Development of Logistics Essay

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Chapter 2: Ch t Development of Logistics2 Hongyan DAI H Business School, CUFE Big Picture An overview of supply chain management 1. 1 2. Logistics and supply chain Development of Logistics Building effective supply chains 3. 3 4. 5. 5 6. 7. Logistics strategy Integrated supply chains Global logistics Locating facilities Capacity management Moving materials g through supply chains 8. 8 9. 10. 10 11. 12. 13. 14. Controlling the flow of materials Procurement Inventory management Warehouse and material handling g Transport Transport management g Organizing and analyzing logistics systems 2 Development of Logistics Why • Early y logistics • Pressures to improve logistics What • Customer satisfactio n • Communic ations ti • …… How • New logistics operations 3 Early Logistics Logistics has a long history, but it has grown dramatically in the past few years d ll h f 兵马未动,粮草先行! 4 Pressures to Improve Logistics Recognition of its high cost Changing management attitudes Changes in the nature of markets Changes in the nature of customers Changes in business operations Changing views of society 5 Expensive Logistics 1955, Unilever reports: A delay of one day of product flow incur additional £5 m of working capital (£100m in 2010) 13 man hours to product a ton of washing powder 19 man hours to distribute it 1970s and 1980s Logistics accounts for 15-20% of revenue 1990s Logistics costs becomes clear as it evolves into a coherent function 6 Other Pressures of Change Changing Management Attitudes Recognition that logistics is an essential function and have a strategic impact Changes in the nature of markets Broad demands for faster deliveries and fiercer competition Globalization Gl b li ti Concentration of ownership

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