Importance of Logistics and Supply Chain

Topics: Logistics, Supply chain management, Supply chain Pages: 6 (1523 words) Published: February 25, 2012
Q: explain the importance of logistics / Supply Chain Management & What Strategies and planning Use with it. Discuss ANS :
Before the explain the importance of Logistics I want to introduce the logistic history . Early people had the choice of Consume the goods at their immediate location or moving the good to a preferred site and storing them for a letter use .However because no well Developed transportation And Storage system yet existed .the movement of goods was limited to want and individual could personally move .a storage of commodity was possible for only short time. This limited movement –storage system generally constrained to people live close to the sources of production Even today in some Areas of world Consumption and production take Places only within a very limited geographic region some population live in Small Self Sufficient Villages and most of goods needed by the resident are produced in the immediate Vicinity .few goods are import ted from other areas .therefore production Efficiency and Economics Standard of living is low .in this type of economy a well Developed and inexpensive logistics system would encourage an exchange of goods with other production areas of the country or even in the world In start I want to put some Definition of supply chain management Monczka, Trent, and Handfield (1998)

Supply Chain Management requires traditionally separate materials functions to report to an executive responsible for coordinating the entire materials Process, and also requires joint relationships with suppliers across multiple tiers. SCM is a concept, “whose primary objective is to integrate and manage the sourcing, flow, and control of materials using a total systems perspective across multiple functions and multiple tiers of suppliers.” La Londe and Masters (1994)

Supply chain strategy includes: “... two or more firms in a supply chain entering into a long-term agreement; ... the development of trust and commitment to the relationship; the integration of logistics activities involving the sharing of demand and sales data; the potential for a shift in the locus of control of the logistics process. Stevens (1989)

The objective of managing the supply chain is to synchronize the requirements of the customer with the flow of materials from suppliers in order to affect a balance between what are often seen as conflicting goals of high customer service, low inventory management, and low unit cost. Houlihan (1988)

Differences between supply chain management and classical materials and manufacturing control: “1) The supply chain is viewed as a single process. Responsibility for the various segments in the chain is not fragmented and relegated to functionalareas such as manufacturing, purchasing, distribution, and sales. 2) Supply chain management calls for, and in the end depends on, strategic decision making. “Supply” is a shared objective of practically every function in the chain and is of particular strategic significance because of its impact on overall costs and marketshare. 3) Supply chain management calls for a different perspective on inventories which are used as a balancing mechanism of last, not first, resort . 4) A new approach to systems is required—integration rather than interfacing. Jones and Riley (1985)

“Supply chain management deals with the total flow of materials from suppliers through end users.. Cooper et al. (1997)
Supply chain management is “... an integrative philosophy to manage the total flow of a distribution channel from supplier to the ultimate user.

Supply Chain Management Activities
1. Integrated Behavior
2. Mutually Sharing Information
3. Mutually Sharing Risks and Rewards
4. Cooperation
5. The Same Goal and the Same Focus on Serving Customers
6. Integration of Processes
7. Partners to Build and Maintain Long-Term Relationships
Logistics / Supply chain is a collection of functional Activities ( transportation , inventory Control etc,)...
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