LOB 31203: INTERNATIONAL LOGISTICS

TASK CHAPTER: 6

SESSION: September 2022

NAME : _OBEYE JESSICA_____________________________

ID NUMBER : _56212220056_____________________________

SUBMISSION DATE: 24.11.2022 - Thursday

INSTRUCTION: ANSWER ALL THE QUESTIONS

Tutorial: 23.11.2022 (Wednesday) – Online submission

Answer all questions.

1. Explain the details concept of;

i. Push & pull
ii. JIT
iii. TQM
iv. KANBAN
v. MRP/MRP II
2. Identify the key challenges facing logistics today.
3. Explore the most pressing issues in intermodal transportation market.
4. Explain the major transportation issues in warehouse.
 Answers

1. Explain the details concept of:

 Push & pull

The original meaning of push and pull, as used in operations management, logistics and supply
chain management. In the pull system production orders begin upon inventory reaching a certain
level, while on the push system production begins based on demand (forecasted or actual
demand).
 JIT
Just-in-time, or JIT, is an inventory management method in which goods are received from
suppliers only as they are needed. The main objective of this method is to reduce inventory
holding costs and increase inventory turnover.
 TQM
A core definition of total quality management (TQM) describes a management approach to long-
term success through customer satisfaction. In a TQM effort, all members of an organization
participate in improving processes, products, services, and the culture in which they work.
Primary elements of TQM. Benefits of TQM.
 KANBAN
Kanban is a popular framework used to implement agile and DevOps software development. It
requires real-time communication of capacity and full transparency of work. Work items are
represented visually on a kanban board, allowing team members to see the state of every piece of
work at any time.
 MRP/MRP II
Manufacturing Resource Planning (MRP II) is an integrated information system used by
businesses. Manufacturing Resource Planning (MRP II) evolved from early Materials
Requirement Planning (MRP) systems by including the integration of additional data, such as
employee and financial needs.
The system is designed to centralize, integrate, and process information for effective decision
making in scheduling, design engineering, inventory management, and cost control in
manufacturing.

2. Identify the key challenges facing logistics today

  Reduction of transport costs

Transportation costs are a major item in logistics. All freight forwarders and agents try to
negotiate the most optimal amounts for the transportation of the particular cargo. However, this
is becoming increasingly difficult because of rising fuel prices and, consequently, services for
moving goods and materials from one place to another, especially when it comes to imports and
exports.

 Processing a large amount of information

Generating timely and accurate documentation makes it difficult for logistics professionals
because the process involves many figures, data and compliance with legal deadlines. This
requires a great deal of concentration not only in coordinating and tracking shipments, ensuring
the safety of staff, loading fleet, etc., but also administrative work.

 Compliance with regulations

Some clients have no idea how much logistics managers need to know the regulations and laws.
Sometimes the package price for the logistics service may seem high, but in fact you pay a
“peace of mind” and a “guarantee fee” for your valuable supplies. Each rule varies from country
to country, and goods can travel to many different destinations. This means that every logistics
expert should be aware of current laws and upcoming updates on some aspects. A slight mistake
in documentation, or lack thereof, can be very costly to the business. And every logistics
company faces this challenge because it is a serious responsibility.

 Streamline operations

The future of logistics is focused on improving technology – automating possible logistics

processes. Different software solutions will help improve the performance of different industries,
resulting in speed, efficiency and customer satisfaction. The shorter the time for completing a
task, the more orders can be fulfilled, which is also associated with an increase in the revenues of
the logistics industry.

 Offering segmented, personalized services

Logistics today is not only about delivery within the agreed period, more specialized specialized
services should be offered. Logistics processes are turning into many small segments in the
supply chain. Therefore, it is necessary to offer specific services as well as package price offers
for overall freight management.

 Logistics management

Logistics management is associated with complete control of actions. It is a complex process

requiring flexibility, timely decisions, multi-unit communication, tracking, etc. Using software
could significantly shorten some hard-to-trace operations and give you a detailed analysis of
what is happening.
Keep in mind that to tackle such a challenge, one device will not suffice. It is necessary to
implement a system on all computers, to have good maintenance and to be adapted to the needs
of the company. In addition, rely on other additional applications on your smartphone to be able
to operate constantly when needed.

 Workforce Management

Human resources are most valuable, though some processes can be facilitated through logistics
software. The responsibility of the management is the greatest, even to the employees of the
company. Valuable staff at every level contractors, administration, various levels of leadership
positions require, above all, good attitude and stress free work.

This can be very difficult to implement, especially because of the dynamism of the work and the
location of the participants performing different logistical functions in different places in the
country and abroad. Manpower management requires great precision in terms of schedules, job
responsibilities, good communication, consistency in the implementation of supply chain
operations, etc.

3. Explore the most pressing issues in intermodal transportation market.

 More customers prefer smart and sustainable transport solutions

Today, there is a large focus on environmentally friendly solutions in the transport industry.
More customers prefer smart and sustainable transport solutions to the traditional standard
solutions that do not take the environment into consideration. This is true also for intermodal
freight transport, which constitutes an important part of turning the global transport system into
this direction. There is now a wide range of smart and sustainable solutions in the market as well
as companies focusing entirely on eco-friendly intermodal freight transport.

 Intermodal freight transport is gaining ground over traditional road transport

There is a clear trend where intermodal freight transport is gaining ground over traditional road
transport. Many countries, especially across Europe, are making large investments in
infrastructure development. Road as well as rail networks are extended and becoming more
sophisticated. As a result, many transport companies can now offer the same transit times for
their intermodal freight transport as for standard road services. This makes it difficult for
standard road services to compete with those new smart and sustainable solutions for intermodal
freight transport.

 Increased demand for intermodal freight transport from automotive and FMCG

The increasing demand for intermodal freight transport is coming especially from two industries:
the automotive and FMCG (Fast Moving Consumer Goods). This is a result of the (previously
mentioned) improved transit times and infrastructure developments, putting intermodal freight
transport in an increasingly competitive position against standard road service.

 Transport companies struggle to provide reliable transport services

However, one of the greatest challenges in intermodal freight transport at the moment is for the
transport companies to truly offer reliable services. Even though intermodal freight transport is a
growing segment, there is a lack of flexibility in the transport chain. The infrastructure in Europe
does not yet fully correspond to the demand on reliable service levels. Ongoing constructions
and temporary strikes are challenging the time schedules for both road and ocean freight. Having
that said, we are well on track considering the large number of investments made only in the last
few years.

 More consolidated shipments and groupage consignments due to smaller volumes

Another challenge in the transport industry today, is that more customers are booking smaller
volumes with shorter notice. There is a large focus on flexibility in production and many
companies want to reduce safety stocks and inventory costs. This has led to an increased demand
for consolidated shipments and groupage consignments. It also mirrors the overcapacity in the
container segment, now leading to some of the giant container ships being taken out of operation.

 Higher expectations on service levels and integrated and flexible IT systems

Digitalisation is transforming many industries today and the transport industry is no exception.
As technology becomes more advanced, customers expect a higher level of service including
integrated and flexible IT systems. The many modes of transport in intermodal freight contribute
to a complex and dynamic supply chain and information has become a vital part in efficient
supply chain management. Transport companies are now making large investments in IT
solutions with fully integrated view of real-time information across the supply chain to meet
those new demands, and improve customer satisfaction.

4. Explain the major transportation issues in warehouse

 Wasted space
Lack of storage space is one of the main problems facing most businesses. In view of this
situation, caused primarily by increased activity, companies are forced to optimize space if they
don’t want to end up shelling out a small fortune on logistics real estate.
 Lack of goods organization
Failure to arrange the products in a methodical way leads to mistakes and delays when looking
for a specific item, making it difficult to meet delivery times. An orderly installation is the first
step towards logistics efficiency.
To avoid disorganization, it’s necessary to draw up an effective goods slotting strategy that takes
into account the characteristics of the SKUs, the storage systems available, the turnover of the
products, and the movements of the operators.
Making use of a warehouse management system ensures comprehensive control over the stock in
the installation by syncing inbound and outbound orders. A WMS, for example, automates the
warehouse slotting process through criteria and previously configured rules.
 Picking errors
From picking the wrong item to mixing various orders into one, the price of reverse logistics
(product returns) due to mistakes made during order prep has serious repercussions for a
company’s logistics processes.
Picking errors constitute a high cost for the business. Several studies have found that their
average impact accounts for approximately $20 per order.
In an operation as complex as picking, where employees normally prepare multiple orders
containing various SKUs, automation is the answer to reducing the error rate and increasing the
number of picks per hour carried out in the warehouse.
 Lack of traceability
Against a backdrop of integrated supply chains, customers and suppliers demand to know exactly
which raw materials the merchandise is made of and which production and logistics processes it
has gone through before it reaches their hands.
Product traceability, the logistics attribute that enables you to identify each item from its origin
to its final destination, is especially important in sectors such as the pharmaceutical and food
industries. An error in traceability can pose huge problems for customers who purchase the
product, as well as for the supplier.
The implementation of a logistics software program such as a WMS guarantees the traceability
of products, from their entry in the installation to their dispatch. In addition to this application,
there are others on the market that enhance this logistics capability, for instance, WMS for
Manufacturing, the advanced Easy WMS feature. This module synchronizes the supply buffer
with production to monitor a warehouse’s manufacturing process.
 Out-of-date inventory
Knowing and planning how much stock you have in your installation is vital for maintaining
productivity in all logistics operations. Not surprisingly, a facility with out-of-date inventory can
have severe consequences for a company, from slotting errors to possible stockouts.
As businesses grow and incorporate more SKUs into their installations, implementing a
warehouse management system becomes a necessary tool for knowing what stock is available in
the facility in real time.
 Goods handling errors
Properly handling the unit loads to put together orders is one of the keys to avoiding errors and
boosting productivity. You need to be sure that operators are adequately trained, that the
installation is equipped with suitable handling equipment, and that routine maintenance is carried
out on this equipment.
Nevertheless, to guarantee ideal product handling, the best option is to automate your storage
systems. Logistics managers often choose to replace conventional storage equipment, such as
pallet jacks and counterbalanced forklifts, with conveyors and stacker cranes; this streamlines
goods flows between the different logistics processes.
In addition, when handling the merchandise, it’s important to ensure the unit loads remain stable,
typically by means of pallets or boxes, throughout all operations carried out in the warehouse.
 Dispatch delays
Dispatch is the last process a product goes through before being shipped, whether to an end
customer, distribution center, or production plant.
For this process to go off without a hitch, it’s advisable to ensure the following: advance
planning of the deliveries to be made, efficient consolidation of the goods, verification of all the
required dispatch documentation, and fast and safe loading of the merchandise onto the truck.
A warehouse management system is capable of grouping orders by delivery route, vehicle type,
customer, or order priority, among other criteria.
 Inadequate warehouse signs
In a space in which operators, goods, and handling equipment all coexist, it’s mandatory to
install warehouse signage that minimizes the risk of accidents. These markings and signs should
be easily identifiable and optimally placed on the floor and the racking so as to comply with
safety measures.
OSHA Standard 1910.22 dictates that all companies mark permanent aisles and passageways to
prevent accidents. These signs can be of different colors, symbols, and shapes, depending on
their characteristics and the message to be transmitted.
 Incorrect logistics KPIs
The best tool for performing continuous improvement actions in your warehouse consists of
supply chain KPIs (key performance indicators). Through data and comparisons with the
company’s history, you can monitor a process’s throughput to find opportunities for
improvement.
Supply chain KPIs allow you to measure all operations carried out in an installation: goods
receipt, storage, picking, inventory management, dispatches, deliveries, transportation, and
returns management, among others. If we fail to use these indicators appropriately or we focus
our efforts on analyzing inaccurate KPIs, it will be very difficult to identify positive or negative
trends and act accordingly to achieve logistics excellence.
A module such as Supply Chain Analytics Software monitors all warehouse activity, calculating
the most relevant supply chain KPIs for subsequent analysis.
 Integration with other departments (ERP)
The logistics manager needs to be coordinated with the other departments in the company to
reach the ultimate logistics goal: for the order to arrive on time and as per the terms agreed upon
with the customer.
To this end, the different logistics software apps are integrated within the ERP (enterprise
resourcing planning) system. This IT program groups together all or most of a firm’s various
divisions, for example, accounting, marketing, sales, etc.
Poor coordination between the warehouse and the sales department could result in mistakes or
incomplete orders, which would mean major financial repercussions for the company.