Logistics Management Definition
Logistics management is the supervision of the different functions of the supply chain within an organization that helps it design, manage, and execute an effective process to transport raw materials and finished goods.
What is Logistics Management?
There are several aspects of logistics management, including overseeing goods being sent and received, the management of fleet vehicles, ensuring that goods are being warehoused correctly and customer orders are being fulfilled, making sure there is an effective logistics network, keeping a tight control over inventory, and properly managing the supply and demand aspects of any third-party logistics providers a company works with.
How is Logistics Related to Supply Chain Management?
Logistics concerns both the movement and storage of items along the supply chain. This begins with the raw materials used to manufacture products and ends with the finished product finding its way into consumers’ hands. By effectively developing and executing a logistics plan, companies reduce the headaches that can pop up along the supply chain and ensure that there is a steady stream of goods moving throughout the country and economy.
How Do Logistics and Supply Chain Management Differ
Logistics is just one part of the supply chain formula and focuses on the actual movement of goods. Separately, supply chain management handles the operations that connect each company included in the chain. To put it simply, logistics moves the goods, and supply chain management ensures the strength of each link along the chain.
What is a Logistics Management System?
A logistics management system consists of software solutions that improve the processes from start to finish. These systems can increase efficiencies in everything from processing orders to managing the inventory, shipping orders to customers, and even returning orders when needed.
Fleet Management and Logistics <H2>
Fleet management is a crucial part of any logistics operation. Without the proper management of the vehicles and their routes, there could be detrimental effects to the supply chain. For example, if a vehicle suffers a breakdown and a replacement vehicle is not able to take its place, everything stops and businesses all along the supply chain are interrupted.
To ensure the fortitude of the supply chain, fleet managers use not only industry experience, but technology solutions to determine the best practices they apply to their operations. Fleet management software can help decide on the most efficient routes, automate certain services (like preventive maintenance scheduling), and provide instant access to vehicle location.
What is Fleet Management in Logistics?
As vehicles are one of the main tools to maintain the movement of raw materials and finished goods along the supply chain, fleet management ensures that this process moves as seamlessly as possible. Fleet managers must not only make sure that the vehicles are always in proper working order, but they must also maintain an effective team of drivers that perform their duties in an efficient and safe manner.
Benefits of Logistics Management
A proper system of logistics management keeps the supply chain stocked and moving. These systems can improve the customer experience, reduce costs, deliver higher productivity and operational efficiencies, and increase profits.
Challenges of Logistics Management
Keeping the supply chain moving along is not always an easy job. There are many things that can cause a kink in the chain, including driver recruitment and retention issues, hours of service compliance, increased fuel costs, vehicle maintenance issues, and evolving government rules and regulations.
Future of Logistics Management
Companies have seen several disruptors to the supply chain during the last few years — everything from COVID-19 to rocketing fuel prices. To prepare for the future of logistics management, companies need to be more fluid and have plans for when materials are not available, or if there is a break in one of the links in the chain. They must become more resilient to current challenges and be wary of what the future could bring by learning from the past.
Future Challenges of Logistics Management
Companies will face many of the same challenges of logistics management they are currently facing in the years to come. While fuel costs tend to fluctuate throughout the year, the costs will continue to climb, forcing some to quickly pivot to new technologies such as battery-electric and fuel cell vehicles. The driver shortage is not going away, not matter how tempting some companies are making these open positions. While autonomous technology might solve some of these issues — in the factories, on the road, and in the warehouses — there will be a learning curve to ensure the technology is effective and safe.
