361 Chapter 8 Logistics

361 Chapter 8 Logistics - Planning, implementing, and...

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Unformatted text preview: Planning, implementing, and controlling the effective flow and storage of goods and materials from the point of origin to the point of consumption (CLM). Transportation Warehousing (and more generally, location) Packaging Material handling Logistics information systems Logistics service providers (And some would put inventory here as well!) Deregulation Globalization Technological breakthroughs Environmental concerns Performance impact 1. Transportation providers Elimination of artificial barriers Unrestricted markets Multi-modal solutions Price, schedule, and terms flexibility 1. Buyers have greater freedom Negotiate prices, terms, and conditions Ownership issues Year Exports Imports 1992 $449 Billion $700 Billion 1998 $670 Billion $917 Billion Change +49% +31% What is driving this activity? Information Systems: 1. Global positioning systems 2. Bar-coding applications RFID on the horizon as replacement 1. Real-time simulation and optimization 2. Precise coordination of multi-modal solutions Transportation Systems Standardized containers for ease of transfer Roadrailers, etc. Multi-modal solutions Ship Truck Train Truck ? Even while certain aspects of logistics have been deregulated, other areas are being controlled more stringently, such as: Fuel efficiency Pollution Recovery, recycling, and reuse of packaging, containers, and products Region Gross Domestic Product Logistics Expenditure Logistics % of GDP North America 8,495 915 10.8 Europe 7,981 941 11.8 Pacific 5,605 652 11.6 Other 7,080 916 12.9 Total 29,161 3,424 11.7 Comparative GDP and Logistics Expenditures (billions of $, 1998) Source: D. Bowersox and R. Calantone, Executive Insights: Global Statistics, Journal of International Marketing , Vol. 8, no. 4, 1998, pp 83-93. 2000 2004 Manufacturing Time 2 days 0.5 days Shipping Time 4 days 4 days Total Time to the Customer 6 days 4.5 days Total time to the customer at WolfByte Computer 75% decrease in manufacturing time, but only 25% decrease in time to customer. Where is the leverage now? 1. Transportation Modes Formats Pricing 1. Warehousing Consolidation Cross Docking and Break-Bulk Hub and Spoke Inventory 1. Highway (truck) 2. Water 3. Rail 4. Air 5. Pipeline Mode Value (%) Tons (%) Ton Miles (%) Highway (trucking, parcel, postal, courier) 80.3 58.5 28.4 Water 2.5 11.1 20.4 Rail 4.8 11.2 26.7 Air 2.7 0.2 Pipeline 4.2 13.7 17.6 Other/Unknown 5.5 5.5 6.7...
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361 Chapter 8 Logistics - Planning, implementing, and...

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