1. What is logistics management?1
What is logistics management?

2. Logistics management is the process of1 1
Logistics Management
Logistics management is the process of
planning,
implementing and
controlling
the efficient, cost-effective forward and reverse flow of raw materials, in-process inventory, finished goods, services, and related information from point of origin to point of consumption for the purpose of conforming to customer requirements.
Council of Logistics Management

3. Logistics activities Customer service Demand forecasting
Logistics information systems
Inventory control
Material handling
Order processing
Parts and service support
Plant and warehouse site selection
Procurement
Packaging
Reverse logistics
Traffic and transportation
Warehousing and storage

4. The Five Rights of Logistics
Right Items, needed for consumption or production,
Right Place
Right Time
Right Condition
Right Cost,

5. Factors Impacting the Development of Logistics1 3
Factors Impacting the Development of Logistics
Military logistics developments
Transportation deregulation
Competitive pressures
Information technology
Channel power
Profit leverage

6. 1.Military Logistics
Throughout the history ; wars have been won and lost through logistics strengths and capabilities or the lack of them.

7. 1.Military Logistics
Following the World War II, logistics began to receive increased recognition and emphasis.
In the Persian Gulf War in , the ability to efficiently and effectively distribute and store supplies and personnel were key factors in the success of the US Armed Force.

8. 2.Deregulation
Deregulation of the transportation industry in the late 1970s and early 1980s gave organizations many more options and increased the competition within and between transportation modes.
Carriers become more creative, flexible, customer-oriented, and comparative in order to succeed.
They can focus on negotiation of rates, terms, and services, with their overall attention directed toward getting the best transportation buy.

9. 3. Competitive Pressures
Globalization and competition
With rising interest rates and increasing energy costs during the 1970s, logistics received more attention as a cost driver-emphasis on cost control
WHY?
Local firms versus overseas competitors
Increased offshore buying and selling activities, more complex and more costly global supply chains

10. 4.Information Technology
Information technology gave organizations the ability to better monitor transactions intensive activities such as ordering, movement of goods...
Computerized quantitative models for controlling and optimization
MRP,MRP II,DRP,DRP II,JIT link material management from order processing to inventory management, forecasting and production.

11. 5.Channel Power
Shifting channel power from manufacturers to retailers, wholesalers, and distributors has also had a profound impact on logistics.
Lower brand loyalty decreases a manufacturer’s power-increases retailer’s power

12. 6. Profit Leverage
$1 saved in logistics costs has a much greater impact on the organization’s profitability than a $1 increase in sales.
There are costs associated with sales ( cost of goods sold…) ] $ 1 increase in sales does not result in $ 1 dolar increase in profit

13. Logistics Is Relevant to All Types of Organizations
The definition of logistics includes the flow of materials and services in both the manufacturing and service sector.
The service sector includes entities such as the government, hospitals, banks, retailers and wholesalers.

14. It is only in the recent past that business organizations have come to recognize the vital impact that logistics management can have in the achievement of competitive advantage.
Martin Christopher

15. Competitive Advantage
The source of competitive advantage is found ;
In the ability of the organization to differentiate itself, in the eyes of the customer, from its competitors,
By operating at a lower cost and hence at greater profit.
Christopher s.5

16. Components of Logistics Management1 2
Management actions
Inputs into logistics
Planning
Implementation
Control
Outputs of logistics
Natural resources (land, facilities, and equipment)
Competitive advantage
Logistics management
Human resources
Time and place utility
Suppliers
Raw materials
In-process inventory
Finished goods
Customers
Financial resources
Efficient movement to customer
Information resources
Proprietary asset
Logistics activities
Customer service
Demand forecasting
Distribution communications
Inventory control
Material handling
Order processing
Parts and service support
Plant and warehouse site selection
Procurement
Packaging
Reverse logistics
Traffic and transportation
Warehousing and storage

17. The Outputs of the Logistics System
The outputs of the logistics system are
competitive advantage,
time and
place utility,
efficient movement to the customer, and
providing a logistics service mix such that logistics becomes a proprietary asset of the organization.

18. PETER DRUCKERS stated that:
Logistics is one of the last frontiers of opportunity for organizations wishing to improve their corporate efficiency.