Editing User:Jukeboksi/BBA studies/Logistics and SCM


= Logistics and SCM =
== Fundamental definitions ==
* '''''[[w:Logistics|Logistics]]''' is a practical science concerned with the mananagement of the '''flows''' of '''materials, money and information'''. It deals with businesses' and organizations material flows' physical, informational and financial control from procurement to customer ( Finnish Wikipedia on logistics translated by jubo-jubo )

* '''''[[w:Logistics|Logistics]]''' is the [[w:process|process]] that integrates and co-ordinates the elements within the [[w:supply chain|supply chain]] to ensure the best possible [[w:material flow|flow of materials]] and [[w:information|information]]'' ( Teacher slide core wikified )

* '''''[[w:Logistics|Logistics]]''' deals with the flows and storages of [[w:good (economics)|good]]s, [[w:services (economics)|services]] and related information'' ( Council of Supply Chain Management )

* '''''[[w:Logistics|Logistics]]''' is the [[w:management|management]] of the flow of [[w:resources|resources]] between the point of origin and  in order to meet some requirements, for example, of customers or corporations. ( Wikipedia )
:::The resources managed in logistics can include physical items, such as food, materials, equipment, liquids, and staff, as well as abstract items, such as time, information, particles, and energy. 
:::The logistics of physical items usually involves the integration of information flow, [[w:Materials management|material handling]], [[w:Production (economics)|production]], [[w:packaging|packaging]], [[w:inventory|inventory]], [[w:transportation|transportation]], [[w:warehousing|warehousing]], and often [[w:security|security]]. The complexity of logistics can be modeled, analyzed, visualized, and optimized by dedicated simulation software. The minimization of the use of resources is a common motivation.'' ( Wikipedia )

* A '''''[[w:supply chain]]''' ( '''[[w:fi:Toimitusketju]]''' ) is a system of organizations, people, activities, information, and resources involved in moving a product or service from [[w:Vendor (supply chain)|supplier]] to [[w:customer]].'' ( Wikipedia )

* '''''[[w:Supply chain management]]''' ('''SCM''') is the management of an interconnected or interlinked between  network, channel and node [[w:business|business]]es involved in the provision of [[w:Product (business)|product]] and [[w:Service (economics)|service]] packages required by the end customers in a [[w:supply chain|supply chain]].'' ( Wikipedia )

== In Finnish ==
:::* '''''[[w:fi:Logistiikka|fi:Logistiikka]]''' on materiaali-, raha- ja tietovirtojen hallintaan erikoistunut käytännönjohteinen tieteenhaara. Siinä käsitellään [[w:fi:yritys|yritysten]] ja laitosten materiaalivirran fyysistä, tiedollista ja taloudellista hallintaa hankinnasta [[w:fi:asiakas|asiakkaalle]] saakka.(''  Suomenkielinen Wikipedia )

:::* '''''[[w:fi:Toimitusketjun hallinta|fi:Toimitusketjun hallinta]]''' (Supply Chain Management, SCM) tarkoittaa tavaroiden toimituksen ja palveluketjun optimointia. Kaikkien toimitusketjun osapuolien; toimittajien, jakelijoiden, alihankkijoiden ym. liikekumppaneiden yhdistämistä ja koko ketjun tehokasta hallinnointia. Tavoitteena on lisätä kaikkien jäsenten välistä kommunikointia ja siten alentaa kustannuksia, lisätä myyntiä ja tehostaa asiakaspalvelua.'' ( Suomenkielinen Wikipedia )

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== Modes of transport ==

* '''[[w:Mode of transport|Mode of transport]]''' is a term used to distinguish substantially different ways to perform transport. ( Wikipedia )

* '''[[w:Multimodal transport|Multimodal transport]]''' (also known as combined transport) is the transportation of goods under a single contract, but performed with at least two different means of [[w:transport|transport]]; the carrier is liable (in a legal sense) for the entire carriage, even though it is performed by several different modes of transport (by rail, sea and road, for example). ( Wikipedia )

'''4 strategic decisions'''

# What [[w:modes of transport]] to use ?
# What [[w:carrier|carrier]]s in each mode will the use ?
# Own [[w:fleet]] or hire outsiders ? ( [[w:private carrier|private carrier]] or [[w:common carrier]])
# Will the company manage transportation operations or [[w:Outsourcing|hire a 3rd party]] ?

'''Cost of transport''' ( all trips Hong Kong - Helsinki )
* Volume: A small lot is more expensive then a big lot per unit
* Transport lot: 650€ / 100 kg (air) vs. 1570€ / 24,000 kg (sea)  
:::100x price difference per kilo ( air vs. sea )
* Time: shorter transport time == higher cost
* Time: 2 days / 10,000kg / 40,000€ (air) vs. 30 days / 10 tons / 1,400€ (40' container 2 [[w:TEU]], sea transport) ( all figures from Soile Kallinen's material )

* A '''[[w:private carrier|private carrier]]''' is a company that transports only their own goods. ( Wikipedia )

* A '''[[w:common carrier|common carrier]]''' in [[w:common law{]] countries (corresponding to a '''public carrier''' in [[w:Civil law (legal system)|civil law]] systems, usually called simply a '''''carrier''''') is a person or company that transports goods or people for any person or company and that is responsible for any possible loss of the goods during transport. ( Wikipedia )

*'''[[w:Fleet vehicles|Fleet vehicles]]''' are groups of [[w:motor vehicle|motor vehicle]]s owned or leased by a business or government agency, rather than by an individual or family. Typical examples are vehicles operated by [[w:Car rental|car rental companies]], [[W:Taxicab|taxicab companies]], [[w:Public utility|public utilities]], public bus companies, and police departments. In addition, many businesses purchase or lease fleet vehicles to deliver [[w:good (economics)|goods]] to customers, or for sales representatives to travel to clients. ( Wikipedia )

== History of modes of transport ==

'''Mode of sea transport over time''': 
::''Sail - 
:::[[w:Steamship|Steamship (S/S)]]  ( approx. 1770 - early 1900's ) - 
::::[[w:Motor ship| Motor Ship ( M/S)]] - 
:::::[[w:Containerization]] ( 1960's) - 
::::::[[w:liquified natural gas|LNG powered ships]] ( 2010's )''

TODO: history of land and air transport


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== Logistics is flow ==

* '''[[w:Raw material|Raw material]] [[w:Resource extraction|extraction]]''' and [[w:supplier|supply]] -> '''Component [[w:manufacturer|manufacturer]]s''' ->  '''[[w:Final product|Final product]]''' manufacturing -> [[w:distribution (business)]] -> [[w:consumer|consumer]]

* A '''[[w:lead time|lead time]]''' is the [[:wikt:latency|latency]] (delay) between the initiation and execution of a process. ( Wikipedia )

* '''[[w:Material flow|Material flow]]''' (MF) is the description of the transportation of raw materials, pre-fabricates, parts, components, integrated objects and finally products as a flow of entities. The term applies mainly to advanced modeling of [[w:Supply chain management|Supply chain management]]. As industrial material flow can easily become very complex [[w:Plant Simulation|Plant Simulation]] Software has been developed to simulate, visualize, analyze and optimize these processes. ( Wikipedia ) 

* '''[[w:Reverse logistics]]''' stands for all operations related to the reuse of products and materials. It is "the process of planning, implementing, and controlling the efficient, cost effective flow of raw materials, in-process inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal. ( Wikipedia )

* The '''[[w:waste hierarchy]]''' is a classification of [[w:waste management]] options in order of their environmental impact, such as: [[w:Reduce (waste)|reduction]], [[w:reuse]], [[w:recycling]] and [[w:Energy recovery|recovery]].

== Practical logistics ==
'''[[w:Material flow|Material flow]]s''' and '''[[w:warehousing|warehousing]]'''

'''Order cycle system''':
:# Order transmittal - Electronic or paper order from customer
:# Order processing - Electronic or paper order processed by supplier
:# Order preparation - Order is the goods being readied for shipment
:# Order shipment - Order is the package of goods shipped to customer

* A '''[[w:flowchart|flowchart]]''' is a type of [[w:diagram|diagram]] that represents an [[w:algorithm|algorithm]], workflow or process, showing the steps as boxes of various kinds, and their order by connecting them with arrows. ( Wikipedia )

* A '''[[w:deployment flowchart|deployment flowchart]]''' (sometimes referred to as a '''cross functional flowchart''') is a [[w:business|business]] process mapping tool used to articulate the steps and [[w:Project stakeholder|stakeholders]] of a given [[w:business process|process]]. ( Wikipedia )

== Purchasing and logistics ==

* A '''[[w:requisition|requisition]]''' is a [[w:request|request]] for something, especially a formal written request on a pre-printed form. ( Wikipedia )

* '''[[w:Purchasing|Purchasing]]''' refers to a business or organization attempting to acquiring goods or services to accomplish the goals of its enterprise. ( Wikipedia )

Supply management:
::<tt>'''[[w:purchasing|Purchasing]]''' involvement starts before a product is designed
:::: > '''[[w:Procurement|Procurement]]''' involvement begins ''before a [[w:requisition|requisition]]'' is received
:::::: > '''Buying''' Involvement begins ''after a requisition is received''</tt> ( Soile Kallinen )

* '''[[w:Purchase requisition|Purchase requisition]]''' Purchase Request is a precise document generated by an internal or external organization to notify the purchasing department of items it needs to order, their quantity, and the time frame that will be given in the future. ( Wikipedia )

*  A '''[[w:purchase order request|purchase order request]]''' or '''purchase requisition''' is a request sent internally within a company to obtain purchased goods and services, including [[w:Inventory|stock]]. ( Wikipedia )

* A '''[[w:purchase order|purchase order]]''' ('''PO''') is a [[w:Trade|commercial]] document and first official offer issued by a [[w:buyer|buyer]] to a [[w:vendor (supply chain)|seller]], indicating types, quantities, and agreed prices for products or services the seller will provide to the buyer. Sending a purchase order to a supplier constitutes a legal offer to buy products or services. Acceptance of a purchase order by a seller usually forms a [[w:contract|contract]] between the buyer and seller, so no contract exists until the purchase order is accepted. ( Wikipedia )
::: As always, '''[[w:offer and acceptance]]''' are required to '''form a contract''' ( Refresh from [[Business Negotiations and Contracts]] )

* '''[[w:Global sourcing|Global sourcing]]''' is the practice of [[w:sourcing|sourcing]] from the global market for goods and services across [[w:geopolitical|geopolitical]] boundaries. Global sourcing often aims to exploit global efficiencies in the delivery of a product or service. These efficiencies include low cost skilled labor, low cost raw material and other economic factors like tax breaks and low trade tariffs. ( Wikipedia )

* '''[[w:Just in time (business)|Just in time]]''' ('''JIT''') is a production strategy that strives to improve a business [[w:return on investment|return on investment]] by reducing in-process [[w:inventory|inventory]] and associated [[w:carrying cost|carrying cost]]s. ( Wikipedia )

* '''[[w:Total quality management|Total quality management]]''' / '''TQM''' is an integrative philosophy of management for continuously improving the [[w:Quality (business)|quality]] of products and [[w:business process|processes]]. ( Wikipedia )

== Related concepts ==
* '''[[w:Supply chain management software|Supply chain management software]]'''
* '''[[w:Supply chain optimization|Supply chain optimization]]''' is the application of processes and tools to ensure the optimal operation of a manufacturing and distribution [[w:supply chain|supply chain]]. ( Wikipedia )
* The '''[[w:Demand chain|Demand chain]]''' is that part of the [[w:value chain|value chain]] which drives demand. ( Wikipedia )
* '''[[w:Demand chain management|Demand chain management]]''' (DCM) is the management of upstream and downstream relationships between [[w:supply chain|suppliers]] and [[w:customer|customer]]s to deliver the best value to the customer at the least [[w:cost|cost]] to the [[w:demand chain|demand chain]] as a whole. ( Wikipedia )
* A '''[[w:value chain|value chain]]''' is a chain of activities that a firm operating in a specific industry performs in order to deliver a valuable [[w:product (business)|product]] or [[w:Service (economics)|service]] for the [[w:Market (economics)|market]]. ( Wikipedia )
* '''[[w:Value chain management capability|Value chain management capability]]''' refers to an organisation’s capacity to manage the internationally dispersed activities and partners that are part of its [[w:value chain|value chain]]. ( Wikipedia )

== Learn further ==
* [[Entering Target Markets]]