Lesson 3: The trend development of Logistics
Applying information technology and e- commerce
Applying Logistics: Pull-mode model
Outsourcing from logistics service provider
Besides: Global logistics, sustainable logistics…
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Push and Pull
Push-Based Model Pull-Based model
Cơ chế sản xuất được điều chỉnh bởi cung Cơ chế sản xuất được điều chỉnh bởi cầu
(supply- driven) (demand- driven)
“Sản xuất theo lượng tồn kho” (make/ build “Sản xuất theo đơn đặt hàng” (make/ build
to stock) to order)
Apply when: Organization achieve Apply when: demand forecast is relatively
economies of scale; demand forecast is low and the integration does not help cut
relatively certain costs
EX: escalator Ex: elevator
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From Push to Pull Logistics
Supplier Supplier Supplier Supplier
Supplier Supplier Supplier
Supplier Supplier Supplier
Freight flow
Manufacturer
Manufacturer 3PL
Distributor
Distributor
Customer Returns / Recycling Point-of-sale data
Customer
Push Pull
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OUTSOURCING
What to be outsourced
in logistics?
Outsourcing - Reasons
Avoid Capital Expenditures
Cut Costs
Increase Flexibility (service/financial)
Focus on Core Business
Improve Service
Lack of Scale
Acquire Talent
Avoid Labor Problems
Source: A.T. Kearney
Benefit of outsourcing the logistics function
• Improve company focus
• Allows firm to focus on core functions and core competencies
• cash infusion: selling asset to 3 PL provider
• access to world-class capabilities and new logistics technology
• free- up resources: no capital investments in logistics, resource not available internally
• accelerated reengineering benefits
• reduce and control opearting costs
• eliminate labor problem
• share risk
•Achievies economies of scale and provides better service
Advantage
Strategic discussion on core competencies
Problems With Outsourcing
Loss of Control /Dependency on service provider
Increased cash outflow
Confidentiality and security
Selection of supplier
Too dependent on service provider
Loss of staff or moral problems
Time consuming
Provider may not understand business environment
Provider slow to react to changes in strategy
Problems With Outsourcing
