The Management Of Business Logistics 2
Logistics is much more and much wider concept than plain physical handling of goods. Logistics is a critical part of supply chain management focusing on a number of key activities such as transportation, inventory, forecasting, warehousing, industrial packaging, customer service, materials’ handling, communication technology, order processing and purchasing. In particular:
* Transportation: the selection of the best transportation mode (air, rail, water or truck)
* Inventory Management: balancing inventory levels to achieve high customer service levels
* Demand Forecasting & Planning: determination of the quantity to be ordered
* Warehousing: facilities location and design to meet customer service levels
* Customer Service: right product at the right place at the right time
* Materials Handling: minimization of the movement of raw materials, work in process and finished goods
* Communication Technology: link suppliers to customer demand patterns to facilitate Just-In-Time (JIT) product refill
* Order Processing: the use of e-commerce to facilitate information exchanges
* Purchasing: the selection of the best supplier to meet quality requirements
The importance of logistics is reflected on the fact that they have a significant impact on a manufacturer’s ability to satisfy customers and business performance. The level of manufacturing flexibility in the firm, as reflected on the presence of advanced process technology and the participation of manufacturing management in strategy formulation, alters logistics role in organizational success. Moreover, logistics can be approached in many different ways for analysis purposes. Logistics management is often analyzed through a systematic approach that emphasizes total cost and trade-offs on a short-run or a long-run perspective. pangee.