LOGISTICS IN MANUFACTURINGMCG 5179: Manufacturing System Analysis

Section B (Friday)

Presented By

Utsav Patel (7946404 uOttawa) Ehireme Egbele (8064140 uOttawa)

Tedj Machou (100963272 Carleton)

University of Ottawa

4th December 2015

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• According to (CSCMP) Council of Supply Chain Management Professionals (2007), logistic is “a part of the supply chain process that plans, implements, and controls the efficient, effective forward and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption in order to meet customers’ requirements”.

• During the construction of the pyramids (around 2700 B. C.), Egyptian pyramid construction techniques were used to transport and assemble huge blocks of stones at the construction sites. Giza pyramid is 146 meters high and weighs around 6 million tons. The weight of the each limestone stone was around 2.5 tons. Egypt engineers used a very innovative technique to transport such huge blocks to the construction site.

• During the Second World War (1939-1945),the military of the United States provided their services and supplies to their troops at the right time and right place. They also tried to provide their services to their army in the most economical manner and whenever they want. Best military logistic techniques were developed during the World War 2.

Definition and History of logistics

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Logistics and value• Products have almost no value to little value if products are not delivered to the

customers at the right time and the right place.

• In logistics, the value is expressed in terms of time and place.

• A good value added customer service can be provided to the customer by fulfilling the six RIGHTS of the logistics service. The six RIGHTS can be written as below.

The RIGHT product

The RIGHT condition

the RIGHT customer

the RIGHT time

the RIGHT place

the RIGHT price

indelivered

to

at

at

for

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Objectives of logistics system• Improve customer service

• Reliable and consistent service

• Life cycle support

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Warehouse• Holding goods

• Consolidation

• Break bulk warehouse

• PackingConsolidation warehouse

Break bulk warehouse

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Logistics network planning

Centralized warehouse system Decentralized warehouse system

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In-house logistics is defined simply as a manufacturing company carrying out it’s logistics operations. In-house logistics involves the following:

• Focusing on both the company’s core business and logistics operations

• Investing in logistics infrastructure like warehouses, racking systems, trucks and IT systems

• Bearing the risks associated with logistics operations like lost goods, late deliveries, high stock discrepancies and excessive/insufficient stock.

In-House Logistics

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3PL involves using external organizations to execute logistics activities or services that have traditionally been performed within an organization itself.

These services include:

• Public warehousing

• Contract warehousing

• Transportation management

• Distribution management

• Freight consolidation

Third Party Logistics/Outsourcing

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Advantages of using 3PL/Outsourcing:

• Flexibility

• Convenience

• Expertise

• Better transport rates

• Professionalism

Third Party Logistics/Outsourcing

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Disadvantages of using 3PL/Outsourcing:

• Cost

• Loss of direct control

• Distance

• Potential loss of reputation

Third Party Logistics/Outsourcing

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• A transportation management system (TMS) is a software that facilitates interactions between an organization’s order management system system (OMS) and its warehouse management system (WMS) or distribution center (DC).

• A TMS software is a subset of supply chain management concerning transportation operations and may be part of an enterprise resource planning system.

Transportation Management System (TMS) Software

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Functions of the TMS Software:

• Real time transportation tracking

• Transport costs and scheme simulation

• Shipment batching of orders

• Management of motor carrier, rail, air and maritime transport

• Inbound and outbound transportation mode and transportation provider selection

Transportation Management System (TMS) Software

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Benefits of the TMS Software:

• Reduce freight expenses

• Track drivers in real-time

• Warehouse inventory management

• Streamlined billing process

• Increase supply chain efficiency

Transportation Management System (TMS) Software

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Definition• The efforts that measure and minimize environmental

impact in all activities related to logistics.

• Why should Green Logistics be chosen?

Green logistics

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Some of the benefits:

• Reduction in CO2 footprints and emissions

• It unlocks significant amount of cost savings

• Improves optimization of supply chain

• More efficient packing

• Route optimization

Green logistics

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Challenges that logistics management faces.

• Infrastructure Limitations

• Insufficient Planning

• Financial limitations

• Personnel resources

Challenges in logistics

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• Logistics supply system is an important value adding activity for the manufacturing firms.

• By a good logistics network planning, the total cost of the logistics system can be reduced.

• If company wants to focus more on product development, then the third party logistics is a good option.

• Green logistics should be promoted by manufacturing firm to reduce waste and save environment.

Conclusion

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• Rushton, Alan, Phil Croucher, and Peter Baker. The Handbook of Logistics and Distribution Management. London: Kogan Page, 2006. Print.

• Sople, Vinod V. Logistics Management. N.p.: Pearson Education India, n.d. Print.

• Voortman, Craig. Global Logistics: Management. Lansdowne: Juta, 2004. Print.

• John Snow Inc./DELIVER, 2004. The Logistics Handbook: A Practical Guide for Supply Chain Managers in Family Planning and Health Programs. Arlington, Va.: John Snow Inc./DELIVER, for the U.S. Agency for International Development (USAID).

• Ballou, Ronald H. "BUSINESS LOGISTICS - IMPORTANCE AND SOME RESEARCH OPPORTUNITIES." GESTÃO & PRODUÇÃO 4 (1997): 117-29. Web. 16 Nov. 2015. <http://www.scielo.br/pdf/gp/v4n2/a01v4n2.pdf>.

• Dhl-discoverlogistics.com,. (2015). The changing face of logistics - DHL Logistik. Retrieved 12 November 2015, from https://www.dhl-discoverlogistics.com/cms/en/course/origin/historical_development.jsp

References

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Questions?Thank You