
LOGISTICAL
ACTIVITY
CUSTOMER
SATISFACTION
TRADE &
BUSINESS
OPERATIONS
& MARKETING
Physical movement of goods and
services.
Right quality goods, at right time, at right place, in
right quantity and right condition.
Brings together all
functions/departments under one
umbrella thus overcoming inter-
departmental barriers and achieving
organizational objectives and reducing
costs. For example; production and
purchase department.
Product- depending on the size and
shape decide the transportation,
warehousing etc.
Price- reduce logistical cost to provide
the product at lower price to customer.
Place- Wholesalers (large quantity, less
frequent) Retailers (small quantity,
more frequent).
Promotion- sufficient inventory to
match the boost in sales due to
promotion.
Through customer satisfaction.
For individual businesses logistic
expenditure is 5% to 35% of sales.
Improvement in logistical functions
reduces the logistical cost and also leads
to customer satisfaction.

4. OBJECTIVES OF
LOGISTICS
QUALITY
LIFE CYCLE
SUPPORT
RAPID
RESPONSE
MINIMUM
VARIANCE
MINIMUM
INVENTORY
MOVEMENT
CONSOLIDATION
Satisfy customer requirements/orders
in timely manner.
Eg; Ola/Uber
Difference between Actual Logistical Performance and
Perceived Logistical Performance.
Eg; Pizza Hut, Dominos, McDonalds
Inventory cost includes –
transportation, material handling,
warehousing etc.
Keep inventory minimum
Eg; Nike
Concerned with transportation cost
Grouping up of small shipments into
a single large shipment.
Focus on continuous improvement (aka Kaizen).
Eg; TOYOTA – The Toyota Way
After Sales Service – guarantee,
warrantee etc.
Eg; Croma
Reverse Logistics – goods move from
point of consumption to the point of
origin
Expired product, for exchange/repairs,
rigid quality standard, transit damage etc.

5. RETURN OF UNSOLD
GOODS
• Newspapers
• Magazines
REFILLING /
REUSABLE
PACKAGING
• Soft drink bottles
• Gas cylinders
PRODUCTRECALL
• Defects in the
product (Eg;
faulty airbags)
• Expired products
(Eg; dairy
products)
REPAIRS AND
REFURBISHING
• Refurbishing for
products
returned within
warranty period
due to poor
performance,
damage or
defects.
RECYCLING
• Soft drink bottles
• Cans
SCIENTIFIC
DISPOSALOF
WASTE PRODUCTS
• Electronic goods
like laptops
SCOPE OF REVERSE LOGISTICS

6. LOGISTICAL
MISSION
SUPERIORCUSTOMER
SERVICE
Availability – necessary
level of inventory to meet
requirements
Operational Performance
– time gap between order
receipt and order delivery
Service Reliability – sense
of satisfaction when
requirements are fulfilled on
time
MINIMIZE TOTAL LOGISTICAL
COST
Transportation cost
Warehousing cost
Packaging cost
If company tries to provide superior
customer service, the logistical cost
will increase and if the company
attempts to reduce overall logistical
cost then the customer service is not
satisfactory.
Very important to
maintain a balance
between the two

7. FUNCTIONSOF
LOGISTICS/
LOGISTICSMIX
ORDER
PROCESSING
INVENTORY
MANAGEMENT
TRANSPORTATION
WAREHOUSING
MATERIAL
HANDLING
PACKAGING
INFORMATION
MANAGEMENT
CUSTOMER
SERVICE
Right product reaches the right
customer at the right place and time
in right quantity and condition at
right price (7 R’s).
Customer places order with the supplier.
Order processing time can be reduced with the help of
computers. Maintaining required level of stocks to meet
customer requirements simultaneously ensuring
minimum inventory carrying cost.
Goods are stored until they are sold
Private/Public/Contract Warehouse
Should be near to the market.
Physical movement of goods
3 ways: Private carriage, Contract
carriage, Common carriage.
Determinants:
Cost – cost involved in the
movement.
Speed – speed with which it
reaches the destination.
Consistency – achieving same
speed over period of time.
Packaging influences efficiency and
effectiveness.
Consumer packaging: convenience,
market appeal and protection.
Industrial packaging: focus on
handling, protection and communication.
Involves – movement, protection, storage and control of materials
Around 15%-20% of cost of product is spent on material handling.
Demand forecasting and
order processing are
dependent on information.
Needed for better tactical
and strategic decision.

8. Information from customer flows in form of sales activity, forecasts and orders.
Information is translated into manufacturing and purchasing plans
Raw Material converted into finished products
INTEGRATED LOGISTICS
Supplier
Inventory Flow
Procurement Manufacturing support Physical distribution
Information Flow
Customer
Planning and co-ordination flows
Planned activities
Operations flow
Day-to-day activities

9. GL describes all attempts to measure and minimize the ecological impact of logical activities
Strike a balance between economic and environmental efficiency
Procedures and steps instituted by a logistics company to minimize its waste and other negative effects on the environment
NETWORK
OPTIMIZATION
Optimum
transport
network by
aggregating
entire loads
Full capacity
utilization of
vehicles
ALTERNATIVE MODE
OF
TRANSPORTATION
Adopt
intermodal
transport – rail
emissions are 5
times lesser than
road. Use road
only for last
mile delivery.
Eg; FedEx
hybrid delivery
trucks
ALTERNATIVE FUEL
CNG, battery
operated
vehicles,
electronically
powered
vehicles
BUILDING BYPASS
ROADS
Creating bypass
roads to speed
up traffic.
Reduce
emission due to
optimal speed
PAPER USAGE
REDUCTION
E-retailers do
not provide
receipt to
enhance green
image
NEW FLEET
INDUCTION
Replace older
vehicles with
new vehicles
low on emission
and fuel
efficient
WASTE RECYCLING
& SCIENTIFIC
DISPOSAL
For eg; Kodak
recyclable
cameras
HOW TO ACHIEVE GREEN LOGISTICS

10. NETWORKDESIGN
Analysis of various
facilities
Which facilities are
needed
How many of each
type of facility
Geographic location
Work to be
performed
INFORMATION
SYSTEM
Demand forecasting
and order
processing
TRANSPORTATION
**Refer slide #7
INVENTORY
MANAGEMENT
Maintaining the
required level of
inventory
Decision needs to
be taken regarding:
Safety stock
Lead time
Replenishment of
stock
WAREHOUSING
Storage place where
goods are stocked
till they are sold
MATERIALS
HANDLING
Right quantity of
right material, in
right condition, at
right place, at right
time
PACKAGING
**Refer slide #7
7 PARAMETERS OF ACHIEVING LOGISTICAL COMPETENCY/COMPETITIVE ADVANTAGE

11. INBOUND LOGISTICS OUTBOUND LOGISTICS
1. Upstream Logistics Downstream Logistics
2. Procurement Production Cycle Distribution Performance Cycle
3. Pre production logistics activities Post production logistics activities
4. Raw materials from supplier to company Finished goods from warehouse to customer
5. Activities involved – order placement, sourcing,
transportation, receiving, storage and issue
Activities involved – customer order, order transmission,
order processing, order transportation and customer
delivery
INBOUND LOGISTICS V/S OUTBOUND LOGISTICS

12. QUESTION BANK FOR MODULE 1 – CHAPTER 1 – INTRODUCTIONTO LOGISTICSMANAGEMENT
1. What is the meaning of logistics? Also elaborate what is integrated logistics
2. What is the mission of logistics? Also elaborate the significance of 7 R’s
3. How to gain competitive advantage via logistics
4. What are objectives of logistics
5. What are the importance of logistics in a country like India
6. What is logistics performance cycle
7. What are the functions of logistics
8. Explain Green Logistics