1

I t d ti
Introduction
to
LogisticsandSupplyChain
Management
Class#2
Vithaya Suharitdamrong,Ph.D.
12015
15Aug2015
g

Information
Flow

Move
Input

Do

(Execute)

Move
Do

(Execute)

Move
Do

(Execute)

Move
Do

(Execute)

perfoormance

Think
(Pl i )
(Planning)

execution

Think
(Pl i )
(Planning)

perfoormance

Think
(Pl i )
(Planning)

execution

Think
(Pl i )
(Planning)

perfoormance

Think
(Pl i )
(Planning)

execution

End

What values are logistics and supply chain for?

We have to think as the whole of the value. Thinking in terms of process creating the value

perfoormance

Management

Think in terms of End to End (E2E) in order to create Value

perfoormance

Control

execution

In tthis framewo
ork, this is Lo
ogistics and S
Supply Chain
n Management

Execute

Logistics and Supply Chain of Value

Improve

execution

Plan

End
Value

Move
Do

(Execute)

Output
Good
Fast
p
Cheap

Better
Faster
p
Cheaper

Management

Supply Chain Processes are functions in

creating values according to the
requirement of each value
value.

Flow of Values
(Logistics)

The target is the end point, not just finishing any

functions of logistics process. It depends on the
values at the end point of logistics and supply
chain management.

Have to win the game of competition, not just scoring points. Must complete the process, not just steps.

My Lecture#2
15 Aug 2015

Value Chain and Supply Chain

ValueChain=Processof(Make
l
h i
f ( k +Move))
Value Creation Process of a glass
Value Chain
of a glass

Execution of
value creating
process

SSandd Mines
Mi
(Make)

SSandd Trucks
T k
(Move)

Glass Shops Values of

Glass FFactory
Gl
t
Glass
l Trucks
k
(Move)
(Move & Store) a glass
(Make)

Com
mpetitions beetween supplly chains

V l Creators
Value
C
off glass
l
workk collaboratively
ll b
i l to create a glass.
l
Glass Supply
Chain No.1

Sand Mine
Comp. A

Sand Trucks
p
Comp.B

Glass Factory
Comp.C

Glass Trucks
Comp.D
p

Glass Supply
Chain No.2

Sand Mine
Comp. P

Sand Trucks
Comp.Q

Glass Factory
Comp.R

Glass Trucks
Comp.S

Glass Supply
Chain No.3

Sand Mine
Comp. K

Sand Trucks
Comp.L

Glass Factory
Comp.M

Glass Trucks
Comp.N

SupplyChain=ProcessOwnersof[Make(Manufacturing)+ Move(Logistics)]

Glass Shops Glass

No.1
Comp.E

Better
Faster
Cheaper

Glass Shops Glass

Comp.T
No.2

Better
Faster
Cheaper

Glass Shops Glass

No.3
Comp.O

Better
Faster
Cheaper
My Lecture#2
15 Aug 2015

SupplyChainandValueChain
ValueChainThinking

ProcessDesign(Blueprint)

Determine processes or activities in value creation

Improvement
or Re-design

Value Chain

Value Chain

Value Chain

SupplyChainThinking

Think Design Analyze values until

complete what customers want but
it cannot be used It is just a design
off the
th processes.

We need to take the design of Value

Chain to value creators in supply chains
to use resources to create values
according to design of value chain.
chain

Changed
Customer
Requirements

ProcessExecution
SupplyChainPlan(Collaboration)

Orders

I f
InformationFlow(Communication)
i Fl (C
i i )

Suppliers

l
f l
(
)
FlowofValues(Logistics):Connection

Better
Faster
Cheaper

InternalSupplyChain(SourcetoDelivery)
A Supply Chain is a network of value creators who execute the process
according to value chain in order to respond to customer requirements

Product(External)SupplyChain(upstreamtodownstream)

My Lecture#2
15 Aug 2015

Reductionism and Holism

Organs

Human

Integrated

Bicycle
Parts

Integrated

Organizations
Departments

Integrated
My Lecture#2
15 Aug 2015

CSSMPsDefinitionofLogistics

LogisticsManagement BoundariesandRelationships
Logisticsmanagementactivitiestypicallyincludeinboundandoutbound
transportation management, fleet management, warehousing, materials handling,
transportationmanagement,fleetmanagement,warehousing,materialshandling,
orderfulfillment,logisticsnetworkdesign,inventorymanagement,supply/demand
planning,andmanagementofthirdpartylogisticsservicesproviders.Tovarying
degrees the logistics function also includes sourcing and procurement production
degrees,thelogisticsfunctionalsoincludessourcingandprocurement,production
planningandscheduling,packagingandassembly,andcustomerservice.Itis
involvedinalllevelsofplanningandexecutionstrategic,operationalandtactical.
L i ti
Logisticsmanagementisanintegratingfunction,whichcoordinatesandoptimizes
ti
i t
ti f ti
hi h
di t
d ti i
alllogisticsactivities,aswellasintegrateslogisticsactivitieswithotherfunctions
includingmarketing,salesmanufacturing,finance,andinformationtechnology
This definition considers logistics as a singular which means unity

So, I understand that logistics cannot have many meanings such as transportation,
distribution, locations etc. On the other hand, those activities can be related to logistics.

My Lecture#2
15 Aug 2015

Logistics as an integrating function

Values from each musical

muscial instruments

Values from each musical instruments

Values from each musical instruments
LogisticsManagement=AnintegratingFunction

Supply Chain Management is an act of

planning together. Which songs, Which notes

Logistics Management is to manage

or to orchestrate) all musical
instruments to play in harmonize.
My Lecture#2
15 Aug 2015

ThePowerofTwobecomeOne
DesignChainandValueChain

SupplyChain

ValueCreatorandDeliverer
Value Designer
ValueDesigner
Source,BuildandDistributeandSell
Thi k D i
Think,DesignandDevelop
dD l
My Lecture#2
15 Aug 2015

What is a model?

A ppicture is a model of the real world and it is not real.

People create a model by
The reality of the world
building a mockup (painting)
from the realityy and theyy will
use the model in
communication their thoughts
and experimenting their
thoughts without real
implementation. A model is
used for a test of decision
making.
This painting is a model for communicating and making decisions
My Lecture#2
15 Aug 2015

Logistics
Model

Mode
Distance
Quality
Time
Cost
Transportation
Model

Capacity
Availability
Qualityy
Q
Time
Cost
Warehouse
Model

Volume
Availability

Performance

Communication

Executioon

Volume
Availability

Executioon

Performaance

Executiion

Plan

Plan

Mode
Distance Connection Capacity
Availability
Quality
Qualityy
Q
Time
Time
Cost
Cost
Transportation
Retail
Model
Model

Activities using
information
flow to support
activities of
logistics and
planning.

Service LLevel

Operationall
Model

Informaation
Model

Plan

Capacity
Availability
Qualityy
Q
Time
Cost
Factory
Model

Activities of planning together by

using information flow in order to
create logistics activities

Logistics Planning

Collaboration

Performannce

D
Decision
Model

Logistics Model

10

Customer
Demand

Better
F t
Faster
Cheaper

Logistics

Alogisticsmodelnormallyconsistsofthreesubmodel,DecisionModel(Collaboration),Information
Model(Communication)andOperationalModel(Connection).Themodelsmustbelinkedtocustomer
demand Logistics Model is foc sing on the linkages from decision model to information model and to
demand.LogisticsModelisfocusingonthelinkagesfromdecisionmodeltoinformationmodelandto
operationalmodelineachfunctionsoflogisticalprocessesuntilcustomersgetproductsandservices.
My Lecture#2
15 Aug 2015

11

Logistics Model for International Trades

ExporterslogisticsModel
International

Domestic

Custom

Port Transport W/H

Service

Mfg

W/H

Transport

Mfg Loggistics
Serviices

International
Transport

International

Port Custom
Service

International
Transport

Logistics Service Providers

LSPsLogisticsModel

My Lecture#2
15 Aug 2015

12

Logistics Model for Exporter

ExporterslogisticsModel
International

International

Domestic
Logistics Process

International
Transport

Custom

Port Transport W/H

Service

A logistics model is built to

represent the details of work and
resources in execution logistical
process from factory to customers
hands. The elements of decisions
are iin the
th ffollowings.
ll i

Mfg

W/H

Transport

Port Custom
Service

International
Transport

Customer location
Service level requirements
Order size and frequency Factory and supplier locations
Transport
Transport costs
Ports of entry for imported products
Transport vehicle types and many more key variables
Transport modes
Warehouse
Warehouse (Distribution Centre) size
size, Elements of Model
location, resources, costs
My Lecture#2
15 Aug 2015

13

Logistics Model for LSPs

I t ti l
International

I t ti l
International

Domestic

Port Transport W/H

Service

Mfg

W/H

A logistics model is built to represent the details of works and

resources in execution logistical process of LSPs from factory
(LSPs customers) to customers hands (LSPs customers) .
The elements of decisions are in the followings.

SSupplierrs

Customer location
S i level
Service
l l requirements
i
t
Order size and frequency Factory and supplier locations
Transport costs
Ports of entry for imported
Transport
Transport vehicle types products
Transport modes
and many more key variables
Warehouse (Distribution Centre) size,
location,, resources,, costs
Elements of a model

Transport Port
Service

Custom International
Transport

Port
Servicee

Custom

Transpoort
Servicees

International
Transport

Logistics
i i SService
i PProviders
id

Loogistics Model ffor LSPss

Logistics Process (outsourced)

My Lecture#2
15 Aug 2015

14

LogisticsEngineeringvs LogisticsManagement
Management istheonewhooperatethesystembyhandlingthe
customerordersandsupplyingtheproductsandservicesby
deliveringthemtocustomers
orders
Manufacturing(Planning)

Plan
Procurement

Plan
Manufacturing
f

make

make

R/MSupplier

End

Logistics(Planning)

Plan
Warehouse

move

Manufacturing

Plants

Warehouse
services

Plan
Transport

Plan
Retail

move

move

Transport
services

Retail
Shops

Logistics
Point

End

Engineering designsandbuildsasystem(PlanningandExecuting)andits
elements,logisticsandmanufacturing,tobeoperatedasasupplychain
andlogisticssystemofacompanybuttheyarenottheoneswhooperate
thesystem.Theyimproveandredesignthesystemtohandlechanges.

EndCusto
omers

Plannin
ng
System
m
Execu
ution
Systtem

SystemsP
Perspective
e

SupplyChainPlanning

My Lecture#2
15 Aug 2015

My Lecture#2
15 Aug 2015

Source:RichardE.Crandaall,WilliamCraandallNewMeethodsofCompetinginthe
GlobalMarkketplace CriticcalSuccessFacctorsfromServviceandManu
ufacturing
(ResourceM
Management)2008

The evolution of a supply chain from unaligned to aligned

15

16

Process Management

Pl
Plan
Procurement

Pl
Plan
Manufacturing

move
move

make
make

Procurement

Manufacturing

Pl
Plan
Warehouse

Pl
Plan
Transport

Pl
Plan
Retail

move
move

move
move

move
move

Warehouse

Transport

Retail

End

Products
&Services

ITfor
execution
ITfor
Performance
Measurement

Control
Performance
Benchmark
andAnalysis

Improve

SSupply
l
=
Demand?

ProcessExecution

Execution

End

(Manufacturing&LogisticsActivities)

ProcessMeasurement(Control)

Pro
ocessImprovementProjject

MasterPlanning

ITfor
Collaborative
Planning

ITfor
Operational
Planning

RePlan:ProcessImprovementor
RedesignProcess

Customerrs

PrrocessM
Manage
ement

Plan
Plan

Process Improvement
ProcessImprovement
Company(internal)Process
Management
Process

(Re)Plan
Execution

Management

Improve
Control

My Lecture#2
15 Aug 2015

17

Logistics, Logistical and Logistically

Logistics (adj) :
is the state of supply perfectly meet Demand at the end of
process, so customers (users) can get the values that they
demand. Logistics Management is the single function to integrate
activities of moving and storing values in the whole process in
order to achieve the objectives of the process.
process

LogisticsManagementasanIntegratingFunction
LogisticsPlanning

JIT
Supply=Demand
Products
&Services
Store

Make

Move
Make

Move
Make

LogisticsActivities

Make

ProcessMetrics
Process
Metrics
Good
Fast
(IntegratedFunctions)
Cheap

EndtoEndProcess

is characteristics of how the process is executed or how the actions

of work steps in the process are operated. Please note that
logistics is how supply meet demand or how customers would
receive the products or services. Moreover, to act or to operate is
concerned about how the single plan is collaboratively created and
sharing information for a seamless connectivity of value flow in the
process.

is attributes of process elements that support the linkages of the

perfect fit between supply and demand and delivering values from one
step to another step seamlessly
seamlessly. Moreover there are information
sharing between steps in the process in order to achieve the objective
of the process, the logistics at the end of process.

Store

Move

Logistically (adv) :

Logistical (adj) :

Logistics
(Status)

Think and plan logistically

and link together to create logistics

Logistics
(status)

LogisticalPlanning

JIT
Supply=Demand
Products
&Services
Store

Store

Move
Make

Move
Make

Move
Make

Logistical Activities

Make

ProcessMetrics
Process
Metrics
Good
Fast
Cheap

Logistics Activities with linkage and seamless attributes to create logistics

Execute or Flow Logistically
EndtoEndProcess

My Lecture#2
15 Aug 2015

If you see the Optimal

(Supply meet Demand) or
the fitness, just in time, this
is Logistics

SupplyChainPlanning
Manufacturing(Planning)
g(
g)

System
msPerrspectiive

18

Logistics,Logistical,Logistically
ofCompanySupplyChain

Plan
Procurement

Plan
Manufacturing

move

make

Procurement

Manufacturing

E d
End

Plan
Warehouse

Logisticsof
Manufacturing

Logisticsof
Warehouse

Retail

X
LP.T
Logisticsof
Transport

Supply=Demand?
Supply
emand?

Logistics
Point

move

Transport
X
LP.W

Supply=Demand?
Supply
emand?

Plan
Retail

move

Warehouse

X
LP.M

Supply=Demand?
Supply
emand?

Plan
Transport

move

X
LP.P
Logisticsof
Procurement

Logistics(Planning)
g
(
g)

Logisticsof
Retail

X
d
End
LP.E2E
LP.R

Supply=Demand?
Supply
emand? Supply
Supply=Demand?
emand?

Cu
ustomers

If you see planning and

collaboration or sharing risks
and rewards with common
goals, this is Logistically

Logisticsof
E2E (EndtoEnd)
Supprocess

Supprocess

Supprocess

Supprocess

Supprocess Supply=Demand?

Process(EndtoEnd:E2E)
LP.P=LogisticspointofProcurement
LP.M==LogisticspointofManufacturing
og s cs po o a u ac u g
LP.W==LogisticspointofWarehouse
LP.T==LogisticspointofTransport
LP.R=LogisticspointofRetail
LP.E2E=LogisticspointofE2E (EndtoEnd)

Company(internal)SupplyChain

If you see the status in the process (E2E) optimal (Supply meet
Demand) or fitted, so the process (E2E) is Logistical.

My Lecture#2
15 Aug 2015

19

TransportandLogistics
g
y or viewingg integration
g
of End to End Process byy
Transport Logistics Look at End to End ((E2E)) logistically

focusing on transport as collaborative plan of E2E in order to respond customer needs

Logistics(Planning)

Mi
Main
move

Modifier
The objective is to manage
E2E which determine a
transport plan to respond
Logistics of E2E

make

move

Logistics
Point

move

x Customers

Transport
End

Logistics(Execution)

End
Supply=Demand

(L i i A i i i )
(LogisticsActivities)

Logistics Transport Look at execution process of transport logistically or being integrated by logistically sharing
transport information to collaborative plan in order to respond to customers needs

Logistics(Planning)

Main
Modifier
The objective is to
manage transport
execution according to
logistics plan of E2E

move

make

move
Transport

End
End

Logistics(Execution)
(LogisticsActivities)

Logistics
Point

move

x Customers
End
End
Supply=Demand
My Lecture#2
15 Aug 2015

20

WarehouseandLogistics

Look at End to End ((E2E)) logistically

g
y or viewingg integration
g
of End to End Process byy
focusing on warehouse as collaborative plan of E2E in order to respond customer needs

Warehouse Logistics

Main

Logistics(Planning)
og st cs ( a
g)

Modifier
move
The objective is to manage
E2E which determine a
warehouse plan to
respond Logistics of E2E

make

Storage
(move)

Logistics
Point

move

x Customers

Warehouse

End

Logistics(Execution)
(LogisticsActivities)

End
Supply=Demand

SupplyChain

Logistics Warehouse

Look at execution process of Warehouse logistically or being integrated by logistically

sharing warehouse information to collaborative plan in order to respond to customers needs

Logistics(Planning)

Main
Modifier
move
The objective is to
manage warehouse
g to
execution according
logistics plan of E2E

make

Storage
g
(move)
Warehouse

End

Logistics (Execution)
Logistics(Execution)
(LogisticsActivities)

SupplyChain

Logistics
Point

move

x Customers
End
Supply Demand
Supply=Demand
My Lecture#2
15 Aug 2015

21

ProcurementandLogistics
Procurement Logistics Look at End to End (E2E) logistically or viewing integration of End to End Process by

focusing on procurement as collaborative plan of E2E in order to respond customer needs

Logistics(Planning)

Main

Logistics
Point

Modifier
move
The objective is to manage
E2E which determine a
procurement plan to
respond Logistics of E2E

make

Storage
(move)

move

x Customers

Procurement

End

Logistics(Execution)
(LogisticsActivities)

End
Supply=Demand

SupplyChain

Logistics Procurement Look at execution process of procurement logistically or being integrated by logistically

Main

sharing procurement information to collaborative plan in order to respond to customers

needs
Logistics(Planning)
Logistics
Point

Modifier
move
The objective is to
manage procurement
g to
execution according
logistics plan of E2E

make

Storage
(move)

Procurement

End

Logistics (Execution)
Logistics(Execution)
(LogisticsActivities)

SupplyChain

move

x Customers
End
Supply Demand
Supply=Demand
My Lecture#2
15 Aug 2015

22

ManufacturingandLogistics
Manufacturing Logistics Look at End to End (E2E) logistically or viewing integration of End to End Process by
focusing on manufacturing as collaborative plan of E2E in order to respond customer
needs

Logistics(Planning)

Main

Logistics
Point

Modifier
move
The objective is to manage
E2E which determine a
Manufacturing plan to
respond Logistics of E2E

make

Storage
(move)

move

x Customers

Manufacturing

End

End
Supply=Demand

Logistics(Execution)
(LogisticsActivities)
Company(internal)SupplyChain

Logistics Manufacturing Look at execution process of Manufacturing logistically or being integrated by logistically

Main

sharing manufacturing information to collaborative plan in order to respond to customers

needs
Logistics(Planning)
Logistics
Point

Modifier
move
The objective is to
manage manufacturing
g to
execution according
logistics plan of E2E

make

Storage
(move)

move

Manufacturing

End

Logistics (Execution)
Logistics(Execution)
(LogisticsActivities)

Company(internal)SupplyChain

x Customers
End
Supply Demand
Supply=Demand
My Lecture#2
15 Aug 2015

23

DistributionandLogistics
Distribution Logistics

Look at End to End (E2E) logistically or viewing integration of End to End Process by
focusing on distribution as collaborative plan of E2E in order to respond customer needs

Logistics(Planning)

Main

Logistics
Point

Modifier
move
The objective is to manage
E2E which determine a
distribution plan to
respond Logistics of E2E

make

move

move

x Customers

Distribution

End

End
Supply=Demand

Logistics(Execution)
(LogisticsActivities)
Company(internal)SupplyChain

Logistics Distribution Look at execution process of procurement logistically or being integrated by logistically
sharing distribution information to collaborative plan in order to respond to customers needs

Logistics(Planning)

Main

Logistics
Point

Modifier
move
The objective is to
manage distribution
g to
execution according
logistics plan of E2E

make

move

move

Distribution

End

Logistics (Execution)
Logistics(Execution)
(LogisticsActivities)

Company(internal)SupplyChain

x Customers
End
Supply Demand
Supply=Demand
My Lecture#2
15 Aug 2015

24

RetailandLogistics
Retail Logistics

Look at End to End (E2E) logistically or viewing integration of End to End Process by
focusing on retail as collaborative plan of E2E in order to respond customer needs

Logistics(Planning)

Main

Logistics
Point

Modifier
move
The objective is to manage
E2E which determine a
retail plan to respond
Logistics of E2E

make

move

move
Retail

End

x Customers
End
Supply=Demand

Logistics(Execution)
(LogisticsActivities)
Company(internal)SupplyChain

Logistics Retail

Look at execution process of procurement logistically or being integrated by logistically

sharing retail information to collaborative plan in order to respond to customers needs

Logistics(Planning)

Main

Logistics
Point

Modifier
move
The objective is to
manage retail execution
g to logistics
g
according
plan of E2E

make

move

move
Retail

End

Logistics (Execution)
Logistics(Execution)
(LogisticsActivities)

Company(internal)SupplyChain

x Customers
End
Supply Demand
Supply=Demand
My Lecture#2
15 Aug 2015

25

LogisticsandLogisticsManagement
Logistics(Planning)

Pl
Plan
Procurement

Pl
Plan
Manufacturing

move
move

make
make

Procurement

Manufacturing

ITfor
Operational
Planning

End
ITfor
execution

X
LP.P

Execution

ITfor
Performance
Measurement

Control
Performance
Benchmark
andAnalysis

Improve
LP.P=LogisticspointofProcurement
LP.M==LogisticspointofManufacturing
LP.W==LogisticspointofWarehouse
LP.T==LogisticspointofTransport
LP.R=LogisticspointofRetail
LP.E2E=LogisticspointofE2E (EndtoEnd)

X
LP.M

Pl
Plan
Warehouse

Pl
Plan
Transport

Pl
Plan
Retail

move
move

move
move

move
move

Warehouse

Transport
X
LP.W

X
LP.T

Retail

Logistics
Point

X End
LP.E2E
LP.R

SSupply
l
=
Demand?

Logistics(Execution)
(LogisticsActivities)

LogisticsMeasurement(Control)

LoggisticsProjecctImprovem
ment

ITfor
Collaborative
Planning

RePlan:ProcessImprovementor
RedesignProcess

Customerss

Lo
ogisticsManaggement

Plan
Plan

Logistics Improvement
LogisticsImprovement
Company(internal)SupplyChain
Logistics
Management
Process

(Re)Plan
Execution

Logistics

Improve
Control

My Lecture#2
15 Aug 2015

26

HolisticViewofLogistics

Pl
Plan
Procurement

Pl
Plan
Manufacturing

move
move

make
make

Procurement

Manufacturing

End

move
move

X
LP.P
Logisticsof
Procurement

Pl
Plan
Warehouse

Warehouse

X
LP.M
Logisticsof
Manufacturing

Supply=Demand?

Pl
Plan
Transport

Pl
Plan
Retail

move
move

move
move

Transport
X
LP.W

Logisticsof
Warehouse

Supply=Demand?

X
LP.T
Logisticsof
Transport

Supply=Demand?

Retail

Logisticsof
Retail

Logistics
Point

X
End
LP.E2E
LP.R

Supply=Demand? Supply=Demand?

Customerss

SysstemsPerspeective

Logistics(Planning)

Logisticsof
E2E (EndtoEnd)
Supprocess

Supprocess

Supprocess

Supprocess

Supprocess

Supply=Demand?

Process(EndtoEnd:E2E)
LP.P=LogisticspointofProcurement
LP.M==LogisticspointofManufacturing
LP.W==LogisticspointofWarehouse
LP.T==LogisticspointofTransport
LP.R=LogisticspointofRetail
LP.E2E=LogisticspointofE2E (EndtoEnd)

Company(internal)SupplyChain
The result at the end of p
process is created from integration
g
of
process elements or its systemic structure of sup processes
which the whole is more than sum of its parts
My Lecture#2
15 Aug 2015

27

HolisticViewofProductSupplyChain
S
SupplyChainPlanning
l Ch i l
i

End

Plan
Procurement

Plan
Manufacturing

make
R/MSupplier

make

Company1
Logisticsof
Company1

X
LP C1
LP.C1

Plan
Warehouse

move

Plan
Transport

Plan
Retail

Logistics
Point

move

move
Retail
Shops

Warehouse
Transport
services
services
X
X
Company3
Company4
LP.C2
LP
C2
LP C3
LP.C3
LP C4
LSP
LSP LP.C4
Logisticsof
Logisticsof
Logisticsof
I Company3
I Company4
I
Company2

Manufacturing
Plants
X
Company2

Supply=Demand?

Companyprocess

Logistics(Planning)

Supply=Demand?

Companyprocess

Supply=Demand?

Companyprocess

X
End
Company5
LP.E2E
LP C5
LP.C5
Logisticsof
Company5

Supply=Demand? Supply=Demand?

Companyprocess

EndCustomers

SysttemsPerspecctive

Manufacturing(Planning)

Logisticsof
E2E (EndtoEnd)
(End to End)

Companyprocess

Supply=Demand?

Upstream
LP.C1=LogisticspointofR/MSupplier
LP.C2=LogisticspointofManufacturingPlants
LP.C3=LogisticspointofWarehouseServices
LP.C4=LogisticspointofTransportServices
LP.C5=LogisticspointofRetailShops
LP.C6=LogisticspointofE2E (ProductSupplyChain)

Product Process (End to End : E2E)

ProductProcess(EndtoEnd:E2E)

Downstream

Product(external)SupplyChain
My Lecture#2
15 Aug 2015

28

HolisticViewofCompanySupplyChain
S
SupplyChainPlanning
l Ch i l
i

Plan
Procurement

Plan
Manufacturing

move

make

Procurement

Manufacturing

End
End

X
LP.P
Logisticsof
Procurement

Logistics(Planning)

Plan
Warehouse

Warehouse

Supply=Demand?

move

Transport
X
LP.W

Logisticsof
Warehouse

Supply=Demand?

Plan
Retail

move

move
X
LP.M

Logisticsof
Manufacturing

Plan
Transport

X
LP.T
Logisticsof
Transport

Supply=Demand?

Logistics
Point

Retail

Logisticsof
Retail

X
End
End
LP.E2E
LP.R

Supply=Demand? Supply=Demand?

Customers
C

SystemsPerspecttive

Manufacturing(Planning)

Logisticsof
E2E (EndtoEnd)
Supprocess

Supprocess

Supprocess

Supprocess

Supprocess

Supply=Demand?

Process(EndtoEnd:E2E)
LP.P=LogisticspointofProcurement
LP.M==LogisticspointofManufacturing
LP W
LP.W==LogisticspointofWarehouse
L i i
i
fW h
LP.T==LogisticspointofTransport
LP.R=LogisticspointofRetail
LP.E2E=LogisticspointofE2E (EndtoEnd)

Company(internal)SupplyChain
p y(
) pp y
My Lecture#2
15 Aug 2015

Centralpositionoflogisticsintheenterprise
between markets and production
betweenmarketsandproduction

29

Seamlessly, perfect fit, Just in Time with

customer demand
Logistics is not just functions in
execution process but it is an
function for integration.
g

x
x x
LogisticsFlow

Source:MichaelSchenkSiegfriedWirthEgonMuller
FactoryPlanningManualSituationDrivenProductionFacilityPlanning 2010

My Lecture#2
15 Aug 2015

30

LogisticsandSupplyChainThinking
End

to

End

Plann
ning

Logisttics
Decisions

Planning

End

End

End

End

End

End

End

LogisticsFFlow

End

End

Loggistics
Perfo
ormance

Planning

Planning

L
Logistics
Infformation

LoggisticsManagementP
Process

LogisticsPlanning(Collaboration)

End End

My Lecture#2
15 Aug 2015

Quality
(Nodamages)

End End

MyNotesof
Dr.Vithaya
Dr.
Vithaya
3Jun
3
Jun15
15

End End

End

End

Quality
(Nodamages)

End End

End

Quality
(Nodamages)

31

Asupplychainplanningmatrix
Strategic

Tactical

Operational

Procurement

Production

Distribution

Source:Knolmayer,G.F.,Mertens,P.,AlexanderZeier,A.andDickersbach,J.T.SupplyChainManagement
BasedonSAPSystems:ArchitectureandPlanningProcesses2009

Sales

My Lecture#2
15 Aug 2015

32
Supply Chain Thinking
SupplyChainThinking
Collaboration
(Co Planning)
(CoPlanning)
S&OPor
SupplierRelationship

Communication
(InformationSharing)

Data&IT

My Lecture#2
15 Aug 2015

33

3Cin SupplyChainModel
DecisionFlows

Plan

C ll b
Collaboration
i
Execute

Measure

Measure

Execute

Communication
Execute

M
Measure

Connection

Measure

Execute

Actions

(Re) Plan
(Re)Plan
Execution

SupplyChain

Improve
Control

My Lecture#2
15 Aug 2015

Performance:3KPIs Effectiveness,Efficiency,Changeability 34

Changeability

Activities,
Process
Systems

If customers
change their
requirements, we
have to change
the processes.

If the utilization is in control, its ok or

improve process for better utilization.

Analysis

Me
easuremen
nt

Measure KPI, check with the goal.

M
Measurement

Change

Analysis

Measurementt

If reach the goal, its ok or

set the new goal higher. If
not reach the goal,
goal
improve the process.

Products&
Services

Customers
Output

Measure KPI, then

check the target of
resource utilization.

Analysis
My Lecture#2
15 Aug 2015

35
Scopelevelsofsupplychains
Supply Chain Professionals must holistically look at supply chain
SupplyChainProfessionalsmustholisticallylookatsupplychain.
Collaborations

Collaborations

Collaborations

Collaborations

EndtoEnd

WorkingasindividualfunctionswithinsupplychainisnotSupplyChainProfessional.
SupplyChainProfessionalmustdefinetheboundaryofsupplychainasEnd
toEndProcessandworkasprocessmanagement.
E dP
d
k
My Lecture#2
15 Aug 2015

36

RememberSupplyChainisallaboutTeamworkfrom
pp y
EndtoEndandLeadership,not justindividual
functions like transportation
functionsliketransportation
orwarehousinginthe
company.
company

My Lecture#2
15 Aug 2015

Dr.Vithayas PerspectiveonLogisticsandSCM(JellyfishModel)

Upstream
p

37

Downstream

EndtoEnd

SoftSide

ProductSupplyChainManagement

Company
SupplyChain
Management

Plan

Plan

Plan

Plan

Source
(move)

Make

Deliver
(Move)

Transport
(Move)

Execution

Execution

Execution

Execution

FlowofValues:Logistics

FlowofValues

EndtoEnd

EndtoEnd

Logistics Flow

Company
SupplyChainManagement

Company
SupplyChainManagement

Plan

Plan

Plan

Plan

Plan

Source
(Move)
Execution

Make

Deliver
D
li
(Move)
Execution

SSource
(Move)
Execution

Deliver
D
li
(Move)
Execution

Execution

FlowofValues:logistics

EndtoEnd

FlowofValues

Better
Faster
Cheaper

Customers
C

HardSide
H

Company
SupplyChainManagement

EndtoEnd
My Lecture#2
15 Aug 2015

Customers
Logistics
L
i ti is
i h
how
customers
receive values at
the right time and
the right place
with
ith right
i ht costt

To make flowss of values to ccustomers

ineffeectively and ineefficiently at no
ot the right timee
an
nd not the right place with no
ot right cost.

Logistics
Activities

Activvities of physsical moving

g and storing..

NoInform
N
mationSSharing

(Uncollaborative Plan
nning)

Planning

To make flowss of values to

T
o customers effectively aand
efficiiently at the rright time and the right pllace with righ
ht cost

Logisstics Activitties

Inform
mationSharing

(Collabo
orativePlaanning)

SupplyyChainPlaanning

Logistics and Not Logistics how are they related to Supply Chain

38

No Logistics Process
NoLogisticsProcess
Activities
Customers
No Logistics
is how
customers
receive values
at not the
right time and
not the right
place with not
right cost

My Lecture#2 15 Aug 2015

39

From Strategic to Tactical to Operational

High

Plan
Execute

Vision

Improve
Control

Management process

Wide

Plan
Execute
Control

Plan

Long

Execute Win IImprove

Uncertainty
Control
Plan

Time
Execute

Low

Inv

Short

Pl
Plan

Control

Plan
I
Improve
Control

Execute

Improve

Plan

Trans
Improve

TACTICAL

Control

Plan
Pl
Plan

Execute Source Execute Make ExecuteDeliverImprove

Improve
Improve

Narrow

STRATEGIC

Execute

Plan

Control

Scope

Improve

Control

Control

Execute

Improve
Control
OPERATIONAL
My Lecture#2
15 Aug 2015

40
PyramidalreferenceframeworkforSupplyChainManagement

Customers

LogisticsFlow
ReverseLogistics

Source:Knolmayer,G.F.,Mertens,P.,AlexanderZeier,A.andDickersbach,J.T.SupplyChainManagement
BasedonSAPSystems:ArchitectureandPlanningProcesses2009

My Lecture#2
15 Aug 2015

ModelingLevelsofAbstraction

Theory

Abstract

Practices

Concrete

Mostly, we focus at concrete level which we can consume and utilize, and ignore
thinking or abstraction which is the origin of things or concrete that we consume.

41

My Lecture#2
15 Aug 2015

42

CreatingSupplyChainRoadmap
(Guideline)
YourCompanyValues

CustomerValues

GSCF

48DecisionsofLogissticsNetworrk

SCOR

SCORand
dGSCFonSC
CMProcess

100QuestionsforStrategicSupp
plyChainmanaagement

Question #1
Question#1

48Decision

Question#100

SupplyChainRoadmap

My Lecture#2
15 Aug 2015