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1、Contemporary Logistics,Twelfth Edition,Chapter 4,Organizational and Managerial Issues in Logistics,Learning Objectives (1 of 2),4.1 To explain organizational structure for logistics4.2 To compare traditional and contemporary organizational design for logistics4.3 To identify productivity issues and
2、improvement efforts in logistics 4.4 To discuss quality issues in logistics,Learning Objectives (2 of 2),4.5 To describe ways to manage theft and pilferage4.6 To review the concept of logistics social responsibility4.7 To articulate issues associated with reverse logistics4.8 To report on programs d
3、esigned to lessen the impact of terrorism on logistics systems,Organizing Logistics Within the Firm (1 of 8),Two key organizational logistics topicsOrganizational structure Organizational design,Organizing Logistics Within the Firm (2 of 8),Organizational structure for logisticsTwo basic structures
4、include:Fragmented logistics structureLogistics activities are managed in multiple departments throughout an organizationUnified logistics structureMultiple logistics activities are combined into and managed as a single department,Organizing Logistics Within the Firm (3 of 8),Organizational structur
5、e for logisticsTwo basic structures for logistics departments include:Centralized logistics organizationCompany maintains a single logistics department that administers the related activities for the entire company from the home officeDecentralized logistics organizationLogistics-related decisions a
6、re made separately at the divisional or product group level and often in different geographic regions,Organizing Logistics Within the Firm (4 of 8),Organizational structure for logisticsJob title or corporate rank Leading-edge organizations tend to head the logistics department by senior-level perso
7、nnelGenerally excluded from holding a “C-level” position,Organizing Logistics Within the Firm (5 of 8),Organizational design for logisticsThree primary types of organizational design include:Hierarchical (functional)Top-down flowMatrixCross-functional responsibilitiesNetworkProcess philosophy focuse
8、d on combining tasks into value-creating products and activities,Organizing Logistics Within the Firm (6 of 8),Organizational design for logisticsNetwork organizational design is manifested in terms of:RelevancyRefers to satisfying current and emerging customer needsFacilitated by developing mutuall
9、y beneficial relationships with key customersAt a minimum, these relationships should provide an understanding of customer needs and wants,Organizing Logistics Within the Firm (7 of 8),Organizational design for logisticsNetwork organizational design is manifested in terms of:ResponsivenessReflects t
10、he degree to which an organization can accommodate unique or unplanned customer requestsAchieved when the appropriate decision makers are provided with both relevant information and the authority to address unique or unplanned requests,Organizing Logistics Within the Firm (8 of 8),Organizational des
11、ign for logisticsNetwork organizational design is manifested in terms of:FlexibilityIs an organizations ability to address unexpected operational situationsPredicated on avoiding early commitment to an irreversible course of action,Managerial Issues in Logistics (1 of 28),ProductivityQualityRiskSust
12、ainabilityComplexity,Managerial Issues in Logistics (2 of 28),ProductivityCan be defined as the amount of output divided by the amount of inputProvides insight into the efficiency with which corporate resources are being utilized,Managerial Issues in Logistics (3 of 28),ProductivityThree ways to imp
13、rove productivity include:Reduce the amount of input while holding output constantIncrease the amount of output while holding input constantIncrease output while decreasing input,Managerial Issues in Logistics (4 of 28),ProductivityLabor productivityWarehousing and transportation are heavily depende
14、nt on human laborHuman labor is an input (i.e., workers receive wages or salaries)Productivity improvement efforts in logistics are often directed toward increasing the amount of output while holding input constant (workers resistant to suggestions regarding reduced wages or salaries),Managerial Iss
15、ues in Logistics (5 of 28),ProductivityAsset productivityConcerns include:Space utilizationExcess capacity (unused available space)Can be unproductive as it may result in the purchase of additional equipment or facilities, which adds costs (input)May not yield additional output resulting in a produc
16、tivity decline,Managerial Issues in Logistics (6 of 28),ProductivityAsset productivityConcerns include:Improving the output from existing assetsIncreases productivity as inputs remain constant, but output is increased,Managerial Issues in Logistics (7 of 28),QualityLogistics service qualityRelates t
17、o a firms ability to deliver products, material, and services without defects or errors to both internal and external customers11E.A. Morash, C. Droge, and S. Vickery, “Strategic Logistics Capabilities for Competitive Advantage and Firm Success,” Journal of Business Logistics 17, no. 1 (1996): 122.,
18、Managerial Issues in Logistics (8 of 28),QualityQuality in logistics involves trade-offsIf inferior logistic service quality, customers may perceive lower value If superior logistic service quality than expected or required, organization may be adding unnecessary costOrganizations must try to match
19、the quality levels of the logistic services they provide with the expectations of their customers and the landscape in which they operate,Managerial Issues in Logistics (9 of 28),QualityVendors are expected to have quality programsVendors can demonstrate commitment to quality to potential buyers thr
20、ough achieving and maintaining quality program certificationISO (International Standards Organization) 9000 certification is an example of a quality program certification,Managerial Issues in Logistics (10 of 28),QualityISO 9000Is a set of generic standards used to document, implement, and demonstra
21、te quality management and assurance systemsIs applicable to both manufacturing and service firmsStandards are intended to help companies build quality into every core process in each department,Managerial Issues in Logistics (11 of 28),QualityISO 9000Firms demonstrating commitment to quality through
22、 training, reviews, and continuous improvement achieve initial ISO 9000 certificationOnce certification is obtained, audits are conducted annually and organizations can be recertified every three yearsCertification is credited withan increase in customer serviceimproved order accuracyenabling enhanc
23、ed costs analysis,Managerial Issues in Logistics (12 of 28),QualitySix Sigma Is a quality-focused methodology that emphasizes the virtual elimination of business errorsArea covered under a normal curve is by six standard deviations is 99.99966 percentApproach suggests that there will be 3.4 defects,
24、 deficiencies, or errors per one million opportunitiesCan be applied to various logistics activities such as order packing,Managerial Issues in Logistics (13 of 28),QualitySix Sigma BenefitsReduced costsReduced errors and wasteReduced cycle timeDrawbacksOvercoming business cultural barriersInvesting
25、 required resources (both human and money)Gaining top management commitment,Managerial Issues in Logistics (14 of 28),QualityLean Six Sigma Is a quality-focused methodology that integrates Six Sigma with the Lean approachIntegrates the goals and methods of these two approaches in pursuit of qualityU
26、nique because it recognizes that organizations cannot focus only on quality or speedEmphasizes an organizational focus on improving quality as it relates to responsiveness,Managerial Issues in Logistics (15 of 28),QualityMalcolm Baldrige National Quality AwardRecognizes organizations for their achie
27、vements in quality and performanceEstablished in the late 1980sRestricted to firms headquartered in the United StatesEligibility initially limited to:Manufactures, services, and small businessesEligibility expanded to include:Health care and educational institutions,Managerial Issues in Logistics (1
28、6 of 28),RiskCan be viewed as susceptibility to disruptions that could lead to a loss for a firmCan take a variety of forms as it relates to logistics management activitiesRegularly occurring (or operational) risks (e.g., variability in demand or potential for a damaged shipment)Catastrophic risks (
29、e.g., earthquakes or terrorist attacks),Managerial Issues in Logistics (17 of 28),RiskLogistics uncertainty pyramid modelEstablished to identify sources of uncertainty that can affect the risk exposure for logistics activitiesIdentifies several types of uncertainty including shipper, customer, carri
30、er, control systems, and external,Managerial Issues in Logistics (18 of 28),RiskTerrorism is an example of catastrophic riskTerrorism can be defined as “an illegal use of or threat of force or violence made by a group or individual against a person, a company, or someones property with a goal of men
31、acing the target, often grounded in politics or ideology.”22Terrorism, The American Heritage Dictionary of the English Language, 4th ed. (n.d.). Retrieved from D website: http:/,Managerial Issues in Logistics (19 of 28),RiskCreation of the Department of Homeland Security (DHS)Federal agencyGoalsTo p
32、revent terrorist attacks in the U.S. To reduce the vulnerability of the U.S. to terrorism,Managerial Issues in Logistics (20 of 28),RiskThe 22 separate government entities incorporated into DHS include:Transportation Security Administration (TSA)Transportation Worker Identification Credential (TWIC)
33、Customs and Border Protection (CBP)Container Security Initiative (CSI)Customs Trade Partnership Against Terrorism (C-TPAT)Importer Security Filing (ISF) rule, also known as “10+2”,Table 4.1: Timeline for Presenting Electronic Advance Manifest Information,Source: Erlinda Byrd, “Rules for Improving Ca
34、rgo Security,” Customs and Border Protection Today, March 2004.,Managerial Issues in Logistics (21 of 28),RiskTheft is another logistics risk issue that confronts many managersTheft (stealing) can be defined as the taking and removing of personal property with the intent to deprive the rightful owne
35、r of it.33www.m-,Managerial Issues in Logistics (22 of 28),RiskThoughts regarding theftInsurance companies may reimburse for loss, but time and costs tend not to be coveredTheft results in the planned flow of goods being interrupted, which can lead to stockoutsTheft can factor into facility location
36、 decisions,Managerial Issues in Logistics (23 of 28),RiskThoughts regarding pilferage (employee theft)Transportation and warehousing operations are particularly vulnerable to pilferageManaging pilferage begins with the hiring processZero-tolerance pilferage policyKeep goods moving through the system
37、Recent increase in pirate attacks,Figure 4.1: Shipping Container Locking Handle with a Uniquely Numbered Customs Seal,Source: Philip Cridland/Alamy Stock Photo,Managerial Issues in Logistics (24 of 28),SustainabilityLogistics social responsibilityCorporate social responsibility issues that relate di
38、rectly to logistics,Managerial Issues in Logistics (25 of 28),SustainabilityLogistics social responsibilityPotential dimensions include:EnvironmentEthicsDiversitySafety PhilanthropyHuman rightsOthers,Managerial Issues in Logistics (26 of 28),SustainabilityReverse logisticsIs the process of managing
39、return goodsExceeds $100 billion in U.S. aloneCan be four to five times more expensive than forward logisticsProcess can take 12 times as many steps as forward logistics,Managerial Issues in Logistics (27 of 28),SustainabilityReverse logisticsReverse logistics process focuses on:Why products are ret
40、urnedHow to optimize reverse logisticsWhether reverse logistics should be managed internally or outsourced to a third party44John Paul Quinn, “Are There Ever Any Happy Returns?” Logistics Management, June 2005, 6366.,Managerial Issues in Logistics (28 of 28),ComplexityNetwork complexityIs the growin
41、g number of nodes and the associated changes to the links in logistics systemsProcess complexityCenters on the haphazard development of processes, additions and modifications to processes over time, and/or changing process requirementsRange complexityCenters on the implications associated with the i
42、ncreasing number of products that most companies continue to face in an effort to differentiate themselves with their customers,Key Terms (1 of 3),“C-level” positionCentralized logistics organizationContainer Security Initiative (CSI)Customs Trade Partnership Against Terrorism (C-TPAT)Decentralized
43、logistics organization,Excess capacityFragmented logistics structureImporter Security Filing (ISF) rule,Key Terms (2 of 3),ISO 9000Lean Six SigmaLogistics service qualityLogistics social responsibilityLogistics uncertainty pyramid modelMalcolm Baldrige National Quality Award,PilferageProductivityReverse logisticsSharing economy,Key Terms (3 of 3),Six SigmaTachographTheftTransportation worker identification credential (TWIC)Unified logistics structure,
