Logistics

Logistics defined (History)   

The word logistics has originated from the greek word Logistikos and the latin word logisticus meaning the science of calculating and computing. In ancient time it was more in connection with the art of moving armies and supplies of food and armaments to the war front. The usage of this word can be traced back to the 17th century, when it was probably used in the first time by the french army .

and equipment across the border. . after the world war II. Today logistics has acquired a wider meaning and is used in business for the movement of raw material from suppliers to mfg and finely the finished goods to the consumer.Logistics defined (History)   During world war II logistics gained gained importance in army operations . the army officially used the word logistics . In the US . covering the movement of supplies men.

Logistics defined  Philip kotler defines logistics as ³the process of planning. implementing. . and controlling the physical flows of materials and finished goods from the point of origin to point of use to meet the customers need at a profit´.

The logistics concept is based on the µsystem¶ approach.a system concept   In a mfg enterprises the business process starts with the flow of material from the suppliers . . through the distribution channel. and then to the customer. progresses to the mfg plant .Logistics.

   Logistics covers the following functional area. Information flow: Order registration Order checking coordination . and are termed as µLogistics Mix¶ by martin christopher.Logistics.a system concept  1.

Logistics. Warehousing  Material storage  Load unitizing and material handling  Site selection and network planning  Order picking  Dispatch documentation .a system concept 2.

Logistics. Packing:  For handling and damage prevention 5.a system concept 3. Inventory Control  Material requirement planning  Inventory level decisions for customer 4. Transportation  Route planning  Vehicle scheduling  Mode selection .

Process logistics: This includes storage and movement of raw material and components within the mfg premises.Three logistics phases:  1. . 2. Logistics delivers values to the customer through 3 logistical phases: Inbound logistics: This includes movement of raw material and component for processing from supplier.

transportation. and inventory management of finished goods.Three logistics phases: 3. Outbound logistics: This includes the warehousing . .

 Through the financial accountancy perspective. Inventory reduction: It is one of the prime factors that can adversely affect the bottom line an enterprise. inventory is an asset and does not cause any appreciable disadvantage.  Traditionally. . firms carry excess inventory for the purpose of extending excellent customer service.Objectives of logistics managem 1. even when stocked in excess.

.  Logistics should be consistency in delivery performance.Objectives of logistics management: 2. Reliable and consistence delivery performance: Timely delivery is crucial to the customer to keep up his production schedule. this will help in building customer confidence and contribute to creating long term relationships.

Objectives of logistics management: 3. route planning.transport mode selection. long distance shipments etc. Freight economy: Freight is the major cost element in logistical cost. . This can be reduced by adopting measure like freight consolidation .

.  The reason for product damages are improper logistical packing. Minimum product damages: Product damage adds to the logistics cost.Objectives of logistics management: 4. frequent consignment handling. absence of load unitizing.

Objectives of logistics management: 5.  The usage of latest technologies in information process and communication will enhance the decision making capability in terms of accuracy and time. Quick response: This aspect is related to the capability of the firm to the customer in the shortest time frame. .

CUSTOMER SERVICE   Customer service is a set of activities and programmes designed and implemented by a business firm to make the buying experience more rewarding. Good customer service builds customer loyalty amongst existing customer and through positive word-ofmouth communication. Customer service is the most important dimension of the product/service offered to the customer. attracts new customer. .

which will help in moulding the organization towards customer orientation and in turn influence the perception of the firm in the mind of the customer. Pre-transaction phase: This is an important phase of the exchange process. Customer service is the measure of how logistics creates time and place utility for a product. .CUSTOMER SERVICE PHASE  1.

the Caterpillar. makes a policy commitment to deliver spare parts to its customer within 24 hours of placement of an order. Customer service policy statement in written form: This will indicated the service standards of the firm.CUSTOMER SERVICE PHASE Following are the important elements of the pretransaction phase: a. For ex.  . a leading construction equipment mfg company in the world.

Organization building : For implementing policy directives on customer service the firm should formalize the reporting structure. The contact persons name and the contact number needs to be informed to the customers for getting information on order status. delegate authority .CUSTOMER SERVICE PHASE b. . warranty claims. and allocate responsibility. dispatch details .

. industry standards. Structuring the service: The basic structure of the service depends on customer expectations.CUSTOMER SERVICE PHASE c. and the service standard the firm would like to maintain. The supplier may extend free. periodic product checkup service to gain competitive edge.

transit damages etc. Customer education : This is required for minimizing customer complaints on product deliveries. training. . spare parts inventory requirements and maintenance. product operation and maintenance. freight charges. Customer education is done through manuals. seminars or workshop.CUSTOMER SERVICE PHASE d.

These tasks need coordination for the entire system to be efficient & effective in delivering the service to the customer as per the desired standard.CUSTOMER SERVICE PHASE 2. . Transaction Phase: During transaction phase customer service is associated with routine tasks performed in the the logistics supply chain.

processing. . material planning . packing & transportation . Order fulfillment reliability : In the transaction phase it depends on the coordination and management of various components of the order cycle such as order processing. picking.CUSTOMER SERVICE PHASE a. allocation.

Order convenience: This is the ease with which the customer can place an order.CUSTOMER SERVICE PHASE b. complex payment terms. poor communication network at the suppliers' end. c. . Delivery consistency : The other imp factor in the transaction phase is consistency in delivery of repeat orders. compliance to various procedures. The barriers to convenience are the paper work required by the supplier. and poor coordination in the marketing network of the supplier.

Product substitute: A situation may arise in which the product ordered cant be shipped due to certain mfg or quality problems. In such cases the seller may honour his commitment by offering a substitute product of similar or better quality in different sizes from the available brands in the market with the customer¶s consent. .CUSTOMER SERVICE PHASE d.

CUSTOMER SERVICE PHASE 3. a. Order status information b. claims. returns c. Post-transaction phase: This phase is related to customer satisfaction and building up of a long term relationship with the customer. Customer education and training . Customer complaints .

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