- Learn to better manage the movement of resources from one place to another
- Avoid being caught with insufficient materials, equipment or manpower to do the job
- Reduce waste – resources, equipment, time, money, products
- Improve the productivity and cost effectiveness
Who is this Course for?
Anyone who manages work, but in particular supply managers. In small enterprises, these may be the business owner; but in large enterprises, one or more staff may be assigned to the task of ensuring adequate supply of necessary goods and services is always catered for.
For some, this course may be a starting point for a career in logistics. For others, who may already work in some aspect of logistics, this could serve as professional development or in house training.
A wide variety of jobs can benefit from this course, including:
- Project managers
- Fleet/transport/ shipping staff
- Retail Buyers
- Warehouse staff
- Stock managers
This course is split into the following lessons:
- Nature and Scope of Logistics Management
- Logistics – Strategies and Operations
- Warehousing (and Storage)
- Transport and Delivery
- Inventory Management
- Risk Management – Health and Safety Issues, Legislation
- Supply Chain Dynamics
Course Duration: 100 hours
- Discuss the nature and scope of logistics management.
- Develop strategies for improving business operations.
- Apply logistics to more effective procurement.
- Apply logistics to more effective warehousing.
- Determine and manage appropriate materials to use for different scenarios.
- Compare transport and delivery options for different goods and services.
- Determine appropriate inventory management for different business or organisational contexts.
- Formulate a risk management strategy for supply of good or services in an organisation or business.
- Predict changes that may impact supply within a business or organisation and develop appropriate responses to change.
- Develop a logistics plan for a company manufacturing, selling, and distributing a product.
WHY STUDY LOGISTICS MANAGEMENT?
Being able to manage logistics better can yield a variety of benefits including::
Efficiency should be a priority for both inbound and outbound logistics as well as transportation. Transportation rates and other overheads need to be examined for potential cost reductions. Monitoring costs per order can indicate potential areas for revision. Vendors could also carry out quality assurance checks to inspect the goods being transported as well as their packaging to identify any errors. For example, if a product’s packaging is ineffective this can lead to damages during transportation.
Responding quickly to customer requirements can lead to higher levels of customer service satisfaction and improvements in working relationships. This may lead to a competitive advantage within the logistics marketplace.
Using inventory management technologies such as radio frequency identification (RFID) stock tagging and tracing and real-time data capture can reduce the issue of holding excessive inventories as the rapid response approach means that you’re only moving inventory when the customer requires it. RFID stock tagging uses radio frequencies to track the location of specific items within stock. Individual items are tagged with microchips that carry unique ID codes; these codes act as geotags which can be tracked with an RFID reader. When an employee needs to track down stock, they can simply carry the RFID reader to roughly the right place in the warehouse then follows the signal sent by the microchip/geotag to find the correct item. Real-time data capture means that inventory systems can be updated from various sales points or mechanisms to ensure stock levels are up to date, while reducing the need for human counting cycles. This technology can also feed into click and collect systems at points of sale, meaning that web sales can identify local points for collection within windows as short as two hours. Both technologies, individually or working in tandem, mean that companies can respond to orders quickly and ship or order more stock as needed.
Reducing Unexpected Events
Unanticipated events can lead to logistical disruptions during manufacturing, transportation or delays to customer receiving their orders. This causes huge issues with wasted time and resources and can add costs to the process.
Historically, companies may have decided to hold stock ‘just in case’ or to use higher cost transportation which could guarantee delivery within a set time. The development of more sophisticated software has given businesses greater control over the logistics system. While unexpected events still happen, contingency plans can now be activated to reduce their effects.
Minimising Inventory Costs
Inventory management is a critical aspect to successful logistics. Effective logistics management aims for a high inventory usage (referred to as turn velocity), reducing the likelihood of inventory taking up space and not being used. A high turn velocity indicates efficient stock management. This is particularly important when you are dealing with perishable products.
Reducing the inventory kept on site will support a reduction in overall costs. This may mean smaller warehousing facilities are needed or that more efficient transport can be arranged with fewer deliveries. The reduction in costs could be passed on to the customer, leading to more competitive pricing in the market.
Just-In-Time Inventory Management
Just in time inventory (JIT) management is a key element of the kaizen approach to organisational procedures. We will discuss kaizen more in the next lesson
One of the key aims of kaizen is to reduce waste and to increase efficiency. A JIT inventory strategy allows an organisation to minimise excess inventory by matching raw material supplies with the organisation’s production schedules
- This helps reduce costs as the manufacturer does not have to pay additional inventory costs.
- It also reduces waste as the company is not left with extra inventory if a customer cancels or postpones an order.
For example, say an organisation produces steel-based goods for the railway industry.
They may need 100 tonnes of steel a month, so rather than buying 600 tonnes every six months, they buy 100 tonnes a month. This reduces the cost of storing the additional steel before its usage (reducing warehousing costs) and means that if they do not need the steel for some reason, they can further reduce costs by cancelling the order for that month.
JIT has substantial benefits. However, there are also disadvantages. Just in time means that the organisation relies on precise coordination between the organisation and their suppliers. If there is a delay in the supply of raw materials, this can cause problems as the business does not have a store of inventory. This was shown in the COVID-19 pandemic when supermarkets and other stores struggled to stock their shelves when there was a shortage of lorry drivers.
Other issues with JIT are that they do not take account of:
- Unexpected demand for their product or services
- Large orders
Transport Cost Reduction
Transportation is one of the key costs involved in logistics and is dependent on many things including the product volume, size, and how far it needs to travel. It is important to consolidate shipments to reduce transportation costs where possible. Software is now available to support this process.
The growing awareness of climate change and the impact of CO2 emissions on the environment means businesses must consider sustainability in their transport plans. These concerns apply to the whole supply chain as transport is a significant contributor to CO2 emissions worldwide. Many logistics companies are making use of fleets of vehicles with more efficient engines and aiming for carbon neutrality. More forward-thinking companies are striving to be carbon positive.
Total Quality Management (TQM) strategies are frequently used to manage the business’s overall service as this leads to enhanced customer satisfaction. TQM strategies are the strategies the whole organisation uses to ensure customers are provided with quality service, and that the company meets its customer satisfaction goals. Generally speaking, TQM strategies are part of the company’s overall customer retention strategy, with a particular focus on customer loyalty through strong, reliable service and products; these strategies are heavily reliant on feedback.
Although TQM strategies may seem irrelevant to logistics in a broader sense, they are important because when something goes wrong, there is rarely anything a company can do from a logistics point of view, when a shipment is delayed or goes missing, the organisation cannot make a new one appear. Having strong TQM strategies provides a buffer for problems and unforeseen circumstances; implementing quality assurance measures is vital to ensuring quality service and customer satisfaction over the long-term.