LOGISTICS MANAGEMENT
INTRODUCTION TO LOGISTICS ANS SUPPLY CHAIN MANAGEMENT
Logistics Management
“Logistics Management is that part of supply chain management that plans, implements, and controls
the efficient, effective forward and reverse flow and storage of goods, service and related information
between the point of origin and the point of consumption in order to meet customers’ requirements.”
CSMP (Council of Supply Chain Management Professionals), nowadays
Logistics characteristics:
- Logistics is not a function, but a process, a systemic process that we have to optimize (set
of interrelated activities, correlated into a process, aimed at meeting customer requirements
- Supply chain process is a process that ideally spends all the supply chain, both internal
and external, so the one which connects the customer and supplier
- Logistic is about some activities:
o Executive/implementation of the management of storage and flow of goods
o Planning and control part of the process (demand forecasting, production planning)
o Design of the system, it has to do with the overall design of the process.
Main objectives of logistics:
- Efficiency → increasing the ratio output/input, doing more output with less input.
- Effectiveness → meeting customers’ expectations, se we need to know them.
CSMP, founded in 1963, is the preeminent association for individuals involved in supply chain
management. It was initially formed by a visionary group of educators, consultant and managers
who envisioned the integration of transportation, warehousing and inventory as the future of the
discipline. At that time, physical distribution was just beginning to edge its way into the corporate
lexicon and make its considerable presence felt in the business community.
1
,In 1985, recognizing the growing field of logistics, the association's focus broadened as it changed
its name to the Council of Logistics Management (CLM). It stayed that way until 2004 when CLM's
Executive Committee voted to become CSCMP, the Council of Supply Chain Management
Professionals (CSCMP).
The evolution of Logistics: Distribution
“A term employed in manufacturing and commerce to describe the broad range of activities
concerned with efficient movement of finished products from the end of production line to consumer,
and in some cases includes the movement of raw materials from the source of supply to the
beginning of the production line.”
2
, NCPD (National Council of Physical Distribution Management), 1967
Efficient: emphasis on cost reduction
From production line to consumer: emphasis on the distribution system
Movement of finished products: emphasis on materials handling and transportation
Radar Chart:
Initial scope of logistic was very narrow, it was related to just few elements. Four main dimensions:
- Product → finished products (just sometimes also raw materials)
- Activity → execution/movement: transportation and handling
- Performance → efficiency
- System → distribution part of the supply chain, in terms of the connection between the
consumer and the producer
The evolution of Logistics: Integrated Logistics
“The integration of two or more activities for the purpose of planning, implementing, and controlling
the efficient flow of raw materials, in-process inventory and finished goods from point-of-origin to
point-of-consumption.”
NCPD (National Council of Physical Distribution Management), 1976
Integration: emphasis on the value of global optimization (opposed to local optimization)
Plan, implement and control: not only execution, emphasis on logistics as a business
management discipline
From point of origin to point of consumption: first inclusion of supply chain perspective
Radar chart:
- Product → raw material, process inventory, finished goods
- Activity → plan, implement and control
- Performance → efficiency
- System → from point-of-origin to point-of-consumption internal supply chain
The system is more extended, we have a wider scope of logistic.
“The process of planning, implementing, and controlling the efficient, cost-effective flow and storage
of raw materials, in-process inventory, finished goods, and related information from point-of-origin to
point-of-consumption for the purpose of conforming to customer requirements.”
CLM (Council of Logistics Management), 1985
Process: it is the first explicit recognition that Logistics is a process.
Related information: not only flow of goods but also flow of information.
Conforming to customer requirements: it is the ultimate objective of logistics, not only
efficiency and cost-effectiveness.
3
, Radar chart:
- Product → raw material, process inventory, finished goods and information elements
- Activity → plan, implement, control
- Performance → efficiency + effectiveness in customer requirements
- System → internal supply chain
“The process of planning, implementing, and controlling the efficient, effective flow and storage of
goods, services, and related information from point-of-origin to point-of-consumption for the purpose
of conforming to customer requirements.”
CLM (Council of Logistics Management), 1992
Effective: not cost-effective but effective tout court
Services: logistics management applies also to the provision of services
Radar chart:
- Product → raw material, process inventory, finished goods and services, logistics does not
apply on just product industry, but it is also very important in industries of services (health,
tourism…)
- Activity → plan, implement, control
- Performance → efficiency + effectiveness
- System → internal supply chain
“Logistics Management is that part of supply chain management 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.”
CSCMP (Council of Supply Chain Management Professionals), nowadays
Radar chart:
- Product → raw material, process inventory, finished goods
- Activity → reverse logistics of goods, services, information from the market to the levels at
the beginning of the chain, there is not only the forward logistics
- Performance → efficiency + effectiveness, elimination of just “cost-effectiveness”
- System → internal + external supply chain, we are talking about the overall supply chain
The evolution of Logistics: Supply Chain Management
4
INTRODUCTION TO LOGISTICS ANS SUPPLY CHAIN MANAGEMENT
Logistics Management
“Logistics Management is that part of supply chain management that plans, implements, and controls
the efficient, effective forward and reverse flow and storage of goods, service and related information
between the point of origin and the point of consumption in order to meet customers’ requirements.”
CSMP (Council of Supply Chain Management Professionals), nowadays
Logistics characteristics:
- Logistics is not a function, but a process, a systemic process that we have to optimize (set
of interrelated activities, correlated into a process, aimed at meeting customer requirements
- Supply chain process is a process that ideally spends all the supply chain, both internal
and external, so the one which connects the customer and supplier
- Logistic is about some activities:
o Executive/implementation of the management of storage and flow of goods
o Planning and control part of the process (demand forecasting, production planning)
o Design of the system, it has to do with the overall design of the process.
Main objectives of logistics:
- Efficiency → increasing the ratio output/input, doing more output with less input.
- Effectiveness → meeting customers’ expectations, se we need to know them.
CSMP, founded in 1963, is the preeminent association for individuals involved in supply chain
management. It was initially formed by a visionary group of educators, consultant and managers
who envisioned the integration of transportation, warehousing and inventory as the future of the
discipline. At that time, physical distribution was just beginning to edge its way into the corporate
lexicon and make its considerable presence felt in the business community.
1
,In 1985, recognizing the growing field of logistics, the association's focus broadened as it changed
its name to the Council of Logistics Management (CLM). It stayed that way until 2004 when CLM's
Executive Committee voted to become CSCMP, the Council of Supply Chain Management
Professionals (CSCMP).
The evolution of Logistics: Distribution
“A term employed in manufacturing and commerce to describe the broad range of activities
concerned with efficient movement of finished products from the end of production line to consumer,
and in some cases includes the movement of raw materials from the source of supply to the
beginning of the production line.”
2
, NCPD (National Council of Physical Distribution Management), 1967
Efficient: emphasis on cost reduction
From production line to consumer: emphasis on the distribution system
Movement of finished products: emphasis on materials handling and transportation
Radar Chart:
Initial scope of logistic was very narrow, it was related to just few elements. Four main dimensions:
- Product → finished products (just sometimes also raw materials)
- Activity → execution/movement: transportation and handling
- Performance → efficiency
- System → distribution part of the supply chain, in terms of the connection between the
consumer and the producer
The evolution of Logistics: Integrated Logistics
“The integration of two or more activities for the purpose of planning, implementing, and controlling
the efficient flow of raw materials, in-process inventory and finished goods from point-of-origin to
point-of-consumption.”
NCPD (National Council of Physical Distribution Management), 1976
Integration: emphasis on the value of global optimization (opposed to local optimization)
Plan, implement and control: not only execution, emphasis on logistics as a business
management discipline
From point of origin to point of consumption: first inclusion of supply chain perspective
Radar chart:
- Product → raw material, process inventory, finished goods
- Activity → plan, implement and control
- Performance → efficiency
- System → from point-of-origin to point-of-consumption internal supply chain
The system is more extended, we have a wider scope of logistic.
“The process of planning, implementing, and controlling the efficient, cost-effective flow and storage
of raw materials, in-process inventory, finished goods, and related information from point-of-origin to
point-of-consumption for the purpose of conforming to customer requirements.”
CLM (Council of Logistics Management), 1985
Process: it is the first explicit recognition that Logistics is a process.
Related information: not only flow of goods but also flow of information.
Conforming to customer requirements: it is the ultimate objective of logistics, not only
efficiency and cost-effectiveness.
3
, Radar chart:
- Product → raw material, process inventory, finished goods and information elements
- Activity → plan, implement, control
- Performance → efficiency + effectiveness in customer requirements
- System → internal supply chain
“The process of planning, implementing, and controlling the efficient, effective flow and storage of
goods, services, and related information from point-of-origin to point-of-consumption for the purpose
of conforming to customer requirements.”
CLM (Council of Logistics Management), 1992
Effective: not cost-effective but effective tout court
Services: logistics management applies also to the provision of services
Radar chart:
- Product → raw material, process inventory, finished goods and services, logistics does not
apply on just product industry, but it is also very important in industries of services (health,
tourism…)
- Activity → plan, implement, control
- Performance → efficiency + effectiveness
- System → internal supply chain
“Logistics Management is that part of supply chain management 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.”
CSCMP (Council of Supply Chain Management Professionals), nowadays
Radar chart:
- Product → raw material, process inventory, finished goods
- Activity → reverse logistics of goods, services, information from the market to the levels at
the beginning of the chain, there is not only the forward logistics
- Performance → efficiency + effectiveness, elimination of just “cost-effectiveness”
- System → internal + external supply chain, we are talking about the overall supply chain
The evolution of Logistics: Supply Chain Management
4
