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What is the company's logistics system? Because logistics is increasingly important? How do you design a new logistics system?
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The logistics system
Saturated market
Healthy market
Ideas
Product Lifecycle
Proliferation of the range
Price war
… fast suppliers
Quick lead time …
Necessary flexibility
To be competitive:
The lessons from Japan: The 4 strenght for a company
Technolgy: to create needs
The involvement of human resources
Quality
Logistics
The different stages of logistics
Material management
Before production:
Supply Management
Raw materials inventory Management
Production Planning
Distribution management
After production:
Finished goods inventory management
Warehouse Management
Transport Management
Logistic Manager
Must ensure …
The 7 right conditions
1. Right product2. In the right quantity3. In the right condition4. In the right place5. At the right time6. The right customer7. At the right cost
The 7 right conditions
Why logistics?
A well-organized flow of materials …
… increases the turnover
… because it reduces delivery time
… and improves service levels
But at the same time reduces costs
Inventory cost: before
Inventory costs: after
Warehouse costs: before
Warehouse costs: after
Transport cost: before
Transport costs: after
Integration of functions
Because there’s an increasing need for logistics? The outsourcing
The Outsourcing ….
allows respect for delivery times
but increases the flow of goods and information to manage
Because there’s an increasing need for logistics? To save resources
Logistics helps to save
Thanks to BPR …
Inventory and transport are razionalized
Because there’s an increasing need for logistics? Customer service
Are reduced delivery times
Orders are completed
What does make logistics
Analyze the logistics system
Designing the logistics system
Build the logistics system
Manage the logistics system
This involves dealing with:Demand management
Collect and Control orders
Sales forecast
This involves dealing with: Inventory management
Location
Coverage level
This involves dealing with: Production planning
Forecasting horizon
Programming system
This involves dealing with: Supplying
Choise of supplier
How and When to order?
This involves dealing with: Distribution
Distribution network
Supply logics
Warehouse Lay-out
Transport
This involves dealing with: Customer service
What level of service to offer?
This involves dealing with: Organization
Which organizational structure?
Which information system?
Which automation systems?
It’s necessary to measure:
- The level of stocks
- The level of service
THE ANALYSIS OF THE LOGISTICS SYSTEM
Stocks affect the profit
Service affects the turnover
Where to intervene?
Where is the leak?
The operating cycle is estimated to:
THE ANALYSIS OF THE LOGISTICS SYSTEM
Establish the rationality .…
… and coordination
To eliminate the irrazionality …
… and inefficiencies
The analisys of the logistics system:
THE INFRASTRUCTURES
To verify that the logistics infrastructures of the company are adequate to accommodate the operating cycle must do three things :
1) CHECK THE DISTRIBUTION NETWORK;
THE INFRASTRUCTURES
2) CHECK THE FUNCTIONAL REQUIREMENT:
- minimum, medium and maximum annual pallets stock
per warehouse;- supply frequency;- structure and number of orders to evade;- type of product to manage.
To verify that the logistics infrastructures of the company are adequate to accommodate the operating cycle must do three things :
THE INFRASTRUCTURES
3) CHECK THE TECHNICAL SPECIFICATIONS:
- number of loading and unloading doors;- lay-out;- storage and handling system.
To verify that the logistics infrastructures of the company are adequate to accommodate the operating cycle must do three things :
THE INFRASTRUCTURES
The analisys of the logistics system:
How should be the organizational structure?
Modern
Efficient
The analisys of the logistics system:
When the organizational structure is the right one?
There’s a process responsible
The organization chart in defined
The job descriptions and the procedures are formalized and applied
Working to target
Inventory management
Calculating turnover rate
IR = Dt / St
Calculating duration index
ID = 1 / IR
Calculating weighted average stock
S average=(s n + s n + .. s n ) /T1 1 2 2 n n
Customer service: What is it?
Large assortment
Minimum order
Delivery frequency
Efficiency information system
After sales support
Suitable packing
Adequate transportation
Fast and reliable delivery
Ho do you get?
Speed
Product availability
Flexible production system
Customer service: Ho do you measure?
Speed
Punctuality
Satisfied demand
Average delay
Readiness
Design of a new logistc system
We start measuring…
The service level indicators …
… analyzed from customer perspective
Choice of strategy
Innovation strategy:
Flexible logistics
Economic logistics
Cost strategy:
Service strategy:
Rapid logistics
The main components of the logistics system are 4:
• Distribution network
• Transport
• Stocks
• Supply
Lean distribution network
Flexible Logistics:
Branched distribution network
Rapid logistics:
Centralized distribution network
Economic logistic:
Rapid transport
Flexible logistics:
Rapid logistic:
Urgent transport
Economic Logistics:
Economics transport
The product life cycle
The 4 stages:
1. Introduction2. Growth3. Maturity4. Decline
What is the right logistics for each?
Introduction: low sales
Availability
Growth: increase sales
Punctuality and quality
Maturity: constant sales
Customization
Decline: reduced sales
Low service
Choice of service level
… to be competitive
Ensure integration
Formalize the design of the logistics system
Processes and methods
Promote change
Forecast
Are made to:
Are made to:
allocate resources better
What are the main business forecast?
Human resources requirements
Raw materials
Energy
Technological system
Financial resources
Finished products selling
Forecasting horizon
• very short (less 1 month)• short ( from 1 to 6 months)• medium (less two years)• long (more than two years)
Forecast details
• item• product family• filial• etc. etc.
Supply logistics service in house contract: example
Under contract services
• bundling
• picking and handling
• external storage
Loading and unloading
Handling - a
Handling - b
Storage
Picking
Product bundling
Palletizing
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