The mission of logistics management

abril 12, 2010

It will be apparent form the previous comments that the mission of logistics management is to plan and co-ordinate all those activities necessary to achieve desired levels of delivered service and quality at lowest possible cost. Logistics must therefore be seen as the link between the marketplace and the supply base. The scope of logistics spans the organization, from the management of raw materials through to the delivery of the the final product.

Logistics management, from this total systems viewpoint, is the means whereby the needs of costumers are satisfies through the co-ordination of the materials and  information flows that extend from the marketplace, through the firm and its operations and beyond that to suppliers. To achieve this company-wide integration clearly requires a quite different orientation than the typically encountered in the conventional organization.

For example, for many years markienting and manufacturing have been seen as largely separete activities within the orgranization. At the best they have coexisted, at worst there has been open warfare. MAnufacturing priorities and objectives have typically benn focused on operating efficiency, achivied through long productions runs, minimized set-ups and change-overs and product standaridization. On the other hand, marketing has sought to achieve competitive advantage through variety, high service levels and frequent product changes.

In today’s more turbulent enviroment there is no longer any possiblility of manufacturing and markenting acting independently of each other. The internecine disputes sounter-productive to the achievement of averall corporate goals.

It’s no coincidence that in the recent years both marketing and manufacturing have become the focus of renewed attention. Marketing as a concept and philosophy of costumer orientation noe enjoys a wider acceptance than ever. It is now generally accepeted that eh need to understand and meet costumer requirements is a prerequisite for survival. At the same time, in the search for improved cost competitivities, manufaturing management has been the subject fo a massive revolution. The last decade has seen the rapid introduction of flexible manufacturing systems (FMS), of new approches to inventory based on materials requirements planning (MRP) and just-in-time (JIT) methods, perhaps most important of all, s sutained emphasis on total quality management (TQM).

Equally there has been a growing recognition of the critical role that procurement plays in creating and sustaining comeptitive advantage as apart of an integrated logistics process. Leading-egde organizations now routinely include supply-sides issues in the development if their strategic plans. Not only is the cost of purchased materials and supplies a significant aprt of total costs in msot organizations, but there is a major opportunity for leveaging the capabilities and competencies of suppliers through closer integration of the buyers’ and suppliers’ logistics processes.

In this scheme if things, logistics is therefore essentially and integrative concept that seeks to develop a system-wide view of the firm. It is fundemantally a planning concept that seeks to create a framework through which the needs of the marketplacecan be translated into a manufacturing strategy and plan, which in turn links into a strategy and plan for procurement. Ideally there should be a ‘one-plan’ mentality within the bussiness which seeks to replace the conventional stand-alone and separate plans of marketing, distribution, production and procurement. This, quite simply, is the mission of logistics management.



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