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2. Logistics Management
Introduction to the Course
Jing Yuan
Feb, 2012
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3. Introduce Yourself
Let’s me know who you are.
What’s logistics management?
Supply chain management Vs. logistics
management
…
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4. Outline
Introduce yourself
Who I am
Course introduction
– Course description
– Learning objectives
– Textbooks
– Grading policy
– Schedules
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5. Outline
Introduce yourself
Who I am
Course introduction
– Course description
– Learning objectives
– Textbooks
– Grading policy
– Schedule
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6. Course description
An introductory course in the analysis,
design and operation of logistics and
supply chain
Presented through lectures along with
several case studies and experiments
The lectures consist of nine parts
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7. Learning objectives
Knowledge the strategic role of the supply
chain
An understanding of logistic systems &
their management problems
Ability to devise workable solutions in
business situations
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8. Textbooks
Textbook
– Harrison, A. and Hoek, R. V. (2010) Logistics
Management and Strategy, third edition, 中国
人民大学出版社
References (not required)
– Christopher, M. (2006) Logistics and Supply
Chain Management: Creating Value-adding
Network, third edition, 电子工业出版社
– 张余华，现代物流管理，清华大学出版
社， 2010 年。
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9. Lecture Organization
Lecturing
Videos
Group exercises
Case discussion
Case study presentations
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10. Grading Policy
Grading
– Assignment and Quiz 10%
– Midterm 20%
– Final Project 70%
Midterm
– Case study
– Final presentation
Final project
– A closed examination held in the last week of term
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11. Schedule
Lectures
– 14 weeks
Case study presentations
– 2 weeks
Experiments
– 2 weeks
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12. Logistics and supply chain
Logistics Management
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13. logistics and Supply chain1
Material and information flow2
Competing through logistics3
Logistics strategy4
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14. Seven-eleven convenience store
– Describe the key logistics processes at 7-11.
– What differences between the early reform
and the regional distribution center at 7-11.
– What do you think are the main logistics
challenges in running the 7-11 operation.
Case study
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15. Case study
Centralized
distribution
No
distribution
center
Built its own
distribution
center---joint
distribution
First stage Second stage Third stage
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16. Key issues
11
What is supply chain, and
how is it structured?
22
What is the purpose of a
supply chain?
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17. Video.edhole.com

18. The Supply Chain Concept
Development of the Concept
– Total systems cost - remains an important
element of logistics analysis.
– Outbound logistics – the warehousing and
distribution of finished goods.
– Inbound logistics – the receiving and warehousing
of raw materials, and their distribution to
manufacturing as they are required.
– Value chain analysis integrated logistics activities.
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19. Business Logistics in a Firm
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20.  A supply chain is a group of partners who
collectively convert a basic commodity
(upstream) into a finished product (downstream)
that is valued by end-customers, and who
manage returns at each stage.
The Supply Chain management Concept
DefinitionDefinition
Planning and controlling all of the processes
that link partners in a supply chain together in
order to serve needs of the end-customer.
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21. The process starts with
several external suppliers
that move milk, cardboard,
and plastic to the processing
plant.
After the milk is processed
and packaged, it is delivered
to retailers, who sell it to
customers. The alternative
delivery system is delivery
from a warehouse directly to
customers’ homes.
Supply chain:
structure and tiering
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22. Supply chain:
structure and tiering Supply chain can be fairly
complex. The supply
chain for a car
manufacturer includes
hundreds of suppliers,
dozens of manufacturing
plants (for parts) and
assembly plants (for
cars), dealers, direct
business customers,
wholesalers, customers,
and support functions
such as product
engineering and
purchasing.
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23. Logistics concept
DefinitionDefinition
The task of coordinating material flow
and information flow across the supply
chain.
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24. Activity 1
Wheat Flour
Praline Wafers
Chocolate
Confectionery
manufacturer
Packing
Creamery
(milk)
Cocoa
beans
Sugar
Vegetable
oil
Cocoa
butter
Lecithin
Emulsifiers,
Salt, etc.
Printed
materials
Aluminium Fiberboard
Multiple
retailers
Wholesalers
Others
(hospital etc.)
End
customers
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25. logistics and Supply chain1
Material and information flow2
Competing through logistics3
Logistics strategy4
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26. Key issue
11
What is the relationship between
material flow and information
flow?
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27. Case study: Seven-eleven
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28. Case study: Seven-eleven’s distribution
strategy
 Delivery arrives from over 200 plants
 Delivery is cross docked at DC (over 80 DCs for
food)
 Food DCs store no inventory
 Combined delivery system: frozen foods, chilled
foods, room temperature and hot foods
 11 truck visits per store per day (compared to 70
in 1974)
 No supplier (not even coke!) delivers direct
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29. Case study: Seven-eleven’s
Information Strategy
 Quick access to up to date information (as
contrasts with data)
– High speed data network linking stores, headquarters,
DCs and suppliers
– Store hardware
– Store computer
– POS registers linked to store computer
– Graphic Order Terminals
– Scanner terminals for receiving
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30. Integrated Logistics Management
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31. Material and information flow
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32. Material and information flow
Material flow
Information flow
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33. Activity 2
 Describe the material and information flow in the
supply network affecting one of the major
products in Activity 1.
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34. logistics and Supply chain1
Material and information flow2
Competing through logistics3
Logistics strategy4
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35. Key issues
11
How do products win orders in
the marketplace?
22
How does logistics contribute
to competitive advantage?
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36. Creating logistics advantage: three
basic ways
Logistics advantageLogistics advantage
quality time
cost
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37. Creating logistics advantage:
controlling variability
 Variability undermines the dependability with which a product or
service meets target.
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38. Order winners and order qualifiers
Order winners
are factors that directly and
significantly help products to
win orders in the
marketplace.
Customers regard such
factors as key reasons for
buying that product or
services.
Different logistics
performance
objectives
Order qualifiers
are factors that are regarded
by the market as an ‘entry
ticket’.
Unless the product or service
meets basic performance
standards, it will not be taken
seriously.
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39. Activity 3
 Compare the details for characteristics of
both household appliance and mobile
phone’s product lines.
 Go on to identify the principal order
winners and qualifiers for each product.
Vs.
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40. logistics and Supply chain1
Material and information flow2
Competing through logistics3
Logistics strategy4
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41. The value chain: Linking supply chain
and business strategy
New
Product
Development
Marketing
and
Sales
Operations
Business Strategy
New Product
Strategy
Marketing
Strategy
Supply Chain Strategy
New product
Development
Marketing
and sales
Operations Distribution Service
Finance, Accounting, Information Technology, Human Resources
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42. How to Achieving Strategic Fit
Understanding the Customer
– Lot size
– Response time
– Service level
– Product variety
– Price
– Innovation
How to measure?
Implied Demand
Uncertainty
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43. Levels of Implied Demand Uncertainty
Detergent High Fashion
Low High
Price Responsiveness
Customer Need
Implied Demand Uncertainty
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44. Understanding the Supply Chain: Cost-
Responsiveness Efficient Frontier
High
High
Low
Low
Cost
Responsiveness
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45. Achieving Strategic Fit
Implied
uncertainty
spectrum
Responsive
supply chain
Efficient supply
chain
Certain
demand
Uncertain
demand
Responsiveness
spectrum Zone of
Strategic Fit
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46. Strategic Scope
Suppliers Manufacturer Distributor Retailer Customer
Competitive
Strategy
Product Dev.
Strategy
Supply Chain
Strategy
Marketing
Strategy
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47. Drivers of Supply Chain Performance
Efficiency Responsiveness
Inventory Transportation Facilities Information
Supply chain strategy and structure
Drivers
Competitive strategy
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48. Considerations for Supply Chain Drivers
Driver Efficiency Responsiveness
Inventory Cost of holding Availability
Transportation Consolidation Speed
Facilities Consolidation /
Dedicated
Proximity /
Flexibility
Information What information is best suited for
each objective
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