Efficient Organizational Costs and System Logistics Management - Literature review Example

Essay Name: Course: Tutor: Institution: Date: Introduction Global organisations have encountered increased competition as well as activities. In this regard, organisations have adopted strategic management approaches to execute and implement their strategies. As De Waal, Kourtit and Nijkamp (2009, p.1244) argued, strategic management plays a significant role in increasing organizational management efficiencies. Unlike traditional management approaches, that perceived each organizational operation individually, strategic management perceives the activities as individual parts of a system, which despite their independence have a collective interaction responsibility to increase the overall organizational success. One of the outlined organizational activities in this system is logistics. In an explanation on the role of logistics on organizational success, Murphy and Wood (2011, p.30) argued that “From a companywide perspective, the system and total cost approaches to logistics requires an understanding of logistics and its relationships with other functional areas”. As such, this essay evaluates the interrelationship between logistics and other organizational functions. Marketing Function Management An organizational marketing function plays a significant role in availing its products and services to the consumer base. In this regard, the marketing function is not only charged with informing the consumers of the products existence and features, but also on the key product samples provision as well as the ultimate supply and delivery of such products to the ultimate final consumers. Elliott and Boshoff (2005, p.46) argued on the application and role of a marketing function to an organisations ultimate success. In this regard, the study established that an organizational marketing function plays a significant role in facilitating brands introduction as well as stimulate their growth and influence in the market. This analysis establishes the relationship between organisations marketing function and logistics. The process of presenting product information to the consumers involves information transfer from the organizational staff to the market, a logistics feature. In this regard, it is imperative for the organizational marketing staff to understand logistics and the involved costs for each marketing approach. In addition, the delivery of the goods requires transportation services of the marketed products. As such, the marketing function requires knowledge of the transportation modes, means and their implications, costs and benefits, in order to enhance consumer satisfaction at reduced overall costs. Finance Function Management An additional organizational function that applies the logistics activities is the finance organizational function. Jody (2002, p.311) conducted a review study on the functioning and operations of an organizational finance function. In the review, the study argued that a finance function is charged with the responsibility of developing and establishing appropriate organizational accounting system. In this regard, the function is charged with the mandate of developing and establishing appropriate inventory carrying costs. This incorporates a series of logistics activities such as the determination of optimum stock values, reorder levels as well as minimum required stock values. Through the integration of these logistical factors to an organizational financial management system increases the overall organizational efficiency and effectiveness levels. Therefore, this evidences on the need for organisations to equip their finance staff with appropriate logistical knowledge on the need for appropriate inventory management. This evidences that logistics plays an integral part in the development of appropriate and sound financial systems for eventual organizational success. Production Function Management Further, the logistics functionality and activities are interlinked with an organisations production function management. Avella and Vazquez-Bustelo (2010, P.552) stated that a production function is charged with the mandate of acquiring raw materials, producing and processing them as well storing the work in progress goods and the finished goods as well. In this regard, the function management relies on the presence of a series of logistical activities such as suppliers’ communication and relationship systems, inventory procurement, storage and supply. The existence of an efficient production system relies on appropriate and significant management of the accompanying logistical function. Therefore, this essay establishes that a production function success is reliant on efficiency in organizational logistics management systems. Research and Design Increasing global market demand s and competition has necessitated the need for organisations to develop unique market approaches. In this regard, as Tetteh and Ofori (2010, p.238) argued on Ghana based case study, organisations have resulted to increased use of their research and design functions. Through these functions, organisations increase their overall productiveness through unique products development, a virtue promoting their consequent market competitiveness, enhancing eventual market success. As Deyo, Doner and Hershberg (2001, p.70) stated, the function incorporates activities such as sampling as well as sample distribution for testing. This process incorporates logistical activities such as the process of sharing information between organizational departments on desired templates as well as the process of distribution the templates and samples for appropriate testing, approval or for improvement recommendations. Distribution and Supply Management Wilding and Humphries (2006, p.311) described an organizational distribution and supply function as a marketing branch charged with the functionality of establishing organizational market contacts. Unlike the marketing function that markets the products to increase overall demand, an organizational distribution and supply function seeks to establish market partners and alliances through which the products would be supplied. The function requires increased information flow management between the organization and its market partners. As such, the function success is based on efficient management of information flow a key logistics component. Therefore, based on this analysis, this essay argues on the existence of a relationship between an organizational distribution and supply function with its logistics function activities. This argument is ascertained by an argument developed by Gundlach, Bolumole, Eltantawy and Frankel (2006, p.431). The authors argued on the existing relationship between distribution successes with its interrelationship with proper transportation approaches in an organization. Conclusion In summary, this essay reviews the argument that efficient and successful organizational costs and system logistics management relies on an understanding of the interrelationship between logistics and other organizational functionalities. In this regard, the essay establishes that logistics has a direct interrelationship with marketing, finance, production, research and design and distribution management functions. Through a critical review of each, it is apparent that each of them directly contributes to overall logistical costs and systems. For instance, the marketing function sale force information transfer into the market approach, the production function warehousing and procurement approaches as well as the distribution function transport modes used, all implicate on the overall organizational logistical costs. References Avella, L. & Vázquez-Bustelo, D. 2010, "The multidimensional nature of production competence and additional evidence of its impact on business performance", International Journal of Operations & Production Management, vol. 30, no. 6, pp. 548-583. De Waal, A., Kourtit, K. & Nijkamp, P. 2009, "The relationship between the level of completeness of a strategic performance management system and perceived advantages and disadvantages", International Journal of Operations & Production Management, vol. 29, no. 12, pp. 1242-1265. Deyo, F. C., Doner, R. F., & Hershberg, E. (2001). Economic governance and the challenge of flexibility in East Asia, Rowman & Littlefield Publishers, Lanham, Md. Elliott, R. & Boshoff, C. 2005, "The influence of organizational factors in small tourism businesses on the success of Internet marketing", Management Dynamics, vol. 14, no. 3, pp. 44-58. Gundlach, G.T., Bolumole, Y.A., Eltantawy, R.A. & Frankel, R. 2006, "The changing landscape of supply chain management, marketing channels of distribution, logistics and purchasing", The Journal of Business & Industrial Marketing, vol. 21, no. 7, pp. 428-438. Jody, H.G. 2002, "Relationships between service providers and their impact on customers", Journal of Service Research: JSR, vol. 4, no. 4, pp. 299-311 Murphy, Jnr, PR, & Wood, DF 2011, Contemporary Logistics 10th edition, Pearson Prentice Hall, NJ, USA, Chapter 1. Tetteh, E.N. & Ofori, D.F. 2010, "An exploratory and comparative assessment of the governance arrangements of universities in Ghana", Corporate Governance, vol. 10, no. 3, pp. 234-248. Wilding, R. & Humphries, A.S. 2006, "Understanding collaborative supply chain relationships through the application of the Williamson organizational failure framework", International Journal of Physical Distribution & Logistics Management, vol. 36, no. 4, pp. 309-329 Read More