Introduction to Logistics Systems Management

Gianpaolo Ghiani, Gilbert Laporte, Roberto Musmanno

• Publisher: Wiley
• Year: 2013
• ISBN:
  9781118492178
• Edition: 2
• Topic: Tecnología e ingeniería
• Subtopic: Control de calidad en ingeniería

Introduction to Logistics Systems Management is the fully revised and enhanced version of the 2004 prize-winning textbook Introduction to Logistics Systems Planning and Control, used in universities around the world.

This textbook offers an introduction to the methodological aspects of logistics systems management and is based on the rich experience of the authors in teaching, research and industrial consulting.

This new edition puts more emphasis on the organizational context in which logistics systems operate and also covers several new models and techniques that have been developed over the past decade.

Each topic is illustrated by a numerical example so that the reader can check his or her understanding of each concept before moving on to the next one. At the end of each chapter, case studies taken from the scientific literature are presented to illustrate the use of quantitative methods for solving complex logistics decision problems. An exhaustive set of exercises is also featured at the end of each chapter.

The book targets an academic as well as a practitioner audience, and is appropriate for advanced undergraduate and graduate courses in logistics and supply chain management, and should also serve as a methodological reference for practitioners in consulting as well as in industry.

1
Introducing logistics

1.1 Definition of logistics

According to a widespread definition, logistics (from the Greek term lógos, which means ‘order’, or from the French loger, which means ‘allocate’) is the discipline that studies the functional activities determining the flow of materials (and of the relative information) in a company, from their origin at the suppliers up to delivery of the finished products to the customers and to the post-sales service. The origins of logistics are of a strictly military nature. In fact, this discipline arose as the study of the methodologies employed to guarantee the correct supply of troops with victuals, ammunitions and fuel and, in general, to ensure armies the possibility of moving and fighting in the most efficient conditions. Indeed it was the Babylonians, in the distant 20th century BC, who first created a military corps specialized in the supply, storage, transport and distribution of soldiers’ equipment. Logistics was applied exclusively in a military context until the end of Second World War. Subsequently, it was extended to manufacturing companies in order to determine all the activities aimed at ensuring the correct purchasing, moving and managing of materials. Logistics problems are also increasingly present in the service sector, for example in the distribution of some services such as water and gas, in postal services, in urban solid waste collection, in the maintenance of road and electricity networks and in the post-sales activities of manufacturing companies (service logistics).

1.2 Logistics systems

From the point of view of companies, logistics is seen as a system (the logistics system), which includes not only all the functional activities determining the flow of materials and information, but also the infrastructures, means, equipment and resources that are indispensable to the execution of these activities.

A logistics system is made up of facilities, where one or more functional activities are carried out (e.g. storage and distribution). Figure 1.1 shows a schematic representation of a logistics system in which the manufacturing process of the finished goods is divided into a transformation phase and an assembly phase, performed in different centres. At the start are the suppliers of materials and components which feed the final manufacturing process. The end part represents a typical two-level distribution system with a tree structure. The Central Distribution Centres (CDCs) are directly supplied by the production plants, while each Regional Distribution Centre (RDC) is connected to a single CDC which has the task of serving the customer, who can also be dealers or retailers.

Figure 1.1 Example of a logistics system.

At each facility the flow of materials is temporarily interrupted, generally in order to change their physical-chemical composition, ownership or appearance. In all cases, each logistic activity carried out involves costs which affect the value of the product, constantly adding to it as it draws nearer the facilities closest to the final customer. This added value can be spatial (following e.g. distribution activities) or temporal (owing to storage activities).

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Galbani is the Italian leader in the milk and dairy products sector and one of the main actors in the pressed pork market. The Galbani group is currently made up of three independent operational societies, one of them called biG Logistics. This company has the task of managing the logistics activities of the whole group. The logistics system is organized in such a way as to guarantee an efficient synchronization of the internal production and distribution processes of the products, both for the Great Organized Distribution (GOD) and for the channel represented by the traditional retail shops. The distribution network of the company is organized on two levels: there are, between the production plants and the destination markets, a central warehouse and 11 distribution platforms. This solution allows the minimization of the transport...