CHAPTER 2 Flashcards
TLC
TOTAL LOGISTICS CONCEPTS
TOTAL LOGISTICS CONCEPTS
treat the many different elements of distribution and logistics as one integrated system
Trade off
losing one quality to gain another quality.
FOUR DIFFERENT LEVELS OF TRADE-OFF:
- Within distribution components
- Between distribution components
- Between company functions
- Between the company and external organization
Within distribution components
those trade-offs that occur within single functions.
Between distribution components
those trade-offs between the different elements in distribution.
Between company functions
there are a number of areas of interface between company functions where trade-offs can be made.
Or
Trade-offs between different departments
Between the company and external organization
trade-off may be beneficial for two companies that are associated with each other.
General Classification of Planning:
- STRATEGIC
- TACTICAL
- OPERATIONAL
Strategic
set of procedures for making decisions about the organization’s long-term goals and strategies.
WHAT IS THE TIME HORIZON OF STRATEGIC PLANNING?
1-5 YEARS (MEDIUM TO LONG TERM)
TACTICAL
TRANSLATING BROAD STRATEGIC GOALS INTO SPECIFIC GOALS
WHAT IS THE TIME HORIZON OF TACTICAL PLANNING?
6 MONTHS TO 1 YEAR (SHORT TO MEDIUM-TERM)
OPERATIONAL
process of identifying the specific procedures and processes required at lower levels of the organization.
WHAT IS THE TIME HORIZON OF OPERATIONAL PLANNING?
DAY TO DAY (SHORT TERM)
Planning
- about ensuring that the operation
is set up to run properly
– it is ‘doing the right
thing’ or preparing for and planning the operation ‘effectively.
Control
- about managing the operation in the
right way
– it is ‘doing the thing right’ or making
sure that the operation is being run ‘efficiently’.
Integrated logistics
system-wide management of entire logistics chain as a single entity
Direct product profitability (DPP)
technique of
allocating all of the appropriate costs and
allowances to a given product
Materials requirements planning (MRP) and distribution
requirements planning (DRP)
systems that aim to make the necessary materials or
inventory available when needed.
Material requirements planning (MRP)
a system for
calculating the materials and components needed to
manufacture a product.
MRP three primary steps
(1) taking inventory of the materials and
components on hand,
(2) (2) identifying which additional ones are needed,
and then
(3) scheduling their production or purchase.
Manufacturing resource planning (MRP II)
is an
integrated information system used by businesses.
It evolved from earlier materials requirement planning
(MRP) systems by including the integration of additional
data, such as employee and financial needs.
Distribution requirements planning
process of
determining the right amount of manufactured
goods to be shipped to each distribution center or
warehouse in order to satisfy customer demand.
Just-in-time (JIT)
originated as a new approach to
manufacturing and has been successfully applied in
many industries such as the automotive industry.
Just-in-time (JIT)
provide a production
system that eliminates all activities that neither add
value to the final product nor allow for the continuous
flow of material
– in simple terms, that eliminates the
costly and
wasteful elements within a production process.
The objectives of JIT are vitally linked to distribution and
logistics, including as they do:
- the production of goods the customer wants;
- the production of gods when the customer wants them;
- the production of perfect-quality goods;
- eliminating waste (labor, inventory, movement, space,
etc.)
Supply chain management (SCM)
monitoring
and optimization of the production and distribution
of a company’s products and services.
5 Phases of Supply Chain Management (SCM)
- Planning
- Sourcing
- Manufacturing
- Delivery
- Returns
5 Phases of Supply Chain Management (SCM)
- Planning
- Sourcing
- Manufacturing
- Delivery
- Returns
