Complex because it includes a wide range of locations

complex because it includes a wide range of locations, plants, warehouses, vendors, and
customers that need to be managed across great distances, time
zones, and cultures. The figure below depicts the key issues of global logistics.
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In principle, logistics is a fast evolving and changing field of management, attributed
to the fast growth and evolution of new technologies, services, and markets. The main
decisions in logistics remain unchanged and have to be addressed on both national and
international levels. These decisions are made primarily on three different levels:

1. The strategic planning level
2. The network level
3. The operations level*”
Chapter 8: Managing Global Operations
Strategic planning level decisions are the highest level of logistics decisions. The main
strategic planning issues include performance objectives, the degree of vertical integration,
outsourcing within the supply chain, what will be measured, and how to accomplish the
measurement. These decisions are based on the existing mission and strategies of the
organization. Additional considerations include customer expectations, competition,
availability of financial resources, and the current logistics system.
Furthermore, related strategic level decisions exist beyond logistics that must be addressed
to secure success. Such decisions include the organization’s economic objectives and
strategy, geographic scope of production, distribution, and marketing, along with marketing
and information management objectives and strategy.** Though the design and
development of a new product takes twelve to eighteen months to complete, on average,
other factors of the supply chain network change more rapidly. Thus, it is crucial for a
company to reevaluate strategic level decisions at least once a year. Some do not hesitate to
do so, even if it means looking at various aspects on a monthly basis.”
Network level decisions include the Physical Faciliry Network and Communication/
Information Network decisions. Based on the strategic level decisions, this set of decisions
starts with determining the network strategy first. Such considerations include the degree
of centralization/decentralization, degree of hierarchy, and number of echelons. After these
areas are examined, the physical facilities come to the attention of the organization's
management team. The type, number, location of activities, and services provided by each
facility are analyzed. Finally, the communication and information network must be
designed for effective flow of information along the supply chain, Therefore, the decisions
must be made on the amount and type of information flow, use of information technology
for transfer, processing, and storage of information.* It is important to remember that cost
savings do not only result from looking for the cheapest method but also from looking for
the most efficient method.