Skills requirement for the supply chain managers. Suggest that supply chain managers need strong technological and/or functional knowledge, good people skills, and common sense. CII-KPMG(2007) Survey on logistics skill gap in India. Identified variables that leads to logistics skill gap and proposed a path diagram showing possible linkages among causes that leads to skill gap. Dubey and Singh,2009 Logistics skill gap study in context to Indian supply chain sector.
Level 5: Companies have production network with integrated sourcing, planning, production, and distribution. The companies which operate on level 3 through 5 of this logistic Chain, go for third-party logistics. The rationale of the companies behind going for the third party logistics can be explained by interpretation of definition given as follows: “ Third-party logistics involves the use of external companies to perform logistics functions that have traditionally been performed within an organization. The functions performed by the third party can encompass the entire logistics process or selected activities within that process.” (Skjoett-Larsen, 2000) Logistics for any organization has become a non-core activity. With the promotion of Theory of Core Competency by ( Prahalad & Hamel, 1990), companies have started to remove all the noncore activities from their operations to increase their efficiencies.
Furthermore, supply chains must be adaptable and cost-effective, and have financial integrity to sustain good outcomes. The four aspects of supply chain performance are geographic access, availability, affordability, and quality. According to Anderson, Britt, and Favre (1997), Supply chain management addresses the following problems: first distribution Network Configuration including number, location and network missions of suppliers, production facilities, distribution centers, warehouses, cross-docks and customers. Second, Distribution Strategy: questions of operating control (centralized, decentralized or shared); delivery scheme and transportation. Third Trade-Offs in Logistical Activities: The above activities must be well coordinated in order to achieve the lowest total logistics cost.
chain, you can transport orders quicker to customers. All else being equal, clientele will choose the company that meets their wants best, offering you a competitive advantage in your industry. Challenges of Supply chain Management • In the international business operations the long-term survival of business depends on an understanding of the differences inherent in the international logistics field. International transportation issues • Transportation determines how and when goods will be received. Focus on entrepreneurship details some of the problems that can be encountered in the transport procedure.
In a general business sense, logistics is the management of the flow of things between the point of origin and the point of consumption in order to meet requirements of customers or corporations. The resources managed in logistics can include physical items such as food, materials, animals, equipment, and liquids; as well as abstract items, such as time and information. The logistics of physical items usually involves the integration of information flow, material handling, production, packaging, inventory, transportation, warehousing, and often
Service providers must be willing to change and innovate for clients with collaboration. Skills and capabilities of employees, current clientele, turnover, correspondence to customer’s quality standards, productivity level, security aspects, and the overall financial position will have a collective impact on the selection decision. Location This criterion is again related to supply chain strategy of the company to be responsive or efficient. The ability to offer number of small shipments will be based on the location factor i.e Centralization and decentralization of warehouses and the volume of goods transported between factories and warehouses at a given time period. It is important that at least the warehouse has access for two modes of transport (Catalano, 2009).
But how does a company decide that outsourcing logistics is the right choice for its operations? This article covers some common factors that can motivate companies to consider outsourcing some or all of their logistics. Necessity of saving / reducing costs_ Saving costs becomes more than a simple strategic goal; it is a competitive necessity for many companies. The impact of transportation costs on most firms has been often considered as a sunk cost. Paradoxically, it is a priority for more CFOs and CEOs today to target these costs for important savings.
Third Party Logistics usually specialize in providing integrated operation, warehousing and transportation services, accommodating customers' needs for their products and materials. Often, these services go beyond logistics and include value-added services related to the production or procurement of goods. According to Cakir (2009) one of the most important functions of the logistics department is the selection of efficient logistics service providers, because it brings significant savings for the organization. According to Cakir (2009) a standout amongst the most imperative elements of the logistics office is the choice of proficient logistics third party providers, since it brings noteworthy investment funds for the association. Due
It has been generally approved that logistics plays one of the key roles, both as a cost driver and as a service level enabler. Ricker and Kalakota stated in 1999  that companies succeed or fail in their online business based on the efficiency of their fulfilment strategy, and this was proven in 2008 by Cho et al.  whose research revealed that efficient logistics strategy can be positively reflected on company’s performance in the e‐commerce market. The identification of a logistics strategy is, however, considered to be a complex issue, both in the online and offline channels [3-4] due to a wide range of stochastic variables in the project as well as the number of indirect factors to be taken into consideration (e.g., demand and product features). Many studies devoted to logistics strategy in general pursued the aim to identify some laws and regularity which, given the contextual factors with distribution problem, can generate the best logistics situations