Essay about Applying Anticipatory Logistics to Business

Inbound logistics today is highly inefficient. Most retailers use multiple systems to manage the process and so suffer from fragmented visibility. Prioritisation and scheduling of orders are done on an ad hoc basis, with little consideration of current demand and inventory, while scarce resources, such as dock door and yard capacity, are often poorly utilised.

Logistics and supply chain management is an important aspect of a firm’s strategy for the business to achieve success by creating value throughout the logistics and supply chain. The research paper will outline the concepts that are involved in creating the logistics and supply management framework. The logistics and supply chain management strategies will drive success for the company towards fulfilling and supporting customer needs, procurement and manufacturing operations of the firm.

Due to the large quantity of freight and the long distance that it must travel to arrive to its destination exporters and importers alike have found logistic service providers essential to engage in international trade (Rodriguez, Comtois, Slack, 2013). While some Logistics service providers focus only on the area of transportation others specialize in freight consolidation, distribution management, and warehousing (Robinson, 2014). They have enough market knowledge, information and communication systems to offer supply chain solutions tailored to the specific needs of any company be it small or large (Rodriguez, Comtois, Slack,

Logistics is one of the main functions within a company, and the supply chain is a complex and sometime fragile global endeavor dependent on a network of independent, yet interconnected, moving parts. It requires professional management. Supply chain professionals order the product, build it, move it, ship it, distribute it, and drive the coordination processes with marketing, sales, engineering, manufacturing, finance, and information technology. In short, they make any business effort seem effortless.

Effective supply chain management can provide an important competitive advantage for a business marketer, resulting in improved communication and involvement among members of the chain, increased motivation, and decreased costs. Tracking the movement of and demand for components used to manufacture a product across a variety of potential and actual suppliers, provides insight and the ability to respond instantly to shortages, surpluses, and changes in market conditions. It seeks to optimize production, decrease manufacturing time, minimize inventory, streamline order fulfillment, and reduce cost.

As higher demands continued to be placed on GMM’s production and distribution operations, its transportation network lacked collaboration. In effect, each operation was making individual logistics decisions, creating costly redundancies and inefficiencies throughout the supply chain. However, On-time delivery is critical in their business, and they consistently meet their customers' requirements. With cost, service and punctuality always at the forefront, consolidates shipments, manages carriers, and optimizes air, sea and ground routes. (Penske, 2010)

The catalyst of any effective logistics system is the ability to collaborate accurately and completely with key suppliers while also staying synchronized to the needs of the broader network it is part of. For Huffman Trucking, the challenge is to quickly ascertain which shipments need to be sequenced by delivery location, distribution and supply chain partner, and the costs versus profits of expediting or delaying one delivery relative to another. Just-In-Time (JIT) systems are a critical aspect of logistics and supply chain systems for a service providers' and manufacturing standpoint in that they can drastically reduce operating costs and increase inventory efficiency (Legner, 2005). JIT systems are indispensable for managing highly complex supply chains critical for ensuring manufacturing stays aligned to demand management requirements of their distribution channels and direct customers (Huin, Luong, Abhary, 2002). JIT functionality is a core component of many Enterprise Resource Planning (ERP) systems, which serve as the central coordination system of accounting, finance, logistics, supply chain, service in addition to many other functional areas of a company (Shi-Ming, Kwan, Yu-Chung, 2001).

General Motors is a large automotive manufacturing company that utilizes material requirements planning and linear regression models. General Motors has a very large and complex logistics system that incorporates hundreds of other companies into its processes. From distributors to suppliers, General Motors must be able to communicate throughout the process in order to achieve a successful operation. The MRP system that GM uses allows for better communication, but it wasn’t always this way. In fact, when General Motor’s executive director of global logistics, Mr. Edgard Pezzo, took over GM’s logistics division, he noted that MRP systems needed to be improved to eliminate excess inventory and improve the efficiency of item routing (Ludwig, 2014). Pezzo also worked diligently to improve communication at all levels. He made it easier for internal stakeholders, such as purchasers, manufacturers, finance, and more, to communicate with external stakeholders, like suppliers, so that they could collaborate and participate in planning models to prepare for any scenario that might come along (Ludwig, 2014).

The class text states that Supply chain management is frequently divided into supply chain planning applications, supply chain execution applications, logistics management, and warehouse management. Often when companies fail at implementing an efficient supply chain because of the planning section, or inaccurate demand forecasts. The text states electronic data interchange is one of the earliest uses of information technology for supply chain management, Electronic data interchange is the use of the Internet for everyday business transactions. “In this era of information a firm’s supply chain should operate at speed of thought and this is possible only by enhanced e-speed communications and information sharing with their critical partners.” (4)

In order to remedy this malfunction, the company opted for higher stock levels of some materials and thus avoided production and delivery delays. Gélinas & Bigras (2004) hold that this interrelationship between the factors underlying the purchase and stocking function, heavily influenced by IS inefficiencies, are critical points which reduce the chances of logistics becoming a competitive advantage for the companies which have these characteristics, due to the fact that inconsistent exchange of information creates limitations to performance in the chain. Case study analysis of the production function makes it possible to identify three determining factors: lack of formal planning, underutilization of IS and the need to adapt to the environment. The lack of formal planning is the determining factor in the structure of production, since the inefficiency of forecasting mechanisms makes it possible for sales growth to be much higher than that expected by the

There is predictive monitoring and predictive capabilities out there that businesses are taking advantage of to increase their competitive abilities. Case in point – recently a major commercial aircraft provider was unable to deliver an aircraft order to a customer timely because their ashtray company went out of business. A major bus company was also unable to deliver an order of buses because the company that manufactured and supplied their bumpers also went out of business. These two examples illustrate the power of information and the need to source strategically. It is not just the delivery of a component that is at stake, but the most capable allies that manage your supplies and impact your ability to deliver in the marketplace.

SCM can be divided into three main groups: purchase, manufacture, and transport (Thomas et al., 1996). The focus is on transportation. There are different modes of transportation. These modes of transportation fall under three basic types and they are: land (road, rail and pipelines), water (shipping) and air. Transportation plays a connective role among the several steps that result in the conversion of resources into useful goods for the ultimate consumer. It is the planning of all these functions and sub-functions into a system of goods movement in order to minimize cost and maximize service to the customers that constitutes the concept of business logistics. The system, once it’s put in place, must be effectively managed (Fair & Williams, 1981). What are the advantages and disadvantages of these modes of transportation in logistics?

The variability of logistics performance is quite relevant. ALP has not been able to guarantee a reliable service to its customers in the last years. There seems to be a lack of organization when providing the service to the customers, in the sense of establishing priorities and

Forward logistics (or conventional logistics) is the regular distribution channel followed by the manufactures from time immemorial. Forward logistics concentrates on the products (goods or services) reaching the consumer end and deals with the line of flow from the manufacturer’s end to the consumer’s end. It deals with the very essence of Supply Chain Management and logistical activities of an organization. It has a significant impact on the primary operations carried out, which act as the basic revenue generating aspect of a business. In this logistical system, the flow is a “one-to-many” type and the forecasting or traceability is quite simple.

Logistics is the organization of the flood of things between the reason for starting and the motivation behind use with a particular finished objective to meet necessities of customers or associations. The advantages administered in logistics can fuse physical things, for instance, sustenance, materials, animals, equipment and liquids, and moreover extraordinary things, for instance, manage time, information, transport unit Pricing and Quantity , particles, and essentialness. The logistics of physical things generally incorporates the joining of information stream, which ismaterial dealing with, creation, packaging, stock, transportation, warehousing, and every now and again security. The versatile nature of logistics can be illustrated, bankrupt down, envisioned, and redesigned by dedicated diversion programming. The minimization of the usage of benefits is a commonplace motivation in logistics for import and passage.