Introduzione alla logistica

Definition of Logistics
European Logistics Association (ELA):
The planning, execution and control of the movements and placement of people and/or goods, and the supporting activities related to such movement and placement within a system organized to achieve specific objectives.

Popular logistics terms

Logistics Management Business Logistics Management Integrated Logistics Management Materials Management Physical Distribution Management Marketing Logistics Industrial Logistics

Civil logistics fields

Logistica industriale (business logistics) Logistica delle rinfuse (bulk logistics) Logistica del progetto (project logistics) Logistica dei Sistemi Riparabili (RAM logistics) Logistica degli eventi (Event logistics) Logistica dei servizi (Service Logistics)

Business Logistics
Logistica Industriale

Council of Logistics Management (USA)

That part of the supply chain process that plans, implements, and controls the efficient, effective flow and storage of goods, services, and related information from point of origin to point of consumption in order to meet customers' requirements."

Logistics systems
A logistics system is made up of a set of facilities (nodes) linked by transport services (links) and information systems. Facilities are sites where materials are processed, e.g. manufactured, stored, sorted, sold or consumed.

Nodes and links in a logistics system

Freight flow Information flow

Global flows, nodes and networks

A logistics system
Supplier
Manufacturing plant Assembly plant RDC CDC

Retail outlets

Port
Port

A global logistics system

Consolidator/freight forwarder, 3PL Manufacturer Home Port trucking

Small parcel delivery

Retailer

Warehouse: 3PL, deconsolidator, wholesaler, DC

Facilities and transport

They include manufacturing and assembly centers, warehouses, distribution centers (DCs), transshipment points, transport terminals, retail outlets, mail sorting centers, garbage incinerators, dump sites, etc. Transport services move materials between facilities using vehicles and equipment such as trucks, tractors, trailers, crews, pallets, containers, cars and trains.

Supply Chain Management SCM

Logistics focuses attention on coordinating the product, the information movement and the flow activities of an individual firms Supply chain management is an expanded version of the logistics process that integrates product, information and cash flows among organization

Significance of logistics
Logistics is one of the most important activities in modern societies.
It has been estimated that the total logistics cost incurred by USA organizations in 2006 was 1,305 $ billion, corresponding to approximately 9,9 % of the USA Gross Domestic Product (GDP).

The U.S. Business Logistics System Cost $ Billions

Inventory Carrying Costs Transport Costs Shipper Related Costs Logistics Administration Total Logistics Costs 446 801 8 50 1,305

Inventory Carrying Costs $ B

Interest
Taxes, Obsolescence, Depreciation, Insurance

93
252

Warehousing
Subtotal

101
446

Transport Costs $ Billions

Motor Carriers Truck Intercity Truck Local 452 203

Subtotal
Other Carriers Railroads Water Oil Pipelines Air Forwarders Subtotal Total

635 54 37 10 38 27 166 801

Logistics Cost as a % of GDP

10.2 10.2 10.1 9.9 10.3 9.5 8.8 8.6 8.8 9.4 9.9

1996

1998

2000

2002

2004

2006

Source: 18th Annual State of Logistics Report, 2007

Trend of logistics costs (US GDP%)

14 12 10 8 6 4 2 0 1987 1993 1998 2003 2008 Packaging Transport Warehousing Inventory Administration

Logistics and Economy

Logistics is an important component of Gross Domestic product GDP.
The range is from 10 20% of GDP. Logistics adds value by creating utility. Utility is the value that an item or service has in fulfilling a want or need.

Trend of Logistics Costs

Logistics costs as a percentage of GDP have declined in US from 16 percent in 1980, to under 10 percent in 1999. Early to mid-1970s saw the figure closer to 20 percent. This reflects a serious improvement in the efficiency of logistics systems.

Total Business Inventories

Inventory Sales Ratio

Months of supply

Inventories are back down

Inventory as % of GDP

Year

Utility Creation in the Economy

Types of Utility
Form utility is the process of creating the good or service, or putting it in the proper form for the customer to use. Possession utility is the value added to a item or service because the customer is able to take actual possession made possible by credit arrangements, loans and so on.

Type of Utility related to logistics

A product desired by consumers is in transit, in a warehouse or in another store, it does not create any utility for them, it needs two more utilities provided by logistics: time utility is the value added by having a product or service when it is needed in the marketplace or within the organization; place utility, which means having the item or service available where it is needed.

The Seven Rights of Logistics

The right product, publicized with the proper promotion and needed for consumption or production in the right quantity, must be to the right place at the right time in the right condition at the right cost for the right customer.

Key logistics activities

Customer service Demand forecasting/planning Inventory management Logistics ICT Material handling Order processing Packaging Parts and service support Plant and warehouse site selection Procurement Return goods handling Reverse logistics Traffic and transport Warehousing and storage

Marketing
Place/customer service level

Logistica
Il marketing massimizza i profitti aziendali

La logistica minimizza i costi totali dati gli obiettivi di servizio al cliente

Costi del Marketing

Product/Service

Price Place/customer service level

Promotion

Logistics Costs
Luogo/livello di servizio cliente Place/customer service level Materiale inventariato Inventory carrying costs

Trasporto Transport
Magazzino Wharehouse

Acquisto/produzione lotti Procurement/Lot prod.

esecuzione ordine e informazione Order processing and information

Luogo/livello di servizio cliente Place/customer service level

Servizio al cliente Customer service Assistenza ricambi e servizi Parts and service support Sostituzione prodotti in garanzia Return goods handling

Costi del materiale inventariato Inventory carrying costs

Gestione delle scorte Inventory management Imballaggi Packaging Smaltimento rifiuti o riciclaggio di materiale di scarto Reverse logistics

Costi di acquisto/produzione lotti Procurement/lot production costs

Movimentazione materiali Material Handling Approvvigionamenti Procurement

The setup cost of lot quantity

Time required to set up a line or locate a supplier and place an order Scrap due to setting up the production line operating inefficiency as the line begins to run, or as a new suppliers is brought on board

Other components of lot quantity costs

Capacity lost due to downtime during changeover of line or changeover to a new supplier material handling, scheduling and expediting price differentials due to buying in different quantities order costs associated with order placement and handling

Costi di trasporto Transport costs

Trasporto dal punto di origine al punto di consumo Trasporto rifiuti al punto di smaltimento Trasporto del materiale di scarto al punto di riciclaggio

Costi di immagazzinamento Warehousing costs

Immagazinamento e deposito dei prodotti Warehousing and storage Localizzazione del deposito e della azienda Plant and Warehouse site selection

The relevant inventory costs are those that vary with the amount
Capital cost, or opportunity cost, the return that the company could make on the money that it has tied up in inventory Inventory service cost, insurance and taxes warehousing space related costs inventory risk cost, obsolescence, pilferage, relocation within the inventory system, and damage

Costi di esecuzione ordine e informazione Order processing and information costs

Gestione ordini Order processing
Comunicazioni nella rete logistica Logistics communicatios

Pianificazione e previsione della domanda Demand forecasting/planning

Questions (1)
1. What is the role and importance of logistics in private and public organizations? 2. Discuss the impact of logistics on the economy and how effective logistics management contributes to the vitality of the economy. 3. What is the value-added roles of logistics on both a macro and micro level? 4. Explain logistics systems from several perspectives. 5. What is the relationship between logistics and other important functional areas in an organization, including manufacturing, marketing, and finance?

Questions (2)
6. Discuss the importance of management activities in the logistics function. 7. Analyze logistics systems from several different perspectives to meet different objectives. 8. Determine the total costs and understand the cost tradeoffs in a logistics system. 9. Why does a push-based supply chain react more slowly to changing demand than a pull-based system? 10. What is the impact of product diversification (the increase in the number of product variants) on logistics systems planning and control.