Uark SCMT 3443 Exam 1

logistics management

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

Seven Rights of Logistics

right product to the right customer at the right time in the right condition in the right quantity at the right place for the right cost

Utility

an economic tern used to describe perceived value.

Possession Utility

Created by marketing when it translates customer needs into product and service requirements, promotes the resulting product's value, and facilitates exchange so the customer may "possess" it.

Form Utility

primary responsibility of purchasing and operations managers who acquire inputs and transform them into products or services of greater customer value

Time Utility

When a product arrives when it is needed. Ex. "Just-in-time manufacturing"

Place Utility

Delivering an item exactly where it is needed.

Quantity Utility

Delivering customers the right amount of product.

Movement Logistics

Choosing the right mode of transportation

Storage Logistics

Trying to balance inventory levels, locations, and choice of transport mode to serve your customers quickly.

Processing Logistics

Deals with the flow of information and the visibility of shipments during movement and storage

Supply Chain Management

Encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third party service providers, and customers. In essence, it integrates supply and demand management within and across companies.

Gross Domestic Product (GDP)

The monetary value of all the finished goods and services produced within a country's borders in a specific time period, generally calculated on an annual basis

Infrastructure

The processes, equipment, people, and flows that support a particular industry or activity. For example, logistics infrastructure includes information systems, roadways, airports, truck drivers, distribution centers and much more to make logistics operations possible.

Lean Practices

Eliminating all processes, steps, and materials that do not add value.

Event Logistics

The resources (facilities, people, and infrastructures) used to organize, deliver, and execute an event from initial schedule through teardown and clean up.

Passenger Logistics

Moving people

Military Logistics

Moving groups of people, supplies, setting up camps, replenishing supplies and people, breaking down camps again, and moving out.

Service logistics

All the people, facilities and supplies in place to effectively deliver services to customers.

Humanitarian Logistics

Planning the effective flow and storage of goods as well as the exchange of information to alleviate the suffering of people

Tradeoffs

Giving up something in order to get something else. Often times it occurs when paying more money to get product moved faster.

Product Density

How much space a product takes up vs how much it weighs

Cube

The amount of space that a product uses.

Cube Out

When a product fills up a trailer in terms of space before it hits the imposed weight limit

Weigh out

When a product fills the weight requirement for a truck before it fills the available space

Lean

Elimination of activities (waste) in any process that do not add value to the final customer.

Lean Techniques

1. Look through the eyes of the customer
2. Eliminate process waste
3. Eliminate wasted time and space
4. Repeat

Eight Wastes

defects, overproduction, waiting, not utilizing staff talent, transportation, inventory, motion, excess processing

Defect Waste

Any work of product that is less than perfect

Overproduction Waste

Making more than the customer wants or than you have known demand for.

Waiting Waste

Idle/wasted time when resources are not ready/available to use.

Not Utilizing Staff Talent Waste

Not challenging employees or listening to and encouraging their ideas. If this is blatant, employees can actually undermine your efforts to improve on the other seven wastes!

Transportation Waste

Movement of materials or information that does not add value.

Inventory Waste

Excess materials that customers or manufacturing don't currently need.

Motion Waste

Movement of people that does not add value

Excess Processing Waste

Activities that the customer does not value and is not willing to pay for.

Kaizen Events

gatherings of people who are involved in the day to day management of the process who evaluate the process to search for ways to eliminate the eight wastes and improve the process.

5S Methodology

Sort, Simplify, Sweep, Standardize, Sustain

Sort

Eliminate unneeded items from the area, store things not needed now—organize

Simplify

Have a logical place where everything belongs--i.e., a place for everything and everything in its place

Sweep

Clean and organize each day as you use things—put them away

Standardize

Have standardized processes and procedures to maintain workplace order, ease training of new people

Sustain

Continuously follow this approach and implement it throughout your company

Delivery Window

A contractual arrangement that requires a supplier to deliver a shipment during a specific time period—as little as 15 minutes to an hour. Early or late deliveries can trigger a chargeback or other penalty.

Delivery Window

A contractual arrangement that requires a supplier to deliver a shipment during a specific time period—as little as 15 minutes to an hour. Early or late deliveries can trigger a chargeback or other penalty.

Cross-dock Facility

A warehouse where materials from multiple suppliers are unloaded, sorted, and shipped to different destinations. Materials flow through the facility with little or no storage. Cross docking improves shipping efficiencies, enabling you to ship in full truckload quantities--both inbound and outbound.

Charge Backs

A penalty or fee a customer charges for supplier non-compliance (e.g., damaged product; late delivery, improper packaging, errors in documentation).

Facing

A space allotted to a product on a retailer's shelf

Transship

The logistics practice of transferring product from one warehouse to another or from mode to mode of transportation to another in order to fill an order.

Drop-ship

The logistics practice of shipping an order directly from a manufacturer (or distributor) to a customer, bypassing the retailer.

Stockout

Also called out-of-stock event which occurs when demand for an item cannot be filled from existing inventory.

Scorecards

Documents and communicates a supplier's performance on key measures a company uses to evaluate performance

Point of Sales (POS) Information

Information collected at the point of sale--typically as a product barcode is scanned at a check out register. POS information helps you track sales and inventory levels.

Integrated Business Planning (IBP)

A supply chain practice that shares information across functions and supply chain partners to improve the accuracy and timeliness of forecasts.

Predictive Analytics

The practice of looking for hidden patterns from very large data sets to identify trends and predict outcomes.

Cadence Calls

A periodic call, among company members, to share information and coordinate decision-making. Cadence calls often occur at a set time each week or month.

Product Availability

The capacity to have inventory present when and where it is desired by a customer

Data Management

A process that focuses on data collection, storage, and retrieval.

Inventory Management

The process of buying and storing materials and products while controlling costs for ordering, shipping, handling, and storage.

Timely Delivery

By delivering on time, you help customers minimize costs, maintain efficient operations, and support sales.
-customers care about three aspects of delivery: speed (length of the order cycle), consistency (dependability), and agility (adapting to the unexpected)

Speed

Refers to length of cycle order.

Consistency

Dependability

Agility

Able to adapt to the unexpected

Transparency

Able to seamlessly perform a variety of tasks

Perfect Order

An order that is received, processed, picked, packed, shipped, documented, and delivered on time without damage

RFID tags

Radio Frequency Identification tags used to track movement of people or products

Service Recovery Paradox

The fact that some companies resole service failures so effectively that customer satisfaction actually increases following a disruption or service failure.

Contingency Planning

The process of anticipating potentially disruptive events (e.g./ earthquakes or late deliveries) and making plans to help either prevent negative effects like line stoppages or facility downtime or restore operations to normal as quickly as possible.

Operational Efficiency

the ability to provide goods and services to customers with minimum waste and maximum utilization of resources

Pipeline Inventory

Also called in-transit inventory is the inventory that is being shipped from origin to destination

Overstock

Occur when you have too much inventory, this leads to price discounts and reduce profitability

Order Fulfillment

The logistics process (sequence of activities) responsible for delivering customer orders in a way that meets their needs.

Tailored Logistics

The logistics process responsible for delivering customer orders in a way that meets their needs

Segmentation

The process of classifying customers based on their importance

Pareto's Law

Also called the 80/20 rule, observes that 80% of your revenues/profits are driven by your most important 20% of customers.

Activity-Based Cost management

An approach to the costing and monitoring of activities, which involves tracing resource consumption and costing final outputs. Resources are assigned to activities, and activities to cost objects based on consumption estimates.

Time and motion studies

A business-efficiency technique that analyzes processes to document exactly how they work and identify opportunities to improve efficiency.

Back Orders

An order a company cannot fill with existing on-hand inventory, but a customer is willing to wait for

Lost sales

When a customer takes their business elsewhere

Lost customers

When a customer decides to take their future business elsewhere

Lifetime Stream of Revenues

The total amount of revenue received from a customer over the life of the relationship

Brick-and-Mortar

Physical location (not online), such as a retail store.

Anticipatory Shipping

The concept of shipping products to customers before they place the order. Amazon.com obtained a patent for anticipatory shipping in 2014.

Additive Manufacturing

Also know as 3D printing, additive manufacturing is the process of making three-dimensional products by adding one layer at a time.

Stock-Keeping Units (SKUs)

An individual item that you must manage. Any differentiating characteristic creates a new one