Organizational structures for global logistics can take several forms: 1) Structures have evolved from logistics being a support function to now being centralized under a chief logistics executive. 2) Organizations can be centralized, with logistics planning and execution controlled at the top, or decentralized, with autonomous business units responsible for their own logistics. 3) The role of the logistics manager is to organize storage, distribution, transportation, stock control, and monitor the flow of goods to manage costs and meet customer needs.

2. Organizational Structure for Global Logistics

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This video has been created by Mr. Shantanu Trivedi.

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This video is a part of the Logistics fundamental and Processes course (MBAP-921D).

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• The video discusses the Organizational Structure for Global
Logistics
• It provides the understanding of operational principles of
warehouse design process

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• Organization structure helps in creating, implementing and evaluating plans. The organization structure
gives concrete shape to the organization.
• Basically it is a pattern in which various parts or components are interrelated or interconnected. It
prescribes the relationship among various positions and activities.
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• Logistics is generally viewed as a facilitating or support function prior to the 1950s. The organizational
logistics responsibility is dispersed all through the firm.
• This resulted in duplication and waste, with fragmentation and aspects of logistics related activities were
performed without any cross-functional co-ordination.
• The primary idea behind functional aggregation was done with a belief that grouping all functions of
logistics into a single organization would increase the integration.
• Basically, the organizational chart for a company represents a pyramid, which gives a clear view of how and
where everyone fits and also the reporting relationships.
Organizational Structure

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• Structural Compression: The role of the chief logistics executive is changing and
this ignites the motivation for logistical structural compression.
• An environment with restricted head count as well as intensive control of assets
has enabled the senior logistics manager to emerge as an important part of the
firm’s continuous move towards gaining and maintaining customer loyalty.
• Centralization/Decentralization: An enterprise is considered decentralized if their
basis of function is autonomous. Every unit would be responsible for their own
logistical planning as well as its execution. A centralized organization has the
opposite policy
• Line and Staff Distinction: Traditionally, line performed or executed day-to-day
operations, while the staff was engaged in planning.

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Matrix to Horizontal Structure: Under a functional structure, logistical activities like
transportation and warehousing are grouped into clusters and authority and
responsibility create a direct relationship.
The matrix model of authority and responsibility has been gaining a lot of popularity in
service organizations like consulting and public accounting

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Logistics organizational structures
• For many years, logistics was barely recognized as a discrete function within the organizational structure
of many companies.
• This failure to represent distribution and logistics positively within the organizational structure is often a
result of historical arrangement rather than a specific desire to ignore the requirement for a positive
logistics management structure.
• Several of the more forward-looking logistics-oriented companies have seen the need for some formal
organizational change to represent the recognition now being given to the distribution and logistics
activity.
• This new functional approach emphasizes the need for logistics to be planned, operated and controlled
as one overall activity. The precise structure will obviously differ from one company to another.

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Role of logistics and distribution manager
• Role of logistics and distribution manager is to organise the storage and
distribution of goods.
• Logistics managers are involved in transportation, stock control, warehousing
and monitoring the flow of goods.
• Responsibilities
• As a logistics and distribution manager, you'll need to:
 Use IT systems to manage stock levels, delivery times and transport costs
 Use data from IT systems to evaluate performance and quality and to plan
improvements
 Allocate and manage staff resources according to changing needs
 Manage staff & liaise and negotiate with customers and suppliers
 Develop business by gaining new contracts, analysing logistical problems and
producing new solutions
 Understand, work with and possibly help to develop e-commerce Plan
 Vehicle routes
 Use specialist knowledge, such as mechanical-handling systems, to provide
consultancy services - this may be a requirement in some roles.