Logistics and operations management deal with the design and management of productive systems as well as with the planning and control of daily business operations within a company or in trans-corporate networks, that is in supply chains. This article gives an overview of logistics management and logistics networks in and among companies.
In small companies, the operational management of daily production is often handled by human beings who, through intuition and on the basis of experience, find creative solutions. People have unique operational management abilities in that, they can fill in the blanks accurately and react flexibly to specific situations.
If, however, processes become more complex, frequent, and rapid, intuition alone does not suffice. Prior experience can also be misleading. In large companies and in supply chains, moreover.
There are many people involved in the processes. both simultaneously and in sequence. They differ with respect to the level of experience. knowledge. and intuition at their disposal. It is here that the scientific handling of enterprise logistics comes into play.
Supply chain integration is possible through the disciplining of logistics management, which has advanced from warehousing and transportation to the boardrooms of successful companies across the world. Logistics capabilities supplement the supply chain operation. The efficiency and effectiveness of inventory movement across the supply chain depend on the capability of logistics management.
Logistics has a key role to play in customer service strategy of the organization. With the emergence of e-commerce, logistics operations have become more challenging than ever because the competition is just a click away. Logistics and supply management cannot be separated as they are part of the same customer solution.
The logistics operation may go on irrespective of whether the enterprise follows the supply chain philosophy or not. The increasing importance of business logistics makes it necessary for students of business management to understand logistics, its basic framework, and its practical utility.