Getting to Know Logistics
Since the beginning of civilization, mankind has needed to transport items from one location to another. As we evolved, we became better at getting things to where they needed to go. Improved equipment and resources meant that we could get more items to more locations with less effort. In this article, we are going to talk about getting to know logistics and also the history and importance of logistics. Lately, we saw that how to manage a situation of abandoned cargo.
The word ‘logistics’ originated from the word ‘logistique’ or ‘loger’ in French, which means storage. Logistics in English refers to a system that transports goods, information, and resources from a place of origin to a destination according to customers’ needs. Logistics involves information, transportation, stock management, raw material management, and packing. Logistics is a part of the supply chain which utilizes space and time to add value to goods.
Simply speaking, logistics is a process of transferring, storing, and distributing goods, services, or information from its place of origin to a location where there is a demand. This is done through a holistic process focusing on effectiveness and efficiency, aiming at timely delivery and reducing cost, while also increasing customer satisfaction and adding value to goods and services.
History and Importance of Logistics
Logistics management originated by the British Army far before the outbreak of the First World War where a military supply chain system was developed by building infrastructure such as; roads, railroads, ports, airfields, supply stores, and vehicles to transport weapons and troops. In the United States, which started its agricultural produce distribution across the continent in the late 19th Century, there was a development of industrial goods distribution system. This eventually led to the start of the official Logistics Management Science in the US in 1964. The public sector has adapted logistics management into their business practice up until now.
For the commerce and industrial sector, logistics plays an important role in reducing costs, which in turn increases profits. It is also used as an important tool in creating competitiveness as it helps create effectiveness in customer service, establish a good relationship with both internal and external customers, and acts as a foundation for business growth with help from speedy information technology.
To be able to execute logistics management effectively, one must combine and utilize different fields of knowledge into one. These fields include;
- Engineering science in the field of industrial engineering
- Business management helps take care of international transportation by considering related laws, taxation, freight, different national logistics strategy or plan, and international trades. All these areas will be considered to create a plan for shipping goods to different countries.
- Information management, which studies both software and hardware and combines them together to create a service that helps generate and facilitate logistics activities with greater agility.
Types of logistics management
Logistics Management can be categorized into 3 main categories according to a country’s macro functions. The 3 categories are:
Military Logistics Management
Refers to the management of military-related distribution aiming at a military victory. For instance; transportation of weapons, requisite items, medical treatment, and information technology.
Engineering Logistics Management
Refers to management of engineering distribution aiming at providing readiness of the storage and distribution system. This includes the construction and maintenance of infrastructures that support land, maritime, air, and pipeline transportation, storage system,s and information technology systems.
Business Logistics Management
Refers to the management of storing and delivering persons, animals, or goods from one place to the other according to a person’s need, aiming at success in business.
All of the above should allow us to understand logistics more and to see that it is much closer to us than we might have thought. We can easily say that it is basically a part of our lives and has a significant impact on the development of the economy and society on a global scale.
How business intelligence and technology have helped improve logistics services
Business strategy and intelligence have helped progress the distribution process during this period. Business logic in combination with new technology enables us to plan, implement and control efficient forward and reverse flows as well as the storage of goods via warehouse or other means.
Logistical evolution means that we can get goods to exactly where they need to be as well as track the journey. Technology has helped us to map the most efficient ways of distributing goods.
More thought goes into logistics today than it previously has before. A popular concept is the seven R’s of logistics. These focus on getting the Right product in the Right quantity in the Right condition in the Right place at the Right time to the Right customer for the Right price.
Business logic is applied when selecting the mode of transport. Selecting the most efficient combination in the distribution process improves the value for customers. When inventory is not on the move, it may need to spend time in a warehouse. Warehousing plays a vital role in the logistical cycle. The storage of goods in warehouses has enabled us to plan the journey of goods and deliver a better service.
The future of logistics is very exciting as we make further advancements in technology. Machine learning will likely play a greater role in logistics. It could well be possible that logistics becomes a fully automated process.