Lecture Managing operations across the supply chain (2/e) – Chapter 11: Logistics management. After studying this chapter you will be able to: Explain logistics and major managerial decisions; estimate impact of consolidation on cost; describe the mode and carrier selection process; explain roles and activities of warehousing, distribution, and facility networks; | Copyright © 2014 McGraw-Hill Higher Education. All rights reserved. CHAPTER 11 Logistics Management McGraw-Hill/Irwin 1 Learning Objectives 11–2 LO11-1 Explain logistics and major managerial decisions LO11-2 Estimate impact of consolidation on cost LO11-3 Describe the mode and carrier selection process LO11-4 Explain roles and activities of warehousing, distribution, and facility networks LO11-5 Explain importance of packaging and materials handling LO11-6 Explain network design decisions using the center-of-gravity model LO11-7 Describe benefits of integrated service providers 2 Logistics Management Logistics Management: movement and storage of materials to meet customer needs and organizational objectives Includes forward and reverse flow Includes flow of materials and information Load, offload, move, sort and select material 11–3 LO11-1 3 Logistics Cost Minimization & Trade-offs Cost-to-Service: service levels = costs Cost-to-Cost: cost of one activity, of another Total Landed . | Copyright © 2014 McGraw-Hill Higher Education. All rights reserved. CHAPTER 11 Logistics Management McGraw-Hill/Irwin 1 Learning Objectives 11–2 LO11-1 Explain logistics and major managerial decisions LO11-2 Estimate impact of consolidation on cost LO11-3 Describe the mode and carrier selection process LO11-4 Explain roles and activities of warehousing, distribution, and facility networks LO11-5 Explain importance of packaging and materials handling LO11-6 Explain network design decisions using the center-of-gravity model LO11-7 Describe benefits of integrated service providers 2 Logistics Management Logistics Management: movement and storage of materials to meet customer needs and organizational objectives Includes forward and reverse flow Includes flow of materials and information Load, offload, move, sort and select material 11–3 LO11-1 3 Logistics Cost Minimization & Trade-offs Cost-to-Service: service levels = costs Cost-to-Cost: cost of one activity, of another Total Landed Cost: sum of all product and logistics related costs Country costs of manufacturing Cost in transit to country of sale Cost within country of sale 11–4 LO11-1 4 Transportation Management Government’s Role: Economic Regulation: entry of new carriers, rates and services provided Safety Regulation: safe for carriers and public, including increased emphasis on security from terrorist activity 11–5 LO11-1 5 Transportation Management Transportation Economics: Economy of Scale: cost per unit of weight decreases as shipment size increases Economy of Distance: cost per unit traveled decreases as distance moved increases Cost Per Unit of Weight Weight of Shipment Cost Per Unit of Distance Distance 11–6 LO11-2 6 Consolidation Consolidation: one large shipment made of many smaller shipments By Market Area: combine small shipments from one shipper going to the same area Pooled Delivery: combine small shipments from different shippers going to the same area Scheduled Delivery: delivery at specific times
