Logistic n Distribution


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Logistic n Distribution

  2. 2. Logistics and Supply Chains<br />What is Logistics<br />The total management of the key operational functionsin the<br />supply chain – procurement, production and distribution.<br />Procurement includes purchasing and product<br />development. The production function includes<br />manufacturing and assembling,<br />while the distribution function involves warehousing,<br />inventory, transport and delivery.<br />
  3. 3. Logistics and Supply Chains<br />Logistics : Range of Activities Involved<br /><ul><li> Freight fowarding
  4. 4. Customs brokerage
  5. 5. Freight auditing and payment
  6. 6. Vehicle control and </li></ul> communications<br /><ul><li>Product identifications & </li></ul> tracking<br /><ul><li>Information systems – </li></ul> optimisation in management<br />
  7. 7. Logistics and Supply Chains<br />Logistics : Range of Activities Involved<br /><ul><li> Transportation services / Brokerage
  8. 8. Transportation equipment / leasing
  9. 9. Private fleet assets / management
  10. 10. Warehousing
  11. 11. Order Management & fulfillment
  12. 12. Cross docking
  13. 13. Value added, assembly & configuration
  14. 14. Site location</li></li></ul><li>Logistics and Supply Chains<br />Materials Management<br />is the planning, organisation and control of all aspects<br />of inventory embracing procurement, warehousing, work<br />in progress and distribution of finished goods.<br />
  15. 15. Logistics and Supply Chains<br />
  16. 16. Logistics and Supply Chains<br />Logistics : Transport Principles<br /><ul><li> Economies of scale : Large capacity transportation vehicle are less costly per unit of freight than smaller capacity vehicle.
  17. 17. Economy of distance : Decrease transportation coast per unit of weight as distance increase. To maximise the size of load and the distance being shipped while still meeting the customer expectation,</li></li></ul><li>Logistics and Supply Chains<br />Logistics :Transport Mode<br /><ul><li> Small Packages
  18. 18. Air Cargo
  19. 19. Truckload
  20. 20. Railroad/ Train
  21. 21. Water
  22. 22. Pipe Line
  23. 23. Intermodal (Combination)</li></li></ul><li>Logistics and Supply Chains<br />Logistics :Transportation<br />Management<br /><ul><li> On-time pick up
  24. 24. On-time delivery
  25. 25. Loss & damage claims
  26. 26. Transit time
  27. 27. Transit time reliability
  28. 28. Equipment availability
  29. 29. Price
  30. 30. Continuous improvement</li></li></ul><li>Logistics and Supply Chains<br />Economic Driver<br />
  31. 31. Logistics and Supply Chains<br />Reverse Logistics<br />is the process of planning, implementation and controlling<br />the efficient, cost effective flow of raw materials, in process<br />inventory, finished goods and related information from the<br />point of consumption to the point of origin for the purpose<br />of recapturing value or proper disposal.<br />
  32. 32. Logistics and Supply Chains<br />A Supply Chain is that network of organisations that are involved,<br />through upstream and downstream linkages, in the different processes<br />and activities that produce value in the form of products and services<br />in the hands of the ultimate customer or consumer.<br />Types of Supply Chain<br />Can be classified according to:<br /><ul><li> Customer/supplier characteristics
  33. 33. Virtuality
  34. 34. Scope
  35. 35. Service
  36. 36. Complexity
  37. 37. Products
  38. 38. Purpose and value</li></li></ul><li>Logistics and Supply Chains<br />
  39. 39. Logistics and Supply Chains<br />
  40. 40. Logistics and Supply Chains<br />
  41. 41. Logistics and Supply Chains<br />
  42. 42. Logistics and Supply Chains<br />Customer<br />relationship<br />management<br />Customer service<br />management<br />Returns<br />management<br />Demand management<br />Product development<br />& commercialisation<br />Supply Chain Management<br />– Eight Processes<br />Supplier relationship<br />management<br />Order<br />fulfillment<br />Manufacturing flow<br />management<br />
  43. 43. Lack of<br />Ownership<br />Decision<br />Risks<br />Inertia<br />Risks<br />Chaos<br />Risks<br />J.I.T<br />Relationship<br />Risks<br />Logistics and Supply Chains<br />Supply Chain Vulnerability<br />Cranfield Five Categories of Supply Chain Risk!<br />
  44. 44. Logistics and Supply Chains<br />Ten ways of Managing Supply Chain Risk<br />Diversification<br />1<br />Stockpiling<br />2<br />Redundancy<br />3<br />Insurance<br />4<br />Supplier selection<br />5<br />Supplier development<br />6<br />Contractual obligation<br />7<br />Collaborative initiatives<br />8<br />Rationalisation of the product range<br />9<br />Localised sourcing<br />10<br />
  45. 45. Logistics and Supply Chains<br />Porter’s Value Chain Model<br />Five Primary Activities<br /><ul><li>Inbound logistics
  46. 46. Operations
  47. 47. Outbound logistics
  48. 48. Marketing and sales
  49. 49. Service</li></li></ul><li>Logistics and Supply Chains<br />Porter’s Value Chain Model<br />Four Support Activities<br /><ul><li> Firm infrastructure
  50. 50. Human resources
  51. 51. Technology development
  52. 52. Procurement</li></li></ul><li>Logistics and Supply Chains<br />Ten Major Cost Drivers – Value Chains<br />Economic or diseconomies of scale<br />1<br />Learning and spillovers<br />2<br />Capacity utilisation<br />3<br />Linkages among activities<br />4<br />Inter-relationships<br />5<br />Degree of vertical integration<br />6<br />Timing of market entry<br />7<br />Firms policy of cost or differentiation<br />8<br />Geographic location<br />9<br />Institutional factors<br />10<br />
  53. 53. Logistics and Supply Chains<br />Test the cost reduction<br />strategy for sustainability<br />Main Steps in<br />Strategic Cost Analysis<br />Ensure cost reduction<br />efforts do not differentiate<br />Develop a strategy lower<br />relative cost position<br />Identify competitor<br />value chains<br />Diagnose the cost<br />drivers of each activity<br />Identify value chain &<br />assign costs & assets to it<br />
  54. 54. 20%<br />15%<br />14%<br />Logistics and Supply Chains<br />Supply Chains – Who Runs Them?<br />Logistics or supply manager<br />45%<br />Operations or production director<br />Logistics or supply director<br />Operations or production manager<br />Sale, finance or commercial<br />