Tài liệu tiếng Anh thương mại Chap002 Logistics

Tài liệu tiếng Anh thương mại Chap002 Logistics

Logistics

Overview of logistics

• Logistics of business is big and important

• The logistical value proposition

• The work of logistics

• Logistical operations

• Logistics integration objectives

• Logistical operating arrangements

• Flexible structure

• Supply chain synchronization

What is Logistics?

• Logistics is the design and administration of systems to

control movement and geographical positioning of raw

materials, work-in-process, and finished inventories at the

lowest total cost.

Logistics has risen to a key position in the global

economy

• Postwar U.S (1945-1995)

– Global leader in distribution and logistics, as a direct result of

World War II

• Rise of EEC and Asia (1980-2000)

– Both regions became major exporters and distributors

• e-Commerce (1998-Present)

– Global logistics capability almost everywhere

Logistics will continue its renaissance in the

future

• Information technologies will automate many of the

traditionally manual logistical functions:

– Automated port and rail operations

– RFID tagging of materials

– Advanced technologies for warehousing and inventory operations

• Removal of trade barriers will continue to expand global

trade and logistics

Goal of logistics management

• To satisfy customer

expectations for delivery of

products (or services) while

minimizing the total cost

• Managers must support the

requirements for procurement,

manufacturing and customer

accommodation supply chain

operations

Transportation has become the major

logistics cost component in the USA

Logistics costs trends from Table 2.1

• Transportation Costs relative to the Total Cost of Logistics

have gone up

– Because of fuel prices and movement of manufacturing to Asia

• Inventory Costs relative to the Total Cost of Logistics have

gone down

– Adoption of JIT and Lean practices have reduced these

• Administrative Costs relative to the Total Cost of Logistics

have stayed the same

Logistical value proposition

• Logistical value proposition consists of a commitment to

key customer expectations and requirements at a minimum cost

• The two elements of this value proposition are Service and

Cost Minimization

– Firms must make appropriate tradeoffs between service and cost

for each of their key customers

Service benefits are created by logistical

performance in 3 areas

• Availability involves having inventory to consistently meet

customer material or product requirements

• Operational performance deals with the time required to

deliver a customer’s order

– Key metrics for this area involve delivery speed and consistency

• Service reliability involves the quality attributes of logistics

– Key to quality is accurate measurement of availability and

operational performance over time

Basic logistical service may not fit all customers

• Basic logistics service describes the level of service a

firm provides all established customers

– However, some customers require unique or special value-added

Cost minimization using the total cost logistics

model

• Focused on achieving the lowest

possible cost for each individual

function of logistics

– For example, Transport the material

the cheapest way possible

• Expected lowest cost based on

decisions that were cheapest for

individual functions

• Ignored the impact of cost decisions

across logistics functions

• Focused on achieving the lowest total cost across each function of logistics

• A cost decision in one function should consider impact to costs of all other logistics functions

– For example, Transporting material the cheapest way is slower than other choices This requires an increase in storage cost to hold the material longer

– Would it still be a lower cost to use the cheapest mode of transport?

Traditional Cost Logistics Model Total Cost Logistics Model

Different perspectives on cost minimization

Minimize order processing cost

Minimize warehousing, materials

handling and packaging cost

+

Minimize facility cost

Lowest logistics cost

Minimize (order processing + inventory + transportation + warehousing,

materials handling and packaging + facility) cost

_

Lowest total logistics cost

Traditional Cost Logistics Model Total Cost Logistics Model

Example of evaluating alternatives to find lowest

total cost

• Compare two alternative shipping carriers to

move a shipment of electronic chips

– Value of shipment = $25,000.00

– Faster shipping is generally more expensive than

slower shipping

• Carrier 1 costs $250 to ship

• Carrier 2 costs $20 more but delivers 1 day faster

– Product in transit is a form of inventory

• Holding costs for shipment is 40% of value per year

– No other cost differences across remaining logistics

functions

Example of evaluating alternatives to find lowest

total cost

• Minimize transportation cost

– Compare 1 st carrier at $250 vs 2 nd carrier at $270

• Decision is to use 1 st Carrier to save $20

• Minimize total of transportation and inventory cost

Traditional Cost Method

Total Cost Method

Daily cost of holding product = Annual holding cost x Product value /365

= (.40 x $25,000)/ 365 = $27.40

Logistics includes these major functions of work

Integrated logistics framework

• Goal is to achieve customer satisfaction at the lowest Total

Cost

• Decisions in one functional area will impact cost of all

others

• We integrate the logistical functions into a coherent

framework starting with the customer (Order processing)

and ending with the customer (Transportation and Delivery)

The five functions of logistical work are

interrelated

Order processing

• Order processing is the transmission of customer

requirements to the supply chain

• Accurate information is needed to achieve superior

logistical performance

• Responsive supply chains require accurate and timely

information about customer purchase behavior

• Fast information flow enables improved work balancing

• Inventory requirements of a firm are directly linked to the

facility network and the desired level of customer service

• Inventory strategy seeks to achieve the desired customer

service with the minimum inventory commitment

• Inventory strategy is based on a combination of

– Core customer segmentation

– Product profitability

– Transportation integration

– Time-based performance

– Competitive performance

Transportation

• Transportation is the operational area that geographically

moves and positions inventory

• There are three basic ways to satisfy transportation

requirements

– Operate a private fleet of equipment

– Contract with dedicated transport specialists

– Engage carriers that provide different transportation services as

needed on a per shipment basis

Warehousing, materials handling and packaging

• These work activities are integral parts of other logistical

functions

– Inventory typically needs to be warehoused at selected times

during the logistics process

– Transportation vehicles require materials handling for efficient

loading and unloading

– Individual products are most efficiently handled when packaged

together into shipping cartons

• Effective integration of these functions facilitates the speed

and overall ease of product flow throughout the logistical

system

Facilities network

• The number, size and

geographical relationship of

facilities used to perform

logistical operations directly

impacts customer service

capability and cost

• Types of facilities in the

logistics network include

– Manufacturing plants,

warehouses, cross-dock

The scope of integrated logistical operations

Inventory flow

• Managers must be concerned

with the movement and storage

of inventory in 3 major forms

– Materials

– Work-in-process

– Finished products

• Logistical operations should

add value by moving inventory

when and where needed

– Materials and components gain

value at each step of their

transformation into finished

inventory

The 3 areas of the value-added logistic process

• Customer accommodation is the movement of finished

product to customers

• Manufacturing support concentrates on managing

work-in-process inventory as it flows between stages of

manufacturing

• Procurement is concerned with purchasing and arranging

inbound movement of materials, parts, and/or finished

inventory from suppliers into manufacturing or assembly

plants, warehouses or retail stores

Information flow

• Information flow identifies specific

locations within a logistical system

that have requirements

– Information also integrates the three

operating areas

• Information facilitates coordination of

planning and control of day-to-day

operations

• Logistical information has two major

components

– Planning / coordination information

– Operational information needed to

complete work

Logistical integration requires achieving six

Logistical operating arrangements

• All logistical arrangements share two common characteristics

– They are designed to manage inventory

– The range of logistics alternatives is limited by available technology

• Three widely utilized structures are

– Echelon (traditional) is a linear flow from origin to destination through buffers

or warehouses/distribution centers

– Direct is designed to ship products directly to customer’s destination from one

or a limited number of centrally located inventories

– Combined is a combination of Echelon and Direct, depending on the product,

market, or customer

Figure 2.3 Echelon Structured Logistics

Figure 2.4 Combined Echelon and Direct

Delivery

Flexible structures are programs to service

customers using alternatives

• Flexible operations are preplanned contingency strategies to prevent

logistical failures

– For example, a warehouse is out of an item so a contingency policy assigns

the total order to another warehouse

• The structure appears the same as a combined arrangement, but

with the ability to change the logistical structure to suit the service

need

– Different approaches for different situations

– Very common with “factory-less” companies like Nike and Best Buy

Example situations for flexible logistics structure

• The customer-specified delivery facility might be near a

point of equal logistics cost or equal delivery time from two

different logistics facilities

• The size of a customer’s order creates improved logistical

efficiency if serviced through an alternative channel

arrangement

• Decision to use a selective inventory stocking strategy

• Agreements between firms to move selected shipments

outside the established echeloned or direct arrangements

Figure 2.5 Flexible Echeloned and Direct

Delivery

Supply chain synchronization

• Supply chain

synchronization is the

operational integration of multiple firms across a supply chain

– Seeks to coordinate the flow of materials, products and

information between supply chain partners to reduce duplication of effort

– Seeks to reengineer internal operations of individual firms to leverage overall supply chain capability

The logistics performance cycle is the basic unit

of supply chain design and operational control

• The performance cycle represents elements of work

necessary to complete the logistics related to customer

accommodation, manufacturing or procurement

• A performance cycle consists of the following elements

Figure 2.6 Logistical Performance Cycles

Input and output requirements are not illustrated

Performance cycle uncertainty

• Major objective of logistics in all areas is to reduce

performance cycle uncertainty

• Operational variance is randomly introduced during the

Total time to complete the customer delivery cycle is based on each task within the cycle

Ways to improve performance cycle times

• EDI (Electronic Data Interchange) or Internet order

management and tracking

• RFID or Bar code material tracking

• Automated inventory management

• Automated order selection and picking

• Communication with customers to determine their needs

• Communication with suppliers to determine their

capabilities

Performance cycle synchronization seeks to

achieve planned time performance

• Delayed or faster performance at any point along the

supply chain results in potential disruption of operations

• Once consistent operations are achieved, managers can

focus on reducing the time to complete the performance

cycle to a minimum

END