DSHM-MHM UNIT 2 SCLMM

Logistic Management
In today’s highly competitive global business scenario, organisations are compelled to find
innovative ways to deliver value to their customers. The changing global market dynamics
make an organisation compete with competitors in terms of products, cost, quality and
services. This, in turn, has paved the way for a need to develop logistics systems that are
more advanced as compared to traditional methods. Over the last two decades, logistics has
shifted its focus from a mere operational level to the corporate level. A growing need for
effective logistics management that encompasses the whole organisation assists in cost
reduction and enhancing service delivery.
Logistics management maximises profit by integrating an organisation with flow of materials,
information and funds. The key to a successful logistics management requires an efficient
collaboration of activities, cooperation, coordination and information sharing throughout the
organisation’s supply chain. It plays a crucial role in solving perplexed logistics problems and
manage the entire supply chain as a single entity. It is cardinal to an organisation as it is
concerned with both materials and information flow. On the one hand, while the materials
flow from the supplier to the consumer, on the other hand, information flows from the
consumer to the supplier in the form of feedback. It is not just limited to inventory and
resource maximisation, but even customer feedback of the product also comes under the
scope of logistics.
It establishes a link between the manufacturing and various operations of the organisation.
Without this crucial link, it would be uphill for organisations to make their products reach the
target customers. The Council of Supply Chain Management Professionals (CSCMP) defines
logistics management as that part of supply chain management that plans, implements, and
controls the efficient, effective forward and reverse flow and storage of goods, services and
related information between the point of origin and the point of consumption to meet
customers’ requirements.
The CSCMP explains logistics management as the management activities that include
inbound and outbound transportation management, fleet management, warehousing, materials
handling, order fulfilment, inventory management, demand and supply planning and
management of third-party logistics service providers. Logistics also encompasses various
aspects of customer service, procurement, planning and scheduling production and
packaging. Logistics management comprises all levels of planning and implementation,
whether strategic or operational. Logistics further collaborates functions of marketing, sales,
manufacturing and finance, and information technology.

Logistic
Logistics undertakes the task of safe delivery of the product from one point to another, and,
thus, it is responsible for the security of the product. Most logistics organisation take
insurance on the products being transported. Logistics comprises material handling,
warehousing, transportation and packaging the goods and controlling the inventory. Logistics
involves dealing with both finished and unfinished products.

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

Logistics can affect an organisation in more than one way. If the logistics of the organisation
is not efficient enough, it would lead to increased costs and low customer satisfaction. On the
other hand, efficient logistics serves to reduce the costs for the organisation and increase the
customer service, therefore, helping in increasing the profitability.

Concept Of Logistic Management

Logistics management is an essential component of supply chain management that aims at
catering to customer demands. Logistics management involves planning, controlling and
implementing of the movement and storage of goods and services from the point of origin to
the ultimate customer. It enables organisations to cut down on expenses and bolster customer
satisfaction. The genesis of the term ‘logistics’ was military-based that encompasses how
military personnel procured, stored and moved army equipment and supplies. The term is
now pervasively used across the business industry, especially by organisations in the
manufacturing sectors.
The process of logistics management is initiated from garnering raw materials to the final
stage of delivering finished products for customers to avail. Logistics management entails
formulating strategy, planning and implementing it to address customers’ demand while also
considering prevailing market condition. Logistics management collaborates activities, such
as raw materials procurement, production process, and distribution of finished products. It
aims at providing an organisation competitive and increased product value for fulfiling
customers’ expectations. It also looks at minimising holding excess of inventory and supply
costs.

The five Rs of logistics are as follows:

 Right products
 Right place
 Right time
 Right condition
 Right cost
Some of the elements related to logistics management are as follows:
 It helps in choosing the right supplier for providing transportation facilities.
 It assists in choosing the most effective channel for product distribution.
 It measures the customer and market needs.
 It helps in cutting down on inventory and storage costs.
 It focusses on maximising organisational profits.

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

Definition Of Logistic Management

According to Council of Logistics Management, “Logistics is the process of planning,
implementing, and controlling the efficient, effective flow and storage of goods, services, and
related information from point of origin to point of consumption for the purpose of
conforming to customer requirements.” Note that this definition includes inbound, outbound,
internal, and external movements, and return of materials for environmental purposes.
According to Phillip Kotler, Market logistics involves planning, implementing and
controlling physical flow of material and final (finished) goods from the point of origin to the
point of use to meet customer requirements, at a profit.
According to The Council of Supply Chain Management, Logistics management is a part
of supply chain management that plans, implements, and controls the efficient flow and
storage of goods, services, and related information in order to meet the customers’
requirements.
According to The Council of Logistics Management, Logistics is the process of planning
and controlling the efficient and effective flow and storage of goods, services and related
information from the point of origin to the point of utilisation, as per the customer
requirements.
According to Logistics Partners Oy, Helsinki, FI, Logistics is defined as a business
planning framework for the management of material, service, information and capital flows.
It includes an increasingly complex information, communication and control systems
required in today’s business environment.
According to Canadian Association of Logistics Management, Logistics is the process of
planning, implementing, and controlling the efficient, cost-effective flow and storage of raw
materials, in-process inventory, finished goods and related information from the point of
origin to the point of consumption for the purpose of meeting customer requirements.

Objectives Of Logistic Management

The primary objective of logistics management is to maintain a smooth flow of materials in a
supply chain effectively so as to fulfil the customers’ desired level of satisfaction. Logistics
management is also involved with providing products and services as and when they are
required. The objective of logistics management is to maintain the goals of the organisation
by keeping the cost at minimum as possible.
Logistics management involves storage, distribution, warehousing, goods handling,
transportation, monitoring and delivery of goods. It also entails planning, organising,
managing, coordinating and controlling the flow of goods to ensure that goods reach the right
place, at the right time, for the right cost and in the right condition. Logistics management
also strives to maintain ethical integrity throughout the organisation. For example, in various
instances, personnel responsible for transporting valuable merchandise falsely report theft of
missing of merchandise and sell it in the market. It is the responsibility of the logistics
department to monitor and control such unethical practices.

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

The objectives of logistics management are as follows:

 To ensure all the requirements of the customers are met on time
 To coordinate with third-party logistics (3PLs)
 To ensure timely despatch of the products
 To devise policies and procedures for successful implementation of logistics system
 To synchronise business goals with logistics system
 To create and maintain customer support
 To have stable integration among the vendors, service providers and transport carriers
 To provide a competitive edge to an organisation through increased sales and better
customer service
 To ensure cost reduction and maximise return from products/services

Types Of Logistic

 External logistics is especially concerned with things that move between your
suppliers, your factories and distribution centers and your customers.
 Internal logistics has similar goals, but the things that are tracked are usually moving
within the global four walls of your organization.
 Inbound logistics refers to the movement of goods from suppliers to production.
This includes storage and transportation of various products and information from the
suppliers through the warehouse and further through production facilities of
manufacturers for processing and production. The types of goods or items that are
transported through this logistics flow are raw materials. Some could be tools for
manufacturing or consumable products needed for fuel or various spare parts and
components for production inputs. Better inbound logistics management makes the
cycle more efficient and integrative. An excellent way to manage inbound logistics is
to use automatic ordering or order-fulfilment systems. With this, you can be sure that
it will directly impact the organization’s success. For example, if you produce car
parts in a factory, you will use door-to-door inbound transport to send your car parts
to various recipients depending on the nature of your relationship with those
businesses. This could be providing car parts to manufacturers, using them in their
finished products, or passing them on to retailers and distributors. Most car parts

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

distributors use large trucks to transport these products, so choosing the right partner
for these logistics services is essential.
 Outbound logistics is the movement of finished products from production facilities
to the next supply chain link. These goods move through warehouses, further to the
point of consumption (in the hands of end-users). This is often referred to as the order
fulfilment process. Using the same example above, after the manufactured car parts
make their way through the inbound logistics flow to a retailer, they will then be sold
and distributed to the end-user, thus moving through the outbound logistics flow to
reach the desired final destination. All the products are intended for the end-users to
move through this outbound logistics flow. In a nutshell, the outbound logistics
movement refers to businesses shipping and delivering their products from the
warehouse to the customer (whereas inbound refers to the change between companies
and their suppliers).
 Third-Party Logistics In a 3PL model, an enterprise maintains management
oversight, but outsources operations of transportation and logistics to a provider who
may subcontract out some or all of the execution. Additional services may be
performed such as crating, boxing and packaging to add value to the supply chain. In
our farm-to-grocery store example, a 3PL may be responsible for packing the eggs in
cartons in addition to moving the eggs from the farm to the grocery store.

 Fourth-Party Logistics In a 4PL model, an enterprise outsources management of

logistics activities as well as the execution across the supply chain. The 4PL provider
typically offers more strategic insight and management over the enterprise's supply
chain. A manufacturer will use a 4PL to essentially outsource its entire logistics
operations. In this case, the 4PL may manage the communication with the farmer to
produce more eggs as the grocery store's inventory decreases.

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

Outsourcing Of Logistic
Outsourcing is the business practice of hiring a party outside a company to perform services
and create goods that traditionally were performed in-house by the company's own
employees and staff. Outsourcing is a practice usually undertaken by companies as a cost-
cutting measure.

 1PL - First-Party Logistics An enterprise that sends goods or products from one
location to another is a 1PL. For example, a local farm that transports eggs directly to
a grocery store for sale is a 1PL.

 2PL - Second-Party Logistics An enterprise that owns assets such as vehicles or

planes to transport products from one location to another is a 2PL. That same local
farm might hire a 2PL to transport their eggs from the farm to the grocery store.

 3PL - Third-Party Logistics In a 3PL model, an enterprise maintains management

oversight, but outsources operations of transportation and logistics to a provider who
may subcontract out some or all of the execution. Additional services may be
performed such as crating, boxing and packaging to add value to the supply chain. In
our farm-to-grocery store example, a 3PL may be responsible for packing the eggs in
cartons in addition to moving the eggs from the farm to the grocery store.

 4PL - Fourth-Party Logistics In a 4PL model, an enterprise outsources management of

logistics activities as well as the execution across the supply chain. The 4PL provider
typically offers more strategic insight and management over the enterprise's supply
chain. A manufacturer will use a 4PL to essentially outsource its entire logistics
operations. In this case, the 4PL may manage the communication with the farmer to
produce more eggs as the grocery store's inventory decreases.

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

 5PL - Fifth-Party Logistics A 5PL provider supplies innovative logistics solutions and
develops an optimum supply chain network. 5PL providers seek to gain efficiencies
and increased value from the beginning of the supply chain to the end through the use
of technology like block chain, robotics, automation, Bluetooth beacons and Radio
Frequency Identification (RFID) devices. Through the spectrum of logistics models
from 1PL to 5PL, it's clear that more and more of the logistics function are in the
hands of the provider rather than the enterprise itself. The most common models now
are 3PL and 4PL and each one can help to solve supply chain challenges.

What is a Third-Party Logistics Provider?

The term "third-party logistics provider," or 3PL, has been around since the 1970s. It simply
means that a third party is involved in a company's logistics operations, in addition to the
shipper/receiver and the carrier.

A 3PL does not take ownership of (or title to) the products being shipped. This third party
comes into play as an intermediary or manager between the other two parties. The first 3PLs
were intermodal marketing companies that accepted loads from shippers and tendered them
to railroads, becoming a third party in the contract between shippers and carriers, according
to the Council of Supply Chain Management Professionals (CSCMP) glossary. Today, any
company that offers some form of logistics services for hire is known as a 3PL. This includes
facilitating the movement of parts and materials from suppliers to manufacturers, as well as
finished products from manufacturers to distributors and retailers.

A 3PL may or may not have its own assets, such as trucks and warehouses. In some cases, the
role of 3PL and broker overlap, but typically a broker is used to engage trucking capacity for
a specific shipment. A 3PL may act as a broker or use brokers to move clients' freight.

Most 3PLs offer a bundle of integrated supply chain services, including:

 Transportation Warehousing Cross-docking
 Inventory management Packaging
 Freight forwarding

A 3PL can scale and customize services to meet customers' needs based on their strategic
requirements to move, store, and fulfill products and materials. Companies turn to 3PLs when
their supply chain becomes too complex to manage internally. For example, a company may
grow through mergers and acquisitions, so a supply chain that was manageable at one time
outgrows the in-house capability.

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

What is a Fourth-Party Logistics Provider?

A fourth-party logistics provider, or 4PL, represents a higher level of supply chain
management for the customer. The 4PL gives its clients a “control tower” view of their
supply chains, overseeing the mix of warehouses, shipping companies, freight forwarders and
agents. The goal is to have the 4PL act as the single interface between all aspects of the
supply chain and the client organization.
In some cases, a 4PL may be established as a joint venture or long-term contract between a
primary client and multiple partners, often to manage logistics for specific locations or lines
of business. The structure of a 4PL can vary, as there may be a 4PL component within a
larger 3PL relationship. A 4PL is a form of business process outsourcing, similar to
contracting out human resources or financial functions.

The Advantages and Drawbacks of Logistics Outsourcing:

The rise of on-demand delivery has forced modern-day businesses to rethink their traditional
logistic operation models. Outsourcing the entire function to a trustworthy 3PL partner has
become a viable option since it reduces the complexity of achieving deliveries until the last
mile. The benefits of logistics outsourcing come in several forms – savings in operating costs,
savings in human capital, streamlined operations, no lock-in of working capital and well-
connected global delivery endpoints to name a few.

Let’s take a closer look at some of the additional advantages:

1.Reduces burden of back-office management
On the surface, the logistic function appears to be simple: sending physical packages from
point A to point B. However, before each consignment is sent out on transit, there is
paperwork, auditing and verification to be conducted and documented. 3PL outsourcing
service providers will have the necessary backend personnel and systems in place to take care
of these procedures. From assigning a dispatch note and carrying out physical verification, to
ensuring that all shipping papers are in order, logistics outsourcing can take care of the
routine activities, sparing time for the business to focus on other priorities.

2.Economies of scale
3PL players usually have a globally distributed network of carriers and fleets which allow
them to reach any destination with ease. Since the function is outsourced, it is easy to scale
up or scale down the logistic reach of the business without having to set up owned
infrastructure and personnel.

3.Real-time visibility of inventory

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

Professional logistic outsourcing service providers use ERP systems or cloud-based

Warehouse Management Systems to help track inventory on a real-time basis. This data can
also be received from the service provider on a regular basis for supply chain management
planning.

4.Expert documentation handling

Logistics, especially cross-border logistics, requires adherence to sophisticated paperwork.
For a business that has logistics only as a small function or department, this can be a tedious
job to do on a routine basis. Logistics outsourcing service providers have the domain
expertise and knowledge to take care of all kinds of paperwork involved like inter- connected
carrier contracts, insurance certificates, bill of lading, certificate of origin, etc.

Five Often Overlooked Pitfalls in Logistic Outsourcing:

While logistic outsourcing delivers high on economic benefits, it also riddled with pitfalls
that businesses must safeguard against.

1.Outsourcing without proper appraisal process:

A good logistics partner is hard to find. The appraisal process itself will include gathering
quotes and doing quality reports to check if the provider meets benchmark standards and so
on. Rushing through the tender process without adhering to a well-thought process will lead
to hassles in the future.

2.Choosing a low-pricing vendor for cost-benefit:

An after effect of rushing through the logistic outsourcing vendor process is that you end up
signing the deal with someone who offers the lowest rates. As Sun Tzu, the legendary
military leader once said, “The line between disorder and order lies in logistics.” Outsourcing
the function to a low-priced vendor who cuts corners might actually create chaos rather than
an orderly logistics function. There is a reason why top-notch 3PL players charge a premium
rate. It costs a lot to have personnel and processes in place to ensure perfect paperwork,
timely coordination of carriers, warehouse management and much more.

3.Not specifying roles and responsibilities in writing:

Logistics is a subset of supply chain management which by itself is a combination of several
micro-steps. This increases the complexity in logistics planning and implementation. Unless
the roles, responsibilities and tasks of each party take the form of an explicitly written a
Service Level Agreement (SLA), there could be serious complications when the process
kicks into action.

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

4.Not viewing logistics outsourcing as a strategy:

Logistics plays a key role in the overall strategy of an organization. Moreover, the business
environment and customer demands are not what they used to be a few years ago. E-
commerce, mobility, on-demand services and other advancements, have reformed the
commerce landscape. If you are outsourcing logistics merely as a function to be done with,
and not as a strategic element, then the business is not going to gain much despite the
economy of scale.
5.Disconnect between clients and outsourcing agents:
Does your logistic outsourcing agent really know what you are trying to do? A lack of
consensus between the parties can lead to a waste of resources and also lead to cost overruns
and delayed deliveries.

Logistic Cost
While the typical supply chain used to be small and simple, our global economy has forced to
evolve and build out sprawling networks of supply chains that live independent of geographic
boundaries. Expanded supply chains can help reduce the cost of procuring raw materials and,
ultimately, lessen the overall manufacturing cost. However, they have disadvantages too.
1. Inventory Management Cost
Inventory is a common contributor to supply chain logistics costs. Managing the number of
units you have in production vs demand has a direct impact on your bottom line. Stock too
many units, and you’re eating into cash flow that could be used elsewhere. Stock too little,
and you’re losing out on business. Bottlenecks in your supply chain management (SCM) can
exist simply as a result of not being able to effectively track large amounts of data in real time
– with so many moving parts, that can exist over multiple countries, it can be near impossible
to get a birds-eye view of your entire inventory.

Blind sports in your inventory management can lead to:

 Poor forecasting
 Shipping delays & misdirection errors
 Escalating production costs
 Wasted or obsolete inventory
 Low rate of inventory turnover
 Volatile and variable overhead costs
 Data-entry errors (for tracking)
 Lost customers
The costs incurred by these issues can start to add up quickly – and to make matters worse,
many of these issues aren’t easy to identify based on historical data alone.
2. Warehousing Cost

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

Properly measuring performance data is key to managing your warehousing costs – you can
start by asking yourself the following questions:

 How often are you measuring (tracking) performance?

 What is your picking accuracy?
 What is your shrinkage rate for inventory?
 Is the percentage of customers retained increasing year-over-year?
Simply put, what gets tracked gets managed. And when you combine a lack of warehouse
measurements with poor demand planning, it can lead to having excess inventory (value) tied
up in your supply chains.
This can be a result of poor forecasting, unexpected seasonal shifts in demand, product
recalls, and more. Whatever the cause — your company needs a way to manage and track
these fluctuations as they come about. And even if inventory forecasting is on point — your
warehouse operations might be bleeding your business dry (too many warehouse staff, not
enough machinery, inefficient placement of inventory, liability issues, etc.).

3. Transportation Mode Shifting Cost

Transportation costs related to mode-shifting and fulfilment are another key area of logistic
costs – with an increasing strain on businesses from online shopping (and the expectation to
have these products delivered in a timely fashion).
Every global supply chain needs to deal with mode-shifting in some form, but it’s becoming
more difficult for businesses to keep these processes visible across transportation and
distribution touchpoints.
When inventory isn’t managed well (as detailed above) an undue burden is placed on the
transportation leg of the supply chain. For example, if a product isn’t available when a
customer orders it you might need to expedite shipping (from ground to air) in order to
guarantee that the product arrives on schedule. And as the supply chains grow (with ever-
increasing fuel costs) the types of indirect costs associated with these inefficiencies becomes
more taxing on your bottom line.

4. Distribution Costs
Distribution costs include moving inventory through your distribution channels – a common
source of inefficiency. Vendor efficiency, vehicle utilization, scheduling, and throughput
times can all be massive contributors to your logistics costs. Naturally, this area of supply
chain optimization is ripe for tracking across vendor touchpoints due to high variability in
costs.
In fact, more variability means that it’s more difficult for your business to track and manage
data, in order to make informed decisions. And when you can’t track data, your customer
service suffers too.
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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

Components Of Logistic Management

The components of logistics management are discussed as follows:
 Storage, warehousing and material handling: These elements are important for a retail
enterprise. The merchandises are required to be stored, warehoused and handled in a
proper manner. Some of the important aspects of these elements are warehouse
location, storage type and material handling equipment.

 Packaging: It involves transportation of merchandise, and reduces the possibility of

damage caused during transit. For example, if items, such as processed foods are not
properly packed, these can perish in transit.

 Inventory: It refers to the stock of materials in retail organisations. Retail

organisations maintain inventory levels on the basis of sales and demand forecasts.

 Transportation: An effective transportation system ensures timely delivery of

merchandises from suppliers to the warehouses, from warehouses to the distribution
centres and from distribution centres to the retail stores.

 Information and control: These are the most important elements in logistics. Retail
enterprises need to have access to the real-time information and control over their
logistics operations. Large retail enterprises, such as Walmart uses specialised
software to keep track of their operations.

 Order processing: In large organisations, order processing refers to handling

voluminous products to make them reach the desired destination. Order processing
operations or facilities are generally known as distribution centres. Order processing
comprises verifying the order received and checking whether the facility has the
required amount of goods Order processing is a perpetual process which consists of
the following:
 Picking: It entails taking and collecting products in specified quantity prior to
shipping the orders for customers.
 Sorting: It refers to the process of separating goods as per their destination. It is
crucial for sorting products as it eases the shipment of products. If sorting is not done
in correct manner, then it will create a mess for shipment team and the order will not
reach the target customers.
 Package formation: It is an important part of order processing as it includes weight,
label and pack products. The outer packaging should include weight, usage and
specification of the product to inform the customer how to use the product. The
packaging should explicitly mention the date of manufacturing, batch number, expiry
date or best before date, price of product, organisation producing the product, etc.
 Consolidation: It consists of accumulating packed products to loading bays to be
transported. At the loading bays, the goods will be gathered where bill of landing and
various documents will be prepared. The packaging of goods will also be inspected
whether the outer packaging is sturdy enough to bear the loading and unloading of
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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

goods. The packaging should also be efficient enough to prevent products from
pilferage and spoilage.

Location of Warehouse, Type of

Storage Material Handling
Equipment

Storage, Warehousing and

Material Handling
Unit Load
Systems
Information Protective
Design Packaging
and controls Packing
Control
Handling
Processes
Systems
Transport Inventory

Mode of Transport Product to Stock

Load Planning Route Location to Stock
Scheduling Quantity to Stock

Components of Logistic Management

Transportation Management
The role of transport is moving goods and people from one place to another. It is one of the
most important factors for promoting a country’s growth in trade and commerce. Not only
does it promote growth, but it also helps the country in achieving its social and economic
goals. With the changing business dynamics, there is a change in the modes of transportation
as well, depending upon the change in the needs and requirements of the people. There are
various technologies which are being used in order to improve the transportation of a country.
It is moving in tandem with the changes in science and technologies.
There are various equipment used in the transportation of goods from one place to another.
The equipment is both simple as well as sophisticated. Use of sophisticated equipment
depends upon the level of the country’s economic condition as well as the level of growth.
Transportation in logistics system comprises of two major activities: movement of goods
from one place to another and in-transit storage of those goods. The mode of transportation
which is used also depends upon the availability of the infrastructure of that particular region.
The principle which guides in choosing a mode of transport is the cost per unit
weight/volume of a product. The per-unit cost of a product used over a unit distance should
be the least.

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

Concept Of Transportation
The movement of people, goods and animals from one place to another is the basic concept
of transport or transportation. It helps in enabling trade between people and organisations in
order to develop a nation. The various components of transportation are:
 Infrastructure: There are various fixed infrastructures which enhance the different
modes of transportation. These infrastructures include roads and terminal facilities,
bus stands, railways and railway stations, airways and airports, waterways and
seaports, pipelines and canals, warehouses, land used for parking and maintenance,
etc. There is a need of fixed installation of infrastructures in order to move goods via
roads, railways and pipelines. However, this installation can be avoided when using
sea and air as modes of transport. There is a need for construction of ports in these
cases. In order to build and maintain such installations and infrastructures, there is a
need for financing. Transportation services can get financial help from either public
sectors or private sectors. We all know that transportation is the basic need of the
people and in most of the countries, the construction of infrastructure is funded with
the taxes paid by the citizens of the country. In cases of advanced infrastructure, there
is a need for huge investment. To cover the cost of investment there are fees imposed
by infrastructure owners for usage, landing and tolls on roads.

 Vehicles: There is a need for vehicles in order to move goods and people.
Infrastructures are fixed, but vehicles are tangible and moving devices which carries
both people and commodities from one place to another. In most of the cases, vehicles
are required to be driven by individuals. However, in the modern context, we have
self-driven vehicles which are fully automated and are able to move goods from one
location to another.

 Operation: Transportation is operated by both public and private individuals. In case

of private transport, there are owners of vehicles, who are solely responsible for the
movement of goods from one place to another, and who carry out all the related
activities which forms a part of transportation. In case of public transport, government
is involved in the operations of transportation. Since privatisation yields better
service, most of the transportation operations are taken up by the private sectors. This
is leading to a high rate of competition among industries.

 Policy: In order to maintain order and discipline in the transportation system, there are
several policies that have been instituted by the government. This has been done
keeping in view the rapidly increasing rate of population in countries.

Modes Of Transportation In Healthcare

According to a study, nearly 3.6 million peoples are unable to avail or getting delayed to
medical care due to the lack of proper medical transportation. During a typical catastrophe,
medical emergency or some other accidental emergencies, medical transportation plays a

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

vital role in getting the patient to the healthcare on time. To address this issue, some medical
transport service providers in Chennai are offering cost effective and appropriate transits for
different types of medical needs.

To be accurate there are two types of medical transportations based on the need and
requirement of the patient – Emergency Medical Transportation and Non-Emergency
Medical Transportation.
These two services help patients to reach their destinations on time safely. To make a safe
arrival, both type ambulances will be equipped with highly trained drivers, paramedics,
emergency medical technicians, etc within the vehicle. medical transportations.
Non-emergency medical transportation:
Non-emergency medical transportation (NEMT) usually provides trips to and from scheduled
medical appointments by helping individuals from avoiding travel that is costly. Patients who
need to be transported to medical facilities for regular check-ups and appointments can avail
this transport facility.
Some of the NEMT are,
1. Ambulatory Service - This type of mobile services are helpful when patients require
clinical assistance without a time-critical emergency. This suits best for those who do
not need any equipment to walk and only need basic support.
2. Wheelchair Services - This service is helpful especially for the patients who cannot
walk on their own. Usually, the van and wheelchair lifts are often operated by CPR
trained drivers.
3. Stretcher - This medical transport is helpful for the patients who could not sit due to
issues in spinal cord. The patient will be transported while lying on a stretcher.
4. Flight Service – Flight escorts are mainly for the patients who wish to travel by air
and need medical supervision.
5. Couriers – This type of service is particularly helpful in transporting human organs,
blood and other biological matter to their intended destinations. These services are
highly confidential and they will be treated accordingly.
Emergency Medical Transportation:
This type of medical transportation facility comes in handy during emergency situations.
Emergency Medical transport facility is so vital that it can save lives if excited all the
predefined lifesaving parameters during the transit.
1. Basic Life Support Transportation - It is often referred as BLS which will have
certified medical technicians on-board, always. The patients will be monitored and
aided using advanced equipment on the way to medical destination. This helps in
keeping the situation under control before reaching the hospital. In addition, the tests
or medical procedures performed can save time which is precious during an
emergency.
2. Advanced Life Support Transportation - It is often referred as ALS which has
certified paramedic in it. This medical transport type vehicles contains heart paddles,
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Assistant Professor
DSHM-MHM UNIT 2 SCLMM

IV units, paramedics, ECG monitors, heart monitoring equipment, etc. Patient will be
provided with advanced medical support before reaching the hospital.
3. Critical Care Transport - It is known as CCT which has certified registered nurse
based on the severity of the situation. This may be either private or public transport
service. This is generally for the patients who need critical care between hospitals and
other medical facilities. Ambulance facilities in Chennai possess these advanced
healthcare facilities in vehicles.
4. Neo-Natal Intensive Care Transport – This type of transport is helpful in relocating
the new-born babies who require intensive care support.
5. Irrespective of the service type, both the medical transport facilities are certainly a
boon for the patients who are in medical help. Increase in quality ambulance services
in Chennai is a good sign in healthcare as the need for this sector is high. This way
patients can be transported for better health without any hassle.

Selection Criteria and Importance

Unless and until there are adequate facilities available, movement of goods by means of
roads, rails, sea or air will not be successful. The goods are required to move from one place
to another in the most efficient way. There are various factors which influence and affect
transportation in logistics. The construction, production and dispatches are affected by the
following factors:
Terminal facilities: Terminal facilities means all of the required land, infrastructure and
equipment which are very important for operations in a warehouse. They are all used for the
accommodation of products as storage places as well as for transport facilities of those
products. These facilities are not provided to an organisation easily. One of the reasons for
this is that any sort of inconvenience caused to the truck drivers and operators affects the
carrier and not the goods and the project. It is a loss for the carriers.
The storage space of the produced goods must be adequate because if there is no space
available to store any further produced goods, the production gets hampered. For each kind of
goods, there is a different transport facility available in relation to the requirement of those
products. There are different requirements of transport facilities depending upon the
availability, location and type of product. There must be different terminal facilities for
different kinds of products.
While planning for terminal facilities, things such as loading and unloading lines, storage
space, availability of well-constructed roads, and railways, should also be considered. Not
only planning, but the maintenance of these facilities must also be kept in mind because it is
very essential for transportation.
The overall cost of transport includes the expenditures incurred in various other terminal
facilities. For the movement of products by rail, loading lines must be planned for in advance.
The way lines are configured is more important than its length because an easy movement of
goods through connected lines is essential.
Vehicles: One of the most important things to be kept in mind is the use of a specific type of
vehicle for the transport of goods. There are different kinds of goods and commodities which
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DSHM-MHM UNIT 2 SCLMM

are transferred from one place to other which differ in size, volume, nature, etc. Considering
all these things in mind, different vehicles need to be used depending upon specific product
types. In case of transport of goods by sea, the capacity of the ship to carry the loads, the
speed at which it will move needs to be examined. Similarly, in cases of delivery of goods by
roads, rails and air, the size of the vehicles and the type of goods which can be transported
will be examined.
Fuel cost: Fuel cost plays a very vital role in the transport industry. As and when the price of
fuel comes down, the transport price also goes down and vice versa. This indirectly benefits
customers as well.
Government regulations: There is a direct impact of government regulations in the transport
industry. Government may levy specific hours of driving for commercial operators. They
may set certain rules and regulations which directly affect the charges of freight while
carrying goods from one place to another.
Transit time: The distance between the storage place or the warehouse to that of the
customers or the suppliers determines the time in which goods can reach to the ones who
most need it. In general practice, this transit time is not given any attention and this, at times,
leads to higher overall transportation costs. If there is a need for cutting down the transit time,
organisations switch to air transport. However, the lower transit time, in real practices, does
not validate the use of air as a mode of transport.
Some of the most important projects suffer a loss if raw materials and equipment do not reach
on time because it leads to delay in their production activities. Choosing a mode of transport
which is able to deliver goods on time is very important.
The schedules for construction are pre-decided. Along with this, the order numbers and the
processing time for those orders are also pre-decided. The only thing which is often ignored
is the transit time of the goods. Lack of proper planning on delivering goods on time leads to
huge losses for businesses.
Routes and sectional capacities: There are various routes through which goods move in
order to reach their customers. The availability of these routes and their capacity to carry the
same amount of merchandise from the starting point to the point of consumption is very
important. It happens in all organisations where the decision-makers assume that there is
enough number of routes and sectional capacities available for the goods.
Also, there are different speeds and volumes of carrying goods and rules assigned to different
routes of roads, air and water. These minor but important aspects are ignored by
organisations, which affects the time of delivery of merchandise. This is known as the
sectional capacities of different routes.
There are a number of routes available for the movement of goods and, to these routes, there
are a maximum number of moving vehicles assigned at a given point of time, keeping in
mind the availability of terminal facilities.
Distribution pattern: The pattern of distribution of different types of goods is another
important factor that influences transportation. Movement of goods takes place at different
stages of its production; from raw materials supplied to the organisation by the suppliers to

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DSHM-MHM UNIT 2 SCLMM

delivery of finished products to the actual customers. Some goods directly reach the
customers from the warehouse, while some are distributed to the wholesalers, retailers and
then to the final consumers. These different patterns of distribution demand proper
transportation facilities and planning.
Moreover, there are goods which are meant to be sold within the country itself and then there
are goods which need to be exported to different countries. The overall national and
international trade of a nation involves different distribution patterns.
Detailed information regarding the type of goods to be transported, the place where it needs
to be transported, and other important information should be provided to the carrier services
so that they can adequately plan the movement of goods in its entire range.
Nature of product: The most valuable aspect of the movement of goods is the nature of
products that are being moved from one place to another. This aspect demands very
sophisticated planning so as to deliver goods as undamaged to the customers. The type of
containers to be used, the way product needs to be packed, the time in which the product
should reach the consumers, all should be kept in mind. Some goods are perishable and some
are non-perishable and they should be transported accordingly. Some goods require special
handling and should be packed accordingly. These are some of the most important factors
affecting transportation.

Material Handling
The correct amalgamation of technologies can facilitate in the warehouse layout and seamless
flow of products. While poorly managed and inefficient material handling operations lead to
less customer satisfaction and more overhead expenses, they can also pose a significant threat
to the profitability of the manufacturer. Warehouse planning can get positively impacted to a
great extent with the correct use of technologies. In this section, let us take a look at the most
important warehousing areas where technologies create an impact, i.e., material handling and
tracking. In the present economic climate, there is a lot of pressure on organisations for
getting a quicker Return on Investment (ROI). Hence, manufacturers create new material
handling equipment. There is also a need to find out faster solutions for new issues or
problems that crop up frequently. Let us discuss some of the technologies and trends that can
help make this possible.

Equipment’s Used In Material Handling

Material handling equipment can be defined as the mechanical equipment that is used to
move, store, control and protect goods and products through the warehousing process.

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DSHM-MHM UNIT 2 SCLMM

Transport Equipment

Positioning Equipment

Unit Load Formation Equipment

Storage Equipment

Transport Equipment: This equipment is used for moving material from one location to
another like from a storage area to a loading dock. Some examples of transport equipment are
conveyors, cranes and industrial trucks. Conveyors are used when materials need to be
moved over a fixed path between particular points and there is a proper volume flow Another
type of transport equipment is a crane. It is used for transporting loads over vertical and
horizontal paths within a specific area. These are used in cases where the conveyor’s use
cannot be justified and the flow is intermittent.

Positioning Equipment: This equipment is used for handling materials at a single location to
load/unload, feed, orient or control materials for their correct transport, handling and storage
position. Some examples of this equipment are hoists, manipulators and tilt/lift/turntables.
Manipulators serve as muscle multipliers as they counterbalance a load weight for the
operator to lift only a small amount of weight.
Unit Load Formation Equipment: This equipment is used for restricting materials to
maintain their reliability while storing and transporting. If materials have interlocking parts or
a single part, they can be shaped into a unit load without any equipment. Some examples
include cartons, crates, bags, pallets and skids. Pallets are platforms that are generally made
of woods and, in some cases, these are made of rubber, metal, paper or plastics. They have
proper clearance below their face for enabling the fork’s insertion so that they can be lifted
up.
Storage Equipment: This equipment is used to hold or store materials for a specific time
period. Their design as well as their use in the warehouse design represent an exchange
between reducing handling costs and maximising space utilisation. No storage equipment is
required if materials are stacked on the floor directly.

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Assistant Professor
DSHM-MHM UNIT 2 SCLMM

However, in storage, on an average, every individual item has a stack half full. To increase
cube utilisation, the use of storage racks can be made for letting various stacks of multiple
items to cover the space on the floor at different levels. As the number of units for each item
needing storage decreases, the usage of racks starts becoming preferable to floor storage.
Similarly, the depth at which items are stored has an impact on the utilisation of cubes, which
is in proportion to the number of items that need to be stored.
The pallets can be stored with the use of single- and double-deep pallet racks if the number of
units for each item is small.
Push-back and pallet flow racks are used if units per item are of the middle range. Drive-in
and floor storage racks are used if units per item are large. One can either pick individual
cartons from pallet loads or load in carton flow racks using the First-In, First-Out (FIFO)
access. In the case of individual items, equipment, such as drawers, bin shelves and A-
frames, can be utilised.
In addition to the aforementioned handling equipment, modern warehouses use some trendy
handling equipment, such as:
High-speed sortation systems: These systems are used in warehouses and distribution
centres for sorting materials to particular storage zones and routing them to specific dock
doors for the purpose of shipping. A high-speed sortation system that provides high
throughput is easy to maintain and run quietly.
Motorised roller conveyor: A recent emerging technology in the area of conveyors is a 24-
volt Motorised Roller (MDR) conveyor which has a number of additional and unique
advantages over traditional belt-driven and line shaft rollers.

Warehouse Control Systems

Another material handling technology is the warehouse control system. Earlier, material
handling control systems used to be considered as a mere collection of control and
mechanical devices that move materials from one location to another within a warehouse.
Generally, these used to be taken as an inconvenient requirement instead of a competitive
opportunity.
However, in present times, advanced control systems offer an interface between upper-level
software and material handling equipment. With this interface, it is possible to exchange
information between data-driven software (such as Warehouse Management System, WMS)
and material handling equipment.
More advanced level control systems are known as Warehouse Control Systems (WCS)
which offer a single point interface while coordinating system interfaces and equipment. For
instance, a WCS can allow integrating WMS of all equipment with real-time controls. WCS

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DSHM-MHM UNIT 2 SCLMM

can be considered as a middleware between the upper-level decision- making software

(WMS) and floor automation. Floor automation includes various components, such as scales,
vision systems, barcode scanners, apply systems and label printers. These also include
material handling equipment, such as sorters, conveyors and Automated Guided Vehicles
(AGVs). A WCS can complete operational gaps between customers and organisations, if
configured and architected properly, as it provides real-time data for speeding up information,
delivery and processes.
Voice Picking
Another modern material handling technology is the voice recognition system. These systems
are slowly getting popular as more and more organisations are realising their benefits. These
systems offer hands-free and direct communication between a computer and the equipment
operators through a headset. Operators can work with hands-on equipment while they receive
computer instructions. As a result, a safer working environment is created. With the use of
both the hands, the amount of work done by an operator is increased, which can result in
quicker ROI and increased throughput.

Warehousing: Concept
A warehouse is a place used to store inventory. Most tasks that occur in a warehouse are
related to inventory management. These tasks include collecting receipt of products, issuing
of products, recording changes and tracking the movement of the inventory. At times, the role
of a warehouse includes processing of the inventory from entry to exit, and, at times, it is
limited to providing storage facility for products in transit from the point of origin to the point
of destination.
Nowadays, warehouse management has an important role in effective customer service.
Warehousing can play a pivotal role in minimizing supply chain inefficiencies, improving the
value addition during the logistical flow of products and inventory management that includes
consolidation and customization of inventory.
Before the goods are shipped to the point of consumption, a warehouse serves a place where
the goods can be stocked temporarily. A warehouse is an important cog in the supply chain of
products as it forms a crucial part of the chain. If a warehouse is eliminated from the supply
chain, the entire logistics industry would come to a standstill. The smooth supply of goods is
only possible because of warehouses. They form the spine of the supply chain. The size of the
warehouses varies depending upon the number and nature of goods.

Warehousing Elements:

Whether the purpose is strictly storage or storage plus order fulfilment, warehouses use
specific elements that help manufacturers, distributors, and retailers monitor inventory and
store it safely. An overview of basic elements includes:

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DSHM-MHM UNIT 2 SCLMM

•Shelving and rack systems that offer maximum storage capacity and easy product access.

•A climate control system for the product being stored. This is particularly important for
frozen products or those requiring refrigeration, including certain pharmaceutical or
laboratory products, and others that degrade if exposed to too much heat.
•Inventory control software that tells the product owner – who isn’t necessarily the building
owner – where all individual units are in the system at all times.
•Equipment that can move products from point A to point B – forklifts, pallet jacks, bins that
hold products for orders, and conveyor belts, for example.
•Shipping supplies for order fulfilment.
•People who load products into a warehouse and others (“pickers”) who fill orders in a true
distribution centre, plus those who manage the facility and operation.
•Security to protect stored products.
•Access to cost-effective transportation to bring products in or move them out as orders are
fulfilled. That often means easy access to interstates, rail lines, or airports.

Warehouse Management System:

Warehouse Management System (WMS) is the cornerstone of the logistics system. A WMS
constitutes an internal system of the logistics companies, which is highly configurable to
control and manage aspects of storage, distribution, others. A robust WMS is what an
organization needs for an efficient and productive operation, which includes inventory
balance, manage materials, pickup process and auditing.

Importance of WMS:
Warehouse management process is important to meet the most primary business objective,
which is to keep the operations cost low as possible and maximize the profit margin.

1.Inventory Control and Management: The common challenge of most businesses is to

maintain the accuracy of the inventory. An effective WMS will help to manage the inventory
in a fast, easy, and efficient way. It can improve the accuracy of the inventory by decreasing
the order cycle time and improve the order fulfilment. WMS will help to decrease the
inventory level by tracking every aspect of the inventory using real-time information. It will
also serve all clients as WMS facilitates quick response to customers’ demands and queries.
2.Centralized Location: A warehouse management system saves huge time and cost by
getting a centralized storage location. Storage, shipping and distribution are much easy to
have a centralized location as it can overcome the production gap. It can reach the supplier
also the target market. Thus all can have a continuous flow of goods in and out which
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DSHM-MHM UNIT 2 SCLMM

determines the firm’s logistics supply chain system. The centralized location of logistic
warehousing gives the opportunity to have security stocking. It means the manufacturer can
fulfil customer’s orders on time and deliver the right product at the right time.

3.Improve production quality: The production quality will improve by effective inventory
quality and management. The manufacturer can stay up to date with vendor, suppliers and
better track the raw materials or product shelf life. Thus not monitoring the quantities but the
entire production process. It is now easier to get rid of defective products and ensure a high
quality finished goods. By improving the production quality, the manufacturer can also
maximize the company productivity as WMS boosts speed, efficiency, and quality control.

4.Leverage seasonal growth: It takes utmost advantage of the festive and other shopping
seasons to scale the operations. Since it is easy to track the entire production process with
real-time information, the manufacturer can also monitor consumer behavior during peak
season. The tracking system can handle client problems and deliver high-quality customer
service. Warehousing and logistics ensure easy tracking of the shipment through automation
and real-time information. It means that, manufacturer will have better accuracy and reduce
customer complaints by creating availability of what they need. Thus leveraging the seasonal
growth and boosting up operations without additional cost. It means that gaining new
opportunities to hit the high sales number. By having right warehouse management systems,
the manufacturer can sell faster and boost profit which means the high return of investment.

5.Risk management: Warehouse management system is important to handle the fluctuations

in demand and supply and avoid losses. Handle risks with the help of real-time information
on an increase or decrease in the demand of the product. Make the selling decisions
considering the violent rise or fall in prices.

Role of Information Technology in Logistic

E-Logistics is a Dynamic set of communication computing and collaborative technologies
that transform key logistical processes to be customer centric by sharing data, Knowledge and
information with Supply chain partners. E-logistics is defined to be the mechanism of
automating logistics processes and providing an integrated, end-to-end fulfilment and supply
chain management services to the players of logistics processes.
E-logistics helps in managing the new challenges in the supply chain field. The main
components of the e-logistics are multi-channel operations, cross-border tasks, warehouse
plan and inventory, planning, estimating and performance management.

The impact of ICT on the logistics industry:

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Assistant Professor
DSHM-MHM UNIT 2 SCLMM

Information and Communication Technologies (ICT) covers vast areas of technologies such
as mobile and wireless technology, telecommunications, software development, security,
intelligent systems etc. ICT has had a huge impact on industry, the community in general and
our daily lives. ICT can be applied to many fields. One of the emerging applications in recent
years is in logistics.

Logistics is a process which interfaces and interacts between companies, vendors, customers,
carriers etc. and within the company itself using logistics internally. Logistics is responsible
for the movement of products from the vendors through to the delivery at the customer's
door, including moving through manufacturing facilities, warehouses and third-parties, such
as distributors.

Since logistics plays an important role in both industry and daily life and involves many
parties in the supply chain, the system needs substantial agility. This can be done by using
ICT techniques that allow logistics industry to provide more efficient results, since it play an
essential role in warehousing, transportation and information exchange.

Impact of Information Technology in the Field of Logistics:

•A huge advance in information technology has already taken place in all the industries
including changes in the logistics and supply chain. A fast data transfer is a result of
information technology in supply chain management resulting in increased cooperation.
•Information Technology helps to restructure the entire distribution set up to achieve higher
service levels and lower inventory and lower supply chain costs. IT developments have
presented companies with unprecedented opportunities to gain competitive advantage. So IT
investment is the pre-requisite thing for each firm in order to sustain in the market.
•Supply chain management (SCM) is concerned with the flow of products and information
between supply chain members’ organizations. Recent development in technologies enables
the organization to avail information easily in their premises.
•The development of Inter organizational information system for the supply chain has three
distinct advantages like cost reduction, productivity, improvement and product/market
strategies.

Role Of Information Technology in Supply Chain

The different role of IT in logistics and supply chain are:

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Assistant Professor
DSHM-MHM UNIT 2 SCLMM

1.Electronic Commerce: Electronic commerce includes electronic data interchange, e-mail,

electronic fund transfers, electronic publishing, image processing, electronic bulletin boards,
shared databases and magnetic/optical data capture.
2.Electronic Data Interchange: EDI describes both the capability and practice of
communicating information between two organizations electronically instead of traditional
form of mail, courier, & fax. The benefits of EDI are:
•Quick process to information.
 Better customer service.
 Optimize paper work
 Increased productivity.
 Improved tracing and expediting.
 Cost efficiency.
 Competitive advantage.
 Improved billing.

3.Bar Coding and Scanner: Bar coding is a sequence of parallel lines of different thickness
with spaces in between. These bars are nothing but the items of information in the codified
form, which can be read with the help of a scanner. The information printed in bar code
includes country code, manufacturer name, product details, date of manufacture, material
content etc. These details are required at user end for inventory management. Bar Coding and
Scanner has reduced paper work and processing time. It has increased logistics system
productivity through speed, accuracy and reliability.
4.SKU DIM: This SKU (Stock Keeping Unit) DIM capturing is done by weight machine
integration. During previous years this was done manually and it was time consuming. Now
with the help of this DIM, length, width, height, weight of the consignment is measured
without any much hassle and moreover here we can avoid revenue leakage, because in our
experience we have seen users capturing wrong dimensions which lead to wrong calculation
during billing.
5.RFID: RFID is an Automatic Identification and Data Capture (AIDC) technology. RFID
first appeared in tracking and access applications during 1980. RFID-based systems allows
for non contact reading and are effective in manufacturing and other environment where bar
codes could not survive. These are used as an alternative to Barcodes to communicate the
inventory data to the reader via radio waves. RFID wirelessly exchanges information between
a tagged object and a reader. RFID has improved the ability of manufacturers to better
manage the inventory levels. It has improved the tracking, logistics and planning operations.
6.Case ID Capture: This ID is used to capture information on cases, where for each SKU; box
case will be defined with number of SKU units kept inside each unique product cases. In
some cases information will be flown and measured towards UOM which is mentioned as
CASES.

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DSHM-MHM UNIT 2 SCLMM

7.Route Optimization: Truck routing, delivery scheduling and fleet management software
solutions help hundreds of private fleet and logistics operators to cut transportation costs
every day – giving a fast return on software investment.
Some of the uses of this route optimization are:
 Reduce total mileage for lower fuel bills
 Fully utilize the fleet for maximum distribution efficiency
 Cut overtime and agency bills with improved driver productivity
 Optimize the distribution networks to reduce overall transportation costs

8.GPS Tracking (Track & Trace): New and growing logistics companies are quite
apprehensive and skeptical about transport management, claiming that it will only result in
increased expenses that could eventually hurt their business in the long run. This is a common
misconception about GPS tracking.
The benefits of GPS Tracking system includes below:
 Real time monitoring of the shipment
 Reduced fuel consumption
 Improved productivity
 Better Customer Service

9.Last mail Delivery Tracking on Mobility: Last mail delivery plays a vital role in SCM.
Now days B2C transaction is increased and every end customer expects the delivery on time.
To active this, TAT service providers are very key on delivery information capture and
reflecting it in the online sites. The effects of information technology in logistics management
that can be mentioned are improving cooperation relationships in internal and external
dimensions, increasing responsibility, creating new relationships with customers to identify
their needs, developing sales channels, improving performance and improving the
competitive position of the chain. The pressure to invest in technology is high and will
increase. This is because competitors will also be investing in technology to improve the
effectiveness of their supply chains and develop new ways of doing business in order to
achieve competitive advantage.

Role of Logistics In Supply Chain Management

Logistics is considered to be an essential component of supply chain management. It
comprises several modes of transportation that begins from delivering the right products or
goods at the best time.

Here are some of the major roles of logistics in the supply chain:

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DSHM-MHM UNIT 2 SCLMM

1. Order Processing
The major role of logistics in the supply chain begins with order processing as the company
accepts the order from the customer. Effective logistics tends to manage the entire workflow
that starts from order placement to delivery. Nowadays, the order processing activity is
technical-centric which is crucially dependent on the size of the business as it focuses on
fulfilling the customer orders. A well-managed logistics ecosystem ensures that the orders are
properly prepared, packaged, and delivered to the destination. These are the major functions
of order processing-
 Picking inventory
 Order placement
 Sorting
 Packing
 Shipping
2. Warehouse Management
Managing and storing the inventory is a major process of warehouse management system
because it safeguard the goods which are to be distributed to the customers. It plays a huge
role in the supply chain as it is the centralized location that stores all the inventory, whether it
is raw materials or finished goods. Therefore, it is always advisable that warehouses should
be near to the dealer or the distributors’ place for the efficient delivery of the goods.
Therefore, a warehouse management system effectively audits and tracks the materials and
goods. Also, it is responsible for determining the special requirements like docking facilities,
cold storage, etc.

3. Inventory Management
It is among the logistics functions that determine and identify how much stock is needed to
order at what time. As it is important to maintain sufficient level inventories for fulfilling the
customer demands. It helps organizations to monitor inventory records for restocking and
predicting the demand for goods, ensuring safety, and so on. Effective inventory management
tends to determine and analyze if there is too much or too little stock in the warehouses. It
will help you to meet the customer demands through production and optimizing the
inventory. Therefore, tracking inventory databases is essential to making decisions about
supply chain operations.
4. Transportation
The act of transporting the goods throughout a company’s supply chain efficiently is the most
important role of logistics management. It involves automated routing and route optimization
that tremendously saves cost and determines the success of supply chain management. In the
contemporary world, implementing technological advancements in logistics activities is
highly inevitable as it manages the overall operations and strengthens customer loyalty.
Therefore, it involves the movement of goods from one point to another by following the

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DSHM-MHM UNIT 2 SCLMM

compliance and regulations in the logistics industry. Investing in a fleet management system
can mitigate the transportation risk.
5. Packaging
During transport and handling, the products or goods can be subjected to breakage or spillage
so good packaging is necessary to prevent any kind of mishap. The role of logistics
management is to ensure that the products are safely transferred in large volumes from point
A to point B. The necessary measures should be taken to avoid regulatory issues and make
transportation cost-effective in the logistics industry. Having the right logistics packaging is
majorly important for a well-packaged product that can prevent your product from any kind
of damage, deterioration, and tampering.
6. Demand Forecasting
Logistics demand forecasting is an effective way to anticipate the requirement for products or
goods in the supply chain management process. The scheduling and planning of processes are
important to manage the uncontrollable conditions or circumstances of the market. Therefore,
forecasting models help businesses to make informed decisions by predicting customer
demands and fulfilling the orders in the shortest time span. Therefore, the use of modern
technology with advanced analytics and powerful databases can take your organization to the
next leap.
7. Quick Response
One of the most important roles of logistics is to resolve the customer query in the shortest
time span. It enables the fleet owners to manage the supply chain for meeting consumer
demands. Therefore, it helps the organizations to operate reactively to each order without
bottlenecks, delays, and errors. A quick response strategy can lead to accuracy and fulfillment
of customer orders. Responding to the customers in real-time is the most constructive
business practice. In the contemporary world, deploying new-age technology can save a lot of
time by meeting the customer’s needs.

8. Material Handling
It is necessary that logistics companies should store and protect the materials throughout the
process of manufacturing, warehousing, and distribution. Handling the materials efficiently
can ensure that the products or goods are reaching safely to the customers with ever-rising
shipping costs. The role of logistics management is to embrace and support the diverse needs
of the customers by analysing the product demand and implementing robust material
handling systems. Therefore, optimizing the logistics processes by improving the material
handling and streamlining the delivery times can improve the overall customer service.

9. Fleet Management
Tracking and monitoring commercial vehicles with the best GPS company in Jaipur is an
important function of logistics as it manages cost and improves the maintenance of fleets. It
enhances the safety of the drivers and fleets by providing real-time visibility to businesses. It
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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

is the best way to enhance operational efficiency and ensure compliance within the supply
chain. In order to effectively manage fleets, businesses are using new-age technologies like
Artificial Intelligence, the Internet of Things, Big Data and so on to improve vehicle
performance and utilization. Therefore, it is known to be the major role of logistics
management as it is the most effective way to establish customer retention by delivering the
goods to the right customers at the right time.

10. Information and Control

Data-driven logistics operations are fundamental processes of supply chain operations. It is
essential to monitor and manage the operations to make better decisions. However, getting
insightful information for operating a workflow can help businesses to achieve transparency
in the entire supply chain. Information and control are most valuable for achieving strategic
goals and strengthening the future of the logistics industry. Analysing and understanding the
logistics operations tends to simplify the overall management processes. As it helps the
organizations keep track of day-to-day activities. Therefore, monitoring the flow of
information can help businesses in creating holistic supply chain management.

Role Of Logistic In an Economy

To understand what is happening within the economy and what is likely to happen, upstream
activity needs to be measured. These measures do not necessarily replace matrices such as
GDP, but they need to get a complete picture of current and future trends.
The Logistics Managers Index is an attempt to measure key elements of the economy across
the supply chain in the United States. Researchers have found that inventions, transportability
and prices, and warehousing are elements of the economy that are found at every step in the
supply chain. By looking at the changes in these economic components, we can better see
what is happening in the present and what is likely to happen in the near future.
LMI is a monthly cooperative research enterprise between several supply chain management
universities and supply chain management professionals (CSCMP). We collect data directly
from logistics and supply chain executives with trends in warehousing, transportation and
inventory across a wide spectrum of industries. The Logistics Managers Index consists of
eight metrics as well as an overall index score. When interpreting our results, any value
above 50.0 indicates an increase, and any value below 50.0 indicates a contraction. Simply
put, higher numbers = more growth, and fewer numbers = more contractions.

Transportation metrics–that include transport cost, transport capacity, and transport usage –
have shown to be the most energetic steps in the LMI. For many of 2018, Transportation
Costs reached to the 80s and 90s, which–considering that the scale only goes around 100.0–is
rather significant. This lined up together with all the span of growth we saw in the market.

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SUMAIYA A.QADEER
Assistant Professor
DSHM-MHM UNIT 2 SCLMM

Like the general indicator, Transportation Price started a dramatic slide beginning last fall.
Nonetheless, in December that the Transportation Price Index was up 12.0 points into 52.0, in
the preceding month’s reading of 41.0 (that was the lowest stage of any metric at the
background of this indicator ).

Role Of Logistic In Healthcare Sector

While healthcare has treatment and prevention as its main focus, hospitals, clinics, and
other facilities need medications, syringes, gauzes, and other supplies to treat patients.
Hospitals also need files, paper, computers, and other items for administrative purposes
and keeping record of patients and treatment outcomes.
How Hospitals Secure Supplies
The two main ways in which hospitals secure supplies are by working with distributors
and by buying directly from manufacturers. Purchasing supplies from distributors has
many benefits, the main one being that they are able to ship multiple supplies. To this,
logistics services providers cater to both large and small shipments and offer medical
courier services, flight and land logistics solutions, and more.
Timing of Services
Healthcare logistics providers also feature route, messenger, hot shot, and same day
services. Messenger services, for example, include returning completed documents,
paying filling fees, securing signatures, and more. Hot shot services are also offered to
healthcare providers that require special delivery by a dedicated truck and driver. Route
services are designed for customers that ship medical supplies on a regular basis,
including laboratory and medical specimens, mail, medical records, and documents.
They are offered scheduled monthly, weekly, and daily pickup, shipment, and delivery,
based on timing requirements.

30
SUMAIYA A.QADEER
Assistant Professor