Logistics and SCM

Logistics

“Logistics is the management of the flow of resources between the point of origin and in order to meet some requirements, for example, of customers or corporations. The resources managed in logistics can include physical items, such as food, materials, equipment, liquids, and staff, as well as abstract items, such as time, information, particles, and energy. The logistics of physical items usually involves the integration of information flow, material handling, production, packaging, inventory, transportation, warehousing, and often security. The complexity of logistics can be modeled, analyzed, visualized, and optimized by dedicated simulation software. The minimization of the use of resources is a common motivation.”

~ Wikipedia on Logistics

“Logistiikka on materiaali-, raha- ja tietovirtojen hallintaan erikoistunut käytännönjohteinen tieteenhaara. Siinä käsitellään yritysten ja laitosten materiaalivirran fyysistä, tiedollista ja taloudellista hallintaa hankinnasta asiakkaalle saakka.”

~ Suomenkielinen Wikipedia on logistiikka

A w:supply chain ( w:fi:Toimitusketju ) is a system of organizations, people, activities, information, and resources involved in moving a product or service from supplier to w:customer. ( Wikipedia )

w:Mode of transport is a term used to distinguish substantially different ways to perform transport. ( Wikipedia )

w:Reverse logistics stands for all operations related to the reuse of products and materials. It is "the process of planning, implementing, and controlling the efficient, cost effective flow of raw materials, in-process inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal. ( Wikipedia )

The w:waste hierarchy is a classification of w:waste management options in order of their environmental impact, such as: reduction, w:reuse, w:recycling and recovery.

Mode of sea transport over time:

Sail -

Steamship (S/S) ( approx. 1770 - early 1900's ) -

Motor Ship ( M/S) -

w:Containerization ( 1960's) -

LNG powered ships ( 2010's )

---

SCM

“Supply chain management (SCM) is the management of an interconnected or interlinked between network, channel and node businesses involved in the provision of product and service packages required by the end customers in a supply chain.”

~ Wikipedia on Supply chain management

“Toimitusketjun hallinta (Supply Chain Management, SCM) tarkoittaa tavaroiden toimituksen ja palveluketjun optimointia. Kaikkien toimitusketjun osapuolien; toimittajien, jakelijoiden, alihankkijoiden ym. liikekumppaneiden yhdistämistä ja koko ketjun tehokasta hallinnointia. Tavoitteena on lisätä kaikkien jäsenten välistä kommunikointia ja siten alentaa kustannuksia, lisätä myyntiä ja tehostaa asiakaspalvelua. ”

~ Suomenkielinen Wikipedia on Toimitusketjujen ja logistiikan hallintajärjestelmä

Week 36

• Raw material extraction and supply

• Component manufacturers

• Final product manufacturers

• Reverse logistics is also needed in SCM ( already discussed in Logistics )

• Value chain management capability refers to an organisation’s capacity to manage the internationally dispersed activities and partners that are part of its value chain. ( Wikipedia )

• Value chain is a chain of activities that a firm operating in a specific industry performs in order to deliver a valuable product or service for the market. ( Wikipedia )

4 strategic decisions

1. What w:modes of transport to use ?
2. What carriers in each mode will the use ?
3. Own w:fleet or hire outsiders ?
4. Will the company manage transportation operations or hire a 3rd party ?

• w:Just in time (business) (JIT) is a production strategy that strives to improve a business return on investment by reducing in-process inventory and associated carrying costs. ( Wikipedia )

• Fleet vehicles are groups of motor vehicles owned or leased by a business or government agency, rather than by an individual or family. Typical examples are vehicles operated by car rental companies, taxicab companies, public utilities, public bus companies, and police departments. In addition, many businesses purchase or lease fleet vehicles to deliver goods to customers, or for sales representatives to travel to clients. ( Wikipedia )

• w:International logistics vs.
• Global sourcing is the practice of sourcing from the global market for goods and services across geopolitical boundaries. Global sourcing often aims to exploit global efficiencies in the delivery of a product or service. These efficiencies include low cost skilled labor, low cost raw material and other economic factors like tax breaks and low trade tariffs. ( Wikipedia )

Week 39

• Purchasing refers to a business or organization attempting to acquiring goods or services to accomplish the goals of its enterprise. ( Wikipedia )

• A purchase order (PO) is a commercial document and first official offer issued by a buyer to a seller, indicating types, quantities, and agreed prices for products or services the seller will provide to the buyer. Sending a purchase order to a supplier constitutes a legal offer to buy products or services. Acceptance of a purchase order by a seller usually forms a contract between the buyer and seller, so no contract exists until the purchase order is accepted. ( Wikipedia )

World class purchasing must accomondate

• Total quality management / TQM is an integrative philosophy of management for continuously improving the quality of products and processes. ( Wikipedia )

• Just in time (JIT) is a production strategy that strives to improve a business return on investment by reducing in-process inventory and associated carrying costs. ( Wikipedia )