Inbound Logistics

Inbound Logistics By PRATICK GAYEN.

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Presentation Plan The production planning process  The procurement process  Outsourcing of logistical activities  Third Party Logistics providers (3PL’S)  Partnership agreements 

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Sub-contracting and Outsourcing 

Sub-contracting:  Activities

that are too complex or that require special competencies  Activities that are outside the field of competencies of our enterprise (example construction and aerospace industry) 

Outsourcing:  Delegate

to others activities that we were doing ourselves previously 3

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Outsourcing of logistical services to «3PL’s» To delegate to another organization part or all of logistical activities  These activities include: 

 Transportation  Warehousing  Order

processing  Inventory management  Logistics information systems 4

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Some of the major 3PL’s        

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Ryder Tibbett & Britten Circle Schneider Bax Global Exel GATX Geodis

       

TNT Logistics Hunt Logistics UPS SCS DSC Caliber Menlo USCO FedEx 04/11/09 10:23 PM

3PL: Some examples      

Whirlpool Motorola Proctor & Gamble Wal-Mart (Can)

Ryder Dedicated UPS SCS Exel Logistics SCM (T & B)

Domtar (Can) Goodyear

Groupe Robert CAT

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Reasons for using 3PL’s? Re d u c e c o sts F o c u s o n c ritic a l a c tiv itie s Im p ro v e o p e ra tio n a l effic ie n c y

%

F lex ib ility Ac q u ire e x p e rtis e C u s to m e r se rv ic e

0

7

20

40

60

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3PL’s: Services offered Transportation Warehousing Consolidation Consultation Carrier selection

%

Packaging and labelling Information systems Tariffs negotiation Fleet management Reverse logistics

0

8

20

40

60

Source: CLM Annual Conference, 1999.

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Partnership - a definition •

A partnership is a customized business relation based on mutual trust, openness, and the sharing of risks and benefits.

•

Its objective is to procure a competitive advantage resulting from improved performance compared to what partners could have obtained individually.

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Partnership Life Cycle Having a vision  Searching for a partner  Negotiating an agreement  Managing the relationship 

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Having a vision and searching for a partner

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Forming a partnership Reasons leading to a partnership

Decision to engage in a partnership

Factors facilitating partnerships

Shared activities and processes Partnership results Reevaluation Source: Lambert, D.M., M.A. Emmelhainz et J.T. Gardner, «Developping and 12 Implementing Supply Chain Partenership», IJLM, vol. 7, no 2, 1996.

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Reasons leading to a partnership External factors: •Consumer requirements •Logistical excellence / complementary •Information technologies and systems •Complexity and globalization of markets

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Reasons leading to a partnership Internal factors: • • • • •

Minimizing costs (ex. transportation) Increase speed and reduce cycle time Improve service/product quality Increase customer satisfaction Better utilization of assets

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Partnership - advantages Reducing the number of suppliers  Collaborative planning  Risk sharing  Continuous improvement  Acquiring an expertise  Requiring less resources and capital  Increased flexibility 

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Partnership - disadvantages Difficult to select a partner  Loss of direct control over outsourced activities  Performance evaluation may be difficult  Risk of logistical dependency  Internal resistance to change 

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Facilitating factors 

    

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Compatibility of organizations in terms of culture and conduct (individuals) Similar management techniques and practices Readiness to share with partner Complementary needs and competencies Symmetry There must be a common interest!

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Activities supporting the partnership (cont’d) Mutual trust and engagement  Sharing risks and benefits  Investments 

 Human  Material  Financial

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Conditions for a successful partnership 







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A complex and gradual approach Trust between partners Sociopsychological proximity Dedicated resources



  

Exchange of « rich » information Shared innovation Firm engagement Common learning process

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Conclusion  Partnership

arrangements have to be adapted to the particular situation and specific needs of the partners  Successful partnerships require time and energy

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