PPT for Logistic Mgt unit 1 and Unit II

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Logistics Management

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Logistics Management:

Logistics Management UNIT -I HIMALAYA PUBLISHING HOUSE 1

INTRODUCTION:

INTRODUCTION Logistics is a challenging and important activity Links - suppliers with customer- across a company The growth in telecommunication and transportation technologies has led to further growth of the supply chain. The supply chain, also known as the logistics network. It plays an important role in making the product conform to customer requirements. HIMALAYA PUBLISHING HOUSE 2

Meaning, Definition & CONCEPT of Logistics:

Meaning, Definition & CONCEPT of Logistics MEANING : It is a Management of the flow of goods between the point of origin and the point of use in order- to meet the requirements of customers or corporations . DEFINITION: Council of Supply Chain Management Professionals, “ Logistics is the process of planning, implementing and controlling procedures for the efficient and effective transportation and storage of goods including services and related information from the point of origin to the point of consumption for the purpose of conforming to customer requirements and includes inbound, outbound, internal and external movements ”. CONCEPT: Inbound logistics Outbound logistics HIMALAYA PUBLISHING HOUSE 3

LOGISTICS FIELDS:

LOGISTICS FIELDS 1.Procurement logistic: 1. Internal User 2. Emergency Response/ Beneficiaries 3. Stock replenishment Procurement Sourcing Internal Users Emergency Response/ Beneficiaries Stock replenishment Central Warehouses Field warehouse/ Hubs HIMALAYA PUBLISHING HOUSE 4

LOGISTICS FIELDS:

LOGISTICS FIELDS 2. Production Logistics: Procurement Logistics Production Logistics (within plant) Sales Logistics Procurement MKT Production Materials Warehouse Customers IT kitting services IT kitting services Trunkmate Moving/ Office relocation Maintenance & repair Logistics Relevant logistic HIMALAYA PUBLISHING HOUSE 5

LOGISTICS FIELDS:

LOGISTICS FIELDS 3 . Distribution Logistics: Raw Material Raw Material Production Process Intermediary Intermediary Customer Customer Customer Physical Distribution / Logistics HIMALAYA PUBLISHING HOUSE 6

LOGISTICS FIELDS:

LOGISTICS FIELDS 4. Disposal Logistics: HIMALAYA PUBLISHING HOUSE 7

BUSINESS LOGISTICS:

BUSINESS LOGISTICS HIMALAYA PUBLISHING HOUSE 8

LOGISTICS OUTSOURCING:

LOGISTICS OUTSOURCING It involves - relationship between a company and an LSP. HIMALAYA PUBLISHING HOUSE 9

TYPES OF LOGISTICS:

TYPES OF LOGISTICS HIMALAYA PUBLISHING HOUSE 10

LOGISTICS MANAGEMENT & its IMPORTANCE :

LOGISTICS MANAGEMENT & its IMPORTANCE Importance : Transform in the customers attitude Product life cycles are contracting The power in distribution chain is shifting from the manufacturers to the trade Companies are centralizing production to gain economies of scale. HIMALAYA PUBLISHING HOUSE 11

MEANING AND DEFINITIONS OF SUPPLY CHAIN MANAGEMENT:

MEANING AND DEFINITIONS OF SUPPLY CHAIN MANAGEMENT Meaning of Supply Chain Management Supply Chain Management refers to an integrated management of various functions in the areas of materials, operations, distributions, marketing and services after sales with a customer focus in perspective so as to synergize various processes in the organizations with a view of optimizing the total cost Definitions of Supply Chain Management According to American Production and Inventory Control Society, “ Supply Chain Management is the organizations that successively transform raw materials into intermediate goods , then to final goods and deliver them to customers”. According to Harland, “ Supply chain management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers”. HIMALAYA PUBLISHING HOUSE 12

INBOUND LOGISTIC PROCESS:

INBOUND LOGISTIC PROCESS Step-1: Recording and Receipts Step-2: Load Arrival Step-3: Receiving Real-Time Information Step-4: License Plate Tracking Step-5: Put-Away and Receipt Close HIMALAYA PUBLISHING HOUSE 13

INTERNAL LOGISTICS IN SCM:

INTERNAL LOGISTICS IN SCM I mportant for large manufacturing companies. It manages, arranges, plans and delivers the finished products . It is an indispensable part of the supply chain Point of sale systems,- POS HIMALAYA PUBLISHING HOUSE 14

OUTBOUND LOGISTICS IN SCM:

OUTBOUND LOGISTICS IN SCM The processes involved in the movement and storage of products and how related information flows from the end of the production line to the firm's customer Concepts - storage and transportation. HIMALAYA PUBLISHING HOUSE 15

THE OUTBOUND PROCESS:

THE OUTBOUND PROCESS Step-1: Order Entry, Adds, Changes and Deletions Step-2: Replenishment and Product Picking Step-3: Packing, Staging, Checking and Loading Step-4: Shipping and Document Generation HIMALAYA PUBLISHING HOUSE 16

DEVELOPING THE LOGISTICS ORGANIZATION FOR EFFECTIVE SUPPLY CHAINMANAGEMENT :

DEVELOPING THE LOGISTICS ORGANIZATION FOR EFFECTIVE SUPPLY CHAINMANAGEMENT Strategic Structural Functional Implementation HIMALAYA PUBLISHING HOUSE 17

LOGISTICS SYSTEM:

LOGISTICS SYSTEM HIMALAYA PUBLISHING HOUSE 18

DEVELOPMENT OF INTEGRATED LOGISTICS STRATEGY :

DEVELOPMENT OF INTEGRATED LOGISTICS STRATEGY Originally developed for military purposes, it is also widely used in commercial product support or customer service organizations. Various stages of Development of Integrated Logistics Strategy: The Product Support Management Facilities and Infrastructure Maintenance Planning and Management Manpower and Personnel Packaging, Handling, Storage, and Transportation Supply Support Support Equipment staining Engineering spans Technical Data Management Training and Training Support HIMALAYA PUBLISHING HOUSE 19

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LOGISTICS IN MAXIMIZING PROFITABILITY & CASH FLOW HIMALAYA PUBLISHING HOUSE 20

THIRD-PARTY LOGISTICS (3PL) TYPES OF THIRD PARTY LOGISTICS:

THIRD-PARTY LOGISTICS (3PL) TYPES OF THIRD PARTY LOGISTICS C ompany's use of third-party businesses to outsource elements of the company's distribution and fulfillment services. Standard 3PL Provider- P erform activities such as, pick and pack, warehousing, and distribution. Service Developer- O ffer their customers advanced value-added services such as tracking and tracing, cross-docking, specific packaging etc The Customer Adapter- C omes in at the request of the customer and essentially takes over complete control of the company's logistics activities. The Customer Developer- These providers will have few customers, but will perform extensive and detailed tasks for them. HIMALAYA PUBLISHING HOUSE 21

FOURTH PARTY LOGISTIC (4PL):

FOURTH PARTY LOGISTIC (4PL) The concept of a 4PL provider is an integrator that accumulates resources, capabilities and technologies to run complete supply chain solutions Fourth party logistic service providers often have no means of transport and warehouses (non-asset based logistics ) Fourth party logistic service providers often check the entire supply chain. The organizational and executive activities are again often outsourced to other parties. HIMALAYA PUBLISHING HOUSE 22

INTERNATIONAL LOGISTICS IMPORTANCE& BENEFITS:

INTERNATIONAL LOGISTICS IMPORTANCE& BENEFITS International logistics involves the management of resources in a company's supply chain across at least one international border . HIMALAYA PUBLISHING HOUSE 23 IMPORTANCE Production Inputs Transportation Logistic Customs Clearance Supply Chain BENEFITS Wide Network of Resources Save Time and Money Industry Expertise & Experience Scalability and Flexibility Best Practices and Optimization

REVERSE LOGISTICS:

REVERSE LOGISTICS HIMALAYA PUBLISHING HOUSE 24

Slide25:

THANK YOU HIMALAYA PUBLISHING HOUSE 25

PROCUREMENT:

PROCUREMENT UNIT - II HIMALAYA PUBLISHING HOUSE 26

MEANING, BENEFITS & IMPORTANCE OF PROCUREMENT :

MEANING , BENEFITS & IMPORTANCE OF PROCUREMENT HIMALAYA PUBLISHING HOUSE 27 BENEFITS Obtaining the Best Price Developing Expertise Negotiating Contracts Maintaining Consistency IMPORTANCE Better chance to meet business goals Cost Reductions Lower Supply Chain Risks Advanced Process Management

PROCUREMENT MANAGEMENT:

PROCUREMENT MANAGEMENT HIMALAYA PUBLISHING HOUSE 28 Identification of need F inding &qualifying the supplier Requesting proposal Negotiating with supplier Contracting Delivery Analyzing result

MEANING ,IMPORTANCE & TYPES OF SOURCING:

MEANING ,IMPORTANCE & TYPES OF SOURCING Sourcing refers to a number of procurement practices, aimed at finding, evaluating and engaging suppliers for acquiring goods and services. IMPORTANCE: L ower operational and labor costs P rovide a buffer capital fund to companies S pecially offshoring helps companies mitigate risk E nables companies to realize the benefits of re-engineering TYPES: Single sourcing Multi-sourcing Outsourcing HIMALAYA PUBLISHING HOUSE 29

SOURCING OF MATERIAL:

SOURCING OF MATERIAL The role of materials sourcing - Extremely challenging Important goals of sourcing- Reducing time and costs If sourcing managed improperly- supply chain interrupted A periodic review- Ensures achievement A ssessment are based on: Goods are produced in accordance with the safety management principles of Fertilizers Europe Goods satisfy the requirements of reach and other legal legislation Goods and the supply chain satisfy requirements to security HIMALAYA PUBLISHING HOUSE 30

MEANING, ADVANTAGES & DISADVANTAGES OF GLOBAL SOURCING :

MEANING, ADVANTAGES & DISADVANTAGES OF GLOBAL SOURCING MEANING: Sourcing from the global market for goods and services across geopolitical boundaries ADVANTAGES: L ow cost manufacturing Learning global business skills DISADVANTAGES: No exposure of international culture, traditions and beliefs. Hidden costs related to different time zones and languages HIMALAYA PUBLISHING HOUSE 31

GLOBAL SOURCING OF ISSUES & PROBLEMS:

GLOBAL SOURCING OF ISSUES & PROBLEMS Global sourcing - Procurement strategy takes advantage of global efficiencies for the delivery of goods and services. ISSUES OF GLOBALLY SOURCED GOODS AND SERVICE: Goods produced in China - low production cost BPOs staff- low cost English proficiency people (IT - software and hardware) Global sourcing - Associated with a centralized procurement strategy for a multinational International procurement organizations (or IPOs) - Element of the global sourcing strategy for a firm . GLOBAL SOURCING OF PROBLEMS: Language differences- To discuss complex technical issues Payment methods for international transaction & Cash flow issues Shipping procedures, C ultural differences , Managing the supply chain Global sourcing is often associated with a centralized procurement strategy for a multinational, 32

MEANING OF E-PROCUREMENT & ITS BENEFITS:

MEANING OF E-PROCUREMENT & ITS BENEFITS MEANING : E-procurement is the electronic purchase and sale of goods and services, usually through an Internet-based platform. BENEFITS: Reduced Costs Transparent Spending Increased Productivity Eliminating Paperwork Increased Transaction Speed Standardized Buying Reduced Errors HIMALAYA PUBLISHING HOUSE 33

GROUP PURCHASING & BENEFITS OF JOINING A GROUP PURCHASING ORGANIZATION:

GROUP PURCHASING & BENEFITS OF JOINING A GROUP PURCHASING ORGANIZATION Group purchasing is a process that allows several individuals or businesses to come together for the purpose of purchasing various types of goods and services at discounted rate. BENEFITS: Saves Time Fighting for the Little Guy Competitive Edge Trust and Safety It's a Two-Way Street HIMALAYA PUBLISHING HOUSE 34

AUCTIONS & RESERVE AUCTIONS:

AUCTIONS & RESERVE AUCTIONS Auction is a process - buying and selling goods or services by offering them up for bid, taking bids, and then selling the item to the highest bidder. TYPES OF AUCTIONS: Primary Auction Secondary Auction Unique bid auction Lloyd's syndicate auction Reserve auction is the minimum amount that the owner of an item up for auction will accept as the winning bid in the auction . JAPANESE REVERSE AUCTIONS HIMALAYA PUBLISHING HOUSE 35

CREATING AND MANAGING SUPPLIER RELATIONS:

CREATING AND MANAGING SUPPLIER RELATIONS Supplier relation is the systematic approach of assessing suppliers' contributions and influence on success, determining tactics to maximize suppliers' performance and developing the strategic approach for executing on these determination FOUR STEPS FOR SUCCESSFUL SRM: Segment the supply base Build a supplier governance framework Build key performance indicators Create supplier strategies HIMALAYA PUBLISHING HOUSE 36

SUPPLIER PARTNERSHIPS & MULTI-TIER SUPPLIER PARTNERSHIPS:

SUPPLIER PARTNERSHIPS & MULTI-TIER SUPPLIER PARTNERSHIPS SUPPLIER PARTNERSHIPS : Focus on continuous improvement. Share information, risks and successes with suppliers to establish a long-term mutual partnership . User quantitative measurement to judge if improvements are performed . MULTI-TIER SUPPLIER PARTNERSHIPS: Multi-tier supply chains are multiple single-tier collaborations , means multiple supplier-buyer-relations, within one supply chain Manufacturers need multi-tier connectivity because: Well-coordinated product launch I mproved daily coordination of activities Faster reaction to demand and capacity change S hare demand forecasts and commitments with suppliers Real-time collaboration on capacity plans, forecasts and supply schedules. HIMALAYA PUBLISHING HOUSE 37

CHALLENGES & BENEFITS OF MULTI-TIER SUPPLY CHAIN MANAGEMENT::

CHALLENGES & BENEFITS OF MULTI-TIER SUPPLY CHAIN MANAGEMENT: CHALLENGES- Time to synchronize, Complexity, Information sharing and Costs. BENEFITS- More Seamless Product Launches Ongoing Streamlined Operations Reduced Planning Cycle Improved Supplier Performance Less Supply Chain Risk HIMALAYA PUBLISHING HOUSE 38

Slide39:

THANK YOU HIMALAYA PUBLISHING HOUSE 39

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