CHAPTER-1

LOGISTICS MANAGEMENT

What is logistics & logistics management?

Logistics
The planning, execution, and control of the movement / placement of goods and / or people, and the
related supporting activities, all within a system designed to achieve specific objectives.

Logistics Management

"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”

Supply Chain Management

The integration and organization of information and logistic activities across firms in a supply chain for
the purpose of creating and delivering goods and services that provides value to customers.

ACTIVITIES INVOLVED IN LOGISTICS MANAGEMENT

 Order processing

 Inventory management

 Material planning

 Warehousing

 Transportation.

Relating marketing channels, logistics management, and supply chain management

IMPORTANCE OF LOGISTICS

 Maintaining competitive advantage

 Good consumer relationship

 Effectively coordinated logistics leads to positive business results

 Logistics helps businesses create value

 Keep your customers satisfied, rely on experienced logistic professionals

 Logistics is the key to success with supply chains

  Cost Savings

 Providing organization

https://www.youtube.com/watch?v=kxS02k4GVn4 Procurement

https://www.youtube.com/watch?v=Ks2qnadxLqA Material handling

LOGISTICS
INFORMATION
SYSTEM
(LIS)

https://www.youtube.com/watch?v=geg2QXMGbM0 SAP, ERP AND OTHER MODULES

COST MINIMIZATION

Logistics Cost Reduction by Focusing on Safety

Focus on Labor Costs

Focus on Preventative Maintenance

Focus on the Use of Systems & Tactical Technology

Focus on Suppliers for Logistics Cost Reduction

Focus on the Customer

Be Transparent on Shipping Prices and Conditions

TIPS OF LOGISTIC COST REDUCTION

Increases storage density in bins & racks by improving vertical space utilization or bin re-profile as a
means to achieve it.

Decreases freight costs through better truck utilization in both full (FTL) and less than
truckload (LTL) shipments.

Reduces damage to case picked pallets by eliminating movement in transit

Better utilizes available floor-space to increase storage density

Encourages organized operations, which is directly linked to labor, efficiency, asset utilization, and
inventory accuracy.

https://www.youtube.com/watch?v=KEJe-I4ZosU Transportation management system

https://www.youtube.com/watch?v=YD9XTO8q5jMA RFID

https://www.youtube.com/watch?v=PzdCZJMhHwI Cost minimization

https://www.youtube.com/watch?v=ThmL9jDRiUc Drones technology

https://www.youtube.com/watch?v=URGpYkrc3xA Green logistics

https://www.youtube.com/watch?v=y-I_Hid3sRE LOGISTIC TECHNOLOGY

https://www.youtube.com/watch?v=93E_GzvpMA0 BLOCK CHAIN

https://www.youtube.com/watch?v=FtK65VH5OBg BLOCK CHAIN

https://www.youtube.com/watch?v=6A0FMv-JXQE LOGISTIC CHAIN

https://www.youtube.com/watch?v=WS6IaesHopo LOGISTIC ALL ABOUT TECHNOLOGY

https://www.youtube.com/watch?v=3hhWt9Xbq7Y BIG DATA ANALYSIS

SUBJECT -2
TRANSPORTATION AND WAREHOUSE MANAGEMNT

DOCUMENTATION IN TRANSPORTATION

BILL OF EXCHANGE

TRANSPORTATION DOCUMENTS

MARINE INSURANCE POLICY

INVOICE

BILL OF LADING

MULTIMODAL BILL OF LADING

AIRWAY BILL

ROAD, RAIL OR INLAND WATERWAY TRANSPORT DOCUMENTS

COURIER RECEIPTS

CMR DOCUMENTS
PACKAGING LIST

DELIVERY NOTES

STORES MANAGEMENT

Store is an important component of material management since it is a place that keeps the materials
in a way by which the materials are well accounted for, are maintained safe, and are available at the
time of requirement.

OBJECTIVES

Uninterrupted supply of materials without delay to various users.

To prevent overstocking and under stocking.

Safe handling of materials and prevent their damage.

Protect materials from pilferage, theft, fire.

Minimize cost of storage

Control over materials.

Effective utilization of available storage space.

PROCESS OF STORE

FUNCTIONS OF A STORE

RECIEPT OF INCOMING MATERIALS

Stores receive the ordered materials from the supplier.

Check the documents (delivery challan) against purchase order

Quantity is to be verified

Quality test takes place

Unloading of materials and tallying of materials

If not according to specification materials is sent back to supplier.

Filling of “goods inward” day book or daily collection register.

STORAGE

Once receiving is done materials is send to specific place in stores layout.

Storage ensures protection against deterioration, damage and pilferage.

Detailed system is adopted for location and labeling if items in storage

1) Nature of product: physical state, toxicity, inflammability & other hazards

2) Volume and weight : heavy or light

3) Movement frequency : fast moving and slow moving

4) Point of use

ISSUE

a. A properly authorized material requisition should be presented

b. A foreman should prepare the requisition.

c. Requisition should be prepared in triplicate, two copies should be sent to the stores and the
requisitioning department should retain the third copy.

d. The storekeeper should issue the necessary materials against the signatures of the person
receiving the materials.

e. The storekeeper uses one copy of material requisition in making necessary entries in the bin
card. The costing office receives the other copy for pricing the issue and making necessary
entries in the stores ledger.

RECORDS

Maintaining record of receipt and issue

I. preparation of goods receipt note

II. preparation of goods rejection memo

Updating stock level as per movement of materials.

Records of store

Bin card

Store ledger

CONTROL

Consumption pattern & replenishment pattern are closely monitored.

Material movement is watched to identify nonmoving material for disposal

Effective control puts effective management objective of “no shortage & no excess“.

SURPLUS MANAGEMENT

Disposal system for unneeded materials to reduce inventory cost and proactive measures to eliminate
deterioration and obsolescence.

Surplus items are those that have accumulated due to faulty planning, forecasting and purchasing

VERIFICATION

Stock verification to eliminate gap between information and physical stock.

CORDINATION BETWEEN STORES & PURCHASE

Identification or coding of materials

Coordination regarding ‘LOT SIZE’ of the materials for purchase which should suit production,
requirement, transport, handling and storage space.

Coordination with respect to the material specification

Coordination in order placement, receipt of materials, rejection, shortages, breakages, theft and loss
of materials

HOW TO IMPLEMENT BUSINESS PROCESS IMPROVEMENTS?

1) IDENTIFY THE NEED FOR CHANGE: The first step in the BPI process is to identify the need for
change. A useful way to discover improvement opportunities is by conducting a process audit. The
audit will identify current issues or potential risks for your company. From the audit report you will be
able to prioritize your areas for business improvement. At this stage, you should also review how each
process impacts your organization, resources and stakeholders (employees, customers, students,
partners, suppliers, etc.)

2) ANALYZE CURRENT PROCESS: Once you have decided which process you are going to improve you
need analyze the current procedure. This way you can fully understand the process from A-Z and set
realistic improvement objectives. Regardless of the tool you choose for analysis (process mapping,
operational surveys, cause/effect analysis, etc.)

3) OBTAIN COMMITMENT AND SUPPORT: The third step in the process is to solicit senior management
commitment. This is possibly the single-most important element in the process as the success of the
project hinges on managerial support. At this stage you need to clearly present the necessity for
change and how it impacts the organization. It is crucial that management understands the need for
change to ensure they will support recommendations. As process improvement can be time and
resource intensive upper-management support is a must.
4) CREATE IMPROVEMENT STRATEGY: With the process analysis phase completed you need to
develop your strategy. It is recommended that you include what steps in the process are broken, why
and how they should be improved and any financial and resource implications. Answering how the
process can be improved is a springboard to create your improvement objectives. It is recommended
that you set realistic and measurable objectives that align with your overall strategic goals.

INVENTORY CONTROL

Key Inventory Terms

 Lead time: time interval between ordering and receiving the order

 Holding (carrying) costs: cost to carry an item in inventory for a length of time, usually a year

 Ordering costs: costs of ordering and receiving inventory

 Shortage costs: costs when demand exceeds supply