Logistical Coordination

Coordinating logistical flows

Logistical flows are material flow, information
flow and cash flow or realization
Logistical coordination is ensuring a well
planned, smooth, uninterrupted and quick flow of
materials in the value chain
This objective is achieved by ensuring smooth
flow of information in the same value chain.
Realization is the result of well-coordinated flows
of information and inventory
Coordination takes place when logistical plans
incorporate strategic customer service objectives
and constraints to meet the above
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  Net work design [Location analysis]
What is a network?
Location of facilities and routes or links
Network influences cost of product movement
What is location analysis?
Study of the locations & links for minimizing
logistical costs and or maximizing customer service

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 Some salient features of net work design
 Number of facilities [factories and warehouses]
 Their locations
 Communication systems
 What is to be performed in these facilities,
What item? Store? Break bulk?
 Who should operate these facilities
 What should be the size of the facility?
Factors to be considered in deciding the size
9. Fixed versus variable slot locations for product
storage
10.Horizontal versus high rise layout
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1. Order picking versus stock replenishment
activities
2. Multi-dock versus single dock layout
3. Aisle space versus rack space
4. Labor intensive or high tech operations
5. Degree of automation in picking
6. Amount of cross docking

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Number of facilities

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 Importance of location analysis or logistical
network design
1. This is strategic in nature. But this decision
needs review periodically
Changing customer service requirements. There
is constant pressure to reduce lead times and costs
Long term relationship or strategic partnership
with suppliers
Dynamics of market
• Changing customers
• Shifting locations of customer
• Changing locations of supply market
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• Change in corporate ownership and subsequent
changes in corporate policies
2. Impact of network design on cost of moving
the product to the customer
Analysis of logistical network yields
opportunities for cost reduction
No of locations influence the inventory levels
(inventory cost) in the firm, the square root law
Who operates these facilities? - outsourcing
decisions
Communication between these facilities
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3. Network design Has direct impact on ‘Delivery’
expectations of the customer and thereby on
customer satisfaction.
4. Network is sensitive to Competitive action – to
be able to be competitive to the customer with
respect to competition
5. Network design has to accommodate corporate
organizational changes such as down sizing and
reengineering
6. Globalization

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Some models for facility location
Gravity model
Analytical models
Ton-mile center