Supply Chain Logistics Management (Part 1) PDF

Chapter 1 SUPPLY CHAIN LOGISTICS MANAGEMENT (PART 1) By: Ms. Adelyn Soriano Agenda A. 21st Century Supply Chain 1. The Supply Chain Revolution 2. Supply Chain Information System Modules 3...

Chapter 1 SUPPLY CHAIN LOGISTICS MANAGEMENT (PART 1) By: Ms. Adelyn Soriano Agenda A. 21st Century Supply Chain 1. The Supply Chain Revolution 2. Supply Chain Information System Modules 3. Integrative Management and Supply Chain B. Logistics 1. The Logistical Value Proposition 2. The Work of Logistics 3. Logistical Operations 4. Logistical Operating Arrangements C. Customer Relationship Management 1. Customer- Focused Marketing 2. Customer Service 3. Customer Satisfaction 4. Customer Success 5. Developing Customer Relations 7/29/20XX Employee orientation 2  A. Century 21st Supply Chain 1. The Supply Chain Revolution 2. Supply Chain Information System Modules 3. Integrative Management and Supply Chain 7/29/20XX Employee orientation 3 1. The Supply Chain Revolution It has reshaped contemporary strategic thinking. Supply Chain Management Logistics Consists of firms collaborating to leverage The work required to move strategic positioning and to improve operating and geographically position efficiency. inventory. Supply Chain Strategy Is a channel and business organizational arrangement based on acknowledge dependency and collaboration. 4  2. Supply Chain Information System Modules Key Supply Chain Modules- the following list can help you explore which supply chain modules are crucial to maintaining a resilient and successful operation. 1. Logistics and Transportation are the backbone of supply chains, without which smooth goods movement would be impossible. this process requires strategic planning, execution and control of the physical flow of products, information and financial data. Leveraging transportation and logistics solutions allow organizations to optimize operations, reduce costs, enhance visibility and improve customer service. Transportation Sourcing and Agent Delegation Procurement Edit and Track Claims Carrier Repository Freight Management Trade Compliance Financial Analysis Report Dock Scheduling Transportation Order Management Yard Management Freight Rating 5 Route Planning 2. Supply Chain Information System Modules 2. Inventory Management This SCM module ensures the right product quantity is available at the right time, place and cost. Track and manage inventory in real time with a wide range of modules. 6 2. Supply Chain Information System Modules You can gain real-time stock-level visibility to boost the customer experience and fulfill orders promptly. Inventory management tools also allow you to control and minimize carrying costs like storage and insurance expenses. They align production schedules, procurement activities and inventory levels with anticipated demand to optimize inventory investments and prevent excess or insufficient stock situations. Low Stock Report First-In, First-Out (FIFO) Inventory Control Backorder Management Serial Number Tracking Returns Management Cycle Count Last-In, First-Out (LIFO) 7 2. Supply Chain Information System Modules 3. Purchase Order Management This element provides a structured framework for procurement processes. It helps streamline ordering by standardizing purchase order format and content. The solution helps validate and verify order details like item descriptions, quantities, prices, delivery dates, and terms and conditions. Rules like automatic approvals optimize the overall purchase order approval workflow. Track purchase orders and their associated delivery schedules to anticipate inventory needs, manage stock levels and align procurement activities. With this process, you can facilitate efficient inventory management and reduce stockouts or excess inventory situations. Direct Spending E-Procurement Financial Supply Chain Management Intelligent Spend Buying and Invoicing 8  2. Supply Chain Information System Modules 4. Warehouse Labor Management Warehouse labor management systems can strengthen workforce planning and maximize productivity to close the gap between teams and high-performing employees. Workers can compare planned and actual work duration, like indirect labor, value-added services, physical inventory and quality inspection documents, and more. 9 Use historical data to define shifts and shift sequences. 2. Supply Chain Information System Modules Employ workforce planning to avoid under-staffing and adjust labor allocation to ensure workers meet their performance goals. Workforce Management Planning and Forecasting Record Direct and Indirect Labor Activity Shift Scheduling 10 2. Supply Chain Information System Modules 5. Supply Chain Planning The best supply chain planning (SCP) practices allow organizations to meet operational challenges and optimize factors affecting the supply chain. Effective planning minimizes inventory carrying costs, reduces transportation expenses and optimizes production, leading to cost savings. Organizations can anticipate and mitigate potential risks and disruptions to ensure operations continuity. 11 A preview of supply chain planning tools.  2. Supply Chain Information System Modules Advanced models like AI and machine learning can analyze historical sales data, market trends, customer behavior and other external factors to generate more accurate demand forecasts. Demand Planning and Forecasting Multi-Location Supply Planning Production Scheduling Sales and Operations Planning (S&OP) Order Planning Inventory Optimization Projected Inventory Levels 12 2. Supply Chain Information System Modules 6. Procurement Employ procurement software to minimize costs, maximize organizational value and facilitate better sourcing decisions. Procurement dashboard overview. 13 2. Supply Chain Information System Modules Effective supplier selection allows you to establish strong relationships, ensure timely delivery and reduce disruption risks. It can contribute to risk management by diversifying supplier sources, implementing contingency plans and ensuring business continuity. Contract Creation Three-Way Invoice Matching Manual/Automatic Receipt Creation Stock Transfers Approval Reminders Bid Management RFQ Creation 14  2. Supply Chain Information System Modules 7. Supply Chain Analytics Analytics provides insights and data-driven intelligence for strategic decision-making within the supply chain. You can track metrics and KPIs to measure supply chain performance like order cycle time, on-time delivery and inventory turnover. Supply chain analytics also help you evaluate different scenarios, assess potential changes or disruptions, and guide strategic initiatives (network design, sourcing strategies and capacity planning). 15 Gather data from various sources and convert it into visual dashboards. 2. Supply Chain Information System Modules Supply chain modules like analytics let you collect, integrate and analyze data from multiple sources to improve supply chain performance. For example, a retail company wants to optimize its inventory management and ensure sufficient stock availability while minimizing carrying costs. It can leverage supply chain analytics to analyze historical sales data, market trends and other relevant factors to make informed decisions. Custom Reports Labor Utilization Dashboard Custom Dashboards Procure-To-Pay Analytics Replenishment Planning Analytics Demand Forecast Simulations Purchase Order Tracking End-To-End Supply Chain Visualizations Inventory Optimization Analytics 16 2. Supply Chain Information System Modules 8. Integrations Integration with multiple platforms like enterprise resource planning, warehouse, transportation and customer relationship management systems supports seamless data flow across different solutions. It eliminates the need for manual data entry to ensure data consistency and accuracy. Optimize operations and gain real-time inventory details 17 2. Supply Chain Information System Modules Seamless integration with other platforms provides end-to-end supply chain visibility. You can track and monitor goods, services and information movement from origin to consumption. Integrating functions like production schedules, inventory data and transportation plans help optimize resource allocation, minimize bottlenecks and ensure timely product delivery. API Access Accounting, CRM, ERP and eCommerce Software Integration iPaaS and Middleware Software Integration Logistics and Shipping Software Integration 18 2. Supply Chain Information System Modules 9. Warehouse Management Warehouse management lets you manage efficient warehouse and inventory operations, boost productivity, enhance order fulfillment processes and more. Track and record product information like lot or serial numbers, expiration dates and other relevant details to meet compliance requirements. Access real-time inventory information to prevent stockouts, overstock situations and record inaccuracies. A dashboard overview of a warehouse management system. 19  2. Supply Chain Information System Modules Improve end-to-end visibility by integrating with inventory, transportation and order management systems. Adopt better resource planning to predict labor requirements and equipment utilization. Billing Management Warehouse Slotting Cross Docking Task Management Picking and Packing Yard Management Put away Advance Shipping Notice (ASN) Returns and Sales Order Management Task Interleaving Shipping and Receiving Slotting Optimization 20 2. Supply Chain Information System Modules 10. Supplier Management Supplier management systems facilitate and streamline various supplier relationship management activities. A preview of a supplier risk evaluation dashboard. 21 2. Supply Chain Information System Modules Create, store and track supplier contracts. Other functionalities include contract authoring, version control and automated notifications for contract renewals or expirations. Mitigate supplier-related risks by monitoring financial stability, quality issues, capacity constraints and geopolitical factors. Spend Analysis Supplier Portal Vendor Performance Tracking Reverse Auctions Purchase Contracts Management Supplier Risk Management 22  3. Integrative Management and Supply Chain Integrated Supply Chain Management (ISCM) is a comprehensive approach to managing the flow of goods and services from suppliers to customers. It involves coordinating all aspects of the supply chain, including procurement, production, distribution, and customer service. ISCM is an integrated system that encompasses all activities related to the movement of materials from raw material suppliers through manufacturing plants or warehouses until they reach end-customers. This includes planning, scheduling, inventory management, transportation optimization, warehousing management and more. It provides many benefits for logistics managers including: improved visibility into operations improved collaboration between partners in the supply better forecasting capabilities chain network reduced lead times enhanced customer service levels increased efficiency in order fulfillment higher quality products/services delivered on time at lower inventory levels competitive prices with minimal waste or disruption along the way. 23 B. Logistics 1. The Logistical Value Proposition 2. The Work of Logistics 3. Logistical Operations 4. Logistical Operating Arrangements 24 1. The Logistical Value Proposition If stated compellingly, a company’s logistics value proposition – its promise to customers – should persuade a prospect that a particular offering will better resolve a problem or give them more value than those of the competition. In this article, I’ll breakdown 6 effective tactics you need to create a compelling logistics value proposition. #1 Be Clear In Your Service Offer The first step when crafting your irresistible proposition is to be clear about what you are selling. A confused person will be wary of making a purchase. #2 Determine Your Target Market Now that you know exactly what type of service you’re rendering, it’s time to identify those who are in the market for such services. If you’re a new company, your target market will be determined by your capacity and capability in handling production, inventory, packaging, warehousing, transportation, and security. 25 1. The Logistical Value Proposition #3 Identify Your Competitors Who are your competitors? Which of them do you consider your niche’s best practice reference? What does that leading rival provide that you don’t? Is there something vital they do better or differently that separates them from others? Do they use a commercial carrier or their own ships – and also what are the pros and cons of each Take the time to painstakingly analyze any rival and use the information to refine the focus and vision of your logistics company. #4 State Your Value Proposition Once you’re done evaluating the competition, pinpoint what makes your business stand out and state that in a way your customers will clearly understand. Is it newer technology, lower prices, guarantees, or operational efficiencies? What are your most satisfied clients raving about concerning your services? Use these to create your value proposition. If you’re already advertising your unique proposition but still can’t attract qualified leads, check how respected and valued your brand is in the market. If the answer is not so great, then you’ve got to make the necessary adjustments to raise the bar. 26 1. The Logistical Value Proposition #5 Require an Immediate Response Always let your logistics value proposition have a time-limited offer or whatever benefits that can compel a potential customer to buy now rather than later. Show that the time frame for a special offering is limited or maybe show how that the offering is one that is hotly sought after by most customers. #6 Offer a Bulletproof Guarantee One surefire way to make your logistics value proposition attract a potential customer is to include a strong guarantee. You need to remove all risks from the customer and bear it yourself. Customers are more likely to take action if they believe there won’t be any risk to them. Guarantee also tells customers you’re confident you can deliver what you promised. 27 2. The Work of Logistics Logistics is: 1.Moving products and/or materials from one place to another 2.Getting raw materials from suppliers to your business 3.Dependent on reliable transportation 4.Reliant on warehousing and storage 5.Part of the wider supply chain management process 6.Worthy of serious investment 28 2. The Work of Logistics What is logistics management? Logistics management is the strategic side of logistics, involving the procurement, movement, and storage of materials, parts, and finished inventory (goods and services) from their point of origin to point of consumption. The ‘Seven Rs’ is a popular way to define the goal of logistics management: Get the right product At the right quantity At the right time In the right condition To the right place And to the right customer At the right cost Get all of these, well, right, and your business will stay competitive. 29 3. Logistical Operations Is an essential part of the supply chain and refers to the process of moving finished goods, starting from the manufacturer and moving to the end user. The entire inbound and outbound logistics process consists of managing ecommerce inventory, and fulfilling and shipping orders. Inventory management, warehousing, and order fulfillment all play a key role in optimizing ecommerce logistics. While larger companies may have dedicated logistics directors to manage logistics operations, smaller business owners typically handle it themselves. 30 3. Logistical Operations Logistics operations: 4 key processes 1. Suppliers and manufacturers Obtaining raw materials is the first part of supply chain management, which is taken care of by the manufacturer or supplier. A dependable manufacturer is responsible for tracking the work-in-process inventory phase (i.e., the movement of raw materials being processed into finished goods) to make sure you get a high-quality, sellable product on time and at the most affordable price. Choosing the right supplier is important; manufacturers that are inconsistent in delivering a quality product and/or shipping inventory to the seller can slow down operations from the very start. 31 3. Logistical Operations Logistics operations: 4 key processes 2. Distributed fulfillment centers Fulfillment centers are warehouses that hold inventory close to the end customer, so each order is picked, packed, and shipped as soon as it’s placed to ensure the fastest delivery possible. Many direct-to-consumer (DTC) brands depend on a third-party logistics (3PL) company that performs ecommerce fulfillment services. That way, they don’t have to worry about fulfilling and shipping orders themselves. Another key benefit of partnering with a 3PL is the ability to distribute inventory across logistics centers. For instance, ShipBob is a retail fulfillment company that offers a robust international fulfillment center network that allows merchants to split inventory across locations to be closer to their customers. This reduces shipping costs and speeds up delivery. 32 3. Logistical Operations Logistics operations: 4 key processes 3. Warehousing Warehousing is a key stage in the logistics operations process that involves storing and managing physical goods before they are sold. There are several key parts to warehouse management, including the safety and security of stored goods, inventory control processes that help to optimize inventory storage, and much more. These crucial operational warehouse management systems help to track where items are located, when they arrived, and how long they have been there. 33 3. Logistical Operations Logistics operations: 4 key processes 4. Shipping Orders that are shipped to customers accurately and quickly speaks to how well you run your logistics operations. Although the execution of shipping orders to their final destination is ultimately up to the carrier, you can choose which shipping methods to offer your customers (e.g., standard via ground, expedited shipping via air, etc) and to which locations (domestic vs. international shipping). You also have the option to ship orders in-house, most often which involves standing in line at the post office. Otherwise, you can outsource fulfillment to a company that has access to discounted shipping rates from major carriers and can take care of the shipping process (and all other logistics operations) for you. 34 4. Logistical Operating Arrangements What is logistics arrangement? The term logistics is the process of planning, coordinating, and executing the movement of goods and materials from one location to another. This includes activities such as transportation management, warehousing, and inventory management, which are all essential components of logistics arrangement. It's an important part of the supply chain, which is the network of businesses and organizations that work together in a sequence of processes to produce and distribute goods to end-consumers. 35 4. Logistical Operating Arrangements Logistics arrangement for business events If you’re looking to expand to new markets, holding international events will give you great exposure to new customers. For a smooth event, getting the logistics arrangement right is the key to success. Five tips to streamline event logistics: 1. Set goals and objectives Whether its team-building or drumming up excitement for international expansion, defining the event’s objective ensures all involved parties work towards the same goal. 2. Communicate duties and requirements Defining tasks and instructions clearly for each team member avoids overlapping work and wasted time. Communicating in a group chat on messenger apps or email will do the trick. It’s helpful for keeping in touch with multinational parties. For vendors and suppliers, state the deliverables, payment terms, revisions, and relevant conditions clearly to avoid any disputes. 36 4. Logistical Operating Arrangements 3. Plan your budget It helps to note down all expenses, being clear about the currency used, so there aren’t any hidden surprises. Also, any change in the budget should be communicated well with stakeholders. 4. Be clear about your logistics needs with vendors Each event will have it’s unique logistics requirements, from the equipment needed to transportation and entertainment. Giving vendors precise and thorough instructions reduces the risk that something will go wrong. 5. Research potential logistics vendors Reading up on reviews will tell you about the experiences of their past customers and discover who can meet your expectations. You should try to put more weight on recent reviews as they give a better indication of the vendor’s current operations than older reviews. Remember that outbound logistics is a crucial component to ensure timely delivery. 37 4. Logistical Operating Arrangements 3. Plan your budget It helps to note down all expenses, being clear about the currency used, so there aren’t any hidden surprises. Also, any change in the budget should be communicated well with stakeholders. 4. Be clear about your logistics needs with vendors Each event will have it’s unique logistics requirements, from the equipment needed to transportation and entertainment. Giving vendors precise and thorough instructions reduces the risk that something will go wrong. 5. Research potential logistics vendors Reading up on reviews will tell you about the experiences of their past customers and discover who can meet your expectations. You should try to put more weight on recent reviews as they give a better indication of the vendor’s current operations than older reviews. Remember that outbound logistics is a crucial component to ensure timely delivery. 38 C. Customer Relationship Management 1. Customer- Focused Marketing 2. Customer Service 3. Customer Satisfaction 4. Customer Success 5. Developing Customer Relations Employee orientation 39 1. Customer- Focused Marketing Consumers’ expectations for customer service have hit an all-time high. 90% of customers expect a response to their questions within 10 minutes, and 66% expect you to understand their needs and meet their expectations for service. If you don’t, 89% of customers will leave your brand after just one poor experience. As a result, the customer experience is more important than ever. 40 1. Customer- Focused Marketing What Is Customer Focus? Customer focus (or client focus, depending on your industry) is a business-wide strategy that involves building your operations, products, and services around customers. This strategy involves more than just personalization in customer service and marketing — you prioritize the customer experience above all else. It emphasizes the importance of having all-consuming knowledge of what your customers need and how your business can give it to them. The goal of a customer-focused business is customer success, which leads to business success in the form of better customer satisfaction, improved retention rates, and increased customer lifetime values. 41 1. Customer- Focused Marketing Why Is It Important to Be Customer-Focused? Today’s customers expect businesses to be customer-focused—even if they aren’t using that term. Seventy-three percent of customers expect companies to understand their needs and expectations, while 62% expect companies to adapt based on their behaviors. However, only half of consumers believe companies actually understand their needs, and 47% think companies are adjusting based on their behaviors. 42  2. Customer Service 3. Customer Satisfaction 4. Customer Success 5. Developing Customer Relations Becoming customer-focused will help your team meet these expectations. It will also help you: ❖ Build relationships The more attuned you are to your customers’ backgrounds, interests, needs, and goals, the better you can connect with them. You can provide more useful products and services. You’re able to offer more engaging marketing content. You will also have more empathetic customer service messaging and email chats. ❖Increase customer satisfaction Customers are a lot more likely to feel satisfied if you’ve built strong relationships with them. A customer-focused business asks for frequent feedback—empowering your teams to proactively solve customer problems. Plus, customers will appreciate the value you put on their opinion and see that you’re always looking to improve. 43 2. Customer Service 3. Customer Satisfaction 4. Customer Success 5. Developing Customer Relations ❖ Retain more customers The biggest factor in gaining customer loyalty is empathy. Understanding customers better—and catering to that knowledge—helps your customer service team connect with customers more easily, your marketing team creates resonant content, and your product team builds items or services that customers actually need to encourage returning customers. ❖Grow your business Businesses that demonstrate a deep knowledge of their customers (also called “customer intimacy”) achieve faster revenue growth than competitors. They’re able to leverage positive relationships and experiences to generate social proof with online reviews, personal recommendations, and other ambassador marketing. This combination comes as no surprise when you’ve built strong customer relationships, boosted their satisfaction, and kept them coming back for more by delighting them at every stage. 44 1. The Logistical Value Proposition 45 2. Customer Service 3. Customer Satisfaction 4. Customer Success 5. Developing Customer Relations Understand customers’ wants, needs, and expectations The only way you’re going to provide what customers want is by understanding what they want in the first place. You should know what customer needs and goals are, what is driving their decisions, and what they feel (in general and about your brand). There are a few keyways to listen to and learn from your customers: Surveying customers Your customers can tell you exactly what they want; you just need to ask them and give them an easy way to respond. Customer service tickets, emails, and messages Customer service and support communications can be telling. This is where you’ll find explicit complaints about your brand. Pay attention to trends you see in this sphere and consider how they reveal what your customers actually want. 47 2. Customer Service 3. Customer Satisfaction 4. Customer Success 5. Developing Customer Relations Website and online reviews Check your website’s reviews and third-party online review sites for comments about your brand Noting which products, services, or content customers prefer Customers don’t have to say anything for your team to understand which of your products are most helpful. Use your website analytics to understand which items, services, or content are most popular. Social listening Over a third of consumers share their customer service experiences, whether they’re good or bad, on channels like Facebook and Instagram. Check the internet for direct mentions and hashtags around your brand. 48 2. Customer Service 3. Customer Satisfaction 4. Customer Success 5. Developing Customer Relations Build strong customer relationships Relationships are the basis of your customer-focused service and support strategy. Doing business online is notoriously impersonal, so when it comes to communicating with your customers, you have an opportunity to do more than be a website or online storefront – you can humanize the experience. Building strong relationships allows you to gain your customers’ trust. When you personalize messages and give customers attentive, individualized support, they’re more likely to have conversations than simply make transactions with you. This relationship allows you to more easily collect feedback and encourage loyal customers to become ambassadors for your brand, offering valuable social proof for your business. There is a wide range of strategies for building strong customer relationships, but two incredibly important elements include conversational messaging and meeting customers in their preferred channels. 49 Thank you 50