Logistics Strategy is the science of evaluating the most cost-effective methodology of distributing goods to market while achieving service delivery level objectives. It is important for companies to recognize that their logistics strategy can be product-specific, customer-specific, location-specific and that supply chains for each industry are dynamic and evolving. Contact MD Vincent Consulting LLC for a private consultation on developing your logistical strategy today.
Our team of professionals works with our clients to develop and execute logistics strategies that optimize the flow of company’s products and information within the supply chain, within their distribution network and within each distribution center. We believe that to achieve supply chain excellence, it is critical to continuously evaluate alternative cost-cutting strategies that enable the company to gain competitive advantage.
When a company creates a logistics strategy it is defining the service levels at which its logistics organization is the most cost effective. Because supply chains are constantly changing and evolving, a company may develop a number of logistics strategies for specific product lines, specific countries or specific customers.
In today’s business environment, the supply chain constantly changes and companies need to adjust their operations to minimize the effect on the logistics operation of the organization. The ability to adapt with flexibility of the supply chain, companies need to develop and implement a formal logistics strategy. This will allow a company to identify the impacts imminent changes and make the organizational or operational functional changes to ensure company service delivery objectives are not reduced.
What Is Involved in Developing a Logistic Strategy?
A company can start by looking to develop a logistics strategy focusing on four distinct levels of their logistics organization.
- Strategic: By examining the company’s objectives and strategic supply chain decisions, the company’s logistics strategy should review how the logistics organization contributes to established high-level goals/objectives.
- Structural: The logistics strategy should examine the structural issues of the organization, such as the optimum number of distribution centers, warehouses, or what products should be produced at a specific manufacturing plant.
- Functional: Any strategy should review how each separate function in the logistics organization is to achieve functional goals and excellence.
- Implementation: The key to developing a successful logistics strategy is how it is to be implemented across the organization. The plan for implementation will include the development or configuration of an information system, introduction and establishment of new company policies and procedures and the development of a change management plan.