#h367

[phantomtutor]

SOLUTION AT Academic Writers Bay Logistics Management & Strategy Competing Through the Supply Chain Fourth Edition Alan Harrison & Remko van Hoek Logistics Management and Strategy We work with leading authors to develop the strongest educational materials in logistics, bringing cutting-edge thinking and best learning practice to a global market. Under a range of well-known imprints, including Financial Times Prentice Hall, we craft high quality print and electronic publications which help readers to understand and apply their content, whether studying or at work. To find out more about the complete range of our publishing, please visit us on the World Wide Web at: www.pearsoned.co.uk Logistics Management and Strategy Competing through the supply chain Fourth Edition Alan Harrison Remko van Hoek Pearson Education Limited Edinburgh Gate Harlow Essex CM20 2JE England and Associated Companies throughout the world Visit us on the World Wide Web at: www.pearsoned.co.uk First published 2002 Second edition published 2005 Third edition published 2008 Fourth edition published 2011 © Pearson Education Limited 2002, 2005 © Alan Harrison and Remko van Hoek 2008, 2011 The rights of Alan Harrison and Remko van Hoek to be identified as authors of this work have been asserted by them in accordance with the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without either the prior written permission of the publisher or a licence permitting restricted copying in the United Kingdom issued by the Copyright Licensing Agency Ltd, Saffron House, 6–10 Kirby Street, London EC1N 8TS. All trademarks used herein are the property of their respective owners. The use of any trademark in this text does not vest in the author or publisher any trademark ownership rights in such trademarks, nor does the use of such trademarks imply any affiliation with or endorsement of this book by such owners. Pearson Education is not responsible for the content of third party internet sites. ISBN: 978-0-273-73022-4 British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data Harrison, Alan, 1944– Logistics management and strategy : competing through the supply chain / Alan Harrison, Remko van Hoek. — 4th ed. p. cm. Includes bibliographical references and index. ISBN 978-0-273-73022-4 (pearson : alk. paper) 1. Business logistics. 2. Industrial management. I. Hoek, Remko I. van. II. Title. HD38.5.H367 2010 658.5–dc22 2010041143 10 9 8 7 6 5 4 3 2 1 14 13 12 11 Typeset in 9.5pt Stone Serif by 73 Printed by Ashford Colour Press Ltd., Gosport The publisher’s policy is to use paper manufactured from sustainable forests. To Cathi, Nick, Katie, Maryl and Ticho, with love. Contents Foreword Preface Authors’ acknowledgements Publisher’s acknowledgements How to use this book Plan of the book xiii xv xvii xix xxi xxiii Part One COMPETING THROUGH LOGISTICS 1 Logistics and the supply chain Introduction 1.1 Logistics and the supply chain 1.1.1 Definitions and concepts 1.1.2 Supply chain: structure and tiering 1.2 Material flow and information flow 1.2.1 Material flow 1.2.2 Information flow 1.3 Competing through logistics 1.3.1 Hard objectives 1.3.2 Supportive capabilities 1.3.3 Soft objectives 1.3.4 Order winners and qualifiers 1.4 Logistics strategy 1.4.1 Defining ‘strategy’ 1.4.2 Aligning strategies 1.4.3 Differentiating strategies 1.4.4 Trade-offs in logistics Summary Discussion questions References Suggested further reading 2 Putting the end-customer first Introduction 2.1 The marketing perspective 2.1.1 Rising customer expectations 2.1.2 The information revolution 2.2 Segmentation 2.3 Demand profiling 2.4 Quality of service 2.4.1 Customer loyalty 2.4.2 Value disciplines 3 3 4 6 8 12 12 15 16 17 19 25 26 27 28 29 30 31 32 33 33 34 35 35 36 37 37 38 46 50 51 53 viii Contents 2.

4.3 Relationship marketing and customer relationship management (CRM) 2.4.4 Measuring service quality 2.5 Setting priorities for logistics strategy 2.5.1 Step 1: Diagnose current approach to market segmentation 2.5.2 Step 2a: Understand buying behaviour 2.5.3 Step 2b: Customer value analysis 2.5.4 Step 3: Measure logistics strategy drivers 2.5.5 Step 4: Specify future approach to market segmentation Summary Discussion questions References Suggested further reading 3 Value and logistics costs Introduction 3.1 Where does value come from? 3.1.1 Return on investment (ROI) 3.1.2 Financial ratios and ROI drivers 3.2 How can logistics costs be represented? 3.2.1 Fixed/variable 3.2.2 Direct/indirect 3.2.3 Engineered/discretionary 3.3 Activity-based costing (ABC) 3.3.1 ABC example 3.3.2 Cost–time profile (CTP) 3.3.3 Cost-to-serve (CTS) 3.4 A balanced measurement portfolio 3.4.1 Balanced measures 3.4.2 Supply chain management and the balanced scorecard 3.4.3 Supply chain financial model 3.5 Supply chain operations reference model (SCOR) Summary Discussion questions References Suggested further reading 53 56 56 58 59 60 60 63 68 69 70 71 73 73 74 75 77 79 81 85 87 89 91 92 94 95 96 97 99 101 105 105 106 106 Part Two LEVERAGING LOGISTICS OPERATIONS 4 Managing logistics internationally Introduction 4.1 Drivers and logistics implications of internationalisation 4.1.1 Logistical implications of internationalisation 4.1.2 Time-to-market 4.1.3 Global consolidation 4.1.4 Risk in international logistics 4.2 The tendency towards internationalisation 4.2.1 Focused factories: from geographical to product segmentation 4.2.2 Centralised inventories 109 109 111 114 115 116 119 120 120 121 Contents 4.3 The challenges of international logistics and location 4.3.1 Extended lead time of supply 4.3.2 Extended and unreliable transit times 4.3.3 Multiple consolidation and break points 4.3.4 Multiple freight modes and cost options 4.3.5 Price and currency fluctuations 4.3.6 Location analysis 4.4 Organising for international logistics 4.4.1 Layering and tiering 4.4.2 The evolving role of individual plants 4.4.3 Reconfiguration processes 4.5 Reverse logistics 4.6 Managing for risk readiness 4.6.1 Immediate risk readiness 4.6.2 Structural risk readiness 4.7 Corporate social responsibility in the supply chain Summary Discussion questions References Suggested further reading 5 Managing the lead-time frontier Introduction 5.1 The role of time in competitive advantage 5.1.1 Time-based competition: definition and concepts 5.1.2 Variety and complexity 5.1.3 Time-based initiatives 5.1.4 Time-based opportunities to add value 5.1.5 Time-based opportunities to reduce cost 5.1.6 Limitations to time-based approaches 5.2 P:D ratios and differences 5.2.1 Using time as a performance measure 5.2.2 Using time to measure supply pipeline performance 5.2.3 Consequences when P-time is greater than D-time 5.3 Time-based process mapping 5.3.1 Stage 1: Create a task force 5.3.2 Stage 2: Select the process to map 5.3.3 Stage 3: Collect data 5.3.4 Stage 4: Flow chart the process 5.3.5 Stage 5: Distinguish between value-adding and non-value-adding time 5.3.6 Stage 6: Construct the time-based process map 5.3.7 Stage 7: Solution generation 5.4 Managing timeliness in the logistics pipeline 5.4.1 Strategies to cope when P-time is greater than D-time 5.4.2 Practices to cope when P-time is greater than D-time 5.5 A method for implementing time-based practices 5.5.1 Step 1: Understand your need to change 5.5.2 Step 2: Understand your processes 5.5.3 Step 3: Identify unnecessary process steps and large amounts of wasted time ix 124 125 125 125 126 126 128 130 130 131 132 141 143 143 144 145 150 150 151 151 153 153 154 154 155 156 157 159 161 162 162 163 165 168 169 169 170 170 170 171 171 176 177 178 179 179 180 181 x Contents 5.5.4 Step 4: Understand the causes of waste 5.5.5 Step 5: Change the process 5.5.6 Step 6: Review changes 5.5.7 Results 5.6 When, where and how? Summary Discussion questions References Suggested further reading 6 Supply chain planning and control Introduction 6.

1 The supply chain ‘game plan’ 6.1.1 Planning and control within manufacturing 6.1.2 Managing inventory in the supply chain 6.1.3 Planning and control in retailing 6.1.4 Inter-firm planning and control 6.2 Overcoming poor coordination in retail supply chains 6.2.1 Efficient consumer response (ECR) 6.2.2 Collaborative planning, forecasting and replenishment (CPFR) 6.2.3 Vendor-managed inventory (VMI) 6.2.4 Quick response (QR) Summary Discussion questions References Suggested further reading 7 Just-in-time and the agile supply chain Introduction 7.1 Just-in-time and lean thinking 7.1.1 The just-in-time system 7.1.2 The seven wastes 7.1.3 JIT and material requirements planning 7.1.4 Lean thinking 7.1.5 Application of lean thinking to business processes 7.1.6 Role of lean practices 7.2 The concept of agility 7.2.1 Classifying operating environments 7.2.2 Preconditions for successful agile practice 7.2.3 Developing measures that put the end-customer first to improve market sensitivity 7.2.4 Shared goals to improve virtual integration 7.2.5 Boundary spanning S&OP process to improve process integration Summary Discussion questions References Suggested further reading 181 181 181 182 183 183 184 184 184 185 185 187 187 193 198 201 203 204 210 214 217 218 219 219 220 221 221 223 224 228 229 232 234 235 236 241 242 246 247 248 249 250 251 252 Contents xi Part Three WORKING TOGETHER 8 Integrating the supply chain Introduction 8.1 Integration in the supply chain 8.1.1 Internal integration: function to function 8.1.2 Inter-company integration: a manual approach 8.1.3 Electronic integration 8.2 Choosing the right supply relationships 8.3 Partnerships in the supply chain 8.3.1 Economic justification for partnerships 8.3.2 Advantages of partnerships 8.3.3 Disadvantages of partnerships 8.4 Supply base rationalisation 8.4.1 Supplier management 8.4.2 Lead suppliers 8.5 Supplier networks 8.5.1 Supplier associations 8.5.2 Japanese keiretsu 8.5.3 Italian districts 8.5.4 Chinese industrial areas 8.6 Supplier development 8.6.1 Integrated processes 8.6.2 Synchronous production 8.7 Implementing strategic partnerships 8.8 Managing supply chain relationships 8.8.1 Creating closer relationships 8.8.2 Factors in forming supply chain relationships Summary Discussion questions References Suggested further reading 9 Sourcing and supply management Introduction 9.1 What does procurement do? 9.1.1 Drivers of procurement value 9.2 Rationalising the supply base 9.3 Segmenting the supply base 9.3.1 Preferred suppliers 9.3.2 Strategic relationships 9.3.3 Establishing policies per supplier segment 9.3.4 Vendor rating 9.3.5 Executive ownership of supply relationships 9.3.6 Migrating towards customer of choice status 9.4 Procurement technology 9.5 Markers of boardroom value 9.6 What does top procurement talent look like? 255 255 257 258 259 260 264 270 271 271 271 272 272 272 273 273 276 278 280 284 284 285 285 290 290 291 292 294 295 297 299 299 301 302 314 316 319 320 320 321 322 324 326 326 327 xii Contents Summary Discussion questions References Suggested further reading 328 329 329 330 Part Four CHANGING THE FUTURE 10 Logistics future challenges and opportunities Introduction 10.1 Changing economics? 10.2 Internal alignment 10.3 Selecting collaborative opportunities upstream and downstream 10.4 Managing with cost-to-serve to support growth and profitability 10.5 The supply chain manager of the future 10.6 Changing chains Summary Discussion questions References Suggested further reading Index 333 333 334 336 340 343 345 347 349 350 350 350 351 Supporting resources Visit www.pearsoned.co.uk/harrison to find valuable online resources For instructors ● Complete, downloadable Instructor’s Manual, containing teaching notes, notes on case studies and teaching tips, objectives and discussion points for each chapter ● Downloadable PowerPoint slides of all figures from the book For more information please contact your local Pearson Education sales representative or visit www.

pearsoned.co.uk/harrison Foreword I am delighted to introduce Logistics Management and Strategy, now in its fourth edition – a further aid in our ability to drive our understanding of such a critical part of the business environment. In Bausch and Lomb logistics remains a key area of management attention, given its central role in customer service and the opportunities it provides for cost control, two fundamental essentials for any global business today. Bausch and Lomb is built on a tradition of developing state of the art Optical products – from contact lenses to cataract surgery and the fast-growing optical pharmaceutical markets. These complex supply chains cover five continents and serve varying types of customers including hospitals, opticians and multiple retailers. They involve stock-keeping units (skus) requiring temperature control, serial traceability and sterility, and make for a diverse and challenging set of logistics demands. When you then add these challenges to a range of over 100,000 skus – with some products being offered in over 7,000 different refractive powers/pack sizes – then you can understand why utilising the very latest approaches to logistics management and strategy is absolutely crucial. In recent years we have invested heavily in automated warehouses, such as at our site in Amsterdam, recently recognised as one of the ‘top ten’ logistics facilities in the Netherlands. We have also developed our utilisation of agile logistics. This has been addressed by reducing the number of base products produced in our 17 factories, whilst increasing our customer responsiveness through postponement of labelling, bundling, promotional artwork and language compliance. In this regard, being a member of the Agile Supply Chain Research Club at Cranfield and working with Alan has been a rewarding and beneficial experience. I note that some of our experience has been invested in Chapter 7. In the last two years Bausch and Lomb has greatly reduced inventory holdings through a number of logistics initiatives – improving working capital whilst maintaining, and even improving, customer service levels. But the fight goes on, and it is with texts such as Logistics Management and Strategy in your armoury that you can continue to drive further improvements in your supply chain. The great aspect of this text is its readability – it does not seek to lecture the reader, but imparts its wisdom in a straightforward and practical manner. Fundamentally, I believe that is the essence of the science of logistics. Every element of our complex logistical environment is captured in this book with new sections covering sustainability, planning and control, and particularly the strategic role of procurement – all adding to the rich content. In introducing this collaboration between Alan and Remko my parentage springs to mind. This was another Anglo-Dutch partnership – albeit with different outcomes! xiv Foreword I have spent the last twenty-five years in logistics, working in both British and Dutch environments. The last ten of these years have been in a global role. The output of Alan’s and Remko’s partnership rings true in so many areas – and offer methods and approaches which will continue to drive our improvements in the coming years. Paul Mayhew MSc, MCILT Vice President, Global Logistics Bausch and Lomb. Preface Logistics has been emerging from Peter Drucker’s shadowy description as ‘the economy’s dark continent’ for some years. From its largely military origins, logistics has accelerated into becoming one of the key business issues of the day, presenting formidable challenges for managers and occupying some of the best minds. Its relatively slow route to this exalted position can be attributed to two causes. First, logistics is a cross-functional subject. In the past, it has rightly drawn on contributions from marketing, finance, operations and corporate strategy. Within the organisation, a more appropriate description would be a business process, cutting across functional boundaries yet with a contribution from each.

Second, logistics extends beyond the boundaries of the organisation into the supply chain. Here, it engages with the complexities of synchronising the movement of materials and information between many business processes. The systems nature of logistics has proved a particularly difficult lesson to learn, and individual organisations still often think that they can optimise profit conditions for themselves by exploiting their partners in the supply chain. Often they can – in the short term. But winners in one area are matched by losers in another, and the losers are unable to invest or develop the capabilities needed to keep the chain healthy in the long term. The emergence of logistics has therefore been dependent on the development of a cross-functional model of the organisation, and on an understanding of the need to integrate business processes across the supply network. While its maturity as a discipline in its own right is still far from complete, we believe that it is time to take a current and fresh look at logistics management and strategy. Tools and concepts to enable integration of the supply chain are starting to work well. Competitive advantage in tomorrow’s world will come from responding to end-customers better than competition. Logistics plays a vital role in this response, and it is this role that we seek to describe in this book. The globalisation of logistics assumes that quality can be duplicated anywhere, that risks are relatively small, and that sustainability does not really matter. Case study 4.2 quotes an environmental activist as saying ‘we are producing food in one corner of the world, packing it in another and then shipping it somewhere else. It’s mad.’ The reality is that 21st-century supply chains are developing very different profiles from those developed by the mindsets of ten or 20 years ago. Risk will become more important. Plans will need to be in place to prevent or mitigate the impact of financial, operational and political uncertainty. It is both environmentally and economically right to focus on sustainability. Logistics stands at the heart of this debate. This text has a clear European foundation (its currency is the euro) and an international appeal. In line with the globalisation of logistics, we have included cases from other parts of the world than Europe – diverse though European logistics solutions are – including South Africa, the United States, Japan, China and Australia. xvi Preface Accordingly, we start in Part One with the strategic role of logistics in the supply chain. We continue by developing the marketing perspective by explaining our view of ‘putting the end-customer first’. Part One finishes by exploring the concept of value and logistics costs. In Part Two, we review leveraging logistics operations in terms of their global dimensions, and of the lead-time frontier. Part Two continues by examining the challenges of coordinating manufacturing and retail processes, and the impact on logistics of just-in-time and the agile supply chain. Part Three reviews working together, first in terms of integrating the supply chain and second in terms of sourcing and supply management. Our book ends with Part Four, in which we outline the logistics future challenge. This text is intended for MSc students on logistics courses, and as an accompanying text for open learning courses such as global MSc degrees and virtual universities. It will also be attractive as a management textbook and as recommended reading on MBA options in logistics and supply chain management. In the second edition, we listened carefully to… CLICK HERE TO GET A PROFESSIONAL WRITER TO WORK ON THIS PAPER AND OTHER SIMILAR PAPERS CLICK THE BUTTON TO MAKE YOUR ORDER

[matsudar]

目的地に向かう途中に定休を思い出し、

せっかく出て来たのに手ぶらで帰るのもなーと思ってたところ、

四王寺山で出会ったハイカーさんの言葉を思い出した。

北に見える玄界灘を指差し、

「わたしのホームはあの立花山、三日月山側から登って下りるんです。

低いけど良い山ですよ」

セブンの駐車場に入りスマホで調べたら、山頂まで往復約一時間、

天気も良いし散歩にはちょうど良さそう。

店に入ってポカリを買い、ナビに入れて登山口駐車場につける。

冬の間の体力の低下を身に染みて感じたが、

確かに標高300m台でこの眺めは最高。

花粉とP.M.で白く烟る街を見下ろしながら、この中で生活していると思うと分かってる事とは言えやや怯む。

下山中、三日月山方面への分岐に

大クス（樟の原生林）の標示があったので寄り道してみる。

街でも楠はよく育ち、シンボルツリーになっている例が多いが、

それより一回りもふた回りも大きな楠が立ち並ぶ光景は

なんて素敵なんだろう。

昔、地図で何かの原生林を見かけて行きたいと思ってたけど、

多分ここのことだ。よしよし。 永遠に変わらないものはないと知りながら、

それでも人の一生よりはずっと長く生きる楠たちに

またいつか会いに来たいと思う。 そんな事を考えながら下山していたら、5mほど前方を

100キロはあろうかと言う大きな猪が横切って行った。 沢を挟んだ隣の斜面を下りてきて、此方側の急斜面（昨日までの雨で表面がぬかるんでいる）を時々ずり落ちながらも一気に駆け上っていく。

正に猪突猛進そのままの姿に

一ノ谷の戦いでの清和源氏の姿を思い出し、

そんなに急がずとも…と思いかけたが、月末までは狩猟期間。

もちろん登山道のメインルート近くでは行われないだろうが、

遠くに鉄砲の音は聞こえていて、そちらから逃げてきたのかも。

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