ABSTRACT
This essay utilized Global Logistics Model as the entity to review its present logistics management and how it dealt with critical situations, specifically the choice of distribution centres and the combination of transportation tools. From the analysis, key trends in the logistics management were identified, how it worked and its effectiveness in dealing with critical situations mentioned was ascertained. The paper then moved on to assess the Global Logistics Model’s strategies with regard to its suitability to critical situations, during which the internal capabilities of the model in relation to the strategy being followed was determined also. An overall analysis of the performance and effectiveness of the Global Logistics Model was also conducted to assess and compare the capabilities of the model with those of others. Gaps in the model’s capabilities were then identified.
Finally, several choices of strategies to improve the logistics management of the Global Logistics Model as effective means in dealing with critical logistical situations were recommended and evaluated in terms of appropriateness to the issues reviewed, feasibility in carrying out the options and acceptability within the key stakeholders and decision makers. Several key implementation issues related to managing strategic change was also addressed as well.
INTRODUCTION
As a person with knowledge of global logistics, the author has always brought up to his superiors the viability of strategy formation regarding global logistics management and at times fails to understand the reasons or logic behind certain strategic implementations imposed on its distribution.
By delving into this project paper, the author intends to have better insights into how global logistics management are thought up, formulated and then imparted down. The author hopes to have an in-depth understanding as to how the global logistics model for the choice of Distribution Centres and the combination of Transportation Tools promotes effectiveness and profitability in this era of internationalization where competition is extremely intense.
In order to reinforce the learning objectives, two key focal issues were focused upon, i.e. innovation and diversity. Innovation was discussed with regards to the global logistics model where it was renowned for its developmental capabilities to constantly innovate. Diversity came under strategic thinking and formation as the author considered the diverse culture, political climate, economic surroundings, social environment, technological settings, government policies and legal systems in order to further understand the global logistics model.
Global logistics can be defined as the implementation of the policies and processes necessary towards the effectiveness and efficiency of services. Global logistics focuses on the careful management of the processes involved in the production and distribution of products and services, which include the transportation of products and information, the time allotment and cost analysis (Ballot, 1998).
More often than not, small companies don’t really have the capabilities to implement global logistics management. Instead, these companies engage in activities that various schools of management typically associate with global logistics management. These activities include the manufacturing of products, product development, production and distribution.
However, global logistics deals with all operations done within companies and organizations. Activities such as the management of purchases, the control of inventories, logistics and evaluations are often related with global logistics. A great deal of emphasis lies on the efficiency and effectiveness of processes. Therefore, operations management includes the analysis and management of internal processes.
REVIEW OF RELATED LITERATURE
Overview
The Global Logistics Model is meant to solve real company problems regarding logistics which normally would require hiring a human logistics expert to solve them. Building the Global Logistics Model therefore first involves the extraction of the crucial information from a human expert in logistics. Such knowledge is often characterized as heuristic in nature. However, the extraction of relevant information from an expert in a way that can be used by a computer is generally a difficult task (Blanchard, 1998).
The first attempt in the construction of the Global Logistics Model would unlikely be very successful. This is partly because the human logistics expert generally would find it very difficult to express the necessary knowledge and rules needed to solve the logistics problem. Much of it is almost subconscious, or appears so obvious that most human logistics experts don’t even bother mentioning it. Knowledge acquisition for the Global Logistics Model would involve a big area of research in logistics, with a wide variety of techniques that also need to be developed. However, it is important for the company or organization to first develop an initial prototype based on the relevant logistics information extracted in the interview of the human logistics expert, then make some refinements on it based this time on the feedbacks coming from both the human logistics expert and from the potential users of the Global Logistics Model (Bowers ox et al. 1996).
In order to do such refinements from the prototype it is important that the Global Logistics Model must be done in such a way that it can easily be inspected and modified. The model should be able to explain its reasoning and also be able to answer questions regarding the logistics process. The model updating must not involve modifying a whole lot of concepts. It must include simply the addition or deleting localized chunks of logistical knowledge.
The most widely used logistical representation scheme for the Global Logistics Model is rules. Typically, the rules do not have certain conclusions, but there is some degree of certainty that the conclusion will hold if the conditions hold also. Statistical techniques are often used to determine these certainties. Rule-based logistics models, with or without certainties, can be easily modified, thus making it easy to provide helpful traces of the model’s reasoning. These traces can be further used in providing explanations of what it is doing (Lambert et al. 1997).
Global Logistics Models have long been used to solve a wide range of problems in logistical domains. Within each logistical domain, they have been used to solve problems of different types. Types of problem involve diagnosis (e.g., of a logistical fault or student error) and interpretation (of, for example, logistical data) (Langford, 1994).
The Typical Model of Global Logistics
A typical Global Logistics Model is based on three poles of integration. Efficient global logistics management lies on the proper coordination of all the physical flows provided by the various operations. The manufacturing of products, product development, production and distribution all possess tremendous development potential if and only if the marketing, logistics and production functions can be coordinated appropriately. This is the primary approach of functional integration (Christopher et al. 1997).
The secondary approach of functional integration is to determine the manner in which the logistics function incorporates the goals and limitations of the other operations which have a considerable effect on the logistics model and management. A transportation time of one day simply means that there exists varying problems for modeling a physical and informational distribution network than a transportation time of one month.
In most ordinary supply chains, the retailers and their client typically create an agreement of their own logistics and operations. As a result, they are not aware that along the process they are already making various constraints and hindrances for other vital players. This will in the end all contribute to the total costs of the entire system. But through the existence of sartorial integration, directions for coordination will be identified by both the retailers and their clients to apply the solutions pulled by the demand of clients more than pushed by supply of products. In the area of goods and products that need fats and efficient transportation, sartorial integration projects play an important role towards the success of its operations (Coyle et al. 1996).
The globalization that defines the industry nowadays has indicated the significance of strategy formation regarding geographical locations that are not a part of a state. The sudden boom of international markets and industries have more and more added the pressure for various transportation routes to improve between countries, thereby adding another aspect on the realm of logistics, which is performing in a global setting. In this case, the geographical integration performs a critical role by giving physical solutions such as collection systems, and informational solutions to guide and follow the movement of the products from the beginning to the end. It is through geographical integration that companies and organizations can transport their products even to the farthest places in the shortest time possible, and with a lower delivery cost (Glaskowsky et al. 1992).
Through the coordination of these three poles of the global logistics model, logistics is then equipped with the functions that can help attain the objectives of a company or organization. Through the understanding of the global logistics model, the management of companies and organizations can gladly welcome the responsibility of solving the logistics problems which typically hounds them, in belief that the global logistics model’s features have what it takes to solve the problem.
The Global Logistics Model for the Choice of Distribution Centers and the Combination of Transportation Tools
With the ongoing boom of globalization come other issues that cannot be taken for granted especially in the area of global logistics. One practical example is time zones. It is just a common incident that certain individuals in Japan, France and the United States are all doing some online chatting at the same time even if there are varying differences in the time zones in these countries.
This type of Global Logistics Model begins with the identification of logistical problems, in this case the choice of distribution centers and the combination of transportation tools. These include the gaps between the desired and actual states of distribution centers and transportation tools that cannot be easily closed easily because of the new logistical knowledge that needs to be produced to support the decisions and actions needed to close them. There are generally three (3) classes of such problems:
· problems occurring in the logistics processes;
· problems occurring in the transportation tools knowledge processes; and
· problems occurring in the distribution centers management processes.
Problems occurring in the logistics processes cannot be resolved through the use of logistics management solutions, but through logistics knowledge processing solutions. The other two classes of problems, however, can be solved through the use of the Global Logistics Model. This model will identify, formulate, and evaluate the transportation tool knowledge processing and distribution centers management problems (Hand field et al. 1998).
This is the most important service that the Global Logistics Model could provide. Failure to solve these problems within the use of the Global Logistics Model, for instance, may not be caused by a problem in the organization and structure of the company employing it. Instead, it may be possibly caused by a failure in solving an extremely difficult logistics process problem, even though available logistical knowledge processes are working just fine (Kasilingam, 1999).
There are certain instances, however, that it is not always very clear what the nature of the logistics problem is, even if a Global Logistics Model exists. For example, the fact that the knowledge needed to support a particular combination of transportation tools is not there may be possibly caused by the fact that the knowledge exists, but is currently unavailable because of a poorly operating knowledge sharing process within the company or organization. Another possible explanation is that it could be caused by the fact that the process of the development of new knowledge claims is not open to most organizational employees (Jones, 1998).
The bottom line is the process on how the logistics problem is formulated and diagnosed. Because of its experience in the development of the underlying conceptual foundations of logistics, the Global Logistics Model will be able to identify, formulate and evaluate various combinations of transportation tools and the appropriate distribution centers.
CONCLUSION
The results of the analysis carried out on the Global Logistics Model indicated very significant impacts, even amidst the threats of unrest. Therefore, we could conclude that the Global Logistics Model could still be expected to improve faster than average.
The review of the Global Logistics Model’s capabilities and resources revealed very little inconsistencies regarding its strategies. This is coherent with its traditional inside-out approach. However, the need to reconcile both the inside-out and outside-in approaches becomes imperative now.
The analysis of The Global Logistics Model in terms of its choice of distribution centers and the combination of transportation tools revealed certain gaps, most of which are biased towards the environment. However, these gaps paved the way towards determining a number of recommended strategic options to secure the model’s competitiveness.
Credit:ivythesis.typepad.com
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