How does the total integration of the overall business process creates value?
Economic Value
Lowest total cost, economies of scale, service creation
-> Procurement/Manufacturing Strategy
Market Value
attractive assortment, product presentation
-> Market/Distribution Strategy
Relevancy Value
Customization, segmental diversity, service positioning
-> Supply Chain Strategy
The Key Definition of Logistics
Logistics is that part of the supply chain that plans, implements and controls the flow of goods, information and services from the place of origin to the place of consumption, effectively and efficiently according to the customers criteria.
adding sustainability, latest technology and delight of customer
Why is flow so important in logistics?
without smooth, unimpeded flows logistics will not achieve its ultimate goal: successfully moving goods from A to B
Name the 4 important flows in logistics.
Product Flow: movements of goods from supplier to customer
Information Flow: flow is bidirectional, the faster the better, IT transforms performance
Financial Flow: impact on cash flow position and profitability
Document Flow: very similar to information flow
Name the 3 streams of logistics.
Upstream: Exploration, Production, Manufacturing
Midstream: Storage, Transportation
Downstream: Marketing, Distribution, Retail-Outlets
Why is logistics more important now than ever?
bottlenecks in ports and trucking delays -> increased prices
war in Ukraine effects smooth flow of goods (wheat, grain)
tension between China and the USA
escalating shipping and transportation costs
role of sustainability is getting more dominant
Why do we need vendors and customers?
Nobody is omnipotent and can do everything
Division of labour leads to increased productivity (Taylor)
We are interdependent
What do you have to keep in mind when dealing with different products?
Every product has its own character/culture
-> luxury cars vs. FMCG
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