LOGISTICS AS A FACTOR OF COMPETITIVENESS, Challenges and Functions of Logistics and Supply Chain Management - Logistics and Supply Chain Management


Challenges and functions of logistics and supply chain management

Over the past few decades, the term & quot; logistics & quot; firmly entrenched in the modern scientific and entrepreneurial lexicon. The number of publications on logistics is growing in an avalanche manner, which reflects the undoubted interest in this category both from the scientific community and from specialists in various spheres of social and economic activity.

Logistics today is both a sphere of practical activity, and a scientific direction. Logistics is associated with such activities as transportation, warehousing, cargo handling, supply, formation of stocks, protective packaging, support of the required level of customer service, etc. The goals and objectives of logistics that are formed at specific enterprises will differ depending on the level of logistics development we'll discuss this in more detail in Chapter 3), competition, the goals and objectives of the enterprise itself and a number of other factors.

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Despite the diversity of these factors and, as a consequence, the goals and objectives of logistics in individual enterprises, we can talk about the universal purpose of logistics, or the ideal logistics model: the goal of logistics is to provide specific /i> in the assigned time and specified place necessary with required quality and required quantities with minimum /i> costs.

The purpose of logistics is often called the "seven rules" logistics - 7R logistics, since all seven words in the English wording can be replaced by right - correct, true.

Logistics tasks can be divided into two groups. The first group is the tasks related to the efficiency of logistics business processes that are performed to ensure all the parameters specified in the logistics goal. At the same time, supply, production support, and product distribution are viewed as a single and continuous process, during which raw materials move and are transformed into finished products, then delivered to final consumers. The second group of logistics tasks is aimed at providing a given level of customer service. Thus, the decisions made in logistics are aimed, on the one hand, to efficiency (optimality, efficiency), on the other hand, to the consumer with his service expectations.

To achieve the goals and objectives of logistics, various conceptual approaches can be used that have emerged in different periods of logistics development, for example: demand-driven logistics; logistics based on the time factor; lean logistics, etc. One such approach is the management of supply chains.

The term & quot; supply chain management & quot; Used in conjunction with & quot; logistics & quot; and often together with "logistics". There is no unequivocal opinion about the general and various features of logistics and supply chain management. Managing supply chains is sometimes called a logistics concept, i.e. an idea that has arisen within the framework of logistics, and we conclude that those who adhere to this point of view consider the management of supply chains as part of logistics.

Often these two terms are considered synonymous and are used interchangeably. For example, Waters writes that "logistics is responsible for the flow of material flow through the supply chain." This function is sometimes also called supply chain management & quot;.

To differentiate the concepts of logistics and supply chain management, some experts believe that if the flow management decisions are made within the same enterprise, then this is logistics, and if the solution covers the interaction of several organizations jointly participating in the flow of the flow, then this is supply chain management . It is not difficult to see that such a separation of "logistics" and & quot; supply chain management & quot; is unconvincing and even absurd, since the transformation of raw materials into finished products is a lengthy process, in which, in most cases, several enterprises are included.

Today, a number of experts agree that logistics is a subsystem of supply chain management, i.e. its part, connected with the activity on coordination of flows in the supply chain. With concepts and types of flows and supply chains, we will get acquainted in Ch. 2.

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In our opinion, the question of the separation of concepts & quot; logistics & quot; and & quot; supply chain management & quot; irrelevant. Whatever view on the ratio of & quot; logistics & quot; and & quot; supply chain management & quot; we did not adhere, it is clear that the goals and objectives of logistics and supply chain management are the same. When managing the supply chain, it is important to ensure the efficiency of ongoing processes and a given level of customer service. And logistics, and supply chain management in the face of growing competition and increasing consumer pressure on the features of the functioning of value chains become tools to improve the efficiency and competitiveness of enterprises, goods and services.

Today, logistics is recognized by most experts as a scientific direction. Logistics has a certain history, in its development, it went through several important stages. In modern logistics, a significant potential has been formed to systematize and summarize the main theoretical developments, regulations and results, as well as to analyze the theoretical, methodological and practical problems of logistics and supply chain management. With some of the achievements of logistics as a science, you can see in other chapters of the textbook.

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