logistics and competitive strategy chapter eleven by martin christopher
TRANSCRIPT
Logistics and Logistics and Competitive strategyCompetitive strategy
Chapter Eleven Chapter Eleven
By Martin ChristopherBy Martin Christopher
Unit 1Unit 1 Strategic Logistics ManagementStrategic Logistics Management 22
Dimensions of Logistics: Dimensions of Logistics: IntroductionIntroduction
Logistics has come a long way since the Logistics has come a long way since the 1960s.1960s.
The The big challengebig challenge is to manage the whole is to manage the whole logistics system in such a way that order logistics system in such a way that order fulfillment meets or exceeds customer fulfillment meets or exceeds customer expectations.expectations.
Focus of this chapter is upon the individual Focus of this chapter is upon the individual firm’s logistics system but also recognizing firm’s logistics system but also recognizing that no logistics system operates in a vacuumthat no logistics system operates in a vacuum..
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What is Logistics?What is Logistics? Popular logistics terms:Popular logistics terms:
• Logistics ManagementLogistics Management• Business Logistics ManagementBusiness Logistics Management• Integrated Logistics ManagementIntegrated Logistics Management• Materials ManagementMaterials Management• Physical Distribution ManagementPhysical Distribution Management• Marketing LogisticsMarketing Logistics• Industrial LogisticsIndustrial Logistics• DistributionDistribution
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Definition of Logistics:Definition of Logistics: Council of Logistics Management Council of Logistics Management
(CLM, 1985)(CLM, 1985)
• Logistics is the process of planning, Logistics is the process of planning, implementing and controlling the implementing and controlling the efficient, effective flow and storage of efficient, effective flow and storage of raw materials, in-process inventory, raw materials, in-process inventory, finished goods and related information finished goods and related information from point of origin to point of from point of origin to point of consumption for the purpose of consumption for the purpose of conforming to customer requirements.conforming to customer requirements.
Logistics - DefinitionLogistics - Definition
Logistics is the process of strategically Logistics is the process of strategically managing the procurement, movement and managing the procurement, movement and storage of materials, parts and finished storage of materials, parts and finished inventory (and the related information inventory (and the related information flows) through the organisation and its flows) through the organisation and its marketing channels in such a way that marketing channels in such a way that current and future profitability are current and future profitability are maximised through themaximised through the
cost-effective fulfilment of orders.cost-effective fulfilment of orders.
Martin Christopher Martin Christopher
Logistics and Supply Chain ManagementLogistics and Supply Chain ManagementUnit 1Unit 1 Strategic Logistics ManagementStrategic Logistics Management 55
Supply Chain ManagementSupply Chain Management
The management of upstream and The management of upstream and downstream relationships with downstream relationships with suppliers and customers in order to suppliers and customers in order to deliver superior customer value at deliver superior customer value at least cost to the supply chain as a least cost to the supply chain as a whole.whole.
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What is Logistics?:What is Logistics?:2211stst Century View of Logistics (4 Century View of Logistics (4
subdivisions)subdivisions)
1. 1. Business LogisticsBusiness Logistics – supply chain – supply chain process that plans, implements, and process that plans, implements, and controls the efficient, effective flow of controls the efficient, effective flow of goods, services, and related information goods, services, and related information from the point of origin to the point of from the point of origin to the point of use or consumption in order to meet use or consumption in order to meet customer requirements.customer requirements.
2. Military Logistics2. Military Logistics – design and – design and integration of all aspects of support for integration of all aspects of support for the operational capacity of the military the operational capacity of the military forces, and their equipment to ensure forces, and their equipment to ensure readiness, reliability, and efficiency.readiness, reliability, and efficiency.
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What is Logistics?:What is Logistics?:2121stst Century View of Century View of
LogisticsLogistics3. Event Logistics3. Event Logistics – network of activities, – network of activities,
facilities, and personnel required to facilities, and personnel required to organize, schedule, and deploy the organize, schedule, and deploy the resources for an event to take place and to resources for an event to take place and to efficiently withdraw after the event.efficiently withdraw after the event.
4. Service Logistics4. Service Logistics – acquisition, scheduling, – acquisition, scheduling, and management of the facilities/assets, and management of the facilities/assets, personnel, and materials to support and personnel, and materials to support and sustain a service operation or business.sustain a service operation or business.
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3 major dimensions of 3 major dimensions of LogisticsLogistics
1.1. The macro environment of Logistics: The macro environment of Logistics: Economy Economy PerspectivePerspective
2.2. The micro environment of LogisticsThe micro environment of Logistics: : Firm Firm dimensiondimension
3.3. The logistics components and its The logistics components and its internal relationshipinternal relationship
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1. Logistics in the Economy: 1. Logistics in the Economy:
A Macro PerspectiveA Macro Perspective As indicated in Figure As indicated in Figure 2-2, logistics , logistics
costs as a percentage of GDP have costs as a percentage of GDP have declined from 16 percent in 1980, to declined from 16 percent in 1980, to under 10 percent in 1999under 10 percent in 1999..
Early to mid-1970s saw the figure Early to mid-1970s saw the figure closer to 20 percent.closer to 20 percent.
This reflects a serious improvement in This reflects a serious improvement in the efficiency of logistics systems.the efficiency of logistics systems.
Figure Figure 2-3 shows a further breakdown shows a further breakdown of logistics costs for 1999.of logistics costs for 1999.
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Figure 2-2: Figure 2-2: Logistics Costs as a Logistics Costs as a Percentage of GDPPercentage of GDP
15.7
12.3
11.4
10.4
10.3
10.1
9.9
0 5 10 15 20
1980
1985
1990
1995
1996
1998
1999
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Figure 2-3: Figure 2-3: Total Logistics Costs --- 1999Total Logistics Costs --- 1999
Logistic cost as a percentage of Logistic cost as a percentage of GDP across the world is shown in GDP across the world is shown in
the following table the following table
CountryCountry Logistic cost as a Logistic cost as a percentage of GDPpercentage of GDPKoreaKorea 16 (GDP 1.12 16 (GDP 1.12 tn $)tn $)
ChinaChina 15 (GDP 7.32 15 (GDP 7.32 tn $)tn $)
JapanJapan 14 (GDP 5.86 14 (GDP 5.86 tn $)tn $)
IndiaIndia 13 (GDP 1.82 tn $)13 (GDP 1.82 tn $)
FranceFrance 12 (GDP 2.74 tn $)12 (GDP 2.74 tn $)
UKUK 11 (GDP 2.45 tn $)11 (GDP 2.45 tn $)
USAUSA 10 (GDP 15 tn$)10 (GDP 15 tn$)
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1. Logistics in the Economy: 1. Logistics in the Economy:
A Macro PerspectiveA Macro Perspective The two largest cost categories in The two largest cost categories in
logistics systems are logistics systems are transportation and transportation and inventoryinventory..
While we will look at this later, motor While we will look at this later, motor carriers’ share of total freight carriers’ share of total freight expenditures is $450 billion versus $99 expenditures is $450 billion versus $99 billion for all other carriers.billion for all other carriers.
The most frequent trade-off in logistics is The most frequent trade-off in logistics is between transportation and inventory between transportation and inventory cost.cost.
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1. Logistics in the Economy: 1. Logistics in the Economy:
A Macro PerspectiveA Macro Perspective As indicated in Figure As indicated in Figure 2-4, the , the
Federal Reserve measure of Federal Reserve measure of inventory to sales ratios from 1991 to inventory to sales ratios from 1991 to 1999 clearly indicate that companies 1999 clearly indicate that companies are getting better at managing are getting better at managing inventory.inventory.
Companies have been supporting Companies have been supporting larger amounts of sales with larger amounts of sales with decreasing amounts of inventory.decreasing amounts of inventory.
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Figure 2-4: Figure 2-4: Inventory Sales RatioInventory Sales Ratio
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1. Logistics in the Economy: 1. Logistics in the Economy:
A Macro PerspectiveA Macro Perspective Contributing to this declineContributing to this decline
• Improvement in transportation costImprovement in transportation cost• Better inventory managementBetter inventory management• Turnover has had a very positive impact Turnover has had a very positive impact
upon the return on investment for upon the return on investment for companiescompanies
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The role of Logistics in The role of Logistics in Macro economicMacro economic
(i) Value added role(i) Value added role
(ii) Economic impact(ii) Economic impact
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(i) Add values to product/services: (i) Add values to product/services: 4 principal VAs of economic utility4 principal VAs of economic utility
1.1. Form utility- Form utility- (what)(what) - production- production2.2. Place utility- Place utility- (where)(where) - logistic- logistic3.3. Time utility- Time utility- (when)(when) - logistic- logistic4.4. Possession utility- Possession utility- (why) (why) - -
marketingmarketing Also referred to as the seven Also referred to as the seven RsRs --- --- RRight product, ight product, RRight ight
quantity, quantity, RRight condition, ight condition, RRight place, ight place, RRight time, ight time, RRight ight customer, and customer, and RRight cost.ight cost.
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Figure 2-5 Figure 2-5 Fundamental Fundamental Utility Creation in the Utility Creation in the
EconomyEconomy
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2. Logistics in the Firm: 2. Logistics in the Firm: The Micro DimensionThe Micro Dimension
a. a. Logistics Interfaces with Logistics Interfaces with Operations/ManufacturingOperations/Manufacturing
b. Logistics Interfaces with b. Logistics Interfaces with MarketingMarketing
c. Logistics Interfaces with c. Logistics Interfaces with Other AreasOther Areas
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a. Logistics Interfaces with a. Logistics Interfaces with Operations ManufacturingOperations Manufacturing
Examples:Examples:
1. Length of production runs1. Length of production runs• Balance economies of long production Balance economies of long production
runs against increased costs of high runs against increased costs of high inventories.inventories.
2. Seasonal demand2. Seasonal demand• Acceptance of seasonal Acceptance of seasonal
inventory to balance inventory to balance lead production times.lead production times.
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a. Logistics Interfaces with a. Logistics Interfaces with Operations ManufacturingOperations Manufacturing
3. Supply-side interfaces3. Supply-side interfaces• Stocking adequate supplies to ensure Stocking adequate supplies to ensure
uninterrupted production now a logistics uninterrupted production now a logistics function.function.
4. Protective packaging4. Protective packaging• Principal purpose is to protect the Principal purpose is to protect the
product from damage.product from damage.5. Foreign & third party alternatives5. Foreign & third party alternatives
• Some logistics functions are being Some logistics functions are being outsourced.outsourced.
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b. Logistics Interfaces with b. Logistics Interfaces with MarketingMarketing
The Marketing Mix – Four PsThe Marketing Mix – Four Ps(i) (i) Price
(ii) (ii) Product
(iii) (iii) Promotion
(iv) (iv) Place
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Logistics in the Firm: Logistics in the Firm: (i) (i) Price Price
Carrier pricingCarrier pricing• Generally, since the larger the shipment, the Generally, since the larger the shipment, the
cheaper the transportation rate, shipment sizes cheaper the transportation rate, shipment sizes should be tailored to the carrier’s vehicle should be tailored to the carrier’s vehicle capacity where possible.capacity where possible.
Matching schedulesMatching schedules• Quantity discounts should be tied to carrier Quantity discounts should be tied to carrier
quantity discounts.quantity discounts. Volume relationshipsVolume relationships
• Volumes sold will affect inventory Volumes sold will affect inventory requirements.requirements.
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Logistics in the Firm: Logistics in the Firm: (ii) (ii) ProductProduct
Consumer packagingConsumer packaging• Generally, since the size, shape, weight and Generally, since the size, shape, weight and
other physical characteristics of the product other physical characteristics of the product impact on its storage, transportation and impact on its storage, transportation and handling, the logistics managers should be handling, the logistics managers should be included in any decisions regarding these included in any decisions regarding these product traits.product traits.
• A minor correction in any of the above could A minor correction in any of the above could conceivably cost (or save) millions of dollars conceivably cost (or save) millions of dollars in logistical costs.in logistical costs.
• Logistics costs are not necessarily Logistics costs are not necessarily paramount, but they need to be considered paramount, but they need to be considered in the decision making process. in the decision making process.
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Logistics in the Firm: Logistics in the Firm: (iii) (iii) PromotionPromotion
Push versus pullPush versus pull• The most important factor is that the logistics The most important factor is that the logistics
division is aware of any changes in demand division is aware of any changes in demand patterns so that it can plan for any patterns so that it can plan for any consequences.consequences.
• Pull strategies tend to be more erratic.Pull strategies tend to be more erratic.• Push strategies tend to more predictable.Push strategies tend to more predictable.
Channel competitionChannel competition• The more popular a product, the easier it is to The more popular a product, the easier it is to
persuade channel members to promote your persuade channel members to promote your product.product.
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Logistics in the Firm: Logistics in the Firm: (iv) (iv) PlacePlace
WholesalersWholesalers• Generally, since wholesalers are combining Generally, since wholesalers are combining
purchases for multiple retailers, the shipment purchases for multiple retailers, the shipment sizes tend to be larger and the number of sizes tend to be larger and the number of transactions that have to be processed are transactions that have to be processed are fewer, with the result that logistics costs are fewer, with the result that logistics costs are smaller. smaller.
RetailersRetailers• With the exception of very large retailers who With the exception of very large retailers who
act more like wholesalers, smaller sales are the act more like wholesalers, smaller sales are the norm. These generally cost more for norm. These generally cost more for transportation and order processing. transportation and order processing.
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c. Logistics Interfaces with c. Logistics Interfaces with Other AreasOther Areas
Manufacturing and marketing are probably the Manufacturing and marketing are probably the two most important internal, functional interfaces two most important internal, functional interfaces with logistics.with logistics.
Other important interfaces now include finance Other important interfaces now include finance and accounting.and accounting.• Logistics can have a major impact on return on Logistics can have a major impact on return on
assets and return on investment.assets and return on investment.• Logistics costs reported by cost systems Logistics costs reported by cost systems
measure supply chain trade-offs and measure supply chain trade-offs and performance.performance.
Session 1 – Summing UpSession 1 – Summing Up
End of Session 1End of Session 1
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Sources of Competitive Sources of Competitive AdvantageAdvantage
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Porter's 5 Forces - Elements of Industry Structure (source: Porter, 1985, p.6)
New Entrants
BuyersSuppliers
Substitutes
IndustryCompetitors
Intensityof Rivalry
Threat ofSubstitutes
Threat ofNew Entrants
Bargaining Powerof Suppliers
Bargaining Powerof Buyers
Determinants of Buyer Power
Bargaining Leverage• Buyer concentration vs. firm concentration• Buyer volume• Buyer switching costs relative to firm switching costs• Buyer information• Ability to backward integrate• Substitute products• Pull-through
Price Sensitivity• Price/total purchases• Product differences• Brand identity• Impact on quality/ performance• Buyer profits• Decision maker’s incentives
Determinants of Substitution Threat• Relative price performance of substitutes• Switching costs• Buyer propensity to substitute
Rivalry Determinants• Industry growth• Fixed (or storage) costs / value added• Intermittent overcapacity• Product differences• Brand identity• Switching costs• Concentration and balance• Informational complexity• Diversity of competitors• Corporate stakes• Exit barriers
Entry Barriers• Economies of scale• Proprietary product differences• Brand identity• Switching costs• Capital requirements• Access to distribution• Absolute cost advantages Proprietary learning curve Access to necessary inputs Proprietary low-cost product design• Government policy• Expected retaliation
Determinants of Supplier Power• Differentiation of inputs• Switching costs of suppliers and firms in the industry• Presence of substitute inputs• Supplier concentration• Importance of volume to supplier• Cost relative to total purchases in the industry• Impact of inputs on cost or differentiation• Threat of forward integration relative to threat of backward integration by firms in the industry
Sources of Competitive Sources of Competitive AdvantageAdvantage
new technologiesnew technologies iPhone, Cloud ComputingiPhone, Cloud Computing
new or shifting buyer needsnew or shifting buyer needs Apartments vis-à-vis BungalowsApartments vis-à-vis Bungalows
the emergence of a new industry the emergence of a new industry segmentsegment
Organic Vegetables, Green IndustryOrganic Vegetables, Green Industry
shifting input costs or availabilityshifting input costs or availability Non-availability of WoodNon-availability of Wood
changes in government regulationschanges in government regulations Banning of Sun Control Films in CarsBanning of Sun Control Films in Cars
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Logistics Value PropositionLogistics Value Proposition
Service BenefitsService BenefitsAvailabilityAvailabilityOperational PerformanceOperational Performance
• Speed, Consistency, Malfunction and Recovery Speed, Consistency, Malfunction and Recovery TimeTime
Service ReliabilityService Reliability• Quality Aspect – by standards and monitoringQuality Aspect – by standards and monitoring• Manpower, Software, Training, Continuous Manpower, Software, Training, Continuous
Improvement, Improvement,
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Logistics Value PropositionLogistics Value Proposition
Cost MinimizationCost MinimizationLeast Total Cost ConceptLeast Total Cost Concept
• Airfreight, Air Travel, Airfreight, Air Travel,
Logistics Value GenerationLogistics Value GenerationCommitment Commitment
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What is logisticsWhat is logistics
Logistics is the Logistics is the processprocess of strategically of strategically managing the managing the procurementprocurement, , movement movement and and storagestorage of materials, parts and of materials, parts and finished inventory (and the related finished inventory (and the related information flows)information flows)
through the organization and its through the organization and its marketing channelsmarketing channels
in such a way that current and future in such a way that current and future profitability are maximized through the profitability are maximized through the cost-effective fulfillment of orders. cost-effective fulfillment of orders.
Logistics and Logistics and competitive advantagecompetitive advantage
Firms can achieve competitive Firms can achieve competitive advantage through:advantage through:
1.1. DifferentiationDifferentiation, in the eyes of the , in the eyes of the customer, from its competitioncustomer, from its competition
And And
2.2. By operating at a By operating at a lower costlower cost and and hence at greater profit. hence at greater profit.
Competitive Competitive advantage and the advantage and the
3Cs3Cs
Needs seeking benefitsAt acceptable prices
Assets and Utilisation
Assets andUtilisation
CUSTOMER
COMPANY COMPETITOR
VALUE VALUE
Cost differentials
Logistics and Logistics and competitive advantagecompetitive advantage
A position of enduring superiority over A position of enduring superiority over competitors in terms of customer competitors in terms of customer preference may be achieved through preference may be achieved through logistics.logistics.
Successful companies either have Successful companies either have productivity advantageproductivity advantage or they have or they have a ‘a ‘value’ advantagevalue’ advantage or a combination or a combination of the two.of the two.
Logistics and Logistics and competitive advantagecompetitive advantage
Productivity
Lower cost profile
Value
Differential plus
Productivity advantageProductivity advantage
There is substantial evidence to There is substantial evidence to suggest that big is beautiful when it suggest that big is beautiful when it comes to cost advantage. This is comes to cost advantage. This is partly due:partly due:
1.1. to economies of scale to economies of scale
2.2. to the impact of the "Experience to the impact of the "Experience Curve".Curve".
Productivity advantageProductivity advantage
In this regard In this regard Logistics managementLogistics management can provide a multitude of ways to can provide a multitude of ways to increase increase efficiency efficiency and and productivityproductivity and hence contribute significantly to and hence contribute significantly to reduced unit costs.reduced unit costs.
Value advantageValue advantage
Customers don’t buy products, they Customers don’t buy products, they buy benefits, buy benefits, these benefits may be these benefits may be intangible (image or reputation) intangible (image or reputation)
In other wordsIn other words Products are purchased for Products are purchased for the promise the promise
of what they will “deliver”. of what they will “deliver”.
Value advantageValue advantage
Adding value through differentiation Adding value through differentiation is a powerful means of achieving a is a powerful means of achieving a defensible advantage in the market. defensible advantage in the market.
But How it could be achieved?But How it could be achieved?
1.1. Value segments approachValue segments approach
2.2. Services augmented offers Services augmented offers
Productivity and Value Productivity and Value advantageadvantage
Successful companies will often seek both Successful companies will often seek both productivity and a value advantage. productivity and a value advantage. Available options are:Available options are:
Productivity and Value Productivity and Value advantageadvantage
Marketing logistics’ strategic goal would be Marketing logistics’ strategic goal would be
Gaining competitive Gaining competitive advantage through advantage through
logisticslogistics Competitive advantage cannot be Competitive advantage cannot be
understood by looking at a firm as a understood by looking at a firm as a whole. It stems from the many discrete whole. It stems from the many discrete activities a firm performs.activities a firm performs.
In this regard; we can use the In this regard; we can use the value value chain analysischain analysis to disaggregates a firm to disaggregates a firm in to its strategically relevant activities in to its strategically relevant activities
Gaining competitive Gaining competitive advantage through advantage through
logisticslogistics
Margin
Gaining competitive Gaining competitive advantage through advantage through
logisticslogistics Competitive advantage grows out of Competitive advantage grows out of
the way in which firms the way in which firms organizeorganize and and perform perform these discrete activities these discrete activities within the value chain. (within the value chain. (More cheaply More cheaply oror better better than its competitors) than its competitors)
Gaining competitive Gaining competitive advantage through advantage through
logisticslogistics
Productivity advantageProductivity advantage::
Capacity utilization, inventory Capacity utilization, inventory reduction, closer integration with reduction, closer integration with
suppliers.suppliers.
Value advantageValue advantage::
Superior customer services Superior customer services
Gaining competitive Gaining competitive advantage through advantage through
logisticslogistics
The mission of logistics The mission of logistics managementmanagement
It is to It is to plan plan and and co-ordinateco-ordinate all all activities necessary to achieve the activities necessary to achieve the desired levels of delivered service and desired levels of delivered service and quality at lowest possible cost.quality at lowest possible cost.
Logistics must therefore be seen as the Logistics must therefore be seen as the linklink between the between the market placemarket place and and the the operating activityoperating activity of the of the business.business.
The fig illustrates total system conceptThe fig illustrates total system concept
The mission of logistics The mission of logistics managementmanagement
The previous fig suggests that the The previous fig suggests that the needs of customers are satisfied needs of customers are satisfied through:through:
The The co-ordinationco-ordination of the of the materials materials and and information flowsinformation flows that extend that extend from the market place, through the firm from the market place, through the firm and its operations and beyond that to and its operations and beyond that to supplier. supplier.
The supply chain and The supply chain and competitive advantagecompetitive advantage
• The supply chain is the The supply chain is the network network of of organizations that are involved( through organizations that are involved( through upstream and downstream linkages) in upstream and downstream linkages) in the different the different processesprocesses and and activitiesactivities that that produce value produce value (goods or/and (goods or/and services).services).
Recall the value system in Ch 5Recall the value system in Ch 5
Supplier VC Firm VC Channel VC Buyer VC
The supply chain and The supply chain and competitive advantagecompetitive advantage
Supply chain management in this Supply chain management in this regard should be after regard should be after integratingintegrating outside boundariesoutside boundaries of the firm to of the firm to include both suppliers and include both suppliers and consumers consumers
The supply chain and The supply chain and competitive advantagecompetitive advantage
The main challenge would be:The main challenge would be:
Integrating and coordinating the flow of Integrating and coordinating the flow of materials from suppliers (materials from suppliers (often off often off shoreshore) and managing the distribution of ) and managing the distribution of final products through final products through multiple multiple intermediariesintermediaries. .
The supply chain and The supply chain and competitive advantagecompetitive advantage
The difference between logistics and The difference between logistics and supply chain management p157supply chain management p157
Achieving an integrating supply chain Achieving an integrating supply chain p158-159 fig 11.9p158-159 fig 11.9
Scope of supply chain management Scope of supply chain management fig 11.8 p158 fig 11.8 p158
Very important
Fundamentals of supply Fundamentals of supply chain managementchain management
1.1. Views the supply chain as a Views the supply chain as a single single entity entity
2.2. It calls for It calls for strategic decision makingstrategic decision making because of its impact on overall costs because of its impact on overall costs and market shareand market share
3.3. provides a provides a different perspectivedifferent perspective on on inventoriesinventories which are used as a which are used as a balancing mechanism of balancing mechanism of last not first last not first resort. resort.
4.4. Requires high level of Requires high level of integrationintegration
The changing logistics The changing logistics environmentenvironment
The customer service explosionThe customer service explosion (Services (Services excellence, appropriate delivery systems, excellence, appropriate delivery systems, committed employees) committed employees)
Time compressionTime compression (logistics lead time) (logistics lead time) ORDER CASHORDER CASH
Globalization of industryGlobalization of industry (offshore) (offshore)
Organizational integrationOrganizational integration (Material, (Material, production, and marketing managers)production, and marketing managers)
The challenge of logistics The challenge of logistics managementmanagement
To achieve the goal of competitive To achieve the goal of competitive advantage through both advantage through both cost reductioncost reduction and and service enhancementservice enhancement..
Organizations need to Organizations need to accelerateaccelerate the the movement through the supply chain and movement through the supply chain and to have more to have more flexibleflexible Logistics systems Logistics systems and this could be achieved through: and this could be achieved through:
The challenge of logistics The challenge of logistics managementmanagement
- - Cutting short the pipelineCutting short the pipeline (Unneeded inventory)(Unneeded inventory)
- - Improve the pipeline visibilityImprove the pipeline visibility (Organizational barriers removals, (Organizational barriers removals, better coordination)better coordination)
- - Managing logistics as a systemManaging logistics as a system
We covered so farWe covered so far
Definition of logisticsDefinition of logistics Logistics and competitive advantage Logistics and competitive advantage
(Productivity and Value advantage)(Productivity and Value advantage) Competitive advantage and value chain Competitive advantage and value chain
managementmanagement The mission of logistics managementThe mission of logistics management The supply chain and competitive The supply chain and competitive
advantageadvantage The changing logistics environmentThe changing logistics environment The challenge of logistics managementThe challenge of logistics management
ActivitiesActivities
1.1. Identify the fundamentals of supply Identify the fundamentals of supply chain management, and how they do chain management, and how they do function.function.
2.2. Explain the characteristics of the most Explain the characteristics of the most challenging factors, in the area of challenging factors, in the area of logistics. logistics.
3.3. How can we use logistics to add value How can we use logistics to add value and obtain competitive advantageand obtain competitive advantage