Practical Approach to Transport Logistics

Timeline of Transport related laws

Two Acts have an important part in the role and function
of the bill of lading, the Carriage of Goods by Sea
Act 1971, which succeeded the Carriage of Goods by Sea
Act 1924, and the Carriage of Goods by Sea Act 1992,
“which repealed the Bills of Lading Act 1855.

2014-2015
1952-2006 .MULTIMODAL
• Myanmar Inland TRANSPORT LAW
1934-1952 Waterway Transport
.Customs SEA Land
Act - 1952
• The Myanmar • Myanmar Domestic ACT(Amended)
1905-1925 Carriage by Air Act -
1934
Airway Transport Act -
.Highways Law(new)
1963
• The Yangon Port Act - • The Myanmar Aircraft • Land and Sea
1905 Act - 1934 Transport Businesses .Tax Law(New)
• The Defile Traffic Act - • The Myanmar Act – 1963
1907 Lighthouse Act - 1937 -Road Transport Law
• Motor vehicle Law -
1841-1890 • The Ports Act - 1905 • The Maritime 1964 -Rail Transport Law
• The Out ports Act - Navigation Treaties • Road and bridge usage
•The Myanmar 1914 Act - 1952 2015
Registration of
law - 1985
• The Inland Stream • Vessel Traffic Act - • Highways Law - 2000
Ships Act - 1841
Vessels Act - 1917 1952
•The Bills of Lading • Myanmar Maritime
Act -1856 • The Myanmar • Myanmar Inland University Law - 2002
•The Carriers Act - Merchant Shipping Waterway Transport
• Maritime Resources
1865 Act - 1924 Act - 1952
and River Maintenance
•The Obstructions in • The Myanmar Law - 2006
Fairways Act - 1881 Carriage of Goods by
•The Railways Act - Sea Act - 1925
1890
4
 Basic Principles
• Time (Speeds, predictablity, Velocity +Visibility
(responsiveness), Saving…?)

• Cost (cheapest, quickest, safest...?)

• Quality (Safety, Satisfactory…?)
• Responsiveness
• Flexibility
• Availability (On shelf availability, service…..?)
• Dependability (Trust, confidence…..?)
• Sustainability
 COST

• Cost is the most important feature of any product or

services

• Cost cannot be reduced without

affecting quality
• Quality can be improved without
increasing cost
• Cost can be reduced by
improving quality
6 J Horck: ISO 9000, QA
 Quality is:

• To keep what you promise and

not promise anything you not can keep.
• Compliance with specified requirements
• Fitness for use
• Customers satisfaction

7 J Horck: ISO 9000, QA

 Visible Quality Trust
The globalization of markets,
increasing quality requirements
and though, faster- pace, price-
sensitive competition have led to
Quality awards
 COMPETITIVE ADVANTAGE vs CUSTOMER VALUE
Logistics management is almost unique in its ability to impact both
the numerator and the denominator of the customer value ratio. This
point becomes clearer if we expand the ratio as follows:
Quality X Service
CUSTOMER VALUE = ---------------------------
COST X TIME

Quality: The functionality, performance and technical specification of the offer.

Service: The availability, support and commitment provided to the customer.

Cost: The customer’s transaction costs including price and life cycle costs.

Time: The time taken to respond to customer requirements,

e.g. Delivery lead times.
Source: Johansson, H.J., McHugh, P., Pendlebury, A.J. and Wheeler, W.A., Business Process
Reengineering, John Wiley & Sons, 1993.
 What is transportation?
Transportation is the movement of
people and goods from one
location to another. Modes of
transport include air, rail, road,
water, cable, pipeline, and space.
 TRANSPORT DEFINITION

•MODE OF TRANSPORT : Way to perform or Method

•MEANS OF TRANSPORT: Vehicle to use

•TYPE OF TRANSPORT : Mode & Means

 Transportation-Related Service Elements
• Speed: time-in-transit
• Availability: accessible to customers when they want it
• Dependability: pick-up and delivery time variability
• Flexibility: adjustment to shipper’s needs
 Basic Modes of Transportation and cost characteristics

MODE FIXED COST VARIABLE COST Traffic composition

RAIL HIGH LOW bulk food, mining, heavy mfg
TRUCK LOW MEDIUM consumer goods, light mfg
WATER MEDIUM LOW bulk food, mining, chemicals
AIR LOW HIGH high-value goods, rush shipments
PIPE HIGH LOW petroleum, chemicals, mineral slurry
Rail
High fixed costs, low variable costs
High volumes result in lower per unit (variable) costs
Highway
Lower fixed costs (don’t need to own or maintain roads)
Higher unit costs than rail due to lower capacity per truck
Terminal expenses and line-haul expenses
Water
High terminal (port) costs and high equipment costs (both fixed)
Very low unit costs
Air
Substantial fixed costs
Variable costs depend highly on distance traveled
Pipeline
Highest proportion of fixed cost of any mode due to pipeline ownership and maintenance and extremely low variable costs
 Relative Operating Characteristics
Operating
characteristics Rail Motor Water Air Pipe
Speed 3 2 4 1 5
Availability 2 1 4 3 5
Dependability 3 2 4 5 1
Capability 2 3 1 4 5
Frequency 4 2 5 3 1
Composite 14 10 18 16 17

1 = best, 5=worst
 Introduction - Transport
_______________________________________________________
UNIMODAL TRANSPORT:
The Carriage of Goods by one single mode of Transport, namely Road, Rails, Sea,
Inland Waterway, Air, Space.
Unimodal Transport covers the entire transport including transshipment if the
second leg of transport is the same mode but in the different means of transport,
such as Sea transport using feeder and mother vessel.

What is Intermodal Transport ?

- has been defined as
“the movement of goods in one and the same loading unit or road
vehicle, which uses successively 2 or more modes of transport
without handling the goods themselves in changing modes.”

What is Combined Transport ?

- “is defined as “intermodal transport where the
major part of the European journey is by rail, inland & waterways or sea
and any initial or final legs
carried out by road are as short as possible.”
DHL to Deliver Medicine via Drone
 Routes of Goods
May
change
Air Air transpor-
plane
terminal terminal tation
Goods at modes
shippers Container
terminal Container Freight
vessel terminal/
bulk goods forwarder
Freight mid-stream port warehouse
pier
forwarder
barge
warehouse

Rail railway Rail

station station Goods at
consignees
truck

NODE MODE NODE

MULTIMODAL TRANSPORT
UPS
 အခန္း (၁)
အမည္နင
ွ ့္ အဓိပၸါယ္ ေဖာ္ျပခ်က္

(ဇ) ေထာက္ပပ့ျဖည့္ဆည္း စီမပေဆာင္ရက

ြ ္မွွဳ (Logistics) ဆုိသည္မွာ ကုန္ၾကမ္းရွာေဖြမွွဳမွသည္
ကုန္ေခ်ာအဆင့္ထိ ထုတ္လုပ္ေရး၊ ထားသုိေရး၊ ျဖန္႔ျဖ းေရး၊ ျမန္ဆန္ သြက္လက္စြာ ကုန္စည္စီးဆင္ေရး၊
ကုန္တင္သြင္းေရး၊ တင္ပုိ႔ေရးနွင့္ ျပည္တြင္း ျပည္ပရွိ စားသုပးသူမ်ား၏ လုိအပ္ခ်က္နွင့အ
္ ညီ
၄င္းတုိ့ထပအေရာက္ ပုိ႔ေဆာင္နုိင္ေရးတုိ့အတြက္ သတင္းအခ်က္အလက္မ်ား ရယူျပီး စရိတ္စက
သက္သာစြာျဖင့္ ၾကီးၾကပ္၍ ထိေရာက္စြာ အေကာင္အထည္ေဖာ္ကာ စီမပခ်က္ခ်ျပီး ေခတ္မီသိပၸပနည္းက်
လုပ္ကုိင္ေဆာင္ရြက္ေပးသည့္ နည္းလမ္း (သုိ႔မဟုတ္) စနစ္ကုိ ဆုလ
ိ သ
ို ည္။

Logistics is concerned with managing two key flows:

• material flow of the physical goods from suppliers through the
distribution centers to stores;
• information flow of demand data from the end-customer back to
purchasing and to suppliers, and supply data from suppliers to the
retailer, so that material flow can be accurately planned and controlled.
A logistics configuration showing the key components of logistics and the
importance of physical flows and information flows
 Upstream Supply Network Downstream
nd
2 tier 1st tier 1st tier 2nd tier
The logistics task of
suppliers suppliers customers customers
managing material
Primary manufactures

flow and information

End - Customers
FOCAL flow is a key part of
FIRM
the overall task of
supply chain
Inbound logistics Internal logistics outbound logistics management.
Supply Chain Management

• Logistics refers to management of materials and information.

• Inbound logistics deals with links between the focal firm and its
upstream suppliers, while
• outbound logistics refers to the links between the focal firm and its
downstream customers.
• Internal logistics deals with planning and control of material flow
within the boundaries of the focal firm.
 Inbound Logistics
Raw material Supply Raw material
points Storage Transport
Transport
Storage Plant 1

Movement/ Transportation
Movement/ Transportation

Outbound Logistics
Manufacturing Transport Finished Goods Transport Markets

Plant Warehouse A

Physical distribution is concerned with the transporting of merchandise, raw materials, or by-
products, such as hazardous waste, from the source to the customer.

Materials management is the branch of logistics. Specifically, this covers the acquisition of
spare parts and replacements, quality control of purchasing and ordering such parts, and the
standards involved in ordering, shipping, and warehousing the said parts.

24
 Integrated logistics system

Strategically managing and controlling the flow of goods, information and other resources
like product, services, and people, from the source of production to the marketplace.

Raw Material Raw Material Manufacturing Finished goods Markets

supply points storage storage
Movement/ Movement/ Movement/
Transport Transport Transport
Transport Transport Transport

Storage Plant 1 Warehouse A

Transportation is part of the logistics.

the flow of goods, information and services

Promoting the speed of the flow is a key to logistics management.
 Transportation Decision Making in
an Integrated Supply Chain

Macro Understand total network flows Strategic

Understand individual lane flows

Decision Flow
Decision Scope

Understand current
carrier usage patterns

Make mode/carrier
decisions
Routing/Scheduling,
Load Planning, etc.

Micro Product/Info Flows Operational

Inbound Outbound

Supplier Manufacturer Customer

Info/Return Goods Flows

1963 National Council
of Physical
Distribution
Management
(NCPDM)

1985 Council of
Logistics
Management

2005 Council of Supply

Chain
Management
Professionals
(CSCMP)
Components of
logistics management : Management actions

Planning Implementation Control Outputs of logistics

Inputs into logistics

Natural resources Marketing

(land, facilities, Logistics management orientation
and equipments) Suppliers Raw In-process Finished Customers (competitive
materials inventory goods advantage)
Time and
Human resources
Logistics Activities place utility

•Customer Service •Plant and warehouse Efficient

Financial resources site selection movement to
•Demand forecasting
customer
•Distribution •Procurement
Information communications •Packaging
resources •Inventory control •Return goods handling Proprietary
•Material handling •Salvage and scrap asset
•Order Processing disposal
•Parts and service •Traffic and
support transportation
•Warehousing and
storage
Logistics FUNCTIONS CONTENTS
TRANSPORT
Transport long trip, line haul, traffic function, one to one
Pick-Up short trip, area access function many to one
Delivery short trip, area, ingress function, one to many

STORAGE AND DEPOSIT

Storage Longtime inventory
Deposit Short time inventory

Assembling
Handling Check, Sorting, stock, picking, allotment
Processing Construction, Slice, Cutting , Measurement
Assembling Price tagging, Unitization, Packing

Packaging, Wrapping
Packaging For transport and inventory
Wrapping For marketing

Cargo Handling
Loading From facility to transport mode
Unloading From transport mode to facility
Handling Replacement, reshipment, material handling

Information
Physical Distribution Quantity control: cargo tracing, inventory control
Quality control: temperature, humidity
Handling management: sorting machine, picking system
Commercial Trade Placing and receiving order: POS,EOS,VAN,EDI
Financing: banking on-line, EDI
 The major forces driving logistics

other 5%

globalization 20%
DRIVERS

IT intgration 25%

speed 35%

service 55%

cost 75%

0% 10% 20% 30% 40% 50% 60% 70% 80%

cost service speed IT intgration globalization other

% of responses
The Logistics (Strategic) Planning Triangle

Strategy/Control Which mode?

system? Which carrier?
How much? Which route?
Where? Shipment size and
frequency?

Where?, How
many? What size?
Allocation?
 Transportation vs Logistics
Is it a systematic Transportation? Is there any Logistics concept?

Tracking such flow in a comprehensive and systemic manner is a

precondition to obtain as effective logistics management.
 3 objectives
of
Transport logistics strategy:

1. Cost reduction (variable costs)

2. Capital reduction (investment, fixed costs)
3. Service Improvement (may be at adds
with the above two objectives).
• A supply chain is a network of

Valued END-CUSTOMERs
collectively convert a basic
partners who collectively convert a network of partners

into a finished product

RAW MATERIAL
basic commodity (upstream) into a

Down stream
Up stream
finished product (downstream) that commodity adds value
Focal
is valued by end-customers, and Firm
who manage returns at each stage.
• Each partner in a supply chain is
responsible directly for a process
that adds value to a product.
A process:
Transforms inputs in the form of materials and information into outputs in the form of goods and
services.
 What is SCM?
• SCM encompasses the planning and controlling of all processes involved in
procurement, conversion, transportation and distribution across a supply
chain.
• SCM includes coordination and collaboration between partners, which can
be suppliers, intermediaries, third party service providers, and customers.
• In essence, SCM integrates supply and demand management within and
between companies in order to serve the needs of the end-customer.
• Supply chain management (SCM) involves planning and controlling all of the
processes from raw material production to purchase by the end-user to recycling of
the used things.
• Planning refers to making a plan that defines how much of each product should be
bought, made, distributed and sold each day, week or month.
• Controlling means keeping to plan - in spite of the many problems that may get in
the way.
• The aim is to coordinate planning and control of each process so that the needs of
the end-customer are met correctly.
Supply chain management is concerned with managing the entire
chain of processes, including raw material supply, manufacture,
packaging and distribution to the end-customer.
 Upstream Supply Network Downstream
nd
2 tier 1st tier 2nd tier
1st tier
suppliers suppliers customers customers Materials flow from left (upstream) to
right (downstream).
Primary manufactures

End - Customers
FOCAL
FIRM

Inbound logistics Internal logistics outbound logistics

Supply Chain Management

• each link can connect with several others. A focal firm is shown at the centre of
many possible connections with other supplier and customer companies.
• The supply chain can be seen in this diagram as a number of processes that
extend across organisational boundaries.
• The focal firm is embedded within the chain, and its internal processes must
coordinate with others that are part of the same chain.
• aspects of managing the supply chain are:
• Purchasing and supply deals with a focal firm's immediate suppliers
(upstream).
• Physical distribution deals with the task of distributing products to tier 1
customers (downstream).
 1.2- Material and information flow
the supply network around three main factors: the flow of materials, the flow of
information and the time taken to respond to demand from source of supply.
THE NETWORK IN CONTEXT
Finance Flow
FIG-1.4 Material Flow (supply)

END-CUSTOMER
RAW MATERIAL

Down stream
Up stream

Focal
Firm

INFORMATION
TIME
• The network is best seen as a system of interdependent processes, where actions in one
part affect those of all others.
• The key 'initiator' of the network is end-customer demand on the right: only the end
customers are free to make up their mind when to place an order.
• After that, the system takes over. How networks are structured, the different ways in which
they may choose to compete, and how their capabilities have to be aligned with the needs
of the end-customer.
Example of a confectionery network map
Supply chain Management
 Material flow and information flow
Key issue: What is the relationship between material flow and information flow?

The goal is continuous, synchronous flow.

Continuous means no interruptions, no dropping the ball, no unnecessary accumulations
of inventory.
Synchronous means that it all runs like a ballet. Parts and components are delivered on
time, in the proper sequence, exactly to the point they're needed.

INTEGRATING DEMAND AND SUPPLY CHAINS

DEMAND SIGNAL

Plan

Supply Source Make Deliver Supply Source Make Deliver Source Make Deliver SELL

Return Return
Return Return Return Return
Supplier: Focal Firm Customer:
Internal or external Internal or external
DEMAND FULFILMENT
 Transportation mode

Supply chain
Transport Transport Transport Transport
Logistics Logistics Logistics Logistics

Suppliers Manufacturers Wholesalers Retailers Consumers

 Supply chain management is a wider concept than logistics
Logistics
Management
•Logistics is essentially a
planning orientation and
framework that seeks to
create “a single plan for the
flow of products and
information” through a
business
•Characteristic of Logistics-
buyer/supplier relationships
Supply Chain
Management
•SCM builds upon this framework and seeks to achieve
“linkage and co-ordination between the processes of
other entities in the pipeline”, i.e. suppliers and
customers, and the organization itself.
•The concept– of the development of a logistics pipeline
approach for products to flow through the supply chain to
the end customer.
•“goal” of SCM might be to reduce or eliminate the
buffers of inventory that exist between organizations in a
chain through the sharing of information on demand and
current stock levels.
•“focus” of SCM is on co-operation and trust and the
recognition that, properly managed, the ‘whole can be
greater than the sum of its parts’.
 What is Logistics Management?

Logistics is the process of strategically managing the

Procurement,
Movement and storage of materials,
Parts and finished inventory (and the related information flows)
through the organization and its marketing channels
In such a way that
current and future profitability are maximized
through the cost-effective fulfillment of orders.
 Globalization
Trade Liberalization
Transport Developments
Growth in ICT

Global market Reduced tariff Semi finished Multiple Intense

access barriers goods sourcing competition

Demanding
Effective Ability to
Productive Buyers
export bring goods
capacity High quality
competitiveness to market
Reliable delivery
 Need for efficient &
competitive transport

Trans-Asian Railway Asian Highway

(TAR) ICD’s (AH)

Maritime Transport
 Globalization
Supply Chain is part of Glogalization

Logistics is part of Supply chain

•Transportation is part of the logistics.

THANK YOU FOR YOUR ATTENTION