STUDENTS' CORNER - 107
Having seen briefly the major objectives of the logistics, let us look
into ‘Logistics Management’
Logistics Management is actually an integral component of a larger
area of operations called supply chain management. Logistics management is a
necessary means for the supply chain management.
The singular goal of the supply chain management is to carry out
customer service without hitches so as to satisfy the customer’s needs through
movements of the products from the place of origin to the place of
consumption. It is a continuous business
process that keeps the trade going. We will see more of supply chain management
Logistics management focuses on reducing the logistics cost for the
company through prompt delivery of the goods or services to the customer. We
have already discussed this aspect while dealing with the objectives of the
logistics. In fact, logistics management coves all those topics we have studied
under the objectives of the logistics and there is something more.
Logistics management focuses on every activity involved in the
business process. The range and scope of activities of the logistics management
differ from company to company dealing with the same kind of product and differ
depending on the nature of the business the company is engaged. For example,
the total activities of a company which is engaged in procuring and supplying
raw materials needed for manufacturing a specific product differ from the
activities of a company that is exclusively engaged in marketing the product.
Of course, it must be borne in mind that all businesses are governed generally
by the basic principles of management which, to say briefly, include planning,
implementing, staffing, so on.
In short, any efficient logistics management must adopt best practices
which ensure sustainability to the enterprise, meaning taking care of the
bottom line of any enterprise. And the heart of any best practice promises
maximum advantage to the company and all its stakeholders fairly.
Let us look at some of the elements included in logistics management.
To begin with: Vendor selection.
The success of any business activity depends on the right selection of a
vendor. Vendor is supply chain management term. It refers to any individual who
supplies goods or services to any individual or to any company. He may or may
not be a manufacturer of a product though generally he is manufacturer of
inventoriable items. The selection of a
vendor must be cost effective in terms of quality of service; he must deliver
the goods right in time in the right quantity with the right quality. It
implies that the vendor must be in a position to provide good transportation
facilities. The vendor must be able to choose most effective route for transportation. A wrong decision at any level for any business
activity will entail loss of money and at times loss of a good customer.
From this we can understand that logistics management is all pervasive
in the business domain.
Let us look into some more details in our next session.