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1、Unit. 12 Integrated Logistics ManagementIntegrated Logistics Managementn nToday,moreandmorecompaniesareadoptingToday,moreandmorecompaniesareadoptingtheconceptofintegratedtheconceptofintegratedlogisticslogisticsmanagement.management.ThisconceptrecognizesthatprovidingbetterThisconceptrecognizesthatpro
2、vidingbettercustomerserviceandcustomerserviceandtrimmingtrimmingdistributioncostsdistributioncostsrequiresrequiresteamworkteamwork,bothinsidethecompanyand,bothinsidethecompanyandamongallthemarketingchannelorganizations.amongallthemarketingchannelorganizations.Insidethecompany,thevariousfunctionalIns
3、idethecompany,thevariousfunctionaldepartmentsmustworkcloselytogethertodepartmentsmustworkcloselytogethertomaximizethecompanysownlogisticsmaximizethecompanysownlogisticsperformance.Thecompanymustalsointegrateitsperformance.Thecompanymustalsointegrateitslogisticssystemwiththoseofitssuppliersandlogisti
4、cssystemwiththoseofitssuppliersandcustomerstomaximizetheperformanceofthecustomerstomaximizetheperformanceoftheentiredistributionsystem.entiredistributionsystem.3 3ConceptRecognizesthatProvidingBetterCustomerServiceandTrimmingDistributionCostsRequiresTeamworkTeamwork,BothInsidetheCompanyandAmongAllth
5、eMarketingChannelOrganizations.Cross-Functional Teamwork inside the CompanyBuilding Channel PartnershipsIntegrated LogisticsIntegrated Logistics ManagementCross-Functional Teamwork Inside the CompanyCross-Functional Teamwork Inside the CompanyInmostcompanies,responsibilityforvariousInmostcompanies,r
6、esponsibilityforvariouslogisticsactivitiesisassignedtomanydifferentlogisticsactivitiesisassignedtomanydifferentfunctionalfunctionalunitsmarketing,sales,finance,unitsmarketing,sales,finance,manufacturing,purchasingmanufacturing,purchasing.Toooften,each.Toooften,eachfunctiontriestooptimizeitsownfuncti
7、ontriestooptimizeitsownlogisticslogisticsperformanceperformancewithoutregardfortheactivitiesofwithoutregardfortheactivitiesoftheotherfunctions.However,transportation,theotherfunctions.However,transportation,inventory,inventory,warehousingwarehousing,andorderprocessing,andorderprocessingactivitiesact
8、ivitiesinteractinteract,ofteninan,ofteninaninverseinverseway.Forway.Forexample,lowerinventorylevelsreduceinventoryexample,lowerinventorylevelsreduceinventorycarryingcosts.Fromstock-outs,backorders,carryingcosts.Fromstock-outs,backorders,specialproductionruns,andcostlyfast-freightspecialproductionrun
9、s,andcostlyfast-freightshipments.shipments.n nBecausedistributionactivitiesinvolvestrongBecausedistributionactivitiesinvolvestrongtradeoffstradeoffs,decisionsbydifferentfunctionsmust,decisionsbydifferentfunctionsmustbecoordinatedtoachievesuperioroverallbecoordinatedtoachievesuperioroveralllogisticsp
10、erformance.logisticsperformance.n nThus,thegoalofintegratedlogisticsThus,thegoalofintegratedlogisticsmanagementistomanagementistoharmonizeharmonizealloftheallofthecompanysdistributiondecisions.Closeworkingcompanysdistributiondecisions.Closeworkingrelationshipsamongfunctionscanbeachievedinrelationshi
11、psamongfunctionscanbeachievedinseveralways.Somecompanieshavecreatedseveralways.Somecompanieshavecreatedpermanentlogisticscommitteesmadeupofpermanentlogisticscommitteesmadeupofmanagersresponsiblefordifferentphysicalmanagersresponsiblefordifferentphysicaldistributionactivities.Thesecommitteesmeetdistr
12、ibutionactivities.Thesecommitteesmeetoftentosetpoliciesforimprovingoveralllogisticsoftentosetpoliciesforimprovingoveralllogisticsperformance.performance.n nCompaniescanalsocreatemanagementpositionsCompaniescanalsocreatemanagementpositionsthatlinkthelogisticsactivitiesoffunctionalareas.thatlinkthelog
13、isticsactivitiesoffunctionalareas.Forexample,Procter&GamblehascreatedForexample,Procter&Gamblehascreated“supplymanagers”whomanageallofthesupply“supplymanagers”whomanageallofthesupplychainactivitiesforeachofitsproductcategories.chainactivitiesforeachofitsproductcategories.Manycompanieshaveavice-presi
14、dentoflogisticsManycompanieshaveavice-presidentoflogisticswithcross-functionalauthority.Infact,accordingwithcross-functionalauthority.Infact,accordingtoonelogisticsexpert,three-fourthsofallmajortoonelogisticsexpert,three-fourthsofallmajorwholesalersandretailers,andathirdofmajorwholesalersandretailer
15、s,andathirdofmajormanufacturingcompanies,haveseniorlogisticsmanufacturingcompanies,haveseniorlogisticsofficersatthevicepresidentorhigherlevel.Theofficersatthevicepresidentorhigherlevel.Tpanyisasecondaryconcern.Building Channel Partnershipsn nThemembersofadistributionchannelarelinkedThemembersofadist
16、ributionchannelarelinkedcloselyindeliveringcustomersatisfactionandcloselyindeliveringcustomersatisfactionandvalue.Onecompanysdistributionsystemisvalue.Onecompanysdistributionsystemisanothercompanyssupplysystem.Thesuccessofanothercompanyssupplysystem.Thesuccessofeachchannelmemberdependsontheeachchannelmemberdependsontheperformanceoftheentiresupplychain.Forperformanceoftheentiresupplychain.Forexample,Wal-Martcanchargethelowestpricesexample,Wal-Martcanchargethelowestpricesatretailonlyifitsentiresup
