Logistical strategies are key to the success of an organization. A complete supply chain management operates within three levels, which are strategic, operational and tactical: they are all equally important to the success of any business (Blanchard, 2010). The strategic level is charged with the duty of making the strategic decisions that affect the entire organization and thus they should be carefully crafted to ensure that they are geared to meeting the set objectives. These strategic decisions should be binding, and they should be in line with corporate principles that the organization adheres to. Besides, the strategic level is also composed of a number of processes that must be considered in the development of logistics within the supply chain. These processes are logistics, customers, manufacturing, suppliers, and product development. All these processes must follow the strategies developed to ensure that there are efficiency and effectiveness in the entire organization. This paper will explore the subject of Logistical strategies within the supply chain and how the process must fall within these strategies.
Incorporating Logistical Strategies in the Supply Chain
First, the management of any business has the duty to develop directional strategies to the products produced by the company in order to satisfy the targeted market. This process is known as product development, and it forms the core function of any business or company. These strategic decisions may touch on what products and services to be provided to the customers; when to introduce new products; when to withdraw existing products; acquiring new products’ outlets; and acquiring or disposal of existing business. The two major objectives of any business are to satisfy customers and provide goods and services of the right quality. These two form the basis on which the success of any business is founded on, and they should be given the right weight in the process of decision making. The strategies should be able to point the business to where consumer tastes and preferences are presently as well as make predictions about the future. Secondly, customers should be given consideration in the development of logistical strategies if the developed products will be able to reach the targeted customers at the right time and in perfect condition. The logistical strategies here should be able to identify the key customer segments in the market(s) in which the company has ventured into (Donald et al., 2012). With this information, the company will be able to develop channels to advertise as well as distributes its products and services in the best ways possible and thus be able to make a killing out of its efforts.
Manufacturing of the products forms a key area in the supply chain, and this area must be given the weight it deserves in any company that wishes to remain competitive for the foreseeable future. The logistical strategies should thus provide the infrastructure and the technology through which the manufacturing process is achieved without any instances of flaws which, of course, will have trickling effects to the entire company. The strategies should be able to increase or reduce the production capacity when necessary to maximize on the production costs. If the company is engaged in overseas production, then the logistics level should be able to make the decision of subcontracting which is cheaper than buying or constructing manufacturing plants abroad. Supply chain strategic policies must take into consideration the issue of suppliers towards ensuring less purchasing expenses hence increasing the profitability of the company. The logistic strategies must be able to identify the best suppliers in terms of quality and competitive pricing which has the implication of cutting supplies costs. It is also important to look into the provision of after-sale services like transportation of supplies to the company’s premises thus cutting on the transport expenses incurred by the company. It is best to go for suppliers who are within reach and that way the chain supply will not be broken by lack of raw materials which may be a problem if the suppliers are located far from the particular company. Besides, the logistical strategies should also ensure good communication with the suppliers to avoid instances of delivery delays due to evitable circumstances. The logistics function has a center role towards the overall success of the chain supply, and all the other processes may not be accomplished in its absence. Companies’ management must make sound strategic decisions to bolster the logistics network given its importance to the achievement of the organizational goals (Christopher, 2010). These decisions must address the issue of where warehouses are located, the establishment of collection and outlet centers, and when to use subcontracting to cut on the logistical costs.
Conclusion
Logistical strategies are the key to the success of the entire supply chain in any industrial niche that a company invests in. They address problems like backlogs or oversupplies during the production process. The decisions made on this subject will definitely have far reaching implications to the success of the entire organization. The management, therefore, has the duty to ensure that logistical strategies are streamlined to ensure the organizational goals are achieved at all levels. Logistics strategies are indispensable in the supply chain and decisions touching the same should be ratified to ensure they do not have negative effects to the business.
- Blanchard, D. (2010) Supply chain management best practices. New York: John Wiley & Sons.
- Christopher, M. (2010) Logistics and supply chain management: creating value-adding Networks. New Jersey: Prentice Hall.
- Donald, B. et al. (2012) Supply chain logistics management. New York: McGraw-Hill.
