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Management information system, types and terminology.
TMPDOODLE1495576229935

Management information system (MIS) refers to the processing of information through computers to manage and support managerial decisions within an organization. The concept may include systems termed transaction processing system, decision support system, expert system, or executive information system. The term is often used in the academic study of businesses and has connections with other areas, such as information systems, information technology, informatics, e-commerce and computer science; as a result, the term is used interchangeably with some of these areas.

Management information systems (plural) as an academic discipline studies people, technology, organizations, and the relationships among them.[1] This definition relates specifically to “MIS” as a course of study in business schools. Many business schools (or colleges of business administration within universities) have an MIS department, alongside departments of accounting, finance, management, marketing, and may award degrees (at undergraduate, master, and doctoral levels) in Management Information Systems.

MIS professionals help organizations to maximize the benefit from investments in personnel, equipment, and business processes.
There are different areas of concentration with different duties and responsibilities in information system managers starting from the Chief information officer (CIOs), Chief technology officer (CTOs), IT directors and IT security managers. Chief information officers (CIOs) are responsible for the overall technology strategy of their organizations. Basically, they are more of the decision makers and action takers when it comes down to determining the technology or information goals of an organization and making sure the necessary planning to implement those goals is being met.

Chief technology officers (CTOs) are responsible for evaluating how new technology can help their organization. They usually recommend technological solutions to support the policies issued by the CIO.[2]

IT directors including MIS directors are in charge of both their organization’s Information technology departments and the supervision of thereof. They are also in charge of implementing the policies chosen by the other top branches (CIOs, CTOs). It is their role to ensure the availability of data and network services by coordinating IT activities.

IT Security Managers oversee the network and security data as the title implies. They develop programs to offer information and awareness to their employees about security threats. This team is very important because they must keep up-to-date on IT security measures in order to be successful within their organization. Any security violations need to be investigated and supervised by this specific team.
Kenneth and Aldrich Estel identify six eras of Management Information System evolution corresponding to the five phases in the development of computing technology:[3]

mainframe and minicomputer computing,
personal computers,
client/server networks,
enterprise computing, and
cloud computing.
The first era (mainframe and minicomputer) was ruled by IBM and their mainframe computers; these computers would often take up whole rooms and require teams to run them—IBM supplied the hardware and the software. As technology advanced, these computers were able to handle greater capacities and therefore reduce their cost. Smaller, more affordable minicomputers allowed larger businesses to run their own computing centers in-house / on-site / on-premises.

The second era (personal computer) began in 1965 as microprocessors started to compete with mainframes and minicomputers and accelerated the process of decentralizing computing power from large data centers to smaller offices. In the late 1970s, minicomputer technology gave way to personal computers and relatively low-cost computers were becoming mass market commodities, allowing businesses to provide their employees access to computing power that ten years before would have cost tens of thousands of dollars. This proliferation of computers created a ready market for interconnecting networks and the popularization of the Internet. (NOTE that the first microprocessor — a four-bit device intended for a programmable calculator — was introduced in 1971 and microprocessor-based systems were not readily available for several years. The MITS Altair 8800 was the first commonly known microprocessor-based system, followed closely by the Apple I and II. It is arguable that the microprocessor-based system did not make significant inroads into minicomputer use until 1979, when VisiCalc prompted record sales of the Apple II on which it ran. The IBM PC introduced in 1981 was more broadly palatable to business, but its limitations gated its ability to challenge minicomputer systems until perhaps the late 1980s to early 1990s.)

As technological complexity increased and costs decreased, the need to share information within an enterprise also grew—giving rise to the third era (client/server), in which computers on a common network access shared information on a server. This lets thousands and even millions of people access data simultaneously. The fourth era (enterprise) enabled by high speed networks, tied all aspects of the business enterprise together offering rich information access encompassing the complete management structure. Every computer is utilized.
The fifth era (cloud computing) is the latest and employs networking technology to deliver applications as well as data storage independent of the configuration, location or nature of the hardware. This, along with high speed cellphone and Wi-Fi networks, has led to new levels of mobility in which managers may access the MIS remotely with laptops, tablet computers and smartphones.
The terms management information system (MIS), information system, enterprise resource planning (ERP), and information technology management (IT) are often confused. Information systems and MIS are broader categories that include ERP. Information technology management concerns the operation and company of information technology resources independent of their purpose.

Management information systems, produce fixed, regularly scheduled reports based on data extracted and summarized from the firm’s underlying transaction processing systems[4] to middle and operational level managers to identify and inform semi-structured decision problems.
Decision support systems (DSS) are computer program applications used by middle and higher management to compile information from a wide range of sources to support problem solving and decision making. A DSS is used mostly for semi-structured and unstructured decision problems.
Executive information systems (EIS) is a reporting tool that provides quick access to summarized reports coming from all company levels and departments such as accounting, human resources and operations.
Marketing Information Systems are Management Information Systems designed specifically for managing the marketing aspects of the business
Accounting information systems are focused accounting functions.
Human resource management systems are used for personnel aspects.
Office automation systems (OAS) support communication and productivity in the enterprise by automating workflow and eliminating bottlenecks. OAS may be implemented at any and all levels of management.
School Information Management Systems (SIMS) cover school administration, and often including teaching and learning materials.
Enterprise resource planning facilitates the flow of information between all business functions inside the boundaries of the organization and manage the connections to outside stakeholders.
The following are some of the benefits that can be attained using:[6]

Companies are able to identify their strengths and weaknesses due to the presence of revenue reports, employees’ performance record etc. Identifying these aspects can help a company improve its business processes and operations.
Giving an overall picture of the company.
Acting as a communication and planning tool.
The availability of customer data and feedback can help the company to align its business processes according to the needs of its customers. The effective management of customer data can help the company to perform direct marketing and promotion activities.
MIS can help a company gain a competitive advantage. Competitive advantage is a firm’s ability to do something better, faster, cheaper, or uniquely, when compared with rival firms in the market.
MIS report help to take decision and action on certain object with quick time.
Enterprise systems—also known as enterprise resource planning (ERP) systems—provide integrated software modules and a unified database that personnel use to plan, manage, and control core business processes across multiple locations. Modules of ERP systems may include finance, accounting, marketing, human resources, production, inventory management, and distribution.[7]
Supply chain management (SCM) systems enable more efficient management of the supply chain by integrating the links in a supply chain. This may include suppliers, manufacturers, wholesalers, retailers, and final customers.[8]
Customer relationship management (CRM) systems help businesses manage relationships with potential and current customers and business partners across marketing, sales, and service.[9]
Knowledge management system (KMS) helps organizations facilitate the collection, recording, organization, retrieval, and dissemination of knowledge. This may include documents, accounting records, unrecorded procedures, practices, and skills. Knowledge management (KM) as a system covers the process of knowledge creation and acquisition from internal processes and the external world. The collected knowledge is incorporated in organizational policies and procedures, and then disseminated to the stakeholders.
“The actions that are taken to create an information system that solves an organizational problem are called system development”.[11] These include system analysis, system design, computer programming/implementation, testing, conversion, production and finally maintenance.

Conversion is the process of changing or converting the old system into the new. This can be done in three basic ways:

Direct cut – The new system replaces the old at an appointed time.
Parallel implementation – both old and new systems run at the same time until developers are certain the new system is operating correctly.
Pilot study – Introducing the new system to a small portion of the operation to see how it fares. If results are good then the new system expands to the rest of the company.

Management information system, types and terminology.
TMPDOODLE1495576229935

Management information system (MIS) refers to the processing of information through computers to manage and support managerial decisions within an organization. The concept may include systems termed transaction processing system, decision support system, expert system, or executive information system. The term is often used in the academic study of businesses and has connections with other areas, such as information systems, information technology, informatics, e-commerce and computer science; as a result, the term is used interchangeably with some of these areas.

Management information systems (plural) as an academic discipline studies people, technology, organizations, and the relationships among them.[1] This definition relates specifically to “MIS” as a course of study in business schools. Many business schools (or colleges of business administration within universities) have an MIS department, alongside departments of accounting, finance, management, marketing, and may award degrees (at undergraduate, master, and doctoral levels) in Management Information Systems.

MIS professionals help organizations to maximize the benefit from investments in personnel, equipment, and business processes.
There are different areas of concentration with different duties and responsibilities in information system managers starting from the Chief information officer (CIOs), Chief technology officer (CTOs), IT directors and IT security managers. Chief information officers (CIOs) are responsible for the overall technology strategy of their organizations. Basically, they are more of the decision makers and action takers when it comes down to determining the technology or information goals of an organization and making sure the necessary planning to implement those goals is being met.

Chief technology officers (CTOs) are responsible for evaluating how new technology can help their organization. They usually recommend technological solutions to support the policies issued by the CIO.[2]

IT directors including MIS directors are in charge of both their organization’s Information technology departments and the supervision of thereof. They are also in charge of implementing the policies chosen by the other top branches (CIOs, CTOs). It is their role to ensure the availability of data and network services by coordinating IT activities.

IT Security Managers oversee the network and security data as the title implies. They develop programs to offer information and awareness to their employees about security threats. This team is very important because they must keep up-to-date on IT security measures in order to be successful within their organization. Any security violations need to be investigated and supervised by this specific team.
Kenneth and Aldrich Estel identify six eras of Management Information System evolution corresponding to the five phases in the development of computing technology:[3]

mainframe and minicomputer computing,
personal computers,
client/server networks,
enterprise computing, and
cloud computing.
The first era (mainframe and minicomputer) was ruled by IBM and their mainframe computers; these computers would often take up whole rooms and require teams to run them—IBM supplied the hardware and the software. As technology advanced, these computers were able to handle greater capacities and therefore reduce their cost. Smaller, more affordable minicomputers allowed larger businesses to run their own computing centers in-house / on-site / on-premises.

The second era (personal computer) began in 1965 as microprocessors started to compete with mainframes and minicomputers and accelerated the process of decentralizing computing power from large data centers to smaller offices. In the late 1970s, minicomputer technology gave way to personal computers and relatively low-cost computers were becoming mass market commodities, allowing businesses to provide their employees access to computing power that ten years before would have cost tens of thousands of dollars. This proliferation of computers created a ready market for interconnecting networks and the popularization of the Internet. (NOTE that the first microprocessor — a four-bit device intended for a programmable calculator — was introduced in 1971 and microprocessor-based systems were not readily available for several years. The MITS Altair 8800 was the first commonly known microprocessor-based system, followed closely by the Apple I and II. It is arguable that the microprocessor-based system did not make significant inroads into minicomputer use until 1979, when VisiCalc prompted record sales of the Apple II on which it ran. The IBM PC introduced in 1981 was more broadly palatable to business, but its limitations gated its ability to challenge minicomputer systems until perhaps the late 1980s to early 1990s.)

As technological complexity increased and costs decreased, the need to share information within an enterprise also grew—giving rise to the third era (client/server), in which computers on a common network access shared information on a server. This lets thousands and even millions of people access data simultaneously. The fourth era (enterprise) enabled by high speed networks, tied all aspects of the business enterprise together offering rich information access encompassing the complete management structure. Every computer is utilized.
The fifth era (cloud computing) is the latest and employs networking technology to deliver applications as well as data storage independent of the configuration, location or nature of the hardware. This, along with high speed cellphone and Wi-Fi networks, has led to new levels of mobility in which managers may access the MIS remotely with laptops, tablet computers and smartphones.
The terms management information system (MIS), information system, enterprise resource planning (ERP), and information technology management (IT) are often confused. Information systems and MIS are broader categories that include ERP. Information technology management concerns the operation and company of information technology resources independent of their purpose.

Management information systems, produce fixed, regularly scheduled reports based on data extracted and summarized from the firm’s underlying transaction processing systems[4] to middle and operational level managers to identify and inform semi-structured decision problems.
Decision support systems (DSS) are computer program applications used by middle and higher management to compile information from a wide range of sources to support problem solving and decision making. A DSS is used mostly for semi-structured and unstructured decision problems.
Executive information systems (EIS) is a reporting tool that provides quick access to summarized reports coming from all company levels and departments such as accounting, human resources and operations.
Marketing Information Systems are Management Information Systems designed specifically for managing the marketing aspects of the business
Accounting information systems are focused accounting functions.
Human resource management systems are used for personnel aspects.
Office automation systems (OAS) support communication and productivity in the enterprise by automating workflow and eliminating bottlenecks. OAS may be implemented at any and all levels of management.
School Information Management Systems (SIMS) cover school administration, and often including teaching and learning materials.
Enterprise resource planning facilitates the flow of information between all business functions inside the boundaries of the organization and manage the connections to outside stakeholders.
The following are some of the benefits that can be attained using:[6]

Companies are able to identify their strengths and weaknesses due to the presence of revenue reports, employees’ performance record etc. Identifying these aspects can help a company improve its business processes and operations.
Giving an overall picture of the company.
Acting as a communication and planning tool.
The availability of customer data and feedback can help the company to align its business processes according to the needs of its customers. The effective management of customer data can help the company to perform direct marketing and promotion activities.
MIS can help a company gain a competitive advantage. Competitive advantage is a firm’s ability to do something better, faster, cheaper, or uniquely, when compared with rival firms in the market.
MIS report help to take decision and action on certain object with quick time.
Enterprise systems—also known as enterprise resource planning (ERP) systems—provide integrated software modules and a unified database that personnel use to plan, manage, and control core business processes across multiple locations. Modules of ERP systems may include finance, accounting, marketing, human resources, production, inventory management, and distribution.[7]
Supply chain management (SCM) systems enable more efficient management of the supply chain by integrating the links in a supply chain. This may include suppliers, manufacturers, wholesalers, retailers, and final customers.[8]
Customer relationship management (CRM) systems help businesses manage relationships with potential and current customers and business partners across marketing, sales, and service.[9]
Knowledge management system (KMS) helps organizations facilitate the collection, recording, organization, retrieval, and dissemination of knowledge. This may include documents, accounting records, unrecorded procedures, practices, and skills. Knowledge management (KM) as a system covers the process of knowledge creation and acquisition from internal processes and the external world. The collected knowledge is incorporated in organizational policies and procedures, and then disseminated to the stakeholders.
“The actions that are taken to create an information system that solves an organizational problem are called system development”.[11] These include system analysis, system design, computer programming/implementation, testing, conversion, production and finally maintenance.

Conversion is the process of changing or converting the old system into the new. This can be done in three basic ways:

Direct cut – The new system replaces the old at an appointed time.
Parallel implementation – both old and new systems run at the same time until developers are certain the new system is operating correctly.
Pilot study – Introducing the new system to a small portion of the operation to see how it fares. If results are good then the new system expands to the rest of the company.

Reverse Logistics In Supply Chain Management
November 15, 2014
0

 

Define Reverse Logistics

Reverse logistics is the last part of the SCOR model. By definition it means from the point of consumption to the point of initiation, but what?

It can even be a customer’s feedback on a product after consuming or utilizing it so that the company can utilize that feedback in a positive manner in order to improve its product. Secondly, it can also be waste materials that are left over by the consumers, like empty cans, etc and can be utilized by the company in one of or the other.

This is how the loop is of a product cycle is completed, that is from point of initiation to the point of consumption and then finally back to the point of initiation and this is known as closed loop logistics.

 

Reverse Logistics-closed loop logistics-In Supply Chain Management

 

What is reverse logistics?

Reverse logistic is a procedure or process which deals the flow of product and service in a backward direction, that is, from the customer to the respective company domains with the help of supply chain to achieve maximum value and customer satisfaction. Some of the examples of reverse logistics are, return of product, repair of a product, recycling, disposal, customer feedback, etc. The advancement in the importance of Green Logistics and Green Supply chain management has created an urge of having reverse logistic.

Forward logistics or simply logistics deals with the movement of product from the point of initiation towards the point of consumption, however, reverse logistics deals the movement of product in an inverse direction. It can also be from customer back to distributor or even back to the manufacturer. Any procedure that is executed after the product is sold to the customer or the final end involves reverse logistics. Sometime reverse logistic can be executed before the product reaches to the customer, for example a defect product is identified at the distributor end or some damage is there. In such scenarios, products can move back to the manufacturer.

 

Importance of reverse logistics

Reverse logistics plays an important role in not just creating customer satisfaction, but also plays a pivotal role in minimizing environmental issues by reducing waste, recycling and proper disposal of products that can harm the environment.

 

Return of surplus goods

Some companies provide their downstream members in supply chain with goods in excess, that is, more than their requirement, with a common understanding that the left over goods that are not sold will be taken back by the company providing these goods. In this way the downstream member in the supply chain carry more stocks with the option of returning the surplus goods back. On the other hand, the producer or the company that provides the goods makes their channels / end point more fertile and hence they get an advantage of more sales by reducing or minimizing the probability of having stock outs in the market and an additional advantage of storing their additional productions by downstream members, rather than spending or wasting resources on their own warehouses.

 

Green reverse logistics – Reusable packaging

One of the major advantage of reverse logistics is usage of reusable packaging. Packing materials that are left over after the consumption of the goods can be brought back to the company to be reused with the help of closed loop logistic system. Some example are, plastic bottles, cylinder, cans, etc.

 

For Further details

 

Logistic Procurement
November 15, 2014
0

 

Logistic procurement is all about purchasing of logistic services. For example, car rental service, carrier service, etc.

This area is now a day’s very commonly used in organizations in order to reduce cost (especially fixed cost and maintenance cost) by outsourcing its department, but it is also very important to keep a contingency plan and not always completely depend upon your logistic partners.

 

Green Logistics – Supply chain management
November 15, 2014
0

 

What is green logistics?

 

As discussed in previous sessions, logistics is the movement of products, services and information throughout the supply chain with the help of interconnected and integrated management system.

Green logistics defines the methods or ways of minimizing the impact of logistics on our ecological systems. This method covers entire supply chain, that is, the forward and reverse flow of product, services and information from the point of initial to the point of consumption and vice versa, that is, reverse logistics. This will ultimately result in green supply chain management.

 

Now a day’s environmental changes, social and political demands are considered to play a vital role to force companies to focus more on the implementation and execution of Green logistics throughout their Supply chain.

Logistics has a strong interaction with Economy, Environment, Society and natural resources. If the logistic and supply chain strategies are designed in such a method focusing more on reducing fats than this will save help companies to generate more profit by reducing expenses.

More profit means more provision for investment. More investment mean more business, more employment and this will ultimately improve the whole Economy Cycle.

Reducing fats mean you are also saving natural resources, such as Water, gas, crude oil, etc. Hence, this will have a positive impact on the society and environment.

If Green Logistics is properly implemented then the benefits is not just for the company but it is for everyone.

 

Green Logistics - Green Supply chain management

 

Green Supply chain management

 

Green logistics is a method used in order to save the environment by the worst effects of logistic by taking following measures:

  • Reducing carbon footprints, which will automatically save unnecessary emission of carbon from vehicles.
  • Hence fuel will also be save and therefore protecting our natural resources.
  • Reduce the usage of paper, which will save the cutting of treas.
  • Save water and electricity.
  • Implement CSR (corporate social responsibility) as much as possible.

The above methods will surely help you in implementing green supply chain management.

You can further read green supply chain management by clicking on the link: “Green Logistics – Supply chain management

 

Drivers of supply chain excellence
November 15, 2014
1

 Drivers of supply chain excellence

 

In order for a company to achieve excellence in its supply chain, they need to follow and implement six drivers of supply chain excellence.

 

The six drivers of the supply chain excellence are:

 

1. Optimization:

Finish all the fat from the business. By fat means eliminate those resources which are of no use and are unnecessarily consuming time or money.

 

2. Speed:

Speed is one of the most important drivers. One should always be ahead of their competitor and therefore should bring new innovations before their competitors.

 

3. Connectivity:

All supply chain parts should be interconnected with each other in order to achieve excellence. For example your supplier, customer should all be interconnected with each other. Suppose you have 2 product of X left out of 10 from your stock, your customer should know that you have a stock of product X and on the other hand your supplier should know when to provide with new stocks before any stock out occurs.

 

4. Visibility:

Every part of your supply chain should be in your knowledge. For example, you should be well aware that where your fleets are? Which routes they are moving? What is the capacity they are carrying? How much more can be stored in your warehouses? Etc.

 

5. Collaboration:

Focus on your core areas of the supply chain and remaining areas which are not your specialty can be outsourced. For example, a company can outsource its logistics to another company.

 

6. Execution:

Your implementation of plans should be flawless in order to achieve excellence.

 

Third party Logistics (3PL), Services & Quality
November 15, 2014
0

 

Third party Logistics (3PL):

Third party logistic is a concept in which a company outsource its logistics to another company or makes them a strategic partner whose core competency is providing a logistic support.

This has multiple benefits such as:

  • Less or no investment in working capital. This means that the company’s do not have to invest on procuring vehicles, other stuffs related to logistics, as this has a high fixed cost. Therefore, these companies can outsource their logistic parts to those logistic companies who have already invested in their core business.
  • Since the logistic company’s core competencies is to provide smooth and efficient logistic support, therefore this automatically enhances the performance of the partner company.
  • The logistic company properly utilizes its assets pertaining to the concept of low container load or full container load, depending on the volume stocks to be transferred.
  • Since, the partner company do not have to invest in fixed cost, therefore this also helps then in saving / reducing prices of their products and hence they can also focus more on production, which is their core competency.

 

Logistic Services:

The services provided by the logistic unit should be reliable, which means quality and quantity should both exist together. If the services are reliable then this means that the services are readily available when required and there is a timely delivery of the product without or minimum level of damage.

 

Dimensions of a product Quality:

The dimension of a product quality depend on two things:

  1. Aesthetics: Visible criteria, for example it beauty, its packaging, etc.
  2. Conformance: Which states that is a product developed according to the pre-defined specifications or not.

 

Logistic Service standards:

Following are some key important standards that needs to be included in a service level agreement which outsourcing logistic services:

  • No stock out should occur. This means that your product stock should always be available where required.
  • Order size constraints is another important factor. Minimum order for delivery should be as low as possible.
  • There should be technological integration using IT services in order to automatically gauge the requirement for logistics. Some of the example can be using ERP system.
  • Frequency of the delivery should be predefined.
  • On time delivery of the product.
  • Make simple and easy methods for any claims.

 

TOSS (Town wise order split system):

Toss is basically a calculation that decides which distribution routes should be used in order to stocks with respective to towns.

 

Buyer and Supplier agreement in SCM
November 15, 2014
0

 

There are 5 different scenarios when considering buyer and supplier agreement. Usually, in such scenarios, the buyer and the seller belongs to different countries.

These scenarios are as follows:

 

1. EX-Work:

Supplier will give the required stocks to the buyer at his own factory exit.

 

2. Free on board (FOB):

Supplier will place the stocks on the port and from there the buyer has to take care of the stocks.

 

3. Cost & Freighting (C&F):

Supplier in this case is responsible to deliver the stocks on the port of the buyer. All risk and duties till the port will be paid by the supplier.

 

4. Cost insurance & Freight (CIF):

It is similar to the cost and freight (C&F) case, but the supplier will pay for the insurance of the stocks. Huge multinational companies do not go for CIF, because they cover the insurance part by themselves.

 

5. Delivered duty paid (DDP):

The supplier pays everything till the delivery of the product is done to the doors of the buyer.

 

Non Negotiable Documents (NND):

Nonnegotiable documents are the documents required for any shipment to be cleared from the customs. The most important NND documents are as follows:

 

  1. Commercial invoice
  2. Bill of lading
  3. Packing list

 

Methods of Payment for shipments / imports:

For payment of the products that are transported from one country to another are as follows:

  1. Letter of credit (L/C).
  2. Telegraphic transfer (TT)
  3. Bank contract (B/C)

Letter of credit is the safest mode of payment as it is backed up by the state bank of both (Supplier and buyer) country.

 

There are two types of letter of credit which are as follows:

1. Usance: In this type of L/C the buyer pays its supplier within 45 days after receiving the stocks.

2. Sight: is a type of L/C in which the buyer needs to pay the supplier just after receiving all the documentations.

 

Plant facility, Plan and Location in SCM
November 15, 2014
0

 

When a company decides to build an industrial plant it needs to take care for the following things:

  • The plant should be near to port (if available) or it should be near to the exit point of that country.
  • Company should make sure that all production facilities including labor, raw material, etc. should be easily available in that vicinity.
  • Coverage area and infrastructure requirement should be properly designed before constructing a plant keeping provisions for future requirement as well.

 

Plant facility, Plan and Location in SCM

 

 

According to the above figure there are few points that needs to be considered which are as follows:

  • Plant / factory location. (as discussed previously)
  • OFD (Over flow distribution center) required or not. OFD is also a warehouse which is near or in the vicinity of the plant / factory.
  • Location of DCs should be designed in a way that it should easily cover the target regions within a country. Therefore, for DC’s market coverage is very critical and important.
  • LCL (Low container load) / FCL (full container load): This will be covered in later sections.
  • Strategic Alliances (already covered in previous section)
  • Again, carbon foot prints should be minimized.
  • Cross docks. Suppose, there are two points ‘A & B’ which comes after a factory. Suppose a factory send stocks for Point B, which comes after passing point A, and the container drops some of the stocks at point A as well during its transit to point B, so that A region also gets the supply of that stock, then this concept is called cross docks.
  • Master DC: Is the main DC which is further providing stocks to other small DCs.

 

Container load:

Container are the empty vessels that are attached to the vehicles carrying goods in it. There are two kind of container carrying goods:

  1. Low container load: This type of container contains goods of other companies as well. This kind of transportation may cause delay issues as the owner of the container will wait for other company’s stocks to be filled in till entire container is occupied.
  2. Full container load: In such kind of container the entire load is dedicated to one company and therefore has less issues as compared to the LCL. But at least 75% to 80% of the container should be filled up in order to increase the economy of scale.

Container are of different sizes, some of the mostly used containers are: 20, 40 and 60 feet containers.

 

OFD (Over flow distribution center):

OFD is a warehouse which is near or inside the vicinity of the plant / factory. Those stocks whose destination are not decided are stored in OFD, in order to avoid back freighting and inter depot transfer.

 

Logistic Management & Deliver driver of SCOR Model
November 9, 2014
0

 

Logistic Management:

The movement of goods / services from one point to another point or from the point of initiation to the point of consumption by proper forecasting, by defining sequential flow along with quality checks under a supervision of process ownership and right person at the right place.

Logistics is involved in every part of the SCOR model. For example, we need to move feedstock from supplier to our production house. Feedstock is basically another name for raw material. For example, XYZ company makes a bottle caps by using polypropylene, the small pieces of plastic (polypropylene) is a feedstock for bottle caps.

 

Deliver driver Of SCOR Model:

Deliver driver of the SCOR model can be further divided into three parts:

 

  1. Warehouse or DC: Warehouse is also known as distribution center (DC). They are responsible for primary sales. Primary customer for XYZ Company are the distributors, whereas the secondary customer or secondary sale are from distribution and onwards.

 

Following are some important points to be considered pertaining to a warehouse:

  • Location of warehouse is very critical and should be at a place where all the resources are easily available. It should be at the central location depending on the requirement of the company.
  • Covered are of a warehouse is another important factor. This depends on the storage requirement of the company. When designing a warehouse, a company must also consider its future requirement as well.
  • Proper demarcation / segregation of different types of goods is also very important inside a warehouse. For example, the goods can be arranged in Alphabetical order or as per the property of a good.
  • When designing a warehouse, the company also needs to consider that how many number of docks should be available in it. Docks are simply points of loading and unloading in a warehouse.
  • Height of the warehouse is also another important factor, which also depends on the company’s storage requirement or stack height. Stack height tells that how much the containers can be piled up on top of each other. For example a stack height of 7 means that 7 container can be piled up on top of each other.
  • Machinery’s required also depends on the company’s requirement, that is how much of folk lifter, stacker, etc. required.
  • Aging report should be maintained in order to keep a track of products that are near to the expiry level of requirement.

 

  1. Distribution Planning: It is done in order to make decision as to how the goods are going to be distributed, which warehouses and DC are need to be covered, etc.

 

  • Distribution of a product should be on timely manner. For example, we have one or two months in hand for winter to arrive then the company should make distribution plan, after receiving winter products from the manufacturing department, in such a way that all winter products are readily available in the market just before the start of the winter, in order to supersede other competitor.
  • They need to ensure that no wrong dispatch across, else this will give the company a great loss, inters of product unavailability in the market, etc.
  • If the old product is still in stock and new product of the similar type has been produced, then the distribution planner has to make sure that the old stock is first distributed and then the new stock.

 

Inter DC (Distribution Center) Transfer:

 

Inter DC (Distribution Center) Transfer

 

 

Considering the above figure, suppose 1000 boxes of a product ‘X’ was produced in a factory. 500 boxes were transported to DC-C and 500 boxes to DC-D. Due to an unforeseen situation, the demand of product ‘X’ increased near the region of DC-D. Later on, 100 boxes of the product X had to be transferred from DC-C to DC-D. This concept is known as inter DC transfer.

 

Back Freighting:  Considering the same scenario, suppose we have a deficiency of 20 boxes in DC-C, due to which we had to transfer back 20 boxes of product X from DC-D to DC-C, is called back freighting. Back freighting usually occurs due to wrong analysis done on the demand and supply of any product.

 

3. Logistics: This unit should needs to keep in mind following challenges:

 

  • Road Congestion: They need to avoid congested roads, where traffic are mostly high in order to avoid delay in delivery of a product.
  • Fuel Prices: Fuel prices plays an important role in logistics. Companies providing logistical support, should make sure that they have adequate supply of fuel on the same price they have strategically negotiated with their partners to deliver the product, else rise in price may affect the cost of distribution.
  • Safety and Security: Logistic companies should make sure that the products are delivered with safety and security.
  • Carbon Foot Prints: This terminology is used to make sure that the carbon emission of vehicles should be as minimum as possible, so that environment is not effected much and the fuel consumption is also low.
  • Proper human resources should be available in order to handle whole logistic part.
  • No logistics means no business.

 

There are two types of transportation:

A. Dedicated: In dedicated transportation, the transporter is bound to provide you services as per your need and requirement.

B. Non Dedicated: In non-dedicated transportation, you need to request for transportation as and when required by the company.

 

Logistic Strategic Alliance:

 

In order to reduce carbon footprints, companies (Logistic / nonlogistic) can make a strategic alliance with each other. For example, the XYZ Company has to move product from point A to B only and on return it has to come empty (without carrying any product) from point B to A. This is going to result in unnecessary consumption of fuel with no return. On the other hand an ABC company has to move product from B to A only and back to B with empty vehicle. Both companies (ABC and XYZ) can have a strategic alliance with each other that one of them can carry its own product from one point to another and on the way back it can carry other company’s product instead of coming back empty. This will reduce carbon footprint by saving fuel and also reducing price of transportation for both companies.