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13. logistical coord & network design

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13. logistical coord & network design

  1. 1. <ul><li>Logistical Coordination </li></ul><ul><li>Ensuring a well planned, smooth, uninterrupted and quick flow of materials in the value chain </li></ul><ul><li>How is this done? </li></ul><ul><li>Smooth flow of information </li></ul><ul><li>Smooth flow of inventory </li></ul><ul><li>Realization is the result </li></ul><ul><li>Coordination takes place when logistical plans take into account </li></ul><ul><li>Strategic customer service objectives </li></ul><ul><li>Constraints to meet the above </li></ul>
  2. 2. <ul><li>Net work Analysis (or Location Analysis) </li></ul><ul><li>What is a network? </li></ul><ul><li>Location of facilities and routes or links </li></ul><ul><li>What is network analysis? </li></ul><ul><li>Study of the locations & links for minimizing logistical costs and or maximizing customer service </li></ul>
  3. 3. <ul><li>Some salient features of network design </li></ul><ul><li>(What decisions are taken in network design?) </li></ul><ul><li>Number of facilities [factories and warehouses] </li></ul><ul><li>Their locations </li></ul><ul><li>Communication systems </li></ul><ul><li>Activities performed in these facilities, what item (SKU)? Storage? Break bulk? </li></ul><ul><li>Type of the facility (Who should operate these facilities?) </li></ul><ul><li>Size of the facility, how big? </li></ul>
  4. 4. <ul><li>Factors to be considered in deciding the size </li></ul><ul><li>Fixed as against random access storage </li></ul><ul><li>Horizontal versus high rise layout </li></ul><ul><li>Order picking (large inventory) versus stock replenishment (small inventory) activities </li></ul><ul><li>Multi-dock versus single dock layout </li></ul><ul><li>Aisle space? Rack space? </li></ul><ul><li>Labor intensive or high tech operations, carousals? Robotics? </li></ul><ul><li>Amount of cross docking </li></ul>
  5. 5. Number of facilities, How many?
  6. 6. <ul><li>Importance of network analysis & design </li></ul><ul><li>Logistical network has to respond to market dynamics promptly </li></ul><ul><li>What are market dynamics? </li></ul><ul><li>Changing customer service requirements, shorter lead times? Lower costs? </li></ul><ul><li>Shrinking supplier base </li></ul><ul><li>Changing customers </li></ul><ul><li>Shifting locations of customer </li></ul><ul><li>Changing locations of supply market </li></ul><ul><li>Change in corporate policies (dropping of products or product variety) </li></ul>
  7. 7. <ul><li>2. Logistical Network influences cost of moving the product to the customer due to its following features </li></ul><ul><li>Network option </li></ul><ul><li>Amount of transshipment </li></ul><ul><li>No of locations </li></ul><ul><li>Volume of inventory (the square root law) </li></ul><ul><li>Who operates these facilities? - outsourcing decisions </li></ul><ul><li>Communication between these facilities, information and inventory </li></ul>
  8. 8. <ul><li>3. L/N influences the Customer service </li></ul><ul><li>Response time </li></ul><ul><li>Lead-time </li></ul><ul><li>Response to competitive action </li></ul><ul><li>5. L/N has to accommodate corporate organizational changes such as down sizing and reengineering & globalization </li></ul>
  9. 9. <ul><li>Some models for facility location </li></ul><ul><li>Gravity model </li></ul><ul><li>Analytical models </li></ul><ul><li>Ton-mile center </li></ul>

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