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Objectives of Logistics Management

Logistics management plans and controls the flow of goods and services between the point of origin and consumption. It aims to have the right products, in the right quantity and quality, reach the right place at the right time, at minimal cost. Key logistics functions include order processing, transportation management, inventory management, warehousing, materials handling, packaging, production scheduling, and information systems. Effective logistics relies on optimizing the logistics network, transportation, information flow, inventory management, and warehousing.

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50 views3 pages

Objectives of Logistics Management

Logistics management plans and controls the flow of goods and services between the point of origin and consumption. It aims to have the right products, in the right quantity and quality, reach the right place at the right time, at minimal cost. Key logistics functions include order processing, transportation management, inventory management, warehousing, materials handling, packaging, production scheduling, and information systems. Effective logistics relies on optimizing the logistics network, transportation, information flow, inventory management, and warehousing.

Uploaded by

mdasif04
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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The term 

Logistics Management  is that part of Supply Chain


Management that plans, implements, and controls the efficient,  effective, forward,
and reverse flow and storage of goods, services, and related information between
the point of origin and the point of consumption in order to meet customers’
requirements.

Objectives of Logistics Management

1.To make available the right quantity of right quality products at the right place
and time in right condition.
2.To offer best service to consumers.
3.To reduce the cost of operations.
4.To maintain transparency in operations.

Logistics functions include following:

(i) Order processing


(ii) Transport management
(iii) Inventory management
(iv) Warehousing
(v) Materials handling
(vi) Packaging
(vii) Production scheduling
(viii) Information system

(1) Order processing. Though this activity does not contribute much to

Total costs, yet it is treated important because of its contribution to lead time.

(2) Transportation Management. Transportation involves---


 Firm’s own transport (if goods are to be collected)
 Hiring of transport (if services of external firm are to be used)
 Routing and load planning.
 Selection of the most suitable of transport (i.e. rail, road, sea or air).
 Packaging needed (i.e. loose, pallets or special).
 Documentation required (especially if goods are arriving from
overseas.)
(3) Inventory management. Inventories require to be maintained to take care
of needs between the time of demand and time of supply. Inventory
management involved decisions concerning.
 Buffer stocks.
 Lead time.
 Replenishment of stocks.
(4) Warehousing. Is concerned with management of space to hold
inventories and it involves such problems as:
 Site selection.
 Space determination.
 Layout and design.
 Receipts and issues and storage.
 Preservation.
(5) Materials handling is concerned with movement of product at the
stocking point and it involves such decision as :
 Smoothening of materials flow.
 Selection of materials handling equipment.
 Maintenance of materials handling equipment.
(6) Packaging is concerned with design of packing of the product that
ensures damage free movement of the product and is conducive to
efficient handling and storage.
(7) Acquisition is concerned with sourcing, planning and ordering of the
product in order to ensure its availability in the right quantity, at the right
time, at the right place and at the right cost. Acquisition, however, dose
not includes other purchasing activities such as price negotiation, vendor
rating etc.
(8) Product scheduling is concerned with preparation of aggregate quantities
to be produced in accordance with demands, actual as well as projected.
Product scheduling, however, dose not include day-to-day detailed
scheduling carried out by production planner.
(9) Information system is a must for the successful implementation of
logistics function. Database on customer location, sales volume, inventory
levels, lead times etc. must be maintained.

Scope or element of Logistics Management


Or Improving Effectiveness of Logistics Management:
Five pillars to the effective logistics are: (i) Logistical network, (ii) Transport (iii)
information, (iv) Inventory and (v) Warehousing, materials handling and
packaging.

1.Logistical network include facilities such as manufacturing, warehouse, dealers


and retail stores. Superior logistical network, based on systematic analysis and
determination of number of each type of facilities,

2.Information. Accurate forecasting and good order management are essential for
the systematic inventory management JIT and Contingency Replenishment (CR) and
quick response (QR) to the customer. Timely information thus is the key to the
logistical performance.

3.Transport. quality of transport performance becomes the critical factor. Further,


as speed and cost of transport are inter-related, careful selection of the transport
becomes essential for optimum cost.

4. Inventory management. Good inventory management system must be put into


place to achieve desired customer service with minimum inventory investment.

5.Warehousing, materials handling and packaging. The choice and location of


the warehouse should be with a view to get closer to the core customers. Materials
handling within the warehouse should be planned to ensure safe and speedy receipt,
movement, storage and packaging of customer’s requirements.

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