Chapter 15: Logistics/Supply Chain Organization

Marketing	Finance	Operation
1.Sales	1.Inventory carrying cots	1.Plant/work-in-process inventories
2.Advertising	2.Information processing	2.Production scheduling
3.Customer Service	3.Return on investment	3.Product quality
4.Order entry		4.Purchasing
5.Field Finished Goods inventories		5.Traffic
6.Distribution channels

Importance of Organization to Logistics/SC

ü  Extractive industries

ü  Service industries

ü  Marketing industries

ü  Manufacturing industries

Organizational Choices

Informal Organization	Semiformal Organization	Formal Organization
To achieve coordinate among logistics activities for their planning and control	To coordinate projects that involves the supply chain and that cover several functional areas	Establish clear lines of authority and responsibility

Organization Orientation

ü  Process Strategy

ü  Market Strategy

ü  Information Strategy

Organization Positioning

ü  Decentralization Versus Centralization

ü  Staff Versus Line

ü  Large Versus Small

Partnership Benefits:

ü  Reduced cost and lower capital requirement

ü  Access to technology and management skills

ü  Improved customer service

ü  Competitive advantage such as through increased market penetration

ü  Increased access to information for planning

ü  Reduced risk and uncertainty

Alliances

·         A built on trust, a sharing of information that aids logistics performance, specific goods to achieve a higher level of logistics performance than can be achieved alone.

Contract Logistics

·         Using the service of other companies to support their own logistics activities.