Logistics Information System

Question 1

Logistics information systems

Answer 1

Are the means of capturing, analyzing, and communicating information related to logistics and supply chain management. Information was largely paper-based during the past and thus resulted in slow, unreliable, error -prone transfer of information.

Question 2

What are logistics information systems?

Answer 2

Logistics information systems (LIS) are digital programs that are implemented to facilitate decision-making and the management of operations such as procurement, storage, order picking, and the shipment and transportation of goods .

Question 3

Timely and accurate information is critical owing to the following reasons:

Answer 3

 Total customer service includes information related to order status, product availability, delivery etc.
 To reduce supply chain inventory, information is very essential as this can minimize demand uncertainty
 There is more flexibility with information as there is clarity as to how, when and where resources may be utilized to gain strategic advantage

Question 4

Building Blocks of LIS are as follows

Answer 4

a. Transaction System
b. Management Control Systems
c. Decision analysis
d. Strategic Planning

Question 5

a. Transaction System

Answer 5

Initiates and records individual logistics activities. Activities include order entry, selection, inventory assignment, shipping, pricing, invoicing and customer enquiry. In this system, the customer order performance cycle is completed though a series of information system transactions.

Question 6

b. Management Control Systems

Answer 6

Focus is on performance measurement and reporting. Performance measurement provides management feedback regarding the service level and resource utilization. Customer service, productivity, financial and quality indicators are the commonly used performance measures. While, the Logistics Information System (LIS) reports past performance, it is also essential that exceptions are identified as and when they are processed.

Question 7

c. Decision analysis

Answer 7

Focuses on decision applications to assist managers to identify, evaluate and compare logistics strategic and tactical alternatives, vehicle routing and scheduling, facility location cost – benefit analysis etc. Evaluates future tactical alternatives and thus need to be unstructured and flexible to consider a wide range of options. To benefit from its capability, user requires a lot of expertise and training.

Question 8

d. Strategic Planning

Answer 8

Focus is on information support to develop and refine the logistics strategy. Decisions are typically more abstract in nature, are lesser structured and have a long-term focus. This level requires incorporating lower-level data collection into a range of business planning as well as decision-making models, which help in evaluating the probabilities and payoffs of strategies.

Question 9

Logistics Information System Requirements

Answer 9

a. Organisation decisions
b. System requirement
c. Control requirements
d. System input and output data

Question 10

a. Organisation decisions

Answer 10

It relates to the decisions to be made at each level of organisation. While designing information system, it must be ensured that the concerned person is entitled to get required information needed for decision making.

Question 11

b. System requirement

Answer 11

After arriving at the decision on collecting information, next requirement is identification of source of information, the volume and quality of information. A suitable channel of communication will have to be designed to satisfy various requirements.

Question 12

c. Control requirements

Answer 12

Based on guidelines given by the management, Logistics Information System system should be able to aid in decision making, minimising delays, and increasing efficiency. Control is required to ensure that no errors are made.

Question 13

d. System input and output data

Answer 13

To satisfy the demand of a customer, several activities are undertaken by organisation which need proper coordination. Action reports are made for the purpose of undertaking activities based on generated information.

Question 14

LOGISTICS INFORMATION SYSTEM: TECHNOLOGY APPLICATIONS

Answer 14

The three types of important information in an inventory, which can be source of errors if not recorded accurately, are (i) part description/number, (ii) quantity and (iii) location. Identification systems are for the codification of packages inside the warehouse by means of codes that can be scanned by automatic devices and these are of fundamental importance for the computerised management of the warehouse.

Question 15

Some of the technology applications for LIS are described below:

Answer 15

Bar codes
Radio Frequency Identification Tags
QR Code QR (Quick Response) Code

Question 16

Bar codes

Answer 16

Are the optical conversion of a numerical or alphanumerical code which are used to identify a package. This optical conversion is represented by means of an alternating sequence of vertical bars and spaces. Bar codes are read using a laser light, which pick up the reflection from the bars and spaces on the label and is usually read from a short distance, although in present times the distance range is improving with new designs.

Question 17

Technologically there are two kinds of bar code scanning devices:

Answer 17

a) Optical scanners
b) Laser scanners

Question 18

a) Optical scanners

Answer 18

Use a light source that illuminates the surface of the code enabling a suitable sensor to record the variations of the reflected ray.

Question 19

b) Laser scanners

Answer 19

Repeatedly explore the encoded surface at each passage, Logistics Information System taking a series of pictures that allow a greater accuracy of scanning. This allows scanning at high intensity and on moving packages.

Question 20

Radio Frequency Identification Tags

Answer 20

Smart tags are automatic identification system based on radiofrequency technology that work in a way like bar codes. It uses reflected radio waves from a small device or tag to receive its information. It is activated by means of an electromagnetic field generated by the scanner (reader), which is the electronic device used for the exchange of information with the tag itself. The readers can be portable and are used by operators or are installed on vehicles, integrated with an antenna. RFID tags are generally more expensive than printed bar codes, but the price is falling rapidly, promoting their wider applications. Hence major retailers are using this method of gathering information.

Question 21

QR Code QR (Quick Response) Code

Answer 21

code is a matrix or two-dimensional barcode which is a machine-readable optical label that contains information about the item to which it is attached. It consists of black squares arranged in a square grid on a white background containing data for a locator, identifier, or tracker that points to a website or application. A QR code uses four standardized encoding modes i.e. numeric, alphanumeric, byte/binary, and kanji (Chinese character) to store data efficiently. It has become popular due to its fast readability and greater storage capacity compared to standard barcodes.

Question 22

GENERALIZATION

Answer 22

A major factor for enhancement of logistics competitiveness is information. In fact, information is one of the few resources whose cost is declining and capabilities are on the rise. Improved information technology results in lower processing cost for orders, reduces the planning and operating uncertainty and also provides assistance to an enterprise in meeting strategic objectives. Logistics firms, which follow best practice, find that it is cheaper to manipulate information rather than moving inventory. Thus, competitive advantage can be achieved by information only when it provides support in transaction, helps in management control, decision analysis and also strategic planning capabilities.