Understanding of logistics management

Understanding of logistics management

Introduction: Has logistics formed an industry in our country? How to define the boundaries of the logistics industry? How can we promote the healthy development of our country's logistics industry? These are undoubtedly issues that my country’s logistics industry must consider carefully. The following is my understanding of logistics management, I hope it will be helpful to everyone.

Industry is the product of social division of labor and the inevitable result of the continuous development of social productive forces. Its meaning is multi-layered. With the continuous development of social productive forces, it can be subdivided until it can no longer be divided, and its connotation It is constantly enriched and extended. It can be seen that the formation and development of industries are dynamic. The logistics industry is certainly no exception.

1. Definition of the logistics industry

The national standard definition of "Logistics Terminology" promulgated by my country on April 17, 2001: Logistics is the physical flow of items from the supply place to the receiving place. process. According to actual needs, the basic functions such as transportation, storage, handling, packaging, circulation processing, distribution, and information processing are organically combined. It can be seen that logistics activities provide a service activity that is mainly based on transportation and storage and combines multiple functions. Therefore, the logistics industry belongs to the broad category of service industry. According to the three industry classification methods, the logistics industry can be classified into the scope of the tertiary industry. This division method has been widely recognized.

However, what needs to be noted is, which enterprises are included in the logistics industry? Can enterprises whose main business activities include transportation, storage, handling, packaging, commodity circulation information processing, etc., be included in the scope of the logistics industry? In recent years, the emergence of a large number of various specialized logistics enterprises and their rapid development trends indicate that specialized logistics services, as a new field of specialized division of labor, have gradually developed into an emerging industrial sector and an important part of the national economy. an important component. The logistics industry is not included in the classification of industries in the "National Economic Industry Classification and Code" compiled and promulgated by the China National Bureau of Standards. Transportation and warehousing are independent industries. At present, the definition of the logistics industry is still relatively vague and needs to attract widespread attention from the theoretical community for further research and discussion.

2. Has the logistics industry formed an industry in our country?

If we compare the logistics industry with the tourism industry, which is also a tertiary industry. Tourism is the earliest industry in China to integrate with international standards and develop closely with world trends. The latest statistics show that the fixed output value of China's tourism industry has reached 786.1 billion yuan, with nearly 270,000 tourism enterprises and institutions of various types, 254,000 tourist accommodation facilities of various types (including more than 10,000 tourist hotels), and nearly 9,000 travel agencies of various types. It employs more than 30 million people directly and indirectly. China's total tourism revenue is growing at an average rate of 12.7%, which is higher than the average GDP growth rate of 7.4%, and has become a new growth point for the national economy.

The statistics of the tourism industry, which is also a tertiary industry and is relatively mature, are very clear, and its revenue and proportion of GDP are on the rise. However, there are no systematic and quantitative statistical standards and indicators for the development of the logistics industry. When discussing the development status and problems of my country's logistics industry, we must be aware of the following points:

(1) Is the total assets of the logistics industry clear?

(2) Logistics industry How many employees are there?

(3) How much is the annual output of the logistics industry as an industry?

(4) The costs and consequences incurred by the logistics industry itself What are the total profits and taxes?

(5) What are the iconic scientific and technological achievements used in the modern logistics industry?

In the process of comparison with the tourism industry, they constitute the basic statistics of the logistics industry Data and indicators are also a dark continent. When it is necessary to accelerate the development of the logistics industry and local governments support the logistics industry as a pillar industry and a new growth point for the national economy, they must pay attention to the above issues and consider them systematically and comprehensively.

3. Why should we develop the logistics industry?

With the development of economic globalization and the rise of the network economy, the global logistics service industry has accelerated its development. In the 1990s, global logistics grew at an average annual rate of more than 7%, which was higher than GDP growth in the same period. In 2000, the annual logistics industry scale was US$3.6 trillion, which was basically equivalent to the total revenue of the world's tourism industry. The development of global economic integration has made the collaborative relationships among enterprises such as procurement, warehousing, sales, and distribution increasingly complex. The competition among enterprises is not only the competition of product performance and quality, but also the competition of logistics capabilities. At present, many enterprises in our country still use the production-centered management model of the planned economy period, which results in that on the one hand, the inventory of raw materials and finished products of production enterprises is too large, occupying a lot of funds; on the other hand, the effective supply of transportation and warehousing enterprises is insufficient, and the existing Facilities cannot be fully utilized, resulting in low turnover of funds for enterprises and low quality of economic operations. Data show that in 1999, the circulating capital occupied by independently accounted industrial enterprises in my country was 3.1042 billion yuan, and the annual capital turnover rate was 1.2 times, while the turnover rate in developed countries was 15-18 times.

If the capital turnover rate of our country's enterprises reaches the level of developed countries, our country's 3 trillion yuan of circulating capital will be equivalent to more than 45 trillion yuan. According to World Bank estimates, my country's logistics costs account for 16.7% of GDP, and some estimate it to be about 20%. In 2000, my country's GDP was 8.9 trillion, which is 1.78 trillion based on 20%. If the circulation costs of the whole society are reduced by 1 percentage point, 17.8 billion yuan of funds can be saved. However, it should be noted that my country does not yet have a statistical indicator system for the logistics industry, and the above is only an estimate for a certain year. Whether from the perspective of integrating with the global economy or from the perspective of our country's market demand for logistics services, it is necessary for our country to promote the formation and development of the logistics industry.

4. Problems in the development of my country's logistics industry

my country's transportation, warehousing, packaging and other industries have been developing for a long time. However, as a logistics that organically combines several functions, The industry has not yet been formed. From the perspective of development status, my country's logistics industry is in the formation stage. There are mainly the following problems.

1. Domestic enterprises have insufficient demand for logistics services. The concept of modern logistics has not yet been popularized among industrial and commercial enterprises, and the understanding of modern logistics needs to be improved. According to a survey by relevant departments, most enterprises (47% of manufacturing companies and 62% of commercial companies) have not considered what criteria to use to select third-party logistics service providers. For many companies, cost is still the first factor to consider. Many companies' criteria for selecting third-party logistics providers have changed, and they are paying more and more attention to service quality requirements. Among companies that have considered the criteria for selecting third-party logistics service providers, operational quality and the ability to provide comprehensive logistics services have become the primary criteria for measuring third-party logistics companies. This shows that enterprises have realized the importance of logistics efficiency and begun to pay attention to logistics capabilities. Logistics enterprises must be targeted when positioning their service strategies.

2. As emerging enterprises, logistics enterprises have developed rapidly in recent years. A few enterprises can combine their own advantages and integrate with international standards, such as Baogong Company and other enterprises. However, the vast majority of logistics companies have low work quality, limited service content, relatively primitive and single service methods and means, relatively arbitrary service items and charging standards, small organizational scale of logistics companies, and lack of necessary competitive strength. Logistics companies The level of operation and management is low, and the quality of logistics services needs to be further improved. The vast majority of enterprises can only provide single or segmented logistics services and cannot form complete supporting logistics services.

3. The level of infrastructure and technical equipment is backward, the level of informatization is low, and there is a lack of professional talents.

4. Governments at all levels have put the development of the logistics industry on their agenda and actively create a good macro-environment for the development of the logistics industry. However, because my country's logistics market is still in its infancy, the market mechanism is imperfect, the competition order is not standardized, and the existing regulations and management methods are not suitable for the development of modern logistics.

5. The theoretical research and practical operation of modern logistics lag behind. There are still no rules to follow for theoretical and practical issues such as the definition of the concept of logistics industry, the definition of logistics enterprises, the definition of services provided by a single logistics operation link and the definition of integrated logistics operation services, and the measurement definition of the input-output statistical indicator system of the logistics industry.

The formation and development of my country's logistics industry is a long-term and complex process. First, we must clarify the development status of my country's logistics industry in theory and practice, and then proceed from these realities to gradually solve problems and lay a good foundation for the further development of the logistics industry.

The purpose of modern logistics management:

(1) To achieve customer satisfaction as the first goal;

(2) To achieve the overall optimization of the enterprise Purpose;

(3) Information-centered

(4) Emphasis on efficiency and effectiveness.

The Five Elements of Logistics refers to the five main elements for evaluating the logistics system. They are: quality, quantity, time, location and price. Quality refers to the fact that the quality of materials remains unchanged during the logistics process; quantity refers to the economic quantity requirements and the round-trip transport load as full as possible during transportation activities; time refers to the speed that can be achieved based on the principle of timely delivery at a reasonable cost. ; Location refers to choosing a reasonable shipping location and warehouse to avoid two invalid transportations and multiple transshipments; price refers to reducing logistics costs as much as possible while ensuring quality and meeting time requirements.

The purpose of implementing logistics management is to achieve the established customer service level at the lowest possible total cost, that is, to seek a dynamic balance between service advantages and cost advantages, and thereby create a competitive advantage for enterprises. strategic advantage. According to this goal, the basic problem to be solved by logistics management is, simply put, to provide the right products to customers in the right quantity and at the right price at the right time and at the right place.

Logistics management emphasizes the use of systematic methods to solve problems. Modern logistics is usually considered to consist of transportation, storage, packaging, loading and unloading, circulation processing, distribution and information. Each link originally had its own functions, interests and concepts.

The system approach is to use modern management methods and modern technology to enable all links to share the overall information, and organize and manage all links as an integrated system, so that the system can operate at the lowest possible total cost. Provide competitive customer service. The system approach believes that the benefits of the system are not the simple sum of the benefits of each of their local links. The systematic approach means that for a certain aspect of the problem, all influencing factors must be analyzed and evaluated. Starting from this idea, the logistics system does not simply pursue the lowest cost in each link, because the benefits of each link in the logistics tend to influence and restrict each other, and there is an alternating and vulnerable relationship. For example, overemphasis on saving packaging materials may cause increased transportation and handling costs due to their easy damage. Therefore, the systems approach emphasizes total cost analysis, as well as analysis that avoids the application of suboptimal effects and cost trade-offs in order to achieve the lowest total cost while meeting established customer service levels.

The development of logistics management has gone through three levels: distribution management, logistics management and supply chain management. Logistics management originated from the storage and transportation model and technology developed by the army to transport materials and equipment during World War II. After the war, these technologies were widely used in industry, greatly improving the operational efficiency of enterprises and winning more customers for them. At that time, logistics management mainly focused on the distribution part of the enterprise, that is, after the finished products were produced, how to quickly and efficiently deliver the products to customers through the distribution center and maintain the lowest inventory as much as possible. The American Association of Logistics Management was then called the Physical Distribution Management Association, and the Canadian Association of Supply Chain and Logistics Management was called the Canadian Physical Distribution Management Association. At this initial stage, logistics management only passively caters to customer needs after a given number of finished products are produced, transports the products to the location designated by the customer, optimizes the use of resources in the field of transportation, and rationally sets up each distribution Center inventory. To be precise, logistics management did not really appear at this stage. There were only transportation management, warehousing management and inventory management. The position of logistics manager also did not exist at that time, only transportation manager or warehouse manager.

Logistics management in the modern sense appeared in the 1980s. People find it very effective to use cross-functional process management to observe, analyze and solve problems in business operations. By analyzing the entire circulation process of materials from raw materials to the factory, flowing through each workstation on the production line, producing finished products, then transporting them to the distribution center, and finally delivering them to customers, companies can eliminate many visual problems. It is a local optimization behavior that seems to be high efficiency but actually reduces the overall efficiency. Because each functional department wants to utilize its production capacity as much as possible without leaving any surplus. Once demand increases, it will become a bottleneck everywhere, causing the entire process to be interrupted. Another example is that the Ministry of Transportation, as an independent functional department, is always trying to reduce its transportation costs. However, if it sends an order that must be expedited by shipping it by sea instead of by air, it will save freight but lose customers. Overall failure. Therefore, traditional vertical functional management is no longer suitable for modern large-scale industrial production, while horizontal logistics management can comprehensively manage different functions in each process to achieve overall optimal synergy.

At this stage, the scope of logistics management extends to demand forecasting, procurement, production planning, inventory management, distribution and customer service in addition to transportation, in order to systematically manage the operation of the enterprise and achieve overall efficiency. maximize. The book "Goals" written by Goldratt is popular in the global manufacturing industry. Its essence is to manage production from the perspective of production processes. Accordingly, the American Physical Distribution Management Association changed its name to the American Physical Distribution Management Association in the mid-1980s, while the Canadian Physical Distribution Management Association changed its name to the Canadian Logistics Management Association in 1992.

For a typical manufacturing enterprise, its demand forecasting, raw material procurement and transportation links are usually called inbound logistics, the circulation link of raw materials between processes within the factory is called production logistics, and the distribution and customer service links are called outbound logistics. . The key to logistics management is to systematically manage the entire process from raw materials, work-in-progress to finished products to ensure that materials are purchased, shipped in, processed, shipped out and delivered to customers under minimum inventory conditions. For shareholders of companies with efficient logistics management, this means doing the most business with the least capital and generating the greatest return on investment.

Modern logistics, from exposure to initial understanding of this concept, took a very short time. I read several articles about logistics in a hurry, and I felt a lot.

Since the 1990s, more and more companies are changing the traditional logistics system and gradually developing towards modern logistics and supply chain management. Logistics and supply chain have now become the key for companies seeking long-term development and enhancement. main source of competitiveness. Especially in our country, logistics management, together with e-commerce and franchising, has been highly valued by the whole society as one of the important measures to deepen enterprise reform and strengthen scientific management and strategic management.

The development of modern logistics in just a few decades has now become an independent industry. With the rapid development of e-commerce, modern logistics has been closely connected with e-commerce. Modern logistics has become an independent industry to a certain extent. An integral part of modern trading.

This article is about my superficial understanding of modern logistics and my personal views on modern logistics. In this article, I will explain my understanding of modern logistics and Chinese logistics from three aspects, which are mainly divided into understanding of the concept of modern logistics and the value of modern logistics. Re-understanding of the bottleneck of China’s logistics development.

Understanding the concept of modern logistics

For the understanding of the concept of modern logistics, I first quote the national standard of "Logistics Terminology" promulgated in 2000:

The definition of logistics: the physical flow process of items from the supply place to the receiving place. This definition is very accurate and has nothing to criticize. But I think this cannot fully reflect and express the meaning of modern logistics. I think the concept of modern logistics should be defined as: under the conditions of extreme compression of warehousing space, it is transformed into the flow of goods under time and place. This is my understanding of modern logistics. new understanding.

Here I want to borrow a simple physical formula V=S/T (V: speed S: distance T: time), or this formula has a little connection with logistics. Of course, this does not refer to the above. definition. I made the following new definition for this: V=S/T, V: logistics value.VALUE S: location.SPACE T: time.TIME, that is, the logistics value is determined by a certain mathematical relationship between the status of items in two locations and the intermediate time. Decide.

In the development of logistics, warehousing has been replaced by the quantification of time to a certain extent, and this trend will become more obvious. Therefore, from this point of view, the value generating factors of logistics will It is determined by the form of the item itself at the destination and supply place as well as the time factor in the movement process. A practical definition of logistics is to include transportation, storage, loading and unloading, handling, packaging, circulation processing, distribution, information processing, etc. The organic combination of basic functions can be divided into stages using the V=S/T model. At the same time, it is reflected in the logistics chain. It is a flow process of material flow, capital flow, and information flow. The final value is what the enterprise pursues. value.

When it comes to logistics, I have to quote two cases to explain the above points. Although we are already very familiar with these two examples, they are:

1. Haier Logistics JIT, 3PL Warehousing

After the establishment of the Haier International Center three-dimensional warehouse, Haier's inventory time was reduced from the original 30 days to 12 days at the end of 2000. The goal in 2001 is to ensure 7 days, and bulk raw materials and imported parts are not available. For more than 15 days, some parts strive to maintain only 3 days of inventory. Haier implements JIT for inventory management within the group. Distribution management highlights two points: one is to reduce inventory; the other is to ensure 24-hour rapid response and ensure the normal operation of the production line, and implement 4HJIT feeding, that is, the online time of materials should not exceed 4 hours, and if it exceeds 4 hours, it will be returned to the warehouse immediately for identification. The reason is that it will be processed in accordance with the SST contract and materials will be replenished immediately within 1 hour, making the site bright and tidy and reducing sluggish items by 50%.

2. Dell

In the words of its president, Michael Dell, Dell's achievements are due to the clever use of logistics e-commerce. Dell sells through the Internet and corporate intranets. In daily operations, Dell only maintains inventory for two weeks (the industry standard is more than 60 days), and its inventory can be turned over more than 30 times a year. Based on these numbers, Dell's gross margin and return on capital are also quite high: 21% and 106%, respectively. These are the logistics effects achieved by Dell after implementing e-commerce logistics.

From the above two cases, a series of data triggered my thinking. Haier, as a model of China’s logistics development, has done a very good job from hardware to software process. The successful logistics of the two companies depends on certain factors. To the extent that it has achieved the logistics value of eliminating space with time, it also reflects the development direction of modern logistics. A series of declines and reduction percentages. I think this is also the best embodiment of V=S/T. Of course, the specific value realization is not isolated. The two companies have truly maximized the logistics value under the existing conditions.

In the previous part of understanding the concept of logistics, I tried to explain the value of logistics in the form of V=S/T. It may be a bit reluctant, but I still want to continue my point of view in this part. Haier A series of classic cases of JIT, Dell's perfect e-commerce logistics, and the most successful Toyota's zero inventory. We can see that all these cases of successful logistics operations all illustrate: in the flow of materials, capital, and information, people Under the influence of various factors, smoothness has been achieved at the right time. As the first value expression of logistics, time value has become the key to measuring the success of enterprise logistics. The value of time is also guiding the development direction of modern logistics and enhancing the competitiveness of modern enterprises. V has become a direct manifestation of logistics value, and at the same time it has become an intermediate goal for enterprises to pursue profits.

To achieve ideal logistics value, a logistics company must reasonably quantify the value of time. At this time, TIME is the most critical in the model. In successful logistics operations, the company must The TIME of logistics has been quantified extremely accurately. Of course, what I want to point out is that the TIME here is defined as zero time in terms of degree, but it can be said that it is a race against time. This series of targeted and specific quantification makes the value of logistics be accurately quantified. At the same time, the success of Haier and Dell was also achieved.

;