LOGISTICS AND SUPPLY CHAIN MANAGEMENT

INTRODUCTION

• LOGISTICS

Logistics refers to the process of planning, implementing and controlling the

movement of products, services or information within a supply chain from the
point of origin to the point of consumption

• SUPPLY CHAIN MANAGEMENT

. Supply chain management (SCM) is the centralized management of the flow of goods and
services and includes all processes that transform raw materials into final products.

• ROLE OF LOGISTICS

Order processing

Any delivery process can only function if there is an order processing system in
place. Order processing systems vary from business to business - from a Shopify
store to an ERP. Either way, it's meant to support fast and effective information
processing that kick-starts transportation activities.

2. Inventory management

Inventory control is among the logistics functions that are often grouped together
under the inventory/warehousing umbrella. For the purposes of this guide, we
separate inventory and warehouse management processes.

Warehousing

Warehouse management is a natural extension of inventory activities. While

inventory covers all locations and, hence, all inventory for order fulfillment,
warehousing is limited to tracking stock movement within a warehouse. At the
warehouse level, handling, packing, and shipping workflows are established.

Packaging
Packaging includes all the activities and operations implemented to prepare goods
for handling and transportation to and from customers - in case of reverse logistics
and returns specifically. Packaging is one major logistic function as it determines
delivery success.

Cargo handling

Cargo handling is one of the major logistics activities that can't be overlooked
when discussing logistics functions. It's closely related to packaging and
determines logistical costs in a very real way.

Transportation

Last but not least is the transportation itself. Naturally, transportation is among
the main logistics functions, if not the main. It's required at every step of every
supply chain and the way companies build their transportation management
system and functions determines the success of supply chain management.

• Role of supply chain management

Increase Customer Service:

One of the most important supply chain roles and responsibilities is to manage
the customer service. The customers should always get what they are looking for.
Whether it is a product, solution to their issues or answers to their questions.

Reduce Production Cost:

Improve Quality Of Products:

It is a fact that the production cost of the products has to be reduced but at the
same time, the quality of the items has to be enhanced. It has to be assured that
the raw material and manufacturing of the items in high-class because only then
to customers will be attracted.

Improve Financial Position:

Development Of Best Marketing Strategies:

The supply chain management team has to develop the best marketing strategies
for the company to assure that their products will be present in the best possible
way.

• scope of logistics and supply chain management

The scope of logistics management involves order processing, inventory

control, transportation, warehousing, materials handling, and packaging, all
integrated throughout a network of facilities. The goal is to support
procurement, manufacturing, and customer service operational requirements.

Thus Supply Chain Management includes managing supply and demand,

sourcing raw materials and parts, manufacturing and assembly, warehousing and
inventory tracking, order entry and order management, distribution across all
channels, and delivery to the customer.

• Evolution of supply chain management

The evolution of supply chain management has been characterized by
an increasing degree of integration of separate tasks; a trend underlined in the
1960s as a key area for future productivity improvements since the system was
highly fragmented. Although the logistics tasks have remained relatively similar,
they initially consolidated into two distinct functions related to materials
management and physical distribution during the 1970s and 1980s. This
process moved further in the 1990s as globalization incited a functional
integration and the emergence of logistics in a true sense; all the elements of the
supply chain became part of a single management perspective.

However, only with modern information and communication technologies did a

more complete integration became possible with the emergence of supply chain
management. It allows for the integrated management and control of
information, finance, and goods flows and makes possible a new range of
production and distribution systems. Supply chain management has become a
complex sequence of activities aiming at value capture and competitiveness.
More recently, the growing level of automation of supply chains has been a
dominant element of the evolution of both physical distribution and materials
management. This digitalization is particularly notable within distribution
centers that have experienced a remarkable push towards automation such as
storage, materials handling, and packaging. Automation may eventually lead to
automated delivery vehicles.

Stepwise and according to improvements in information and communication

technologies, the two ends of the assembly line became integrated into the
logistics of the supply chain: the timely supply of raw materials and components
from outside and the effective organization of distribution and marketing. High
rack storage, which later became automatically driven, or the internal movement
of packages by flat robots were early expressions of logistical engineering.
Initially, logistics was an activity divided around the supplying, warehousing,
production, and distribution functions, most of them being fairly independent.
With the new organization and management principles, firms followed a more
integrated approach, thus responding to the upcoming demand for flexibility
without raising costs. At the same time, many firms took advantage of new
manufacturing opportunities in developing economies through outsourcing and
offshoring. As production became increasingly fragmented, activities related to
its management were consolidated. Spatial fragmentation became a by-product
of economies of scale in distribution.

• -Decision Phases in Supply Chain

Supply Chain Strategy

In this phase, decision is taken by the management mostly. The decision to be

made considers the sections like long term prediction and involves price of goods
that are very expensive if it goes wrong. It is very important to study the market
conditions at this stage.

Supply Chain Planning

Supply chain planning should be done according to the demand and supply view.
In order to understand customers’ demands, market research should be done. The
second thing to consider is awareness and updated information about the
competitors and strategies used by them to satisfy their customer demands and
requirements. As we know, different markets have different demands and should
be dealt with a different approach.

Supply Chain Operations

The third and last decision phase consists of the various functional decisions that
are to be made instantly within minutes, hours or days. The objective behind this
decisional phase is minimizing uncertainty and performance optimization.
Starting from handling the customer order to supplying the customer with that
product, everything is included in this phase.

• Competitive and Supply chain Strategies

What is a supply chain strategy?

A supply chain strategy is like a roadmap that helps companies get their products
to customers with as little friction as possible. This plan ensures that every phase
of the supply chain is optimized, including the sourcing of materials,
manufacturing, delivery, and logistics.

Engage in real-time supply chain planning

The recent worldwide COVID-19 pandemic has shown how the business landscape can shift
in a very short time. How a business handles quick market shifts will determine its longevity.
Supply chain analytics solutions can bring real-time data from every part of the business, from
POS terminals to the mines from which raw materials are extracted. Companies can analyze
large volumes of contextual data for accurate forecasting and shift plans according to rapidly
changing market demands.

Develop a collaborative supply chain strategy

A large business has an expansive list of suppliers, vendors and distributors.

These stakeholders should not be working in silos. All the participants should be
working in a collaborative environment (rather than competing in the market) to
maximize supply chain value and ensure customer delight.

Adopt innovative supply chain automation solutions

Implement agile process improvements

Implementing disruptive technology could lead to improvements in the supply

chain. But as the name suggests, it is disruptive and can be a costly endeavor. On
the other hand, agile process improvements seek constant and incremental
improvement of processes.
Consider cost drivers and business impacts

To obtain maximum supply chain value, you need to be aware of supply chain
cost drivers and their business impacts. Increasing costs are symptoms of
problematic cost drivers. To create a robust and cost-efficient supply chain,
address the root causes rather than the symptoms on the surface.

• Drivers of Supply Chain Performance

• Obstacles of supply chain

Material scarcity. Insufficient inputs have been a concern since the pandemic
began, due to an abrupt rise in consumer demand like never before. ...
Increasing freight prices. ...

Difficult demand forecasting. ...

Port congestion. ...

Changing consumer attitudes. ...

Digital transformation