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1、Contemporary LogisticsTwelfth EditionChapter 4Organizational and Managerial Issues in LogisticsLearning Objectives (1 of 2)4.1 To explain organizational structure for logistics4.2 To compare traditional and contemporary organizational design for logistics4.3 To identify productivity issues and impro

2、vement efforts in logistics 4.4 To discuss quality issues in logistics Learning Objectives (2 of 2)4.5 To describe ways to manage theft and pilferage4.6 To review the concept of logistics social responsibility4.7 To articulate issues associated with reverse logistics4.8 To report on programs designe

3、d to lessen the impact of terrorism on logistics systemsOrganizing Logistics Within the Firm (1 of 8)Two key organizational logistics topicsOrganizational structure Organizational designOrganizing Logistics Within the Firm (2 of 8)Organizational structure for logisticsTwo basic structures include:Fr

4、agmented logistics structureLogistics activities are managed in multiple departments throughout an organizationUnified logistics structureMultiple logistics activities are combined into and managed as a single departmentOrganizing Logistics Within the Firm (3 of 8)Organizational structure for logist

5、icsTwo basic structures for logistics departments include:Centralized logistics organizationCompany maintains a single logistics department that administers the related activities for the entire company from the home officeDecentralized logistics organizationLogistics-related decisions are made sepa

6、rately at the divisional or product group level and often in different geographic regionsOrganizing Logistics Within the Firm (4 of 8)Organizational structure for logisticsJob title or corporate rank Leading-edge organizations tend to head the logistics department by senior-level personnelGenerally

7、excluded from holding a “C-level” positionOrganizing Logistics Within the Firm (5 of 8)Organizational design for logisticsThree primary types of organizational design include:Hierarchical (functional)Top-down flowMatrixCross-functional responsibilitiesNetworkProcess philosophy focused on combining t

8、asks into value-creating products and activitiesOrganizing Logistics Within the Firm (6 of 8)Organizational design for logisticsNetwork organizational design is manifested in terms of:RelevancyRefers to satisfying current and emerging customer needsFacilitated by developing mutually beneficial relat

9、ionships with key customersAt a minimum, these relationships should provide an understanding of customer needs and wantsOrganizing Logistics Within the Firm (7 of 8)Organizational design for logisticsNetwork organizational design is manifested in terms of:ResponsivenessReflects the degree to which a

10、n organization can accommodate unique or unplanned customer requestsAchieved when the appropriate decision makers are provided with both relevant information and the authority to address unique or unplanned requestsOrganizing Logistics Within the Firm (8 of 8)Organizational design for logisticsNetwo

11、rk organizational design is manifested in terms of:FlexibilityIs an organizations ability to address unexpected operational situationsPredicated on avoiding early commitment to an irreversible course of actionManagerial Issues in Logistics (1 of 28)ProductivityQualityRiskSustainabilityComplexityMana

12、gerial Issues in Logistics (2 of 28)ProductivityCan be defined as the amount of output divided by the amount of inputProvides insight into the efficiency with which corporate resources are being utilizedManagerial Issues in Logistics (3 of 28)ProductivityThree ways to improve productivity include:Re

13、duce the amount of input while holding output constantIncrease the amount of output while holding input constantIncrease output while decreasing inputManagerial Issues in Logistics (4 of 28)ProductivityLabor productivityWarehousing and transportation are heavily dependent on human laborHuman labor i

14、s an input (i.e., workers receive wages or salaries)Productivity improvement efforts in logistics are often directed toward increasing the amount of output while holding input constant (workers resistant to suggestions regarding reduced wages or salaries)Managerial Issues in Logistics (5 of 28)Produ

15、ctivityAsset productivityConcerns include:Space utilizationExcess capacity (unused available space)Can be unproductive as it may result in the purchase of additional equipment or facilities, which adds costs (input)May not yield additional output resulting in a productivity declineManagerial Issues

16、in Logistics (6 of 28)ProductivityAsset productivityConcerns include:Improving the output from existing assetsIncreases productivity as inputs remain constant, but output is increasedManagerial Issues in Logistics (7 of 28)QualityLogistics service qualityRelates to a firms ability to deliver product

17、s, material, and services without defects or errors to both internal and external customers11E.A. Morash, C. Droge, and S. Vickery, “Strategic Logistics Capabilities for Competitive Advantage and Firm Success,” Journal of Business Logistics 17, no. 1 (1996): 122.Managerial Issues in Logistics (8 of

18、28)QualityQuality in logistics involves trade-offsIf inferior logistic service quality, customers may perceive lower value If superior logistic service quality than expected or required, organization may be adding unnecessary costOrganizations must try to match the quality levels of the logistic ser

19、vices they provide with the expectations of their customers and the landscape in which they operateManagerial Issues in Logistics (9 of 28)QualityVendors are expected to have quality programsVendors can demonstrate commitment to quality to potential buyers through achieving and maintaining quality p

20、rogram certificationISO (International Standards Organization) 9000 certification is an example of a quality program certificationManagerial Issues in Logistics (10 of 28)QualityISO 9000Is a set of generic standards used to document, implement, and demonstrate quality management and assurance system

21、sIs applicable to both manufacturing and service firmsStandards are intended to help companies build quality into every core process in each departmentManagerial Issues in Logistics (11 of 28)QualityISO 9000Firms demonstrating commitment to quality through training, reviews, and continuous improveme

22、nt achieve initial ISO 9000 certificationOnce certification is obtained, audits are conducted annually and organizations can be recertified every three yearsCertification is credited withan increase in customer serviceimproved order accuracyenabling enhanced costs analysisManagerial Issues in Logist

23、ics (12 of 28)QualitySix Sigma Is a quality-focused methodology that emphasizes the virtual elimination of business errorsArea covered under a normal curve is by six standard deviations is 99.99966 percentApproach suggests that there will be 3.4 defects, deficiencies, or errors per one million oppor

24、tunitiesCan be applied to various logistics activities such as order packingManagerial Issues in Logistics (13 of 28)QualitySix Sigma BenefitsReduced costsReduced errors and wasteReduced cycle timeDrawbacksOvercoming business cultural barriersInvesting required resources (both human and money)Gainin

25、g top management commitmentManagerial Issues in Logistics (14 of 28)QualityLean Six Sigma Is a quality-focused methodology that integrates Six Sigma with the Lean approachIntegrates the goals and methods of these two approaches in pursuit of qualityUnique because it recognizes that organizations can

26、not focus only on quality or speedEmphasizes an organizational focus on improving quality as it relates to responsivenessManagerial Issues in Logistics (15 of 28)QualityMalcolm Baldrige National Quality AwardRecognizes organizations for their achievements in quality and performanceEstablished in the

27、 late 1980sRestricted to firms headquartered in the United StatesEligibility initially limited to:Manufactures, services, and small businessesEligibility expanded to include:Health care and educational institutionsManagerial Issues in Logistics (16 of 28)RiskCan be viewed as susceptibility to disrup

28、tions that could lead to a loss for a firmCan take a variety of forms as it relates to logistics management activitiesRegularly occurring (or operational) risks (e.g., variability in demand or potential for a damaged shipment)Catastrophic risks (e.g., earthquakes or terrorist attacks)Managerial Issu

29、es in Logistics (17 of 28)RiskLogistics uncertainty pyramid modelEstablished to identify sources of uncertainty that can affect the risk exposure for logistics activitiesIdentifies several types of uncertainty including shipper, customer, carrier, control systems, and externalManagerial Issues in Lo

30、gistics (18 of 28)RiskTerrorism is an example of catastrophic riskTerrorism can be defined as “an illegal use of or threat of force or violence made by a group or individual against a person, a company, or someones property with a goal of menacing the target, often grounded in politics or ideology.”

31、22Terrorism, The American Heritage Dictionary of the English Language, 4th ed. (n.d.). Retrieved from D website: /browse/terrorism.Managerial Issues in Logistics (19 of 28)RiskCreation of the Department of Homeland Security (DHS)Federal agencyGoalsTo prevent terrorist attacks in the U.S. To reduce t

32、he vulnerability of the U.S. to terrorismManagerial Issues in Logistics (20 of 28)RiskThe 22 separate government entities incorporated into DHS include:Transportation Security Administration (TSA)Transportation Worker Identification Credential (TWIC)Customs and Border Protection (CBP)Container Secur

33、ity Initiative (CSI)Customs Trade Partnership Against Terrorism (C-TPAT)Importer Security Filing (ISF) rule, also known as “10+2”Table 4.1: Timeline for Presenting Electronic Advance Manifest InformationInbound to the United StatesModeTimelineAir and courierFour hours prior to arrival in the United

34、States, or “wheels up” from certainnearby airportsRailTwo hours prior to arrival at a U.S. port of entryOcean vessel24 hours prior to lading at foreign portTruckFree and Secure Trade (FAST): 30 minutes prior to arrival in the United States;non-FAST: one hour prior to arrival in the United StatesOutb

35、ound from the United StatesModeTimelineAir and courierTwo hours prior to scheduled departure from the United StatesRailTwo hours prior to the arrival of the train at the borderOcean vessel24 hours prior to departure from U.S. port where cargo is ladenTruckOne hour prior to the arrival of the truck a

36、t the borderSource: Erlinda Byrd, “Rules for Improving Cargo Security,” Customs and Border Protection Today, March 2004.Managerial Issues in Logistics (21 of 28)RiskTheft is another logistics risk issue that confronts many managersTheft (stealing) can be defined as the taking and removing of persona

37、l property with the intent to deprive the rightful owner of it.33/dictionaryManagerial Issues in Logistics (22 of 28)RiskThoughts regarding theftInsurance companies may reimburse for loss, but time and costs tend not to be coveredTheft results in the planned flow of goods being interrupted, which ca

38、n lead to stockoutsTheft can factor into facility location decisionsManagerial Issues in Logistics (23 of 28)RiskThoughts regarding pilferage (employee theft)Transportation and warehousing operations are particularly vulnerable to pilferageManaging pilferage begins with the hiring processZero-tolera

39、nce pilferage policyKeep goods moving through the systemRecent increase in pirate attacksFigure 4.1: Shipping Container Locking Handle with a Uniquely Numbered Customs SealSource: Philip Cridland/Alamy Stock PhotoManagerial Issues in Logistics (24 of 28)SustainabilityLogistics social responsibilityC

40、orporate social responsibility issues that relate directly to logisticsManagerial Issues in Logistics (25 of 28)SustainabilityLogistics social responsibilityPotential dimensions include:EnvironmentEthicsDiversitySafety PhilanthropyHuman rightsOthersManagerial Issues in Logistics (26 of 28)Sustainabi

41、lityReverse logisticsIs the process of managing return goodsExceeds $100 billion in U.S. aloneCan be four to five times more expensive than forward logisticsProcess can take 12 times as many steps as forward logisticsManagerial Issues in Logistics (27 of 28)SustainabilityReverse logisticsReverse logistics process focuse

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