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Logistics Management

Logistics Management

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Published by: ppramodd on Sep 05, 2010
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y Logistics Defined:
y The Process of planning, implementing, and controlling

the efficient, effective flow and storage of goods and services, and related information from the point of origin to point of consumption for the purpose of conforming to customer requirements.
" Council of Logistics Management

y Logistics Management Defined:
y The managerial responsibility to design and administer a

system to control the flow of material, work in process and finished inventory to support business unit strategy.
" Bowersox and Closs, Logistical Management

The case of Bombay Dabbawallahs

y BDO (Bombay Dabbawallahs Operations) is operated by a

group of 5000 individuals organized in form of a cooperative known as NMTBSA (Nutan Mumbai Tiffin

Box Supplier Association).
y About NMTBSA: y History y Charitable trust y Avg. Literacy Rate y Total area coverage y Employee Strength y Number of Tiffin's y Time taken

: Started in 1890 : Registered in 1956 : 8th Grade Schooling : 60 Kms to 70 Kms : 5000 : 2,00,000 Tiffin Boxes
: 3 hrs

WORK IS WORSHIP Tiffin basket s weight: 75-80 kgs. .

m.y Error Rate : 1 in 16 million transactions y Six Sigma performance (99.00/month) y Standard price for all (Weight. y No strike record as each one a share holder y Earnings . 300/month ($ 6.5000 to 6000 p. Turnover approx. 36 Cr. Space) y Rs. y Cost of service . . y Diwali bonus: one month s from customers. Distance.999999) y Technological Backup : Nil.Rs.

How do they do it ? y Organizational Structure y Operations y The Code y War against Time (9:00 am 12:30 pm) .


: Code for Dabbawala at residential station : Code for destination Station eg. Churchgate Station (Nariman Point) 12 E 3 .Coding System VLP : Vile Parle (suburb in Mumbai) 9EX12 : Code for Dabbawalas at Destination EX : Express Towers (building name) : Floor no.

Zones for destination Grant Road (12) Point of Aggregation And Sorting A B C D E Lower Parel (14) Churchgate (1-10) 1 2 3 4 5 6 7 Collection from home Distribution By Carriers at lunchtime To offices .

y 8:30 AM 9:00 AM y The individual dabbawallah visits the pre-assigned set of household under their area of operation. y 9:30 AM 10:30 AM y Sorting of the lunchboxes takes places as per the coding system . y After the collection of approx. the boxes are brought to the nearest sub urban railway station for sorting and onward transportation. 35 lunch boxes.

) y This time period is actually the journey time. they choose to occupy the last compartment of the train.000 disputes But no excuses. The dabbawalas load the wooden crates filled with tiffins onto the luggage or goods compartment in the train.y 10:34-11:20 am (Andheri Stn. Generally. 12 coach train 4.000 commuters 8. Duty first .

the unloading takes place at the destination station y Re-arrangement of tiffins takes place as per the destination area and destination building .y 11:20 12:30 pm (Church Gate Station) y At this stage.

This crate carries 150 tiffins and is driven by 3-4 dabbawalas! .Fort .y In particular areas with high density of customers (Nariman Pt. CST).. a special crate is dedicated to the area.

y 3:30 ² 4:00 PM (At Destination Station) y The dabbawalla·s meet for the segregation as per the destination suburb. eat their own lunch) y 3:00 PM ² 3:30 PM Here on begins the collection process where the dabbawalas have to pick up the tiffins from the offices where they had delivered almost an hour ago. . play cards.y 1:00 ² 3:00 PM y The members hang around (Gossip.

the dabbawalas lighten up the moment with merry making.y 4:00 ² 4:40 pm y The return journey by train where the group finally meets up after the day s routine of dispatching and collecting from various destination offices y Usually. since it is more of a pleasant journey compared to the earlier part of the day. joking around and singing. .

The group meets up at origin station and they finally sort out the tiffins as per the origin area .y 4:40 ² 5:00 pm ( The Origin Station) y This is the stage where the final sorting and dispatch takes place.

UTV. AAJ TAK. ‡CASE STUDY ± ‡ICFAI Press Hyderabad ‡Richard Ivey School of Business . SONY TV. STAR TV.‡ World record in best time management. TV TODAY. ‡ Documentaries made by BBC . ‡Registered with Ripley's believe it or not . TV TOKYO. ‡Name in GUINESS BOOK of World Records . ZEE TV. NDTV. SAHARA SAMAY. CNN.Ontarion . CNBC TV 18. MTV.

y Customers Service y Demand forecasting y Distribution communication y Inventory control y Material handling y Order processing y Procurement y Packaging y Return goods handling y Salvage & scrap disposal y Traffic & transportation y Warehousing & storage .

y Increase in the transportation costs y Fundamental changes in inventory y Increased use of computers y Increased awareness in people about the product y Economic regulation reduction y Globalization y Increase in power of retailers .

y Rapid Response y Rapid response is concerned with a firm s ability to satisfy customer service requirements in timely manner. y Minimum Variance y Variance is an unexpected event that disrupts performance of the system. . y Minimum Inventory y The aim of LM is to reduce and manage inventory to the lowest possible level while simultaneously achieving desired operating aim.

from distribution centres to stores.y Logistics is typically considered as the sub-set of SCM. . from supplier to plants. y SCM has five key functions: y Procure y Make y Move y Store y Service y Logistics is involved at various stages of supply chain. from stores to customers. from plants to distribution centres.

Complexity of a Typical Global Supply Chain Freight Forwarder Customs Agent Ocean liner Supplier Roadways Plant Roadways Port Airways Road + Rail Home Consumer Customer (Retailer) Customer¶s Warehouse DC Roadways .

Distributor Purchasing and Supplier Marketing Interface Middle .Warehousing and Transportation Back end .Customer Contact (Marketing) FRONT END MIDDLE BACK END Functions of Logistics .Cross Functional Nature of Logistics Front end .


Retailer Requirements      Supplier Requirements  Speed to compliance Lower inventory Cross-docking Value-added services Higher number of SKUs Direct-to-consumer Configure-to-order Customer / retailer satisfaction Operational productivity Transportation efficiency Improved in-stock positions Lower inventory Flexible business practices  Imperfect Information       .

Bulk Finished Goods Manufacturer s Distribution Center Manufacturer Bulk Shipments Retail Outlet Store Distributions Local Retail Distribution Center   Hold inventory Value added services .

1 Inbound receipt of goods 2 Storage of goods 3 Bulk outbound shipments 2 1 3 .

Manufacturer Manufacturer s Distribution Center Advanced shipping notice  Bulk or discrete shipments  Store specific pricing  Retail Outlet Local Retail Distribution Center     Lower inventory Greater availability Cross-docking Flow-through .

1 2 3 Inbound shipment tracking Yard management Inbound receipt of goods 4 Storage of goods 5 Order picking 6 Value-added services Value- 7 Order packing 8 Pack and hold 9 Outbound customer compliant shipments 2 3 4 8 5 1 9 7 6 .


y How many plants and/or warehouses? y Where should the plants and/or warehouses be located? y What volume throughout should each plant and / or warehouse have? y Which plant should service what warehouse and which warehouse should service what customers? .

y Operational Performance It means the elapsed time from order receipt to delivery. . A firm s operational performance can be measured in terms of how flexible it is in accommodating unusual and unexpected request of customers.y Availability This denotes having inventory to consistently meet the need of the customer material or product requirements. It pertains to the quality attributes y Service Reliability of logistics.

spare parts. machinery and tools from suppliers.y Physical Supply Management of flow of raw materials. Management of finished goods from the factory to the customers y Physical Distribution y Logistical controls Efficient co-ordination of physical supply and distribution sub-systems .

y Shippers y Suppliers y Carriers y Warehouse providers y Freight forwarders y Terminal operators y The Government y Customers .

y Service y Cost Minimization .

y Service y Cost Minimization Supply Chain Logistics Management .

y Service y Logistics Service Quality Process Dimensions y Logistics Service Quality Outcome Dimensions y Cost Minimization .

y Service y Logistics Service Quality Process Dimensions y Procedures y Contact y Information y Discrepancy y Logistics Service Quality Outcome Dimensions y Cost Minimization .

y Service y Logistics Service Quality Process Dimensions y Logistics Service Quality Outcome Dimensions y Timeliness y Availability y Condition y Accuracy y Cost Minimization .

y Service Benefits y Cost Minimization .

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