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After studying this chapter you will be able to understand: A revised strategy is generating great top management interest, setting customer service goals, transportation, inventory management, order processing and information flows, warehousing, materials handling, acquisition (purchasing), protective packaging, product scheduling, information maintenance.
Logistics Management LSM 730 Lecture Dr Khurrum S Mughal 1-1 Scope of the Supply Chain for Most Firms Business logistics Physical supply (Materials management) Sources of supply Physical distribution Plants/ operations • Transportation • Inventory maintenance • Order processing • Acquisition • Protective packaging • Warehousing • Materials handling • Information maintenance Customers • Transportation • Inventory maintenance • Order processing • Product scheduling • Protective packaging • Warehousing • Materials handling • Information maintenance Focus firm’s internal supply chain 1-14 Key Activities/Processes • • Primary – Setting Customer service goals – Transportation – Inventory Management – Order Processing and Information Flows Secondary, or supporting – Warehousing 1-3 Key Activities/Processes • Primary – Setting Customer service goals (work with marketing) • • • – Identify customer needs and wants for logistics customer service Determine customer response to service Set customer service level – directly related to costs 1-4 Transportation (primary cost absorbing activity Key Activities/Processes • Primary – Inventory Management (adds time value to the products, bridges the gaps between supply and demand) • Raw Materials and finished goods stocking policies • Short term sales forecasting • Product mix at stocking points • Number, size and location of stocking points • Just-in-time (low levels), push (forecasting based) and pull (order based) strategies 1-5 Key Activities/Processes • Secondary, or supporting – – Warehousing • Space Determination • Stock layout and dock design • Warehouse configuration • Stock placement Materials Handling • Equipment selection 1-6 Key Activities/Processes • Secondary, or supporting – – Acquisition (Purchasing) • Supply source selection • Purchase timing • Purchase quantities Protective Packaging • Handling • Storage 1-7 ... points • Number, size and location of stocking points • Just-in-time (low levels), push (forecasting based) and pull (order based) strategies 1-5 Key Activities/Processes • Secondary, or supporting... supporting – Warehousing 1-3 Key Activities/Processes • Primary – Setting Customer service goals (work with marketing) • • • – Identify customer needs and wants for logistics customer service... Determine customer response to service Set customer service level – directly related to costs 1 -4 Transportation (primary cost absorbing activity Key Activities/Processes • Primary – Inventory