Providing Integrated Logistics Management - Coursework Example

Logistic Management: How inbound logistics, conversion operations and outbound logistics converge to provide integrated logistics. Logistics Management There is a very famous quote which says that the strength of the whole chain is totally dependent on the strength of each individual link of the chain. The supply chain management is the management of the supply of goods and services from the manufacturer to the consumer. Logistics management is a very integral part and link of the supply chain management. And thus, its strength is essential to ensure that the whole supply chain goes on smoothly. It includes the planning, organizing, leading and controlling of all those activities which will help the physical distribution of goods, services or information from the place where it has originated to the place where it will be consumed. The root of effective supply chain management lies in managing the logistics well and dealing with them in an effective and efficient manner. The implementation of all plans should be quick and such that the flow of distribution is dealt with correctly, whatever its nature. It can either be the forward flow or the reverse flow. (James, 1994) Two Kinds of Logistics: When it comes to business, there can be two kinds of logistics, based on the kind of focus that they have. They are the inbound logistics and the outbound logistics. Both of them cannot be done in isolation, though many businesses are treating them as separate fields and areas. The challenge that every business has to face now is to do the planning of inbound logistics, keeping in consideration the volumes that outbound transportation brings which ultimately helps in accelerating the level of collaboration, coordination and consolidation that one expects should be the result of logistics management. (Pegels, 2005) Inbound Logistics: The first kind is that of the inbound logistics, which has an internal focus. It is also known as physical supply. It deals with the procurement process which is external and which occurs in a series of steps as soon as the goods are received. As far as transportation planning in concerned, the concept of inbound logistics has gained wide acceptance and has become the major process within this domain. (Brindley, 2004) There are five business processes involved in the inbound processing. The inbound logistics process starts when there is a receipt of goods, which is basically a requisite to a purchase that has been made from a company. it can be called a follow-up activity. The finances of the company as well as the figures for the inventory are updated. And therefore, it encompasses the services of warehouse management and quality management. Then the next step is the deciding on the external demands for a good that has been procured through external means. The third process is that of the advanced shipping notification, which is sent by the vendor and has in it all the details that are necessary to keep in the record. This document is referred to as the Inbound Delivery whenever the receipt is exchanged. The fourth process is that of the delivery monitor where an overview is given of all the deliveries that have been made. The business can exist in different areas and might deliver to various far stretched remote distances and therefore, the delivery monitor gives figures about the workload at different areas, which helps in doing follow up activities. The last process is that of yard management, which is basically made for the convenience and knowledge of the warehouse. It tells them the figure of the stocks which is currently placed in various different vehicles which are in the midpoint of getting delivered and are on the way. It also manages the vehicle itself which is delivering the goods. Conversion Operations: Conversion Operations is a term which refers to the operations that are involved in moving the goods and materials smoothly from one workstation to another. In logistics, the good has to have so many stop over before finally reaching the customer. Conversion operations ensure that the good is safe, does not get damaged, gets its right care and is travelling in the safest manner from one destination to the other. (Farmer, 1991) Outbound Logistics: The second kind is outbound logistics, which has an external focus. It is also known as physical distribution. This kind of logistics covers all the activities which deal with sending to the goods to their final destination. It can include its planning, preparation and deciding on the mode of transport and then finally using that mode of transport to finish the logistics process. For example, if shipping the goods has been chosen as the required (Green, 1991) The outbound processing includes five business processes again. The fist one is that of the issuance of goods, which forms the basis of this kind of logistics. The posting has to be done of all kinds of goods that have been issued. The data which is required to issue the goods is transferred from the outbound delivery to the document that have been made for this purpose especially. Many actions have to be taken as soon as such a document is made. For example, the warehouse people have to decrease their stock by the quantity that is going to be delivered. The balance sheet is changed according to the rules of inventory accounting. The status of the serial numbers is updated and many other relevant and important data. The delivery document cannot be changed once it is made and this prevents any problems from happening in the delivery process. The second process is that of delivery process and distribution, which is the core process of delivering the good at its destination. Many logistics tasks are done at this point in time. The third process is that of the proof of delivery (POD). This is an invoice which is created only after the customer has confirmed the arrival of the goods that he had ordered. Many other factors like recording and analyzing various data in a system specially designed for this purpose is also included in this step. The fourth step is that of providing value added services, which have to be managed in an effective manner nonetheless. And then the last step is that of the delivery monitor, which gives an overview of all the deliveries which are in their working process. Integrated Logistics: The term integrated logistics means the process where customers take priority for a company in terms of their logistics needs and the company uses various resources to effectively anticipate the needs and wants of their customers so as to be able to serve them better by knowing what kind of resources they now need in terms of capital, people, technology, materials and knowledge, then ensuring the production of the premium good and services, and then laying down a network through which the customer can easily reach the company and enter an order, and then utilizing this very same network in the most effective and efficient manner so that the customer’s order is fulfilled in a timely manner. (Rushton, 2006) Suppose an order comes to a company from a customer for the purchase of specific amount of goods. The process of logistics starts with the formation of a purchase order. When this order is taken, a need arises of the transportation services to be available and working. And then to make sure that the whole process goes on efficiently, logistics planning is done in collaboration with other factors, which create more need for transportation like the replenishment processes or the normal daily fulfillment of outbound logistics by taking orders. Together, the inbound logistics, conversion / operations and the outbound logistics form to make an integrated logistics management. This has become a recent trend in many companies to form one network which would facilitate all these components and which would enhance their functionality and performance in the logistics department. The barriers between inbound and outbound logistics should be removed and this can be only done with the effective implementation of conversion / operations, which smoothens the process that occurs while the goods are in transit. Laying down one network to ensure all three factors gives the flexibility to a company as well as security for their own goods and materials. The concept is that of end-to-end logistics where all and sundry of the logistics management will be dealt with in one network only. The access is immediate to various vehicles, distributors, suppliers, vendors and ultimately customers. The company ensures a competitive advantage for its very self by doing integrated management by combining the three factors within its own umbrella. This helps the company in doing real time trading of logistics related goods and the dealing with many different vendors, parties and customers in one single point in time. (Porter, 1998) There are many advantages of the integrated logistics management, such as cent percent control over the operations of the company, whether they are related to inbound logistics, conversion or outbound logistics. Whatever the policies say, bringing it under one umbrella allows the company to bring flexibility within its logistics services, without being answerable to anybody. It also improves operational efficiently, which helps in bringing smoothness to the whole process of delivery goods and services and receiving them as well. And it also opens a new world of opportunities for fleets that are private and that can provide their services to these companies. (Closs, 1986) Conclusion: Integrated logistics management is the new trend among companies and rightly so, seeing the trend towards globalization and the increasing competition that each company has to face from domestic and international competitors. Bringing all the functions of the logistics within ones domain gives the company greater efficiency, control and flexibility. Bibliography 1. Jones, James (1994) Integrated Logistics Support Handbook. Published by McGraw Hill Professional 2. Closs, David (1986) Logistical Management: A Systems Integration of Physical Distribution. Published by Collier Macmillan. 3. Group, Gale. (2002). Logistics Management. Published by Reed Business Information 4. Rushton, Alan. (2006). The Handbook of Logistics and Distribution Management. Published by Kogan Page Publishers. 5. Green, Linda (1991) Logistics Engineering. Published by Wiley 6. Farmer, David. (1991). Effective Pipeline Management: How to Manage Integrated Logistics. Published by Gower 7. Information Access Company. (1998) Logistics Management and Distribution Report. Published by Cahners Publishing Company. 8. Brindley, Clare (2004) Supply Chain Risk. Published by Ashgate Publishing 9. Pegels, Carl. (2005) Proven Solutions for Improving Supply Chain Performance. Published by IAP 10. Porter, Michael (1998). Competitive Advantage: Creating and Sustaining Superior Performance. Published by Simon and Schuster. Read More