Chapter 2 - Logistics and information technology (1)

IBS3002 Logistics & International Trade Chapter Logistics & information technology Contemporary logistics, Murphy (2015) Topic areas  Benefits of effective and efficient use of information for logistics management  Types of information systems and their logistical applications  The Internet’s influence on logistics  Information technology challenges Benefits of effective and efficient use of information  Greater knowledge and visibility across the supply chain  Greater awareness of customer demand via point-of-sale data  Better coordination of manufacturing, marketing, and distribution  Streamlined order processing and reduced lead-times General types of information management systems General Types of Information Management Systems  Office automation systems Provide effective ways to Process personal and organizational business data Perform calculations Create documents Include general software packages Word processing Spreadsheet (most relevant for logisticians) Presentation Database management applications Spreadsheet (most relevant for logisticians) Able to solve for basic logistic optimization models through add-in packages such as “What’s Best” Giúp bên liên quan làm việc cách tương tác chia sẻ thơng tin nhiều hình thức khác Ví dụ cơng nghệ viễn thơn General Types of Information Management Systems  Communication system Help stakeholders work together by interacting and sharing information in many different forms Examples of telecommunication technologies: Fax machines Personal computers Electronic mail Cellular phones Tablets Smart phones General Types of Information Management Systems  Communication system Examples of logistics information technology Electronic data interchange (EDI) Viewed as the measuring stick in the 1990’s Wireless communication Emerged as the measuring stick during the first decade of the twenty-first century Device examples include Global positioning systems (GPS) Tablets (such as Apple’s iPad) General Types of Information Management Systems  Transaction Processing System (TPS) Collects and stores information about transactions Efficient processing of transactions with a choice of Real-time processing or Batch processing Examples include Electronic data interchange (EDI) Automatic identification technologies Essential component in point-of-sale (POS) systems Thu thập lưu trữ thông tin giao dịch Xử lý hiệu giao dịch với lựa chọn Xử lý thời gian thực Xử lý hàng loạt Những ví dụ bao gồm Trao đổi liệu điện tử (EDI) Công nghệ nhận dạng tự động Thành phần thiết yếu hệ thống General Types of Information Management Systems  Transaction Processing System (TPS) Benefits of EDI Reduced document preparation and processing time Increased cash flow Reduced inventory carrying costs Increased billing accuracy Reduced personnel costs Increased productivity Reduced Information float Increase customer satisfaction Reduced shipping errors Reduced lead times Reduced order cycle times Reduced ordering costs General Types of Information Management Systems  Transaction Processing System (TPS) Benefits of EDI Reduced document preparation and processing time Increased cash flow Reduced inventory carrying costs Increased billing accuracy Reduced personnel costs Increased productivity Reduced Information float Increase customer satisfaction Reduced shipping errors Reduced lead times Reduced order cycle times Reduced ordering costs 10 General Types of Information Management Systems  Decision Support Systems (DSS) Examples of logistics-related application-specific software: Transportation management systems (TMS) Software package that automates the process of building orders, tending loads, tacking shipments, audits, and payments Warehouse management systems (WMS) Software package that provides oversight of the storage and flow of materials within a company’s operations2 17 General Types of Information Management Systems  Decision Support Systems (DSS) 18 General Types of Information Management Systems  Decision Support Systems (DSS) Data mining – a DSS technique Is the application of mathematical tools to large bodies of data in order to extract correlations and rules1 Dependent on data warehouses Central repository for all relevant data collected by an organization 19 General Types of Information Management Systems  Enterprise Systems Create and maintain consistent data processing methods and an integrated database across multiple business functions1 Enterprise Systems example: Enterprise resource planning (ERP) “lets a company automate and integrate the majority of its business processes, share common data and practices across the enterprise, and produce and access information in a real-time environment”1 Shortcomings of Enterprise resource planning (ERP) Costs of installation Time-consuming installation process 20 Initially lacked strong application-specific logistical capabilities such as The Internet’s Influence on Logistics Approximately 35% of the world’s population uses the internet – up from 5% at the beginning of the 21st century Specific Influences on Logistics Include: Online retailing Cloud computing Electronic procurement 21 The Internet’s Influence on Logistics Similarities between online retailing and in-store retailing Logistical Functions and Activities •Transportation •Warehousing •Materials handling •Order management Equipment and Materials • Bar coding • WMSs 22 The Internet’s Influence on Logistics Differences between online retailing and in-store retailing Online Retailing •More, smaller orders •Order management systems must handle large volumes of orders •Information management systems capable of correctly transmitting each order so it can be filled in a timely fashion •Smaller orders dictate open-case picking In-store Retailing • Fewer, larger orders • Order management system is set up to handle orders from resellers, not consumers • Full-case picking • Warehouse set up to handle large volume orders 23 The Internet’s Influence on Logistics Differences between online retailing and in-store retailing Online Retailing •Products slotted to facilitate picking smaller orders •Totes and push carts used •Packaging is small cartons, envelopes, bags suited to holding small quantities In-Store Retailing • Variety of materials handling equipment used • Packaging generally cartons that hold large volume orders 24 The Internet’s Influence on Logistics ifferences between online retailing and in-store retailing Online Retailing •Transportation companies used with extensive delivery networks; experience in parcel shipments •Outbound shipments usually picked up by vans •Return rates much higher and from ultimate consumers In-store Retailing • Transportation methods and companies vary by request of buyer • Outbound shipments may be picked up by tractor trailers or railcars • Return rates lower and from resellers 25 ... effective and efficient use of information for logistics management  Types of information systems and their logistical applications  The Internet’s influence on logistics  Information technology. .. (MIS) and Executive Information System (EIS) - Convert TPS data into information for monitoring performance and managing an organization - Objective is to provide managers and executives the information. .. really need - A logistics information system (LIS) can be defined as “the people, equipment, and procedures to gather, sort, analyze, evaluate, and distribute needed, timely, and accurate information