• 1. CHAPTER 18 Measuring and Selling the Value of Logistics
    • 2. Formulate a strategic logistics planDetermine supply chain structure alternatives and evaluateSelect supply chain structureFormulate supply chain objectives and strategyEvaluation of consumerPossible target markets (market grid)Evaluation of target market(s)Selection of target market(s)Company strengths and weaknessesPossible target markets (market grid)Possible target markets (market grid)New productInadequate performanceGovernment (political and legal environment)Corporate objectives and strategyMarketing objectives and strategyCompetitiveSocial and economicMotivation Perception Learning Personal Background specialized education role orientation lifestyleManager’s perceptual screenEvaluative criteriaProgram other marketing Mix componentsProductPricePromotionPlaceDistortionFigure 18-1Aa
    • 3. Generate alternatives re specific supply chain membersWill a change in supply chain structure suffice?Evaluate/select individual supply chain membersMeasure and evaluate performance Is supply chain structure change required? Can performance be improved?Satisfactory?TechnologicalNoYesNoNoNoYesYesYesCBDFigure 18-1 cont. 18-2 b
    • 4. Components of the Strategic Logistics PlanManagement overview Statement of the logistics objectives Description of the individual customer service, inventory, warehousing, order processing and transportation strategies Outline of the major logistics program or operational plans Forecast Logistics financial statement Description of the business impact of the logistics strategy18-3
    • 5. Four Categories of Variables Must Be IdentifiedCustomer service effectiveness Logistics efficiency Utilization of assets Competitive practices18-4
    • 6. Making Logistics DecisionsCorporate objectives and strategy Marketing objectives and strategy Supply chain objectives and strategy Customer service requirementsMake/buy Number/location/size of facilities Transport modes Degree of automation Facility layout/design Organization Supplier/customer linkageSite selection Inventory deployment Carrier/vendor selection Systems capabilities Roles and responsibilities StrategicStructuralFunctionalOperationalOperating policies Operating control rules Operating procedures Routing and scheduling Logistics decisions are generally made hierarchically, but in iterative manner.Source: William C. Copacino, Andersen Consulting, 2000. All rights reserved by the author.. 18-5
    • 7. Logistics Strategy Integrates Eight Key AreasCustomer serviceInformation technologyOrganization and change managementWarehouse design and operationsTransportation managementMaterials managementChannel designNetwork strategy18-6
    • 8. Corresponding Questions Representing Each of the Key AreasWhat are the service requirements for each customer segment? How can operational integration be achieved among the various supply chain members? What is the supply chain structure that best minimizes costs and provides competitive levels of service? What materials handling/storage technologies will facilitate attaining the service objectives with optimum levels of investment in facilities and equipment?a18-7 a
    • 9. Corresponding Questions Representing Each of the Key Areas (cont.)Are there opportunities to reduce transportation costs in both the short run and the long run? Can current inventory management procedures support more stringent service demands? What information technology is required to gain maximum efficiency in logistics operations? How should resources be organized to best achieve service and operating objectives? b18-7 b