Dissertation paperOn

Effect of Logistic Support on Supply Chain Management in manufacturing industries

Dissertation Paper

On

Effect of Logistic Support on Supply Chain Management in Manufacturing industries

Prepared by

MD. REZWANUL ABEDIN

EvMBA-03

ID-1303025

Bangladesh University of Professionals (BUP)

Prepared for

Priyabrata chowdhury

Assistant Professor,

Bangladesh University of professionals (BUP).

Date of Submission: 19 January 2015

Declaration of Originality

I hereby certify that I am the sole author of this report and that neither anypart of this work nor the whole of the work has been submitted for a degree to anyother University or Institution.I certify that, to the best of my knowledge, my work does not infringe uponanyone’s copyright nor violate any proprietary rights and that any ideas,techniques, quotations, or any other material from the work of other peopleincluded in my report, published or otherwise, are fully acknowledged inaccordance with the standard referencing practices. Furthermore, to the extent thatI have included copyrighted material that surpasses the bounds of fair dealingwithin the meaning of the Indian Copyright Act, I certify that I have obtained awritten permission from the copyright owner(s) to include such material(s) in mywork and have included copies of such copyright clearances to my appendix.I declare that this is a true copy of my report, including any final revisions, asapproved by my supervisor.

MD. REZWANUL ABEDIN

Signature:

CERTIFICATE

This is to certify that, Md Rezwanul Abedin, bearing ID# 1303025, Ev.MBA-03, Faculty of Business Studies, Bangladesh University of Professionals has prepaired this dissertation paper entitled “ EFFECT OF LOGISTIC SUPPORT ON SUPPLY CHAIN MANAGEMENT IN MANUFACTURING INDUSTRIES” under my guidance and supervision. I do hereby approved the style and content of this dissertation paper.

(Priyabrata Chowdhury)

Assistant Professor

Faculty of Business Studies

Bangldesh University of Professionals

Letter of Transmittal

19 January, 2015

Priyabrata Chowdhury

Assistant Professor,

Bangladesh University of Professionals.

Subject: Submission of dissertation paper on “Effect of Logistic Support on Supply Chain

Management in Manufacturing Industries”.

Dear Sir

With great pleasure, I want to inform you that I have completed 2 years Masters of Business

Administration with major in Supply Chain Management and done a dissertation paper on “ Effect

of Logistic support on Supply Chain Management in Manufacturing Industries” which is required for

my MBA certificate. I have written a dissertation paper on “Effect of Logistic support on Supply

Chain Management in Manufacturing Industries ”. This report focuses on Logistics activities through

which goods are delivered to its customers on time with quality. During writing this report I have

followed your guideline and tried to relate theory to practice along with my responsibilities in SCM.

After that I am ready to express regret if any discrepancies found in this report.

I hope you will be satisfied with this Dissertation paper. I will be very glad to you if I can complete

this Msaters of Business Administration with a good grade.

Thank you for your consistent support.

Regards,

MD REZWANUL ABEDIN

ID: 1303025

Bangladesh University of Professionals

Acknowledgement

The authors wish to acknowledge their special thanks to their supervisor Mr.

PRIYABRATA CHOWDHURY, Assistant Professor, Bangladesh University of

Professionals, Dhaka for giving them inspiration, guidance and valuable

suggestions in executing the dissertation paper.

Deep gratitude to all concerned of , Bangladesh University of Professionals for

their sincere and helpful cooperation throughout the courses.

MD. REZWANUL ABEDIN

Executive Summary

As the supply chain management sounds innovative management practices in our

country, there is a lot of scope of research about this topic. Supply chain

management and logistic are affecting by a lot of external and environmental

factors. Supervisor planned to research about this part to find out the central

limitations and core development of these limited areas.

Dissertation is done investigating some main areas by some questionnaires over

some customers those who are practicing both the supply chain and logistic

business in their premises.

The findings are effective communication with the customer, informing

trade/Freight charge information, customer service (after delivery service),

political situation, strike are affecting the supply chain and logistic business most

effectively.

The outcomes means the future research should therefore concentrate on the

investigation of the above mentioned areas broadly.

Supply Chain Management means flow of goods from the manufacturing organization to end

Customer through different mediums. In this report various functions of Supply Chain Management is elaborately discussed. The major functions are: Transportation Management,

Distribution Management, Inventory Management, Cost Management, Payment Management,

Supplier Management and Customer Service Management.

Along with the theoretical aspects of these functions, this report also provides an outline how effects the logistic support to a Supply Chain Management of different manufacturing industries.

In this report, the findings of mine in various effect of logistic support on SCM.

I have worked in three departments. Mostly I involved in Logistics department, and partly I worked in Human Resource Management and Corporate Social Responsibility. Finally, from my experience of visiting these companies I have observed some lacking. I tried to provide suitable recommendations for the improvement of the companies

Table of Contents

Chapter………………………………………………………………………………Page No.Title Page…………………………………………………………………………………iDeclaration……………………………………………………………………………….iiSupervisor Certificate………………………………………………………………….iiiLetter of transmittal……………………………………………………………………ivAcknowledgement ………………………………………………………………………vExecutive Summary……………………………………………………………………Vi-vii Table of Contents ………………………………………………………………… vii-ixChapter 1: introduction

11.1 Overview 21.1.1 Logistics 31.1.2 Supply Chain Management 31.2 0bjectives 41.3 Scope of the study 4

1.4 Methodology of the study 4

1.5 Sources of Data 51.6 Potential problem statement 6

1.7 Limitations 7

Chapter 2:literature reviews8

2.1 Definitions 92.1.1 Logistics 92.1.2 Supply Chain Management 102.2 Cycles of Chain Management 11-122.3 Components 122.3.1 Components of logistics system 12-132.3.2 Components of Supply Chain Management

14-182.4 Importance of logistics and Supply Chain Management

192.4.1 Importance of logistics 19-212.4.2 Importance of Supply Chain Management 22-232.5 Theories of logistics and Supply Chain Management 24

2.5.1 Theories of logistics 24-312.5.2 Supply Chain Management theories 31-342.6 Strategies of logistics and Supply Chain Management 342.6.1 Strategies of logistics 34-412.6.2 Strategies of Supply Chain Management 41-442.7.1 Effective factors of Logistics Support

452.7.2 SCM & Logistic Integration 45-47Chapter 3:Project work 483.1 Questionnaires 49-533.2 Contact list 54-56Chapter 4: Findings 574.1 Findings 584.1.1 Effective Communication 584.1.2 Trade/Freight charge information 594.1.3 Transport 59-614.1.4 Customer Service (after delivery service) 61-634.1.5 Mark & Number 634.1.6 Wrong HS code and shipping mode 644.1.7 Strike 64-674.1.8 Political Situation of the country 67-704.1.9 Bride in different sections 704.1.10 Lack of direct oversight 714.1.11 Disadvantages 71Chapter 5:Remedies and Potential Improvements

725.1 Remedies and Potential Improvements 735.1.1 Effective Communication 735.1.2 Trade/Freight charge information 735.1.3 Customer Service (after delivery service)

745.1.4 Mark & Number 745.1.5 Wrong HS code and shipping mode

745.1.6 Political Stability of the country 74Chapter 6: Conclusion

756.1 Conclusion 75-77

References 78-80

CHAPTER 1

Introduction

CHAPTER 1

Introduction

1.1. Overview

Supply chain and logistic both are very often practice in developed countries. Only

some organizations in Bangladesh are practicing supply chain and logistic in

practical field. So scope of our project is limited considering limitations of areas

and time. We are trying to find out some specific areas where improvement can be

done. Which areas will make effective and efficient benefit or solution for both

supply chain and logistic.

Between years 1970's and 1980's is recognized as the first generation of third party

logistics of providing services for example transportation, shipping, but between

1980- 1990 were asset or non-asset based organizations by increasing the service

levels of contribution and third generation is between years 2000 - until now were

generally based on increasing the supply chain integration. A Third Party Logistics

providers (3PL), can be identified as first, second and third service providers. First

party provider is the main company that provides the service or product, the second

is to whom receives the service it is the consumer and the third is the company

which hired by the main company for provide the service between costumers and

company.

1.1.1 Logistics:

Since logistics advanced from 1950s, due to the trend of nationalization and

globalization in recent decades, the importance of logistics management has

been growing in various areas. For industries, logistics helps to optimize the

existing production and distribution processes based on the same resources

through management techniques for promoting the efficiency and

competitiveness of enterprises. The key element in a logistics chain is

transportation system, which joints the separated activities. Transportation

occupies one-third of the amount in the logistics costs and transportation

systems influence the performance of logistics system hugely. Transporting

is required in the whole production procedures, from manufacturing to

delivery to the final consumers and returns. Only a good coordination

between each component would bring the benefits to a maximum.

1.1.2 Supply chain Management:

Supply Chain Management is a subject that involved many areas, from the

hard to soft topics. Supply Chain Management as an independent field was

originated from Marketing and Strategic Management. In this review, the

most relevant and current topics of Supply Chain Management will be

discussed, taking as a primary focus the impact of supply chain issues on

transport and green logistics performance. The topics that will be discussed

in the rest of the paper are supply management from a top-view perspective,

uncertainty in the supply chains and transport, supply chain strategies and

transport, current supply chain practices and transport, and supply chain

integration and collaboration.

1.2 Objectives

The objectives of the project includes the followings-

1. As a third party service provider, find out the barriers, positioning,

limitations of logistics and supply chain management.

2. Find out the possible suggestions and improvements on the limited areas

of logistics and supply chain management.

1.3 Scope of the study

Only some organizations in Bangladesh are practicing supply chain and

logistic in practical field. So scope of our project is limited considering

limitations of areas and time. We are trying to find out some specific areas

where improvement can be done. Which areas will make effective and

efficient benefit or solution for both supply chain and logistic.

1.4 Methodology of the study Data Collection and Sample

This study involves analysis of a questionnaire that consists of statements relating to top level management commitment, mutual understanding, flow of information, organizational factors, relationship and decision making and supply chain responsiveness.

Survey relevant literature. Identify problem related to flow of production. Implement smooth flow of information and production.

1.5 Sources of Data

Collection of Data: Techniques

Primary Open discussion & Questioners

Secondary Different types of manufacturing company in Bangladesh

SL Company Name1 Bengal Group of Industries2 Dekko Group3 Sea Autos (Importer and Supplier)4 Riyan Machinery Equipment (Importer

and Supplier)5 Trade Tech (Importer and Supplier)6 Digital Medical System Ltd. (Importer

and Supplier)7 NRS scientific Ltd ( Importer and

Supplier)8 Surma International(Importer and

Supplier)9 Repon Light House ( Importer and

Supplier)10 Guarantee fiber Ltd.( Importer and

Supplier)11 Sunny trade (Exporter Importer)12 Razdhani Hardware (Importer)13 Lotus-bud Freight & Logistics14 Bandex Knitwear Ltd.15 Humko Battery Ltd.16 Navana Battery Ltd.17 Smartex Composite Ltd.18 Pears Composite Ltd.19 Notex Composite Ltd.20 Akij Group21 Shah Cement Ind. ltd.

1.6 Potential problem statement:

The following problem can be drawn from the present study-

Lack of direct oversight

Effective communication

Trade/Freight charge information

Customer service (After delivery service)

Political situation, strike

Mark and number

Wrong H.S code and shipping mode

1.7 Limitations

During writing this report I have to face some limitations. Those are enlisted here:

My work location was Head Office in Dhaka of the companies, but the major logistics works happen in plant and in different depots. From Head Office the works are only monitored. I got the opportunity to visit the plant for one day, but within that day it was not possible to observe in depth supply chain activities of companies. In addition with that, I was unable to observe the warehouse management system directly as I didn’t get the chance to visit the depots.

As I was an unknown person to the companies, the management didn’t share complex business strategies with me. I could only know the overall process and theoretical aspects.

Most of the companies have strict regulations on its software and internal documents, where I didn’t get excess to learn more. In accordance with that sharing information outside of the companies is prohibited, so I couldn’t write some internal issues.

CHAPTER 2

Literature reviews

CHAPTER 2

Literature review

2.1 Definitions

2.1. Logistics

Logistics is

"Part of the supply chain process that plans, implements, and controls the efficient,

effective forward and reverse flow and storage of goods, services, and related

information between the point of origin and the point of consumption in order to

meet customers' requirements".

"Describing the entire process of materials and products moving into, through, and

out of firm. Inbound logistics covers the movement of material received from

suppliers. Materials management describes the movement of materials and

components within a firm. Physical distribution refers to the movement of goods

outward from the end of the assembly line to the customer. Finally, supply-chain

management is somewhat larger than logistics, and it links logistics more directly

with the users' total communications network and with the firm's engineering

staff". "Process of moving and handling goods and materials, from the beginning to

the end of the production, sale process and waste disposal, to satisfy customers and

add business competitiveness".

"Process of anticipating customer needs and wants; acquiring the capital, materials,

people, technologies, and information necessary to meet those needs and wants;

optimizing the goods- or service-producing network to fulfill customer requests;

and utilizing the network to fulfill customer requests in a timely way".

"Customer-oriented operation management".

2.1.2 Supply Chain Management

"Supply chain management is the streamlining of a business' supply-side activities

to maximize customer value and to gain a competitive advantage in the

marketplace. Supply chain management (SCM) represents an effort by suppliers to

develop and implement supply chains that are as efficient and economical as

possible. Supply chains cover everything from production, to product

development, to the information systems needed to direct these undertakings".

"Supply chain management encompasses the planning and management of all

activities involved in sourcing and procurement, conversion, and all logistics

management activities. Importantly, it also includes coordination and collaboration

with channel partners, which can be suppliers, intermediaries, third party service

providers, and customers. In essence, supply chain management integrates supply

and demand management within and across companies".

If Supply chain management is an integrating function with primary responsibility

for linking major business functions and business processes within and across

companies into a cohesive and high-performing business model. It includes all of

the logistics management activities noted above, as well as manufacturing

operations, and it drives coordination of processes and activities with and across

marketing, sales, product design, finance, and information technology".

"Part of the supply chain process that plans, implements, and controls the efficient,

effective forward and reverse flow and storage of goods, services, and related

information between the point of origin and the point of consumption in order to

meet customers' requirements".

1. Logistics services

2. Information systems

3. Infrastructure/resources

1. Logistics services support the movement of materials and products from inputs

through production to consumers, as well as associated waste disposal and reverse

flows. They include activities undertaken in-house by the users of the services (e.g.

storage or inventory control at a manufacturer's plant) and the operations of

external service providers. They comprise physical and non-physical activities (e.g.

transport, storage and supply chain design, selection of contractors, freightage

negotiations respectively). Most activities of logistics services are bi-direction.

2. Information systems include modeling and management of decision making, and

more important issues are tracking and tracing. It provides essential data and

consultation in each step of the interaction among logistics services and the target

stations.

3. Infrastructure comprises human resources, financial resources, packaging

materials, warehouses, transport and communications. Most fixed capital is for

building those infrastructures. They are concrete foundations and basements within

logistics systems.

2.3.2 Components of Supply Chain Management

In the current business scenario, supply chain requires great consideration as it can

increase value of whole production process of an organization. Supply chain is

basically the whole process starting from the raw material from the suppliers to

manufacturing to packaging to warehouse to distribution to final reach of the

product or service to its intended consumers. So there is lot of components in

supply chain of a large company.

To analyze components of supply chain, Wal-Mart is taken that is global leader in

retail industry and also the largest corporation in the world (Walmart 2011). Wal-

Mart is continuously developing its business by developing its services and product

portfolio. The supply chain of Wal-Mart is also effective to enhance its

effectiveness within the industry (Hoppenstedt & Rathkolb 2005). This paper will

discuss about supply chain components and problems and approaches to solve the

problem.

Supply chain is a network that is used in business concern to sustain the exact flow

of information in the organization (Jespersen & Larsen 2011). Following are the ix

key components of the Wal-Mart's supply chain:

Production: Production is an important element of the supply chain of Wal-Mart.

Strategic decisions of Wal-Mart regarding production focuses on customer needs,

demand from market, capacity, quality and volume of goods (Wal-Mart 2011).

There are some problems that may occur in the production of Wal-Mart such as

changes in tastes & preferences of customers, new technology, and low quality of

raw material. To approach this problem for supply chain component, Wal-Mart

should conduct surveys and get continuous feedback from customers in timely

intervals as it would be 'effective to continue with the production as per their

changing needs and requirements (Jespersen & Larsen 2011).

Supply: Supply is an outsourcing process as through this an organization obtains

required material and inputs for production of its products & services. It is one of

the major components of the supply chain of Wal-Mart (Wisner, Tan & Leong

2008). Wal-Mart focuses on the quality of product, flexibility in prices, developing

velocity to determine supply of inputs that helps to maintain its low cost strategy

continue (Wal-Mart 2011). The price consideration in selecting the supplier for

raw material may create problem for Wal-Mart as it would affect its supply chain

management. To reduce this problem, management of Wal-Mart should consider

developing velocity, flexibility and quality in selecting suppliers as it would be

effective to reduce cost and to maintain lower cost level (Hoppenstedt & Rathkolb

2005).

Inventory: Inventory is also an important element of supply chain management as

it is essential for management to determine appropriate level of inventory within

the business to increase competitiveness. For effective management of inventory,

Wal-Mart focuses on day to day stock bases through Radio Frequency

Identification (RFID) technology. It is a technology that is basically used to track

remaining goods within organization (Wal-Mart 2011). By this technology

company can identify product availability through bar codes that are printed on

them. The more traffic in network may create problem in effective utilization of

this technique and may interpret wrong information that may affect the

organizational effectiveness (Hugos 2006). Increase in server database, continuous

improvement in technology will be effective to minimize impact of this technique

over supply chain management.

Location: Location is also an important part of business as it determines success of

the business (Lambert 2008). Wal-Mart emphasizes on customer demands and

determination of customer's satisfaction in determining places for its stores.

Identification of customer demand helps to determine the locations for store and

production facilities close to the consumers (Wal-Mart 2011). The selection of

inappropriate locations in other region without considering income level and living

standard of the customers may create problem for Wal-Mart in location selection.

The analysis of macro and micro environment before selecting location would be

effective to increase the supply chain management of the organization (Lambert

2008). Transportation: Transportation is intimately related to inventory decisions

and also with the customer requirements (Bolstorff & Rosenbaum 2007). Wal-Mart

uses stores to offer its products to the customers and by its own trucks for delivery

(Wal-Mart 2011). The use of store and its own truck for transportation may create

problem as strike by the employees may affect the delivery of its goods to the

customers that would affect its market share and customer base. To eliminate this

problem, management of Wal-Mart could make arrangement with external

transportation companies that will be used in the situation of strike (Bolstorff &

Rosenbaum 2007).

Information: Information is an important component of the supply chain of an

organization as it includes collection of information from end-users and to link

them with resources (U 2007). Wal-Mart is using linked computers through the

internet to execute information globally. All the stores globally are connected with

each other that help to get customer feedback and information and to implement

them within the business (Wal-Mart 2011). The information sharing with global

stores through the internet may create problem of misuse of data and theft of data.

To manage this problem, organization should use proper security and password

protection for using information.

2.4 Importance of logistics and supply chain management

2.4.1 Importance of Logistics

Logistics is significant to any company since it allows for a smoother running

of company processes as well as dealings. This flow in turn will help the

company generate more efficiently and help raise the amount of cash the

company will make.

Logisticians make certain that materials and information is provided at the

time of service delivery.

Even small businesses deal with finding suppliers, if not with transporting

merchandise to a store. Small business owners also conduct distribution

logistics with inventory and warehousing. And, every small business owner

can tell you about how they handle reverse logistics, with returned

merchandise or refusal of services. Larger businesses may deal in all four

logistic fields.

In the business environment, logistics either have an internal or external

focuses (inbound or outbound). Depending upon the business involved, this

part of the chain can be simple or complicated. For more complicated

procedures, third parties often are hired to conduct anyone of the four fields

within business logistics.

Third-party logistics (3PL) involves using external individuals or

organizations to execute logistics activities that have traditionally been

performed within an organization itself. If, for example, a company decides to

export its product, it may hire a person or organization to help with

distribution logistics. Today, there is a movement toward building fourth-

party logistics (4PL), which integrates 3PL competencies and other

organizations to design, build, and run comprehensive supply chain solutions.

A 4PL general contractor would manage other 3PLs, truckers, forwarders,

custom house agents, and others, essentially taking responsibility of a

complete process for the customer.

Another specialty includes logistics consulting services. Firms in this industry

specialize in the production and distribution of goods, from the first stages of

securing suppliers to the delivery of finished goods to consumers. Such firms

give advice on improvements in the manufacturing process and productivity,

product quality control, inventory management, packaging, order processing,

the transportation of goods, and materials management and handling. In the

process, these consulting firms might suggest improvements to the

manufacturing process in order to use inputs better, increase productivity, or

decrease the amount of excess inventory. Consulting firms in this segment of

the industry also advise on the latest technology that links suppliers,

producers, and customers together to streamline the manufacturing process.

Even project management requires logistics, as one vein of this science

coordinates a sequence of resources to carry out projects. Typical constraints

in project management include scope, time, and budget, or the same

constraints involved in business logistics. The time constraint refers to the

amount of time available to complete a project. The cost constraint refers to

the budgeted amount available for the project. The scope constraint refers to

what must be done to produce the project's end result.

Reduced Delivery Time: Reduced delivery time refers to a shortening of the

period between a customer ordering a product and that customer receiving the

product. When companies need to ship inventory (as e-commerce businesses

do), delivery time is a vital concern of both logistics and marketing. By

shortening delivery time, businesses can impress customers and create loyalty

while adding more value to their processes than competitors have.

Pinpointing Customer Issues: With a highly efficient logistics strategy,

companies can easily track product orders and product shipment data. This

allows a business to spot exactly where a product has gone, what product was

originally ordered and shipped and what needs to happen to fix problems with

the order. With such expert tracking and communication procedures, a

business can easily placate an irate customer and turn a bad situation into a

good marketing opportunity.

Quality Control: logistics is also important to manufacturers, because it

allows for a high level of control over production processes and immediate

adaptations. A company does not want to produce flawed products that have

inherent problems few things are as damaging to a business's reputation. With

efficient logistics, a manufacturer can spot problems immediately and quickly

narrow down the issue to find the source and correct it.

Extra Services: Many businesses offer extra services as part of their

marketing strategy; these allow them to impress customers through advanced

customer service techniques. With modern logistics, companies can offer

advanced tracking options for product shipments that customers can track at

any time. Good logistics also allows for greater product customization and

tools for customers to use themselves.

2.4.2 Importance of Supply Chain Management

Organizations increasingly find that they must rely on effective supply chains,

or networks, to compete in the global market and networked economy. In

Peter Drucker's (1998) new management paradigms, this concept of business

relationships extends beyond traditional enterprise boundaries and seeks to

organize entire business processes throughout a value chain of multiple

companies.

During the past decades, globalization, outsourcing and information

technology have enabled many organizations, such as Dell and Hewlett

Packard, to successfully operate solid collaborative supply networks in which

each specialized business partner focuses on only a few key strategic activities

(Scott, 1993). This inter-organizational supply network can be acknowledged

as a new form of organization. However, with the complicated interactions

among the players, the network structure fits neither "market" nor "hierarchy"

categories (Powell, 1990). It is not clear what kind of performance impacts

different supply network structures could have on firms, and little is known

about the coordination conditions and trade-offs that may exist among the

players. From a systems perspective, a complex network structure can be

decomposed into individual component firms (Zhang and Dilts, 2004).

Traditionally, companies in a supply network concentrate on the inputs and

outputs of the processes, with little concern for the internal management

working of other individual players. Therefore, the choice of an internal

management control structure is known to impact local firm performance

(Mintzberg, 1979).

In the 21st century, changes in the business environment have contributed to

the development of supply chain networks. First, as an outcome of

globalization and the proliferation of multinational companies, joint ventures,

strategic alliances and business partnerships, significant success factors were

identified, complementing the earlier "Just-In-Time", lean Manufacturing and

Agile manufacturing practices. Second, technological changes, particularly the

dramatic fall in information communication costs, which are a significant

component of transaction costs, have led to changes in coordination among

the members of the supply chain network (Coase, 1998).

Many researchers have recognized these kinds of supply network structures as

a new organization form, using terms such as "Keiretsu", "Extended

Enterprise", "Virtual Corporation", "Global Production Network", and "Next

Generation Manufacturing System". In general, such a structure can be

defined as "a group of semi-independent organizations, each with their

capabilities, which collaborate in ever-changing constellations to serve one or

more markets in order to achieve some business goal specific to that

collaboration" (Akkermans, 2001).

2.5 Theories of logistics and supply chain management

2.5.1 Theories Logistic:

- A sigmoid function is a mathematical function that

produces a sigmoid curve- a curve having an "S"

shape. Often, sigmoid function refers to the special

case of the logistic function

Here r is interpreted as an intrinsic growth rate and k as the carrying capacity of the

environment The Ricker model is a limiting case of the Hassell model which takes

the form

2.5.2 Supply Chain Management theories:

The supply chain encompasses organizations and flows of goods and information

between organizations from raw materials to end-users (Handfield and Nichols,

2002).

The supply chain is a meta-organization built up by independent organizations that

have established inter-organizational relationships and integrated business

processes across the borderlines of the individual firms. A supply chain can also be

characterized as a borderless organization (e.g. Picot et al., 2001), a value net

(Bovet and Martha, 2000), a virtual supply chain (Chandrashekar and Schary,

1999), an interactive firm (Johansen and Riis, 2005), a multi-organization/single-

site coordinated operations network (Rudberg and Olhager, 2003), or an extended

enterprise (Davis and Spekman, 2004; Boardman and Clegg, 2001).

Management of such an arrangement refers to inter-organizational relationship

management with the objective of improving the overall profitability of the

activities and/or organizations involved. The current literature on SCM seems to

agree on the nature of the phenomena (e.g. Persson, 1997).

Although SCM has existed for almost 25 years, it still lacks a socio-economic

theoretical basis that may be used to explain and understand this particular form of

inter-organizational arrangement. Initially, two consultants from Booz, Allen and

Hamilton (Oliver and Webber, 1982) introduced the SCM concept. Several authors

have traced the theoretical foundations of SCM.

Thus, Svensson (2002) found that the theoretical foundation of SCM and

Alderson's functionalist theory (Alderson, 1957) have many similarities. Mentzer

et al. (2004) presented a unified theory of logistics based upon logistics capabilities

as a source of competitive advantage.

Recently, academics have presented valuable contributions, enhancing our

understanding of the concept of inter organizational management of different flows

of products and/or information (e.g. Ballou et al., 2000; Heikkila", 2002; Monczka

and Morgan, 1997; Srivastava et al., 1999; Frazier, 1999; New and Westbrook,

2004).

The majority of contributions focus on definitions and concepts from a functional

point of view (e.g. logistics, operations, marketing, and purchasing), providing

pragmatic recommendations on how to improve a firm's performance and

implementation of postponement by supply chain reconfiguration.

Prominent examples of such approaches can be found in Mentzer et al. (2001),

Cooper et al. (1997), Cigolini et al. (2004), Lambert et al. (2005) and Croxton et al.

(2001). Current frameworks of SCM present solutions on how to design and

manage particular relationships between various stages in a chain, but they do not

address the economic, strategic, and socioeconomic theoretical rationales behind

them (e.g. Min and Mentzer, 2004; Chen and Paulraj, 2004a, b).

Currently there's a gap in the literature on supply chain management studies

present: there is no theoretical support for explaining the existence or the

boundaries of supply chain management. A few authors, such as Halldorsson et al.

(2003), Ketchen and Hult (2006), and Lavassani et al. (2009), have tried to provide

theoretical foundations for different areas related to supply chain by employing

organizational theories. These theories include:

Resource-based view (RBV)

Transaction cost analysis (TCA)

Knowledge-based view (KBV)

Strategic choice theory (SCT)

Agency theory (AT)

Channel coordination

Institutional theory (InT)

Systems theory (ST)

Network perspective (NP)

Materials logistics management (MLM)

Just-in-time (JIT)

Material requirements planning (MRP)

Theory of constraints (TOC)

Total quality management (TQM)

Agile manufacturing

Time-based competition (TBC)

Quick response manufacturing (QRM)

Customer relationship management (CRM)

Requirements chain management (RCM)

Available-to-promise (ATP)

However, the unit of analysis of most of these theories is not the supply chain but

rather another system, such as the firm or the supplier-buyer relationship. Among

the few exceptions is the relational view, which outlines a theory for considering

dyads and networks of firms as a key unit of analysis for explaining superior

individual firm performance (Dyer and Singh, 1998).

2.6 Strategies of logistics and supply chain management

2.6.1 Strategies of logistics

How should organizations prepare themselves to deal with these emerging

trends? Top performing companies in our research are not only preparing

themselves for these challenges, but are seeking to exploit these elements for

advantage. Poor performers fail to do so. Customers see themselves as part of

a global network; the winners are those with the best relationships with the

best players. This is true not only for vertical relationships with suppliers, but

also fo horizontal relationships with other companies. It is not sufficient

anymore to think in terms of one's own sphere, but the unit of competition is

now the network. In this summary we present some key insights based on

what these top-performing companies from different sectors are doing

differently and we present the following checklist for your own logistics and

supply chain network.

First, top performers are prioritizing talent management as a priority for

growth. They are seeking to hire, retain, and incent individuals with strong

analytical and team-building skills, emphasizing communication, agile

decision-making, and an ability to work in a multi-cultural setting (PEOPLE).

Second, top performers have constructed a global governance process that

holds people to a standard of conduct and behavior, emphasizing integrated

planning but with enough room to maneuver around regional issues that

confront their global business unit (PROCESS). Process standards ensure that

there is a global set of policies and procedures that drives the right outcomes,

but also emphasizes that plans must be properly aligned throughout the supply

chain.

Third, they have developed long-term technology road maps that are aligned

with core strategic initiatives and customer expectations. Technology

roadmaps seek to drive better capabilities to price products and services

effectively and establish services that meet or exceed customer expectations

(TECHNOLOGY). nvestments in technology are made with the intent of

allowing people to make better decisions in an integrated manner, and are

always considered in light of customer outcomes.

Fourth, leading performers have established a precedent for creating network

partnerships, outsourced relationships, and bundled products and services with

key global partners, resulting in improved set of capabilities that are extremely

difficult to replicate (NETWORK). Organizations recognize that they cannot

lido it alone", but that those with the most capable network of suppliers and

logistics partners will win the end. This requires defining a culture that builds

trust and cooperation in global relationships, which takes time to achieve.

Finally, top performers have established a commitment to improving the

global community, with a plan to leave it in a better condition than when they

arrived, both in terms of carbon footprint and global standards

(COMMUNITY). By investing in green logistics and emphasizing labor and

human rights, these organizations will reap the rewards of these investments

in the years to come. Each of these strategies (PEOPLE, PROCESS,

TECHNOLOGY, NETWORK, and COMMUNITY) are next described.

People: Organizations must be able to quickly adjust and shift direction in

response to sudden changes in a complex environment. A responsive

organizational culture relies at its foundation on a highly capable and trained

workforce. People are the core of any organization, and top performers have

established a commitment to talent management. The goal of talent

management is to ensure people are enabled and capable of making decisions

in response to difficult and unstructured types of situations. Low performers

are more likely to perceive that talent shortfalls will be a major challenge in

the years ahead overall. Top performers are less concerned about talent

shortages in specific areas of expertise than non-top performers. This is

because their supply chain organization is partnering with human resources to

build a talent management strategy, explicitly measuring talent gaps, and

establishing organizational actions to address them. One of the strategies that

is important here is collaborating with universities on joint research,

establishing a presence on university campuses, and building a pipeline of

new talent. A second approach is to educate people more about logistics as a

career, and to "market" logistics as an exciting and growing career for young

managers and students. A third approach involves mentoring and developing

internal talent to work in logistics, including recruiting top talent from other

areas in the organization. A final element is further investing in training and

education for high potential employees to develop them and build loyalty to

your organization, as well as to promote people to different roles that will

challenge them. This is particularly important for young managers who seek a

challenging global career in logistics.

Process: As organizations grow, they need to have a strong core set of

policies, procedures, processes and culture upon which to build. But these

core processes must be able to fit any global situation or culture, which means

that there, needs to be room to flex. Organizations promote people who can

understand your culture through shadowing, mentoring, and plenty of training

and education opportunities. Not only will this improve retention but it will

grow capabilities, and allow innovation and new ways of working to flourish

in your global network. To establish a global process that can adapt to

different local regulatory, cultural, and network conditions means having the

right type of decision-maker that can operate within the context of a process.

An important finding from our research is that top performing firms indicated

that they prefer to hire and recruit individuals who have a strong rational and

analytical foundation. These individuals are able to use data to define

environmental conditions, and act on their logical interpretation of this data.

Top performers also seek managers who can consider the long-term impact of

their decisions, not just the immediate situation in front of them. Top

performing companies also prefer specialists who have deep knowledge in a

specific area, and thus have the experience to assess the situation. Finally, top

performers want individuals who have agility to work in unfamiliar global

environments as well as individuals who are prepared to work in a global

setting (often with multiple language capabilities when possible). To find and

develop these skills requires a focused approach to talent development. This is

a unique combination to find in logistics managers, but aligns well with our

previous observation of having individuals who can quickly grasp the

dynamics of a specific logistics situation, apply analysis and rational thinking

to the situation, and emerge with a clear solution that considers the long-term

implications of the outcome. As organizations expand globally, the need for a

global perspective is also important, and this is increasingly harder to find.

This represents a "tall order" for human resource specialists to identify and

recruit these types of individuals, and emphasizes the importance of casting a

wide net across multiple channels to identify them. It is interesting to note that

an important difference between top performing companies is that they are

more likely to be a stand-alone logistics organization and less likely to be part

of the procurement organization. This independence establishes logistics as a

critical global process with its own governance, but one that is aligned with

business needs. Although procurement has often considered logistics as

"slrnplv a buying activity", there is a clear need to differentiate the types of

logistics issues that require a distinct approach. We are much more likely to

see closer coordination between procurement and logistics in these

organizations, with logistics often playing a "consultative" role in defining

solutions for procurement and for business units alike.

Technology: Leading organizations are recognizing that to enable people,

technology must be leveraged to provide insights, visibility, and promote an

action oriented culture. Respondents expect 30 growth in new technology

investments in RFIO, inventory optimization software, as well as in analytics

and big data technologies. Technology investments that have a direct tie to

user requirements, customer

Responsiveness and accountability for results have the best promise of being

adopted successfully. Top performers are investing in a solid basis of robust

logistics and supply chain data, through ensuring that their data systems can

track events, transactions, and form a strong data-based analytics foundation

(ERP, 20 barcode). Such technologies will become the foundation for network

optimization, global material visibility, and end-to-end integration. As

multiple parties across the extended global supply chain have access to the

same "sheet of music", the global supply chain orchestra will be playing their

instruments, producing a masterpiece of sound. Technologies can help to

integrate planning processes and ensure aligned responses to global events,

and also provide a foundation for analytics that will become more important in

the near future for competitive decision-making. Technology will also enable

tracking of events beyond first tier suppliers, and provides a real-time update

of key performance indicators used to ensure optimization of supply chain

plans.

Network: The interdependencies of globally networked supply chains means

any disruption at a node radiates throughout the network. More than 70 of the

respondents stated that they apply close coordination with key suppliers as a

means to reduce disruptions. However, many organizations we spoke with do

not fully understand who the parties are in their supply chain, and are

increasingly becoming aware that tier 2 suppliers can shut down their entire

network if they are not paying attention. An important component of resilient

supply chains is thus building an understanding of not just who is in your

supply chain, but gaining insight into their capacity, limitations, and paths

through the network. End-to-end integration turns out to be among the most

important logistics and supply chain management strategy in the next five

years. Top performing companies are sharing more tacit data, especially

around R&D and other information that can provide a more holistic

understanding of requirements with their key partners. The other

distinguishing feature is that they are sharing information across a broader arc

of supply chain members, including tier two suppliers and LSPs. Our results

show that top performers are also applying cost-to-serve analytics for logistics

decisions, also in the context of outsourcing processes in the future. Indeed,

there are indications that some organizations are beginning to internalize some

manufacturing and other processes to gain better control over critical customer

impact areas.

Community: Your organization, like every other one in the world, can do

much that is good, and much that can harm the environment and the

community. As customers are more aware of these issues, proactive

organizations are exploring new ways to monitor and measure not just carbon

footprints, but also improved transportation networks, packaging, and end-of-

life product strategies. In Germany, still less than 25 of the respondents

measure CO2 emissions or social responsibility. Our survey results suggest

that top performers are more likely to adopt green logistics strategies than

other companies. They also tended to rate corporate social responsibility as a

more important part of their logistics strategy than other companies in our

sample. The human factor is becoming a central point of contention, and

organizations are holding their suppliers to a single global standard when it

comes to labor and human rights violations. less than 50 of both stationary and

non-stationary retailers have adopted corporate social responsibility (CSR) in

their logistics strategy. In light of recent scandals in food, apparel, and

electronics supply chains, improvement in CSR supply chain management is

an imperative. Organizations will increasingly need to work both vertically

and horizontally with other agencies to form industry coalitions and

government partnerships that will make the world a level playing field and

one that continues to reduce its carbon footprint over time. These concepts

and ideas are not just theoretical, but are based on examples of people and

organizations we have interviewed, witnessed, met with, and researched.

There are certainly differences between industries and countries that are not

discussed in this study in detail, and there is always potential for bias based on

our sampling frame. However, we hope you will find these ideas to be worthy

of consideration in your strategic planning process, and hope they may help

you respond to the complexities of the logistics environment you face.

2.6.2 Strategies of Supply Chain Management

The past several years have been marked by increasing economic volatility, as

reflected by not only the global economic recession, but also the instability of

customer demand and rapid movement in raw material, fuel, and commodity

prices. Supply chain executives are under pressure to develop more efficient,

customer- centric supply chains and find innovative ways to reduce costs.

Meanwhile, they are being asked to take advantage of business opportunities

that may arise from the current economic conditions.

As a result, company leaders are prioritizing projects that reduce inventory

and logistics expense. Although this may help matters in the short term,

professionals risk ignoring the long term. Organizations must prepare for the

rebound while responding to the conditions of the new normal--a reduced

labor pool, stagflation and deflation, and issues surrounding energy and

sustainability. Effective strategies coupled with a well-defined plan and the

right tools will help alleviate pressure today and ready managers for market

changes in the future.

Strategy 1: Adopt demand-driven planning based on real-time demand

insights and demand shaping. The right prediction and contingency planning

tools will ensure a complete view and an effective response to risks such as

suppliers going out of business, political upheaval, and natural calamities

affecting manufacturing. Companies then can adjust pricing and promotions

strategies to shape demand, move additional product quickly, drive revenue

growth, or further expand margins for a high-demand product with limited

market supply. The key is to have the foresight to leverage opportunities and

mitigate challenging events so that your business not only survives, but

succeeds.

Strategy 2: Build an adaptive supply chain with rapid planning and integrated

execution. Once executives are able to better predict demand and risk, they

need to adapt their supply chains to changing market opportunities and events.

Companies must put in place dynamic planning and continually fine-tune

operations. The old model was to wait until the end of the month or quarter to

shift production and supply based on shipments and sales. The new model

calls for more continuous, dynamic supply chain adjustments to rapidly

respond to market changes. This can minimize or even eliminate shocks

across the supply network. The results include better visibility; enhanced

collaboration across the value chain, including sourcing and supply,

manufacturing, transportation, warehousing, and distribution; and accelerated

decision-making with better analytics and support.

Strategy 3: Optimize product designs for supply, manufacturing, and

sustainability in order to accelerate profitable innovation. Innovation is crucial

to being one step ahead of the competition. But innovation doesn't exist in a

vacuum. In order to be successful, products must be manufactured at the right

cost. Decisions made in the early cycles of product development can make or

break the product. Designs must be optimized for supply and

manufacturability, and all the true costs must be accurately captured. In

addition, product innovation and competitive advantage increasingly stem

from the selection of suppliers and technologies. If a company can manage the

information, people, processes, and decisions regarding a product throughout

its life cycle, it can achieve strong dividends and market leadership.

Strategy 4: Align your supply chain with business goals by connecting sales

and operations planning (S&OP) with corporate business planning. Although

S&OP processes provide coordination among sales, manufacturing, and

distribution, there still are disconnects and gaps among finance, strategy, and

operations in many companies. One way to bridge these gaps is with

integrated business planning. This process integrates financial strategic

budgeting and forecasting systems with operations planning. The resulting

marriage of processes ensures revenue goals and budgets developed in finance

are validated against a detailed, bottoms-up operating plan. Concurrently, the

strategy reconciles the operating plan against financial goals. Integrated

business planning, which connects S&OP processes with corporate business

planning, enables companies to achieve the right balance of supply and

demand, aligned with strategic business goals. It provides real-time visibility

to all the key dimensions for success--demand, supply, product, risk, and

performance-- across the organization and throughout the extended supply

chain.

Strategy 5: Embed sustainability into supply chain operations. The triple

bottom line of people, profit, and planet has never been more important than it

is today. Studies show that companies striving for social and environmental

sustainability achieve major competitive advantages, especially with regard to

production efficiency, supplier management skills, and attractiveness to

employees. Substantial opportunities exist for sustainability in supply chain

operations:

Company leaders first need to include sustainability as a core

component of their supply chain strategy. This means incorporating it

as a key requirement across all supply chain processes.

Second, professionals initially should focus on the basics to achieve

quick wins through real-time visibility to energy and resource

consumption and resource or material movement. This enables

reduction of carbon inefficiencies, minimized energy consumption, less

waste with "recycle- reuse-refurbish" materials, and optimized travel

and transportation.

Businesses can keep the momentum by ensuring continuous

improvement through systemic measurement, audit, and knowledge

management. Compliance audits, best practices, and benchmarks

provide a governing framework for sustainable supply chain operations

and ensure clarity around the environmental impact of specific actions.

Effective Factor of logistics Support in Supply Chain Management

The report identified seven underlying factors that tend to be present whenever supply chains go wrong. These are:

1. Offshoring, making it increasingly difficult for firms to monitor supply chains adequately

2. Increasing complexity of supply chains, meaning companies were often unaware of who their suppliers were subcontracting to

3. Cost pressures, which could lead to compromise on quality and ethics

4. Geographic clustering, making manufacturers vulnerable to a localised disaster such as the Japanese tsunami of 2011

5. Modern communications, which can quickly damage reputations

6. Just-in-time production methods, which have reduced the time to recover from supply chain failure

7. Dependence on multiple suppliers, increasing overall vulnerability.

Supply Chain Integration

An article in the last issue of Logistics Solutions (Sweeney, 2006) presented a discussion of both the historical evolution of supply chain management (SCM). From this it is evident that the concept of integration lies at the heart of SCM philosophy (see, for example, Christopher, 2005; New, 1996, Lambert, 2004). Cooper et. al. (1997) specifically described SCM as ‘an integrative philosophy’. The work of Fawcett and Magnan (2002) identified four levels of integration in practice.

1. Internal cross-functional integration;

2. Backward integration with valued first-tier suppliers;

3. Forward integration with valued first-tier customers; and,

4. Complete backward and forward integration (‘from the supplier’s supplier to the

customer’s customer’).

The first of these relates to integration of activities and processes which are carried out within a single organization (i.e. internal or micro or intra-firm supply chain integration).

The others describe varying degrees of integration of activities which span the boundaries of organizations (i.e. external or macro or inter-firm supply chain integration), with the last one being viewed as the theoretical ideal. The following sections discuss internal and external integration in more detail. Supply Chain Integration An article in the last issue of Logistics Solutions (Sweeney, 2006) presented a discussion of both the historical evolution of supply chain management (SCM). From this it is evident that the concept of integration lies at the heart of SCM philosophy (see, for example, Christopher, 2005; New, 1996, Lambert, 2004). Cooper et. al. (1997) specifically described SCM as ‘an integrative philosophy’. The work of Fawcett and Magnan (2002) identified four levels of integration in practice.

1. Internal cross-functional integration;

2. Backward integration with valued first-tier suppliers;

3. Forward integration with valued first-tier customers; and,

4. Complete backward and forward integration (‘from the supplier’s supplier to the

customer’s customer’).

The first of these relates to integration of activities and processes which are carried out within a single organization (i.e. internal or micro or intra-firm supply chain integration).

The others describe varying degrees of integration of activities which span the boundaries of organizations (i.e. external or macro or inter-firm supply chain integration), with the last one being viewed as the theoretical ideal. The following sections discuss internal and external integration in more detail. Supply Chain Integration An article in the last issue of Logistics Solutions (Sweeney, 2006) presented a discussion of both the historical evolution of supply chain management (SCM). From this it is evident that the concept of integration lies at the heart of

SCM philosophy (see, for example, Christopher, 2005; New, 1996, Lambert, 2004). Cooper et. al. (1997) specifically described SCM as ‘an integrative philosophy’. The work of Fawcett and Magnan (2002) identified four levels of integration in practice.

1. Internal cross-functional integration;

2. Backward integration with valued first-tier suppliers;

3. Forward integration with valued first-tier customers; and,

4. Complete backward and forward integration (‘from the supplier’s supplier to the

customer’s customer’).

The first of these relates to integration of activities and processes which are carried out within a single organisation (i.e. internal or micro or intra-firm supply chain integration).

The others describe varying degrees of integration of activities which span the boundaries of organisations (i.e. external or macro or inter-firm supply chain integration), with the last one being viewed as the theoretical ideal. The following sections discuss internal and external integration in more detail.

CHAPTER 3

Project work

CHAPTER 3

Project work

3.1 Questionnaires:

Questionnaires were our main challenges of this project. The questions are formed

considering the practical situation and phenomenon in some core areas.

1. How many days do you take to procure goods to your warehouse around the

world through sea, air or land?

Answer: By sea around 12 to 30 days load Port to destination port from far east

land around Asia, around 30 to 45 days from Europe and 30 to 50 days from

south /north America. By air 1 and two days from far east and inter Asia, 3 or 4

days from Europe and around 4 or 5 days from America. Land port use only India

and Nepal and only one day.

2. How long normally it takes in Chittagong sea port, Dhaka airport or other land

port to release the goods from shipping document and customs clearonce?

Answer: At Chittagong port customs processing time o.: 2 days. Dhaka airport

also takes 1 or 2 days. Otherwise it will take 5 to10 days.

3. How long it takes by truck/covered van or by train from Chittagong sea port to

Dhaka ICD?

Answer: By truck one day by train 10 to 12 days.

4. How much is the cost to carry the goods around the world by air, sea or land and

which is cheaper?

Answer: Use of sea is cheapest cost. By air it takes some extra cost of 400 to 500.

5. Have any barrier to clear the goods from Chittagong sea port customs, Dhaka

airport customs or land port customs to clearonce the goods?

Answer: Maximum time C&F agent offer extra cost of miscellanies without extra

cost most of time delay to clear the goods or other hassle.

Answer: We don't face any barrier because we have nominated a logistics company

for clearing goods from the port.

6. How much is the cost to carry the materials Chittagong sea port to Dhaka?

Answer: By road one TUE BOT (20,000.00 to 25000.00) and by Rail only $(5 to

100).

7. Where do you feel problem in procuring material from any international

destinations?

Answer: There are various carriers which charge more and not issue extra volume

or use long time trans-shipment delay which does not monitor.

8. Where do you feel problem in clearing material from sea port, airport or land

port?

Answer: Most of time it is most problem in custom and their agent and also

shipping agents

9. Where do you feel problem in transporting materials from Chittagong to Dhaka

or factory?

Answer: Unrest situation of political issue it is uncertain to reach goods from

Chittagong to Dhaka or traffic jam.

10. Which type of transport do you like to carry your goods and why?

Answer: For cost save sea is very important also Rail service.

11. Which transport mode do you think is cost effective?

Answer: Sea is most effective.

12. How many employees are working in your organization in logistic

Department?

Answer: Most of organization has 2 to 5 employees In logistics under supply chain

management department.

13. How many employees are working in your organization in supply chain

Department?

Answer: Most of organization has 3 to ID employees in supply chain management

department.

14. In your opinion which transport mode is most critical and why?

Answer: Air shipment is most critical because it should very careful at document

preparation only short time.

15. Which factor is affecting most in logistic department?

Answer: Logistics look after whole process of supply chain.

16. Which factor is affecting most in supply chain department?

Answer: Logistics and supply chain is overlapping one another

17. As a 3,d party logistic provider what types of services do you expect from

them?

Answer: 3rd party logistics al time support importer exporter and supplier for their

goods transformation one way or multimodal transport.

18. Which service will make you benefited in your opinion?

Answer: Sea is most effective for transportation it is easy 1nd low cost but from

Chittagong to Dhaka ICD, Train service to carry container, it is low cost but time

barrier. If we can minimize time duration of train cargo then it is business

effective.

19. As a manufacturer/ Trader have what kind of support get from 3,d party

logistics company?

Answer: Maximum importer said after shipment they don't where their goods hold

and why it is normal way but without taking care cargo hold is trans-shipment

point. 3rd party logistics support to all procedure of Importer, Exporter and

supplier.

20. What kind of support aspect to 3rd party logistics?

Answer: Most of logistics company member of world transportation team and have

huge experience in business field of supply chain.

21. How logistics companies help to supply chain management?

Answer: The logistics company prepare a document 3gdlnst for shipment against

any importer or exporter and lasso of shipping company and multi modal company.

22. What is your opinion to presentation 3rd party logistics in the business

situation in Bangladesh?

Answer: At present situation almost 1500 logistics company in Bangladesh. They

are work at Chittagong and Dhaka. They are helpful for importer or exporter. They

also helpful for upcoming business oriented farm.

3.2 Contact list:

We found the above answers contacting to the following persons-

SL

No

Company Name Contact Person Contact Number

1 Bengal Group of Industries Mr. NurunNabi 01811458307

2 Dekko Group Mr. Sumon 01817296509

3 Sea Autos ( Importer and

Supplier)

Md Mainullslam 01715017499

4 Riyan Machinery Equipment

(Importer and Supplier)

Md Mahmudul Hassan 01713458737

5 Trade Tech ( Importer and

Supplier)

Md Althaf Hossain 01733060190

6 Digital Medical System Ltd. Md Anwarul Kabir

(Importer and Supplier)

7 NRS scientific Ltd ( Importer

and Supplier)

Tarakasawar Narth 01686723745

8 Surma International

(Importer and Supplier)

Md Sachch Mia

9 Repon light house (Importer and

Supplier)

Md Repon 01817085574

10 Guarantee fiber Itd

(Exporter)

Md Mohsin Ali

11 Sunny trade (Exporter Importer) Md Sunny

12 Razdhani Hardware (Importer) Md Sizar 01911216441

13 lotus-bud Freight & logistics Md AftabUddin 01718319369

14 Bandex Knitwear ltd. Ashish Kumar

15 Hamko Battery ltd. Debashish Kumar

16 Navana Battery ltd. Mr. Alam

17 Smartex Composite ltd. Mr. Jewel

18 Pears Composite ltd. Mr. Himel

19 Notex Composite ltd. Mr. Ratul

20 Akij Group Mr. Azad 01717270078

21 Akij Group Mr. Mortuza 01922111061

22 Shah Cement Ind. ltd. Mr. Delwar 01815473228

CHAPTER 4

Findings

CHAPTER 4

Findings

4.1 Findings

4.1.1 Effective communication

As it is taking a bit long time to receive the goods, customer of ten

expects the current information about the location of the goods.

Some international service providers are informing the locations

every time, anybody can track their goods. For example we can track

the goods in DHl, TNT, FEDEX etc. anytime from anywhere of the

globe. No one of the local logistic service provider have these

facilities. This is area to improve effectively.

Effective communication helps us better understanding a customer

or situation and enables us to resolve differences, build trust and

respect and create environment, where creative ideas, problem

solving and caring can flourish.

4.1.2 Trade/Freight charge information

Most of exporter is busy to loading the shipment they does not

follow sea or air freight of different carrier. It is difficult to inform

the customer the actual charges because of variance of charges in

some different key indicators, also difficult for the logistic provider

to guess the actual charges. There is a big gape in this area between

the customer and the supply chain and logistic provider.

When the charges changing time to time, they should inform to the

customer accordingly. It is the effective way to build relation with

the customer.

4.1.3 Transport

The road transport faced problems from external forces unsteady

political situations. In Bangladesh Hartal (Strike) and road blockade

are only medium of significant protests. So the transport is

vandalized or burnt and halt by protesters. Road is also not properly

made for smooth transportation. Traffic systems are old to cope

modern demand. This paper presents a normative model for efficient

goods movement promoting supply chain integration in developing

economies. Supply chains encompass a holistic throughput of goods

movements to and from partner organizations including internal and

external suppliers. Similarly, multimodal freight transport represents

an integrated system for moving goods quickly and inexpensively

from shipper to consignee by at least two different modes under a

single contract. The initial discussion considers the influence of

containerization on international freight transport and some benefits

and limitations of multimodals. A trend towards supply chain

integration and the implications for intermediaries and shippers or

manufacturers in freight transport systems are discussed. Various

barriers to supply chain integration in developing economies are

presented. A case study of the scope for developing multi modal

transport is reviewed in the light of particular national transport

problems facing Bangladesh. Conclusions note the potential for

multimodal freight transport to provide a catalyst for removing trade

barriers and offer a model for achieving supply chain integration in

such economies.

Transportation is the movement goods or service from one location

to another. Modes of transport include air, rail, road, sea. The field

can be divided into infrastructure, vehicles and operations. Without

effective transport system the operations of logistics or movement of

goods will fail measurably.

4.1.4 Customer service (After delivery service)

Logistics service providers integrate functions across the supply

chain, from sourcing of raw materials, through to product

manufacturing and the distribution of finished goods. A consolidated

view of this information is a large part of the expected value to their

customers.

In order to deliver this value, logistics service providers require

scalable systems that effectively manage the depth and breadth of

data and that reliably delivers the data. Viewlocity Technologies'

visibility and control solutions enable a secure view of information

across the extended supply chain.

Business processes differ by customer and product lines. logistics

service providers need insight into business process in order to:

Identify which business processes are not working, where cost

efficiencies and opportunities can be gained and provide continuous

improvement of supply chain processes.

Velocity Technologies solutions provide metrics and key

performance indicators that identify variances and repeated

discrepancies in your business processes. The scorecards and reports

presented enable continuous improvement of extended supply chain

processes specific to each business partner, business unit and

product line. Logistics service providers have investments in

transportation management systems, warehouse management

systems and other technologies that provide a portion of the

capabilities needed by their customers. For real end-to-end visibility

and control of the supply chain, customers must have an integrated

view of orders, shipments and inventory.

Velocity Technologies' solutions works with your existing systems

to provide a single 'version of truth' for all transactions related to the

flow of goods in your supply chain. The tools keep all your systems

synchronized and provide your customers with real-time information

to improve the performance of your supply chain. In our country, the

logistic providers are just helping in carrying the goods but effective

customer service helps effectively and efficiently in the business

expansion.

Customer service is one of most important part of logistics supply

chain management. A good customer service is the lifeblood of any

business. Sales people can offer promotions and slash prices to

bringing as new customer as they want but unless get some of those

customers to come back, the business won't profitable for long.

Good customer service is all about bringing customers back.

4.1.5 Mark and number

Without marks and number packing goods don't finding for delivery

to the customer. It is often seen that label of the box is broken or

can't find. It is very embarrassing situation both for the customs

officer and CNF agent. It results the delay of clearing the goods.

Also affects in the total charges of clearance.

4.1.6 Wrong H.S code and shipping mode

It is most difficult to deliver the goods to customs house for wrong

H.S code and wrong information of Bill of Loading.

4.1.7 Strike

Each day causing a loss of around $200 million, by one estimate.

The estimated annual average cost of hartals is between 3 percent

and 4 percent of the country's $110 billion gross domestic product

(GDP), according to a study. These costs include foregone earnings

and lost employment and output, as well as long-term impacts due to

reduced savings, indebtedness, capital losses and reduced

profitability for businesses.

One of the most serious aspects of damage caused is the negative

image costs of hartals in deterring foreign investors from making

their way into the country, making Bangladesh increasingly less able

to compete with regional competitors.

Strikes also impose non-economic costs on people, including

considerable psychological stress and a sense of personal insecurity.

A study conducted earlier by the United Nations Development

Programme (UNDP) and rough estimates by International Chamber

of Commerce Bangladesh reveal these shocking figures and impacts.

The recent hartals are much more damaging because the economy

today is more integrated The impact is not limited to shipment of

export consignments only. It has also hurt farmers who send

vegetables, fish and other agricultural goods to urban areas.

Disruption in communication also takes a toll on industries that cater

to the domestic market. Products are piling up at their warehouses. A

feeling of insecurity has affected domestic demand. Businesses keep

shops and offices open. But customers don't come.

The static losses of hartal per year are likely to be in the range of 0.5

percent to 1 percent of the GDP.

Impact on industries and trade:

Hartal affects the entire production and supply chain. Incessant

shutdown affected production in all factories as all workers could

not attend work.

Exporters have to ship export consignments regularly. But we could

not send anything for shipment in the day of strike.

The major loss is the damage to our image abroad.

At Chittagong Port, the shutdown caused a dip in delivery of

imported products, forcing importers to count huge losses for

overstay of their imported goods in the port yards. The daily

delivery of import containers slumped to 200 twenty-foot equivalent

units (TEUs) due to shutdown, from nearly 1,500 TEUs of

containers on normal days.

Clearing and forwarding (C&F) agent informed that one of his

Dhaka- based clients had to pay more than $250 as demurrage to the

port authority. They have to count extra Tk 4,000 for each of 20

trucks to transport the goods to Dhaka.

4.1.8 Political situation of the country

Along with foreign competitors, currently hundreds of local freight

forwarding companies is engaged in logistic business. There was a

growth in investments in the sector as the trade volume of the

country was increasing.

The political unrest was spelling short-term problems for business of

freight forwarding, the repeated flare-ups of unrest in the export-

oriented apparel sector caused long-term problems. "As many

buyers are looking for alternative markets, it shows they are losing

their confidence in us fast because of the political instability and

resultantly the growing logistics business is at stake."

Currently many orders for apparel products were being shifted to

India, Vietnam, Cambodia and Myanmar as the buyers found those

countries more stable than Bangladesh.

Coming days the volume of air freights might increase as the

exporters were unable to make shipments by sea due to the

shutdowns affecting transportation of goods by road.

Entire logistic business collapsed and there could be a long-term

effect of it on the business, if the trouble in the ready-made garment

(RMG) sector continues.

More than 80 per cent logistics firms were in trouble, as they were

not getting enough cargoes and were failing to maintain shipment

schedules. Transportation of raw materials from ports to Dhaka is

hampering seriously and resultantly production in factories and

exports are also affecting.

Volume of cargoes both by sea and air declined indicating that

Bangladesh was left at risk of losing all business.

After the glory days of jute the promising RMG sector also might

lose the international market, if this political situation continues.

Millions of dollars were invested in the cargo depot business, but

due to various reasons the logistics business was facing serious

trouble.

Overall investments in the business were left at risks, though it was

masterminded to ease the pressure of export and import business on

ports.

Though the short-term problem caused by the political instability

could be overcome, it became a big headache that the buyers were

losing their confidence in the local manufacturers.

Customer service is one of most important part of supply chain

management. A good customer service is the lifeblood of any

business. Sales people can offer promotions and slash prices to bring

in as new customer as they want, but unless get some of those

customers to come back, the business won't profitable for long.

Good customer service is all about bringing customers back.

Logistics business would be the worst-affected area, if this sector

faces further trouble in the coming days.

4.1.9 Bribe in different sections

Corruption is all-pervasive in Bangladesh. Though corruption has

been a part of our politico-administrative heritage, there is little

denying the fact that after independence the tentacles of corruption

have engulfed the entire society.

It is usually known that almost all kinds of corruption perpetuate in

politics and administration in Bangladesh. The most common form

of corruption is pecuniary bribes.

Bribe is ultimately increasing the cost for the customer, for the

nation, for the country finally. Release the goods from the customs

initially, then in several places on the way.

4.1.10 Lack of direct oversight

One of the downsides of using 3PL services is that the client

businesses have no direct control over their operation. They are

relying on the 3PL company to consistently come through in

delivering the promised services. This lack of direct control means

that client companies are at the mercy of any problems the 3PL

company faces. Beyond the possible loss of business, the damage

that results from

3PL services failing to deliver certain products on time are the client

company's problem, not the 3PL services.

4.1.11 Disadvantages

Loss of control over logistics functions

Distance from clients - loss of personal touch

Difference of opinion in perception of the service level

Impact on in-house workforce

CHAPTER 5

Remedies

And

Potential

Improvements

CHAPTER 5

Remedies and potential improvements

5.1 Remedies and potential improvements:

5.1.1 Effective communication

Contacting to the customers time to time is the solution.

5.1.2 Trade/Freight charge information

When the charges changing time to time, inform to the customer

accordingly. It is the effective way to build relation with the customer.

5.1.3 Customer service (After delivery service)

Good customer service is all about bringing customers back. After

delivering the goods, contact to the for relationship building.

5.1.4 Mark and number

Mark the number and mark properly by a sticker.

5.1.5 Wrong H.S code and shipping mode

Select the right HS code.

5.1.6 Political stability of the country

Stable political environment is the essence of the economic logistic

performance and economic supply chain management between trader

and manufacturer.

CHAPTER 6

Conclusion

CHAPTER 6

Conclusion

6.1 Conclusion:

This paper has given an account of and the reasons for the widespread use of

logistics and supply chain management. This dissertation has investigated of the

weak points of logistics and supply chain management in our country. This project

was undertaken to design the limitation and evaluate the remedies of limitations of

3rd party logistics provider. Returning to the hypothesis/question posed at the

beginning of this study, it is now possible to state that the possibility of discussing

the problems regarding the mentioned subjects.

The following conclusions can be drawn from the present study-

Effective communication

Trade/Freight charge information

Customer service (After delivery service)

Political situation, strike

Mark and number

Wrong H.S code and shipping mode

The results of this study indicate that effective communication, customer service,

political situation and strike are affecting strongly in 3rd party logistic provider and

supply chain management.

This research will serve as a base for future studies. A limitation of this study is

that the numbers of patients and controls were relatively small. Future research

should therefore concentrate on the investigation of the above mentioned areas

broadly. The findings of this study have a number of important implications for

future practice.

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