M2S2 Flashcards
________ is 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’;
Planning
________________ about managing the operation in the right way – it is ‘doing the thing right’ or making sure that the operation is being run efficiently’.
Control
Most elements need to be planned correctly in the first place, and then subsequently they need to be monitored and controlled to ensure that the operation is running as well as it should be.
Planning for Logistics
It is not relevant to define exactly which strategic, tactical and operational decisions or tasks within a company should be classified as either planning or control.
Planning for Logistics
Different Planning Time
Strategic
Tactical
Operational
Medium- to long-term horizon
One- to five-year (plus) time span
Overall ‘structural”decisions
Trade-offs between company functions
Trade-offs with other organizations
Corporate financial plans and policies
Policy decisions developed into a strategic plan
Strategic
Short- to medium-term horizon
Six-months to one-year (plus) time span
Subsystem decisions are made should not impose on other logistics components
Annual budgets provide finance/cost basis
The strategic plan detail is made into an operational plan
Tactical
Day-to-day decision making
Operations controlled against the standards and rules
Control via weekly/monthly reports
The implementation of the operational plan
Operational
customer service
channels of detribution
supply points
production locations
depot configuration
depot types and number
location and size of depots
transport modal chole
third party or own account direct delivery
stock levels
Strategic
transport
vehicle typesisizes/numbers contract hire primary routes
delivery schedules driver resources support facilities
depot storage
design and layout space allocation
storape meda
handling methode
fork-lift truck types and numbers
unit loads
administration/Information
Information support systems monitoring procedures stock location and control
order processing documentation
Tactical
goods receipe and checking’
bulk stampo
order piding
stock replenishment
order marshaling
load scheduling
returns
personnal avallabilty
stock updato documentation complation wchide maintenance
vehide workshop activity
Operational
Are not merely the transportation of goods from one storage point to another. These elements interrelate, and they need to be planned over suitable time horizons
Distribution and Logistics
The cycle begins with the question ‘Where are we now?’
Here the aim is to provide a picture of the current position.
This might be through a regular information feedback procedure or through the use of a specific logistics or distribution audit.
Information Feedback
Stages of Planning and Control Cycle
Information Feedback
Objectives of the Logistics
Planning Process
Monitoring and Control
The second stage is to determine the objectives of the logistics process, to identify what the operation should be trying to achieve.
These objectives need to be related to such elements as customer service requirements, marketing decisions, etc
Objectives of the Logistics
The third stage in the cycle is the planning process that spans the strategic and operational levels
Planning Process
Finally, there is a need for monitoring and control procedures to see the effectiveness of the distribution operation compared to the plan.
This should be undertaken on a regular weekly, monthly and annual basis
Monitoring and Control
A good logistics operation can also offer opportunities for improving financial performance.
truelala
: the ratio between the net profit and the capital employed in the business.
return on investment (ROI)
Enhanced through increased sales, and sales benefit from the provision of high and consistent service levels.
Profits
more efficient transport, thus reducing transport costs;
better storage leading to reduced storage costs;
reduced inventory holding leading to less cash being tied up in inventory;
improved labour efficiency, thus reducing costs
Efficient Logistics Operations
The amount can also be affected by the different logistics components.
Capital employed
should be undertaken according to a certain hierarchy that reflects different planning time horizons.
Planning
________ are influenced by cash-to-cash and order cycle times – both of these being key logistics processes.
Cash and receivables
is generally classified as strategic, tactical and operational.
Planning
